- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
Need a second opinion from the MT board!
Posted on 1/16/25 at 1:12 pm
Posted on 1/16/25 at 1:12 pm
Sorry for the long post, but trying to give the info needed. I do have a financial advisor, and this is the plan we talked about, but I would certainly like to hear if anyone has any different thoughts/suggestions:
-Turn 50 in 2 weeks. Just retired from a job I can go back to tomorrow or years from now. I was the sales director, but would easily do well again as a salesperson if needed. Also can do consulting in this industry remotely.
-Married, no kids.
-Own 2 homes in Hawaii. One rented long-term. 10 years left on that mortgage @2.5%. Our primary has 2 rentals downstairs that cover the mortgage plus prop taxes and insurance. We live there nearly free outside of ~$500/month and soon the rents will be raised to cover everything.
-$600k in my i401k and another $150k in old employer 401ks for her.
-$115k in Roth (got started late)
-$1.35mm in brokerages
-1 BTC
-$200k cash in HYSAs
-$500k Term until I'm 62. Same for her. Also got roped into some sort of life insurance that gives $125k death benefit but is worth the money I put into it, which isnt much ($36k). It will continue growing even though will I stop contributing to it since I just retired and I went past some number of years to qualify.
We want to live on about $75k a year as we will do a lot of traveling. We don't spend that much now. That obviously goes up and he showed plans for 3% vs 6%. We're going to live in Europe for a while and since my wife is an EU citizen, health care coverage isn't a huge issue. Will cost me <$300/month. She's covered. Can rent our upstairs house to easily cover rents in EU or maybe buy something there and I get dual citizenship. Or we can come back to Hawaii and get health care nearly covered because of low/no income until I reach 65 and her a few years later.
Ok, now that's out of the way, the plan is to do Roth conversions for the next few years to where I keep the tax rate to 12% or maybe even 10%. I have cash to live on for a few and of course brokerage money to live on as needed. He says I should get to about $240k Bonds if I remember right. It's written down at home. I have about $100k now. He also said to consider selling my rental and buying a "primary home" in a tax free state. I would likely do Nevada for a few reasons, one being low prop taxes. Issue in my mind is I would pay cap gains on selling my rental offsetting some of the gains from not paying Hawaii taxes on my Roth conversions. The NET is about $25k savings between the cap gains and no state tax, which to me seems low enough to not deal with all of that. Also, easy for me to deal with the house in Hawaii vs having a house in Nevada or Texas, or wherever. Although, it is a condo and I'm beyond tired of HOAs and their BS and the high insurance. I could see some advantages if I did go back to work as I could do my LLC in Nevada for payments. I would buy the house cash since I have plenty equity to avoid these mortgage rates.
Hope you're still with me! Thoughts on the Nevada idea? Any other suggestions/concerns with the plan? Enough money? Realistic expectations? And there's always some form of watered down SS I am not bringing up but should be in the equation for when I'm in my 60s. Not sure I'd wait till 70 as I don't expect to live too long. Family seems to die off in their late 70s. Ending on a positive note!
-Turn 50 in 2 weeks. Just retired from a job I can go back to tomorrow or years from now. I was the sales director, but would easily do well again as a salesperson if needed. Also can do consulting in this industry remotely.
-Married, no kids.
-Own 2 homes in Hawaii. One rented long-term. 10 years left on that mortgage @2.5%. Our primary has 2 rentals downstairs that cover the mortgage plus prop taxes and insurance. We live there nearly free outside of ~$500/month and soon the rents will be raised to cover everything.
-$600k in my i401k and another $150k in old employer 401ks for her.
-$115k in Roth (got started late)
-$1.35mm in brokerages
-1 BTC
-$200k cash in HYSAs
-$500k Term until I'm 62. Same for her. Also got roped into some sort of life insurance that gives $125k death benefit but is worth the money I put into it, which isnt much ($36k). It will continue growing even though will I stop contributing to it since I just retired and I went past some number of years to qualify.
We want to live on about $75k a year as we will do a lot of traveling. We don't spend that much now. That obviously goes up and he showed plans for 3% vs 6%. We're going to live in Europe for a while and since my wife is an EU citizen, health care coverage isn't a huge issue. Will cost me <$300/month. She's covered. Can rent our upstairs house to easily cover rents in EU or maybe buy something there and I get dual citizenship. Or we can come back to Hawaii and get health care nearly covered because of low/no income until I reach 65 and her a few years later.
