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I am a 46 year old professional with a spouse and two teenagers. My current salary is $115,000/year. My spouse is a manager and makes $50,000/year. I can retire at age 50 with a guaranteed lifetime annuity of 50% of my salary plus annual cost of living increases. There is little likelihood of layoffs or downsizing where I work, but on the other hand little likelihood of promotions or major salary increases.

I have a 401k plan which is totally invested in the S&P 500 index (currently the only investment option) and the current balance is $350,000. $15,000 deferred salary a year goes into the 401k. I currently live in one of the top 5 highest cost of living/state taxation states. My oldest child will start college in 2 years. My spouse and I have in addition the following assets: $100,000 in other IRA's; $1 million in stocks; $500,000 home equity. I have no equity position in my company and the stocks do not pay much of a dividend stream. I have a big mortgage. State income tax is over $10,000 a year. Cash stream is currently $165,000/year gross but mortgage and state taxes alone take about $60k/year.

At age 50, I assume I will make $120,000 a year and have $500,000 in my 401(k). I am planning to retire then which give me a 50% annuity of $60,000/year. Assuming I transfer my $500,000 401(k) balance to a 72(t), at 8%/yearly withdrawal for 10 years, I will have $40,000/year in 72(t) income.

I also plan to move to a lower cost of living state with little or no state income tax such as Nevada or Washington, pay cash for a house, and find employment at a salary goal of $50,000/year. The spouse plans not to work. This will still provide a cash flow of $150,000 a year, but pretty much the current $60k mortgage and state taxes expense will be erased. Even if the market goes to pot and the 72(t) is exhausted, I will hopefully still have the $100,000 in other IRA's and the $1 million stock portfolio.

Does anyone see any problems with this?

Does any one have any thoughts on the pros/cons of small variations:

a) my employer will pay for relocation (which I estimate will cost $100,000, all taxable to me) to the West Coast, but at a cut in salary of $9000 to $16,000/year as long as I do it a year prior to retirement. However, since I was planning to retire in the West Coast, that will erase my paying my own relocation expenses after retirement. Is it worth a salary/retirement pay cut in exchange for the relocation expenses?

b) I could probably get a salary in Silicon Valley, CA of $100,000/yr instead of $50,000/yr post retirement, plus stock options, but then it would be in a high cost of living/high tax state. I would assume the extra $50,000 a year would be used up in mortgage and taxes?

c) My employer may offer investment options in the Russell 5000 and a Global Fund in six months. Is it worth switching any money with only 3-4 years to go before retirement?
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