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|Subject: help on ideas for retirement fund opportunity||Date: 9/19/2012 1:25 PM|
|Author: bartsd||Number: 70914 of 77402|
I'm posting this in hopes of getting some feedback on my thoughts of using a bonus that I'm being offered for retirement.
Here's the background data first off:
I'm a government employee, age 35, who is being offered a $30k bonus (taxable) 5 years prior to retirement at 20 years of service.
If I accept the bonus, my retirement pay will be reduced from 50% of base income to 47% of base income. Normally it is reduced to 40%, however I have a weird circumstance where I broke service for a short period of time, but my pay counter continued. So at retirement of 20 years of service, I'll actually be getting 22 years of service in pay.
At the age of 62, my retirement pay will go back up to where it would have been, had I not taken the bonus. This will be reflected in an increase of 8% to 55% of base income. From there it will remain at 55% adjusting for inflation.
My plan so far, consists of dropping the money in to a mutual fund with the expectation of a 5% return rate. With the bonus taxable, I'm expecting somewhere around $22k. At the end of 20 years, with a 5% return rate, I estimate that the amount will then be $28,078.
For the first 5 years POST retirement, I plan on dropping the monthly retirement pay back in to the same account. At which point, at the end of 5 years, it should come out to around $140,269.
From there, I plan on just letting it sit and grow.
My questions are as follows:
Is there a better way?
Is there a way to deposit the money in to an account that is tax deferred, or non-taxable?
I welcome all suggestions.
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