Ok, now that's out of the way, the plan is to do Roth conversions for the next few years to where I keep the tax rate to 12% or maybe even 10%. I have cash to live on for a few and of course brokerage money to live on as needed. He says I should get to about $240k Bonds if I remember right. It's written down at home. I have about $100k now. He also said to consider selling my rental and buying a "primary home" in a tax free state. I would likely do Nevada for a few reasons, one being low prop taxes. Issue in my mind is I would pay cap gains on selling my rental offsetting some of the gains from not paying Hawaii taxes on my Roth conversions. The NET is about $25k savings between the cap gains and no state tax, which to me seems low enough to not deal with all of that. Also, easy for me to deal with the house in Hawaii vs having a house in Nevada or Texas, or wherever. Although, it is a condo and I'm beyond tired of HOAs and their BS and the high insurance. I could see some advantages if I did go back to work as I could do my LLC in Nevada for payments. I would buy the house cash since I have plenty equity to avoid these mortgage rates.
Hope you're still with me! Thoughts on the Nevada idea? Any other suggestions/concerns with the plan? Enough money? Realistic expectations? And there's always some form of watered down SS I am not bringing up but should be in the equation for when I'm in my 60s. Not sure I'd wait till 70 as I don't expect to live too long. Family seems to die off in their late 70s. Ending on a positive note!
7
Posted on 1/16/25 at 1:39 pm to Joe D Grinder
I don't have any input besides congratulations on this being your problem!
Posted on 1/16/25 at 1:43 pm to GrizzlyAlloy
hopefully i didn't describe it as a problem. Just figured it can't hurt to get some different thoughts. We have lots of smart people on the MT.
Posted on 1/16/25 at 2:08 pm to Joe D Grinder
quote:My doctor told me I needed to lose weight.
Need a second opinion from the MT board!
I told him I wanted a second opinion.
He said, "Okay, you're ugly, too."
Posted on 1/16/25 at 2:28 pm to Joe D Grinder
How long are you planning on living in the EU? Will you be giving your properties over to a company to manage them or will you be trying to manage them from the other side of the globe?
The following states have no income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
From there, it depends on whether you prefer hotter climates, colder climates or someplace with a little bit of everything (personally, I love the hell out of TN as it gets all four seasons).
The following states have no income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
From there, it depends on whether you prefer hotter climates, colder climates or someplace with a little bit of everything (personally, I love the hell out of TN as it gets all four seasons).
Posted on 1/16/25 at 2:44 pm to Bard
quote:
How long are you planning on living in the EU? Will you be giving your properties over to a company to manage them or will you be trying to manage them from the other side of the globe?
Hard to say on how long, but i love it there and she obviously does too. We'd travel most every country and likely live in a few so it could be as little as 2 years and maybe permanently. I'm guessing 5-10 years minimum and if it seems to be moving towards permanent we'd sell at least one property and buy there. Regarding a PM, we have a single friend who doesn't have a lot of stuff who would live in our unit upstairs for a reasonable rent and she'd take care of the tenants downstairs. Her rent we'd charge will easily cover a rent in EU.
quote:
I love the hell out of TN as it gets all four seasons).
Yeah, Tenn is my second choice. Nevada has low prop taxes and we have connections in that area to maybe make it a little easier to manage. We'd not really make wherever we buy our actual primary. That's just for tax purposes.
ETA: I'm leaning to not selling the Hawaii condo, but this is one of the main reasons for my OP is to get some other thoughts.
This post was edited on 1/16/25 at 2:48 pm
Posted on 1/16/25 at 2:50 pm to Joe D Grinder
So you have ~2 mill in investments (401k/ira/taxable account). 4% rule says high probability that should support withdrawing $80k/year for 30 years (50/50 stock bond allocation). That would cover your planned 75k in annual expenses.
How much of that 75k is discretionary vs the minimum amount you need to maintain your lifestyle? Lets say the minimum income you need is X.
I would build a TIPS ladder that each year would provide X income. That guarantees a minimum floor of income regardless of how the stock market is doing. Also TIPS are adjusted for inflation to maintain purchasing power which is a bigger concern in retirement imo.
Lets say your minimum income is 50k. You could build a TIPS ladder that provides $50k of income each year which is inflation protected. If you built a 12 year ladder today to age 62 (start taking soc sec) that would cost $529k.
The wrinkle is that you'll be living in Europe. So inflation there could be higher or less compared to US inflation which the TIPS inflation adjustment is based on. Then there is the currency exchange.
If you want to look more at building a TIPS ladder:
https://www.tipsladder.com/
How much of that 75k is discretionary vs the minimum amount you need to maintain your lifestyle? Lets say the minimum income you need is X.
I would build a TIPS ladder that each year would provide X income. That guarantees a minimum floor of income regardless of how the stock market is doing. Also TIPS are adjusted for inflation to maintain purchasing power which is a bigger concern in retirement imo.
