Is there a case to be made that working too long would negate some tax saving/planning benefit? Such that it would cost more to work than to retire.
I feel like we have plenty to comfortably retire and I am trying to convince myself that working until 65 is not really going to increase our lifestyle and will cause me to miss a Roth conversion window, or tax planning opportunity as well as my freedom and go-go time.
VPW says we should draw well more than we have ever spent in the past.
Our portfolio seems to make more than my $110K/yr gross wage.
If I work until April 2025 and my 64th BD, I will have an opportunity to collect up about 10K of free money. (Next year's match, and a substantial pay raise that will increase the value of unused leave and VEBA.) After typing that, it seems like maybe jumping over dollars to pick up pennies.
I am also concerned about my diminishing years of strong health. A blue-collar worker sells a bit of their body every day.
The people in my sphere do not retire before 65 unless they are damaged beyond repair. That makes, leaving just because you want to, a foreign concept.
Today was a really bad day at work, is there any reason to wait for the next one?
One final word, my wife just read this post over my shoulder and she said "You just need to stay the course and take the money from them as long as you can"![:?]( "Confused")
Here is where we stand today, 02OCT24.
Emergency funds: Three to six months of expenses
In checking, plus more in Roth and deferred, if things really get out of hand.
Debt:
None
Tax Filing Status:
Married Filing Jointly
Tax Rate:
22% Federal (barely), 00% State
State of Residence:
Washington
Age:
Him 63.5, Her 59.25
Desired Asset allocation:
70% stocks / 30% bonds
Desired International allocation: 20% of stocks
The approximate size of our combined total portfolio is $2.22M.
Guaranteed income;
Defined Benefit PERS 3 (pension) Appx 14K per year w/COLA @ age 65, 100% Survivor
His Social Security @70yo approximately 46K
Her Social Security @65yo approximately 24K
Current retirement assets
Taxable
00% cash
His 401a and 457b combined/mirrored 785K
35% Vanguard Target Retirement 2035 Investor VTTHX .08%
Company match is 5% of gross = $5200 per year goes in 401a
His PERS 3 Deferred contribution plan 151K
(I will likely convert this to a WA state TAP annuity upon separation????)
6% 2040 Retirement Strategy WA ST Investment Board .22%
.6% His HRA VEBA in a generic 2040 Target fund 15K (similar to HSA) ER=??
This will get a 40K increase upon retirement by selling unused leave time.
This VEBA will fund health care for part of the time when she will be on ACA.
His Roth IRA at Fidelity 486K
3% Vanguard Total International Stock ETF VXUS .08%
19% VANGUARD TOTAL STOCK MARKET INDEX ADMIRAL CL VTSAX .04
0% NOV INC (NOV)
His Rollover IRA at Fidelity 177K
8% VANGUARD TOTAL BOND MARKET INDEX ADMIRAL CL VBTLX .05
Her funds
Rollover IRA at Fidelity 405K
.6% Small-Cap Value VBR .05
10% Vanguard Total Bond Market BND .03
6% VANGUARD INDEX FDS VANGUARD TOTAL STK MKT VTI .03
2% Total International Stock Index Fund VXUS .08
Solo 401k at Fidelity 17.5K
.2% Vanguard Total Bond Market BND .03
.4% VANGUARD INDEX FDS VANGUARD TOTAL STK MKT VTI .03
.04% Total International Stock Index Fund VXUS .08
Roth IRA at Fidelity 181K
8% VANGUARD INDEX FDS VANGUARD TOTAL STK MKT VTI .03
New annual Contributions
$30500 his 457b
$5200 his 401a Employer Match goes in the 401A.
$5200 his defined contribution to PERS 3
$2400 his HRA VEBA (similar to HSA) Employer paid
$8000 his Roth IRA
$8000 her Roth IRA
$16000 her SOLO 401k
OTHER INFORMATION
Expected expenses of less than 100K after taxes. Including health care.
700K home paid off
One of two cars is ’22, other is ‘96
No home expenses looming, only optional improvements
She intends to continue self-employment until at least 65yo in a helping profession she loves. 45K net.
No LTC insurance.
We make about 140-160K, save close to 70K, and spend the rest on life, including at least one international vacation a year.
