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Subject:  8 years till ER Date:  10/11/2004  12:06 PM
Author:  hjg0989 Number:  2652 of 5246

Hi all,

I just found this board yesterday and am glad to see there are others as obsessive about ER as I am. My partner and I are 47 years old and are planning to retire at age 56.

I have made every mistake possible when it comes to retirement planning, but it looks like things will work out in spite of my errors. I didn't start saving until we were 37 years old - that's way late. I also work in the tech industry and turned out to be a real investment whiz ... until the crash where I lost a butt load of money.

However, my partner and I LBOM, we only took out a $87k 15 year mortgage (4 years to go), we have high earnings, no debt outside the mortgage, we will both have gov't pensions (reduced for ER though), and medical benefits in retirement.

So, we are maxing out our 401k/403b, Roths and stashing the rest away in Vanguard's Total Market Index fund.

My really rough figures are that we will have $800k - 1 million in the combined accounts, a combined pension in the low twenties and probably something from SS at 62. I also have a very small pension as a former Digital Equipment employee, but HP will have to stay a float to see that.

At the point that we retire, I would like to have 5 years of living expenses in laddered CDs. I guess when I get within 5 years of retiring (age 51) I will reduce the amount I put in the 401k/403b and in the after tax (Total Market Index) accounts and start buying CDs. I will also use the former mortgage money (12k per year) to buy the CDs.

Writing this is making me realize that I won't be able to take advantage of the after age 50 catch up for contributions to 401k/403b's and Roth's. I guess I would have a couple of options here:

1. Cut way back on spending at age 51 - this is probable plus we will receive raises between now and then.

2. Sell some of the existing money in the Vanguard Total Market Index fund to buy CDs.

3. Use a combination of 1 & 2.

Any other ideas ?


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