Here is where you’ll find regular high-level updates to our financial plan for financial independence and early retirement. We are currently in the accumulation phase. But, we are slowly transitioning to converting our accumulated portfolio to future income. Our time horizon for semi-retirement is roughly five years, but it depends on wealth accumulation, market conditions, and our family situation. Below you’ll find, “The Big Graph” that provides a visual reference of our progress towards our net worth goal as well as some general information on our savings and investing strategies. Greater details on all of these topics can be found in our blog posts. Just for fun, I’ve also included a countdown timer until our projected retirement date.
Our Financial Plan for Early Retirement
We have our workplace retirement accounts maxed out (to include 401(k) plan catch-up contributions and voluntary contributions to Jeff’s pension fund). We’re also contributing the maximum to our HSA fund. Outside of our tax-advantaged accounts we’re saving every spare dollar for a reserve cash account. On the spending side, we’re paying down our mortgage and continuing to put money aside for our children’s college/future funds.
Progress to Funding Goal
Our retirement savings is largely invested in very low fee passive index mutual funds, with the majority being with Vanguard (90% Traditional/10% Roth IRAs) and the remainder being in our workplace 401(k) accounts. We’re invested in 60% equities and 40% bonds, with equities distributed among large, mid, small, and non-us funds. Our bond exposure is via total bond market index funds and also in I-Bonds and TIPS. The overall allocations in the individual accounts vary a bit due to the three accounts offering different fund families. Our HSA is presently held as cash to provide max liquidity for medical expenses, but I’ll be converting a portion of it to a higher risk allocation once the balance gets large enough.
We’re expecting our financial plan for early retirement to have us leaving our full-time jobs on or before May of 2021. Could it be earlier? Maybe. Could it be later? We hope not, but maybe. Keep an eye on this countdown in future years to see how much time we think we have until we enter the ranks of the not fully employed.
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