I feel like we have plenty to comfortably retire and I am trying to convince myself that working until 65 is not really going to increase our lifestyle and will cause me to miss a Roth conversion window, or tax planning opportunity as well as my freedom and go-go time.
VPW says we should draw well more than we have ever spent in the past.
Our portfolio seems to make more than my $110K/yr gross wage.
If I work until April 2025 and my 64th BD, I will have an opportunity to collect up about 10K of free money. (Next year's match, and a substantial pay raise that will increase the value of unused leave and VEBA.) After typing that, it seems like maybe jumping over dollars to pick up pennies.
I am also concerned about my diminishing years of strong health. A blue-collar worker sells a bit of their body every day.
The people in my sphere do not retire before 65 unless they are damaged beyond repair. That makes, leaving just because you want to, a foreign concept.
Today was a really bad day at work, is there any reason to wait for the next one?
One final word, my wife just read this post over my shoulder and she said "You just need to stay the course and take the money from them as long as you can"
Here is where we stand today, 02OCT24.
Emergency funds: Three to six months of expenses
In checking, plus more in Roth and deferred, if things really get out of hand.
Debt:
None
Tax Filing Status:
Married Filing Jointly
Tax Rate:
22% Federal (barely), 00% State
State of Residence:
Washington
Age:
Him 63.5, Her 59.25
Desired Asset allocation:
70% stocks / 30% bonds
Desired International allocation: 20% of stocks
The approximate size of our combined total portfolio is $2.22M.
Guaranteed income;
Defined Benefit PERS 3 (pension) Appx 14K per year w/COLA @ age 65, 100% Survivor
His Social Security @70yo approximately 46K
Her Social Security @65yo approximately 24K
Current retirement assets
Taxable
00% cash
His 401a and 457b combined/mirrored 785K
35% Vanguard Target Retirement 2035 Investor VTTHX .08%
Company match is 5% of gross = $5200 per year goes in 401a
His PERS 3 Deferred contribution plan 151K
(I will likely convert this to a WA state TAP annuity upon separation????)
6% 2040 Retirement Strategy WA ST Investment Board .22%
.6% His HRA VEBA in a generic 2040 Target fund 15K (similar to HSA) ER=??
This will get a 40K increase upon retirement by selling unused leave time.
This VEBA will fund health care for part of the time when she will be on ACA.
His Roth IRA at Fidelity 486K
3% Vanguard Total International Stock ETF VXUS .08%
19% VANGUARD TOTAL STOCK MARKET INDEX ADMIRAL CL VTSAX .04
0% NOV INC (NOV)
His Rollover IRA at Fidelity 177K
8% VANGUARD TOTAL BOND MARKET INDEX ADMIRAL CL VBTLX .05
Her funds
Rollover IRA at Fidelity 405K
.6% Small-Cap Value VBR .05
10% Vanguard Total Bond Market BND .03
6% VANGUARD INDEX FDS VANGUARD TOTAL STK MKT VTI .03
2% Total International Stock Index Fund VXUS .08
Solo 401k at Fidelity 17.5K
.2% Vanguard Total Bond Market BND .03
.4% VANGUARD INDEX FDS VANGUARD TOTAL STK MKT VTI .03
.04% Total International Stock Index Fund VXUS .08
Roth IRA at Fidelity 181K
8% VANGUARD INDEX FDS VANGUARD TOTAL STK MKT VTI .03
New annual Contributions
$30500 his 457b
$5200 his 401a Employer Match goes in the 401A.
$5200 his defined contribution to PERS 3
$2400 his HRA VEBA (similar to HSA) Employer paid
$8000 his Roth IRA
$8000 her Roth IRA
$16000 her SOLO 401k
OTHER INFORMATION
Expected expenses of less than 100K after taxes. Including health care.
700K home paid off
One of two cars is ’22, other is ‘96
No home expenses looming, only optional improvements
She intends to continue self-employment until at least 65yo in a helping profession she loves. 45K net.
No LTC insurance.
We make about 140-160K, save close to 70K, and spend the rest on life, including at least one international vacation a year.
Statistics: Posted by Workinprogress — Wed Oct 02, 2024 10:10 pm