[USER]

single dad of 5. 1M in retirement accounts, 1M in equity in vacation rentals that gross 300k a year and break even.

income is 800k, but working lots of hours taking call.

pull the parachute?

[Wendi]

I am a single mom of 8 and I make more and save more than you…

[Ricky]

I was in the same situation, but with 6 children under the age of 2. It can be done.

[Amanda]

You are getting 300k from the rentals. That or than most make. It seems like you should be fine, imo

[Steve]

Not enough info. What are your expenses? If your short term rentals break even, they don’t produce any net income.

$1M in retirement may not be accessible till certain age and even then it’s only $40k annual income if we use 4% SWR rule of thumb.

[Steven]

Not enough to retire. You need 20 more millions to account for inflation.

[Nick]

If you’re Tom Brady and your career is a quest to build a legacy as the greatest in the history of a profession that brings you worldwide admiration, then by all means, pour yourself into your job.

But if you’re not, then there’s a very good chance you spend your time filing accounting reports, sitting in meetings, or some other soulless function that serves no other purpose but to generate you income.

In that case, you should step away the moment you no longer depend on that income and not a second later.

Seems like you’re already there – enjoy it!

[Maggie]

How old are the kids? If they are young, nope. If they’re mostly grown up, maybe.

[Hill]

Pull the parachute? Sounds like pull the ejection seat on flight BS 101.

[Jonathan]

$800k/y and only have $1m saved. Either you recently got a huge bump in pay or you have a spending issue.

Either way no, you aren’t ready

[Amanda]

Doesn’t seem like you can afford that. Only having 1 mil in investment accounts but making 800k… sounds like you spend majority of your income.

[Daisy]

No, not enough to retire yet.
Are any college funds set up for your kids yet?
Pay off all mortgages.

Continue maxing out on 401k.

After all those things are accomplished and if vacation rentals can cash flow 300k as you’ve mentioned, then you’re good to pull the parachute.

[Jared]

rentals breaking even means you cannot count it as income. if you sold off and consolidated to 2m in market, 4% rule suggests you live on 80k.

based on income vs amount saved you are living off way more than 80k and need to do some math on what nest egg will support your current spending amount or conversely reduce that spending amount significantly

[Chmielecki]

1. Vacation rental with $1MM equity gross $300k a year and break even… What kind of mortgage and expense do you have on this rental? $3MM at 6-7% debt and a property manager?

See if you can reduce expense, make it cash flow positive and live within that cash flow before pulling the parachute
Also consider selling it and roll the equity in the stock market to draw 4%.

2. What’s your expense for you and your kids, how old are they, to what extent of financial support do you want to provide them?

You should first understand your needs, set a tangible goal and ask this community to review them.

Otherwise it seems like you will pull a parachute that won’t open when you jump

[Stephanie]

If this isn’t a troll post, and you’re actually making 800k/ yr yet only managed to save 1M in retirement, no, you’re nowhere near close to pulling the parachute, until you rein in your burn rate and save more.

[Sean]

Most likely you are trolling. But on the off chance you aren’t I can’t see how you’re possibly anywhere close to being able to retire.

[Matt]

Easy. Just cut your current lifestyle by about 93% and you are there.

Is your savings rate over 50% right now?

[Anjoli]

As others have stated, there’s not enough information here. If you have been making 800k/year for a long time and still only have 1m saved, then your spending likely isn’t going to make retirement sustainable…at all.

If you are all of a sudden bringing in this income and actually only living off of a very small amount of money, then sure, working one or two years and saving 90% of your income to make retirement possible might be a thing.

But we don’t have information here like…what about your primary residence?

Other debt? Monthly expenses? Actual monthly savings? Plan to keep or sell your vacation rentals?

If you retire now with no other financial moves, you’re talking 40k/year spending in retirement.

If you have 1m and can sell your RE portfolio for another 1m (assuming sale here since currently no profit and you’ll need the money), you would be living off of 80k/year on average.

If you work another two years and save 85-90% of your income (let’s just say 700k out of your 800k), then sell your rental portfolio, you’d have more like 135k/year in retirement if following the 4% rule.

Big difference there. But both scenarios require a realistic view of your current spending.

[Author]

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