[USER]

Is 2.5 mil savings enough to retire at age 50?
I need 10K/month to live.
2.5k/month rental income.

4% rule says yes, but I’m worried about the unknowns. I have two teenage kids, age 14 and 11 to send to college.

I expect a SS payment of 5K/month between wife and I starting at age 62.

Both of us are 48 now.
Of the 2.5 mil, I have 0.5 mil in brokerage and 180K in HYSA. Rest are in retirement accounts.

Thanks in advance.

[Summer]

Without reading comments, so if redundant ignore, I would say making a judgement at age 48 for age 62 payments is premature.

You don’t know what will happen in 14 years. Brokerages are a good start but — you’re worried about the unknowns, as you should be, as should we all be.

Expect nothing. Don’t stop working at 50 unless your job (which you have not delineated) is utterly intolerable.

Work as long as you can into your fifties at least to some degree. 2.5 million is cool with 10k/month, as you mentioned math wise, but you want extra for college and unknowns.

Try to find some fun part time work/stave off the draw down if you are really worried about unknowns. Life is hairy.

[Serina]

It might be enough if you have money in a 529 on top of that to account for kids college. I think you need more money in a brokerage so you can bridge the time before you pull from retirement accounts.

You need at least 5 years of expenses for a Roth ladder which you have barely enough.

I would want more cushion for unexpected expenses

[Diane]

Is it enough for you to retire? I would say so. Is it enough to support four people?

I would say no way.

[Robert]

Hmmm….. you have certainly crushed it at your age; I mean, you’re probably in the top 5% in terms of savings, given your age.

Having said that, if it were me, I would be looking at late 50s; or early 60s in terms of both of you retiring– and I’ll explain why. Both of you are 48.

As a guy, your life expectancy is to age 79; with a good chance you’ll be living into your 80s. Your wife’s life expectancy is 88 years of age; with a good chance she will be living into her 90s.

Whatever income strategy you will use needs to not only account for the first years of retirement, but also the last years; and I’m a huge proponent of dying with much more money than you need in the bank; as opposed to the last months and years of your retirement being threadbare, worrying that you do not run out of money before you run out of month.

Your 14-year-old starts college in four years; your 11 year old starts college in seven years; and it is certain that college costs will only increase between now and then.

(however, I am not a proponent of short changing retirement savings there’s a problem, for a child’s college education; your children can use the military to pay for the education; or a combination of part-time work, grants, and student loans….

But there are no loans for retirement.) You mentioned both of you taking social Security at age 62; however, virtually everyone you speak to will advocate taking it much later; taking it that early results in a permanent reduction in the monthly benefits, and I do not advise doing so, unless someone desperately needs the income; or is reasonably sure that they will not make it past their late 70s or early 80s which I think is the break-even point; but there are tons of YouTube videos and resources on the Internet that explain how to get the maximum out of Social Security.

But given your age…… the FRA for both of you not until 67; and if you could delay taking it you until both reach age 70; you will maximize your payout.

In this day and age; with unpredictability the stock market; I am inherently leery of any “rule”; be at the 4% rule; or almost any other rule… Especially since after almost 15 years of exceptionally strong returns; I will not be surprised if the next decade is either average or even sub-average.

To sum it up, why you have crushed it at your age; to give yourself more of a security blanket. I would hold off until my late 50s at the very earliest or my early to mid 60s.

But that’s just me.

[Amy]

I’m in a very similar situation. My kids are 20 (financially independent and out of the house), 19 (junior in college with $12k left to pay until graduation) and 17 junior in high school ($25k still to pay for their college).

I just turned 50.

Few key questions…do you have college paid for if you are paying? Do you have health insurance for your family of 4 until not needed?

Are you expecting any inheritance?

If the answer is no to any of those questions, I’d go to 52-54.

[Daisy]

Do you have a mortgage?
Do you have kids and if so, will you be assisting their college tuition, etc.?

If yes to either of the above, then no to retiring at 50.

If no, then yes to retiring at age 50 only if you don’t like your jobs.

[Cory]

Make sure you add some zeros for your social security years if you retire early. Doubtful your ss will be 5k per month if you retire at 50.

Don’t know all your financial information but I’d say it will be less

[Tien]

Look into an FIA. You won’t outlive your money. It’s safe from the market and guarantee income for life.

[Alyssa]

Think you’ve got plenty of money overall, you just need to solve the problem of making it to withdrawal age without penalties on the retirement accounts.

You have $680k to make it, what, 9.5 years? With no gains on the $680k you’d make it 7.5 years.

[Julie]

I’d beef up the brokerage account. If you can work a few more years, you might be better off.

You’re just starting to get into the expensive years with the kids.

[Dave]

So, after your rental
Income you need 7.5k/mo which is $90k/yr
4% rule *of thumb* says you’re ok.

But there’s timing and taxes to consider ….

You say all but $680k is in retirement accounts; that is is tight for 9.5 years @$90k/yr

But if you have contributed $100k+ to Roths that should be enough buffer.

[Susan]

If you’re paying for those college degrees then I would say no.

[Michael]

You missed a great buying opportunity in the market.
I’m 12% below my 2024 high but it provides me an income of 7k to 11k/month, so the fact that I’m preserving and withdrawing is fine for me.

No guts no glory

[Ani]

How will you access the retirement accounts without penalties for the next 11+ years?

I think you need more in your brokerage account first.

[Lit]

I would trial it n retire for 1-2 years if I like it I’ll make it work or resume part time.

If I don’t like it then I would resume full time! It’s not set in stone what you can do with the different variables at this time.

Good luck! My retirement goal is somewhere in the mid 50s

[Kenneth]

Save up more cash. You have enough for retirement, but you need more for current spending.

[Scott]

So that 1/2 million has to last 10 yrs, and you’ll be chewing it up pretty quickly, if a recession happens, then what? I think you’ll have to sell rentals to cover the gaps.

What about college and 1- off expenses?

I don’t think you’re there yet without some serious repositioning.

[Joyce]

52 & our retirement planning has NEVER included SS. We are on the 5 year plan to retirement.

If we actually get SS, then there are lots of non-profits that will benefit.

[Corey]

I’m in a similar situation as you, but I plan on going the 72t route and drawing annually from my IRA’s to supplement the money I have in HYSA and brokerages.

I really see no point in letting the IRA’s grow to the point that I have to take RMD’s when I’m 70.

[Lena]

I am not expert, but I think you should still work part time ? I know health insurance is expensive,plus how are you gonna pay for college foe kids?

their cars, apartment, food?

You cannot take money from 41k before 59.9

[Justin]

I feel like if you are going to start pulling it that early maybe have to figure out if 4% is too much to be pulling to make the money last

[Tristan]

You have about 7.5 years of accessible money right now, but need 10 years. Are you able to get to 10 years accessible in 2 years?

otherwise you’d need to 72t after 7.5 years, which could work since you then have 5 years until 60, but I never love being on a fixed withdrawal amount.

And do you have college in the 10k/month.

If not you would need to put college on the kids (not saying that’s not OK, but since you said you have to send them to college I’m assuming that you mean you want to pay for that)

[Author]

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