I am getting near the finish line at 57 yrs old and currently am semi retired( working 20 weeks a year). We have no debt and currently have 800k in roth 401k,roth IRAs, and brokerage accounts. We also have 60 k liquid cash for emergency fund.I currently max out my 401k and my wifes and my roth IRAs as well as add to our brokerage accounts as cash is leftover. I currently gross around 85k a year and we are putting roughly 50% of my gross into retirement every year. We plan to use our social security to cover our health insurance when I retire,so it is not being factored into our expense equation. Since we have no debt our expenses are low and are currently living comfortably and able to do the things we enjoy. I am thinking I should be in good shape to pull the plug at 62 1/2 knowing I will have to fund our insurance for 3 yrs until medicare kicks in. We do not see any major expenses on the horizon as our home is only 6 yrs old, son is done with college and our Motor-home, and cars are only a couple of yrs old( tend to drive our vehicles for 10 yrs or more before replacing them) Am I missing something?????
You may already have this done:
1) Monthly budget with all expenses listed.
2) one year of expenses in liquid cash for an emergency fund. If the market drops, you have a cushions so as to not eat into your principle. 3) List at least your top 3 financial goals. Then basis your financial strategy on them.
4) Make sure you can cover your monthly expenses (must have needs) with SS, pension (if you have one), cash on hand, possibly part time work, annuity.
5) Do live within the 4% draw down factor to make sure your money will last in your retirement.
You sound like you're in a great position and there is a compendium of calculators to assist you. Do more homework until you are comfortable with your results and enjoy your retirement. I quit working full time at 55 and held on per diem for another 2 years. Didn't need to but it can be challenging to let go.
Do not under estimate health costs. I thought I had it covered when I retired but that was 2.5 times my original estimates ago.
Congrats!
The only other item to think about may be long term care. It can be a significant expense if one or both of you need it down the line.
For me, I plan to use my social security and a reverse mortgage on or sale of my home, if I eventually need it. But it is something to consider. Good luck!
Thanks all, I feel better that I am not apparently overlooking something major. We have been tracking a monthly budget for 2 yrs so I believe barring some tragedy we should be in good shape and will be able to weather market fluctuations.and be able to leave a substantial chunk to our son when that time comes. We too have discussed that our home is our hedge against long term health care expenses if needed. thanks again
"We plan to use our social security to cover our health insurance when I retire, so it is not being factored into our expense equation. "
I guess that means you are going to take SS at 62. Correct? And are you sure it will cover the cost of health insurance until age 65 when you go on Medicare? From age 62 to 65 my wife and I were paying over $3000/month as we did not qualify for any Obamacare subsidies. Also, taking SS at age 62 may not be the best move, your payments are greatly reduced at that age and money you earn outside of SS may be taxable. Personally, I would not have retired at age 62 if I needed SS to pay for health insurance, or anything else.