Lets say your minimum income is 50k. You could build a TIPS ladder that provides $50k of income each year which is inflation protected. If you built a 12 year ladder today to age 62 (start taking soc sec) that would cost $529k.
The wrinkle is that you'll be living in Europe. So inflation there could be higher or less compared to US inflation which the TIPS inflation adjustment is based on. Then there is the currency exchange.
If you want to look more at building a TIPS ladder:
https://www.tipsladder.com/
Posted on 1/16/25 at 3:00 pm to gpburdell
quote:
How much of that 75k is discretionary vs the minimum amount you need to maintain your lifestyle? Lets say the minimum income you need is X.
For the most part that $75k is for daily life and travel and i don't see us always spending that much every year and of course some years more than. Living costs like rent should not eat into it much if at all because of the available rental of our house. If we end up not renting out our unit upstairs to a friend then we'd have to spend lets say $2k a month on rent/utilities.
quote:
I would build a TIPS ladder that each year would provide X income. That guarantees a minimum floor of income regardless of how the stock market is doing.
Thank you, I will definitely look into that and ask the CFP his thoughts too
Posted on 1/16/25 at 6:37 pm to Joe D Grinder
quote:
Thank you, I will definitely look into that and ask the CFP his thoughts too
Fyi, many prefer to put TIPS in a a tax deferred account like a trad IRA. The reason being that if you own individual TIPS bonds in a taxable account then you have to deal with "phantom income". You would have to pay taxes on the inflation adjustment each year before the bonds mature.
Not a big deal really, it's just something else to deal with when filing taxes. Though one advantage of TIPS in taxable is that they are exempt from state taxes as US govt bonds. You could put in a Roth too but I know people usually avoid putting bonds there but whatever works.
Also with no kids, I'm assuming you aren't worried about maximizing growth for leaving an inheritance or a legacy right?
If so, here's what I'd do if I was in your shoes. I'd build a 20 year $75k TIPS ladder that would go until age 70. That would cost ~$1.1 mil. Or even go longer if you want.
This way you have your $75k guaranteed yearly income that is safe as possible and inflation protected. I picked age 70, so then you could have SS kick in at its highest payout. This is longevity insurance in case you live longer than you expect.
You would still have 900k you can put into stocks, plus the two houses, bitcoin and 200k in cash. This would be used for income after age 70.
Posted on 1/17/25 at 9:45 am to Joe D Grinder
Good job on managing your finances to this point.
I am in early 60s and "retired" at 55. Some thoughts for you to consider.
I built my wealth thru stocks and used real estate to diversify. I had similar wealth to you when I was your age. Having a decent amount of assets allowed me to increase my real estate investing and have done pretty well with it. Rentals were fine to get me started, but started getting into commercial leases and new construction. I started selling my rentals and putting the money into those avenues. I like new construction because it involves projects that are short term. Buy lots, hire builder, build house, sell it.
For my stock market type investing, I was 95% stocks most of my life. Around your age, I started moving money into bonds using both a bond ladder and bond funds. I adjusted to about 40% bonds to stocks. I did this to follow conventional wisdom. Recently, I pulled most of the bond money out and put it back into stocks. I am 90% stocks now. I decided that as long as I have a couple of years of money outside of stocks that I could use if we hit a prolonged downturn in the market, then why keep so much in bonds. It is very seldom that we experience a downturn in stocks that persists for 2 years or more. Once you have a decent amount of wealth, like you do, then I no longer see the need to keep the typically advised amount of money in low growth classes of assets.
Last thing to add is that you may be pleasantly surprised by how much your income will be in your retirement years. At least if you stay active in investing. You might see that in your 70s?
I am in early 60s and "retired" at 55. Some thoughts for you to consider.
I built my wealth thru stocks and used real estate to diversify. I had similar wealth to you when I was your age. Having a decent amount of assets allowed me to increase my real estate investing and have done pretty well with it. Rentals were fine to get me started, but started getting into commercial leases and new construction. I started selling my rentals and putting the money into those avenues. I like new construction because it involves projects that are short term. Buy lots, hire builder, build house, sell it.
For my stock market type investing, I was 95% stocks most of my life. Around your age, I started moving money into bonds using both a bond ladder and bond funds. I adjusted to about 40% bonds to stocks. I did this to follow conventional wisdom. Recently, I pulled most of the bond money out and put it back into stocks. I am 90% stocks now. I decided that as long as I have a couple of years of money outside of stocks that I could use if we hit a prolonged downturn in the market, then why keep so much in bonds. It is very seldom that we experience a downturn in stocks that persists for 2 years or more. Once you have a decent amount of wealth, like you do, then I no longer see the need to keep the typically advised amount of money in low growth classes of assets.
Last thing to add is that you may be pleasantly surprised by how much your income will be in your retirement years. At least if you stay active in investing. You might see that in your 70s?
This post was edited on 1/17/25 at 9:48 am
Posted on 1/17/25 at 2:31 pm to gpburdell
quote:
If so, here's what I'd do if I was in your shoes. I'd build a 20 year $75k TIPS ladder that would go until age 70. That would cost ~$1.1 mil. Or even go longer if you want.
Sorry for the delayed response but we're on vacation now
No kids and will plan on leaving behind for our nieces and nephews but that will just be lagniappe for them.
I will look into this more. First reaction is concerns about pulling money from the market to put it into a lower, albeit safer, return. That's without me looking into TIPS at all yet so I will do research on it soon. Thanks again for your suggestion!
This post was edited on 1/17/25 at 2:33 pm
Posted on 1/17/25 at 2:38 pm to KWL85
quote:
Rentals were fine to get me started, but started getting into commercial leases and new construction. I started selling my rentals and putting the money into those avenues. I like new construction because it involves projects that are short term. Buy lots, hire builder, build house, sell it.
I wanted to get into commercial buildings but never had the time to learn it. I will have time now! Dealing with tenants is annoying and time consuming for sure.
quote:
Recently, I pulled most of the bond money out and put it back into stocks. I am 90% stocks now. I decided that as long as I have a couple of years of money outside of stocks that I could use if we hit a prolonged downturn in the market, then why keep so much in bonds. It is very seldom that we experience a downturn in stocks that persists for 2 years or more. Once you have a decent amount of wealth, like you do, then I no longer see the need to keep the typically advised amount of money in low growth classes of assets.
Thanks for this as I wonder as well about "too much" bonds. Sort of competing ideas with the post above and TIPS. Both to consider.
quote:
Last thing to add is that you may be pleasantly surprised by how much your income will be in your retirement years. At least if you stay active in investing. You might see that in your 70s?
I hope you're right! The plan shows me having a good chunk of change until he shows me dying at 95 so my wife will have plenty to spend in her late 80's early 90's
Posted on 1/17/25 at 2:42 pm to Joe D Grinder
75k would be tough imo with travel in there.
Posted on 1/17/25 at 3:21 pm to Joe D Grinder
You have 2 million and you’re hoping to retire?
Hope you don’t need to go to the grocery store when you retire
Hope you don’t need to go to the grocery store when you retire
Posted on 1/17/25 at 4:01 pm to Billy Blanks
quote:
75k would be tough imo with travel in there
$75k is travel, food, and fun. We shouldn't have costs for rent as it's offset renting our upstairs unit. Not every month will we be doing some big trip as we're going to be living in Europe and so there will be plenty of times we'll be chilling at the beach there and exploring cities in that country. I think the plan has us on over $100k living expenses by the time we're in our mid-60s if I'm not mistaken. But yes, at first I thought $75k might be too low. I'm hoping not!
Posted on 1/17/25 at 4:04 pm to el Gaucho
quote:
Hope you don’t need to go to the grocery store when you retire
Posted on 1/17/25 at 4:19 pm to Joe D Grinder
Gotcha, years ago I'd say 75 would be enough but man, dollars just don't go as far as they used to. A $100 today feels like 15-20 bucks 10 years ago.
Posted on 1/17/25 at 4:19 pm to Joe D Grinder
I’m not joking
I’ve doubled my retirement number from 10 million to 20 million since 2021 due to inflation but we all know the only retirement millenials will get is a Canada shot
I’ve doubled my retirement number from 10 million to 20 million since 2021 due to inflation but we all know the only retirement millenials will get is a Canada shot
Posted on 1/17/25 at 4:24 pm to gpburdell
quote:
-$600k in my i401k and another $150k in old employer 401ks for her.
-$115k in Roth (got started late)
-$1.35mm in brokerages
-1 BTC
-$200k cash in HYSAs
Thats over $2.5m (4% SWR=$100k)
Plus second/rental home which either can generate income or be sold.
Posted on 1/17/25 at 4:28 pm to Billy Blanks
quote:
Gotcha, years ago I'd say 75 would be enough but man, dollars just don't go as far as they used to. A $100 today feels like 15-20 bucks 10 years ago.
I know, it's scary. $6k a month which goes up every year by COL should hopefully do it. If not, and we spend more, I'm still ok. And worst case, I'll pick up some PT job or do some consulting. I may want to work anyway after a few years if I get bored.
Page 1 of 2
Popular
Back to top
Follow TigerDroppings for LSU Football News