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Feeling like missed the boat. Any help will be appreciated!

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  • Feeling like missed the boat. Any help will be appreciated!

    I was introduced to this forum recently and I feel like I am too late to this game. I mean wish I had known this forum when we finished residencies 12 years back. Here is our situation.
    We are in late 40's, 2 kids, annual income $400k for last 8 years, before that it was $300k( one full time and one part time academic medicine doc)
    403(b) and 457 (b) : $1.8 M
    Roll Over IRA: $500k
    Cash in Savings account: $230K
    Real estate: Primary Home: Value 1.2 M and Mortgage of 200k left( at 2.625%interest, 4 more years to pay off)
    Rental Property: Value 800K ( 2 properties) with $330k mortgage ( at 3% interest), paying off mortgage with rental income and $800 a month net cash flow.
    529 Plan: $250k( one kid already a junior in college, state school ranked number 1 in the country among state schools, the other one goes to college in 4 years)
    We would like to work till 60. But with current state of our finances, do you guys think thats possible? We love to work and serve the community.
    We don't have any taxable accounts yet ( too late to think now??)
    Any advise will be helpful.

  • #2
    You have a net worth of $4M with some passive income from your rental properties. You're in great shape. If you want to work until you're 60, why do you need a taxable account?

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    • #3
      Originally posted by CordMcNally View Post
      You have a net worth of $4M with some passive income from your rental properties. You're in great shape. If you want to work until you're 60, why do you need a taxable account?
      Thanks for your quick response and encouraging words. We would like to save more and may be move some money from the saving account to a brokerage account and invest in some index funds like VTSAX or VOO. We are maxing out on our retirement accounts.

      I had an idea that we shouldn't be counting out primary home towards our assets for retirement readiness.

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      • #4
        By 60 you'll have more than 10M, you didn't need this forum, you won.

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        • #5
          If you missed the boat, so did I. It is never too late to start a taxable account.

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          • #6
            Originally posted by VagabondMD View Post
            If you missed the boat, so did I. It is never too late to start a taxable account.
            I am doing it Monday the first thing. Also will move the IRA to 403b and will get BDR. Seems like a hot item in this forum these days. We can put 12K in BDR it seems

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            • #7
              How much money will you need in retirement? Unless you're planning on living on a yacht in the Mediterranean then you're going to meet your goals.

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              • #8
                Originally posted by CordMcNally View Post
                How much money will you need in retirement? Unless you're planning on living on a yacht in the Mediterranean then you're going to meet your goals.
                Yacht..ouch!! But in seriousness, I was feeling like I didn't invest enough when I was young. Not that I bought shiny new cars or took expensive vacations, but never lived like a resident for 4-5 years after being an attending as has been advised many times. I could have more frugal and have had some larger nest eggs, but again there is no point thinking about it at this point.
                Immigrant doc and there was no student loans when came out of residency. But had kids and day care cost all along. So had only 30k net worth( retirement account) when finished residency

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                • #9
                  I would start a taxable account for flexibility as you get nearer to retirement. It is time to really figure out your spending pattern. It is hard to know how much you need without knowing how much you spend. When people talk about the 4% rule you cannot factor in your primary home unless you plan to sell and downsize or do a reverse mortgage at 62. Your net worth is 4 Million based on your posted numbers. You do not seem behind. You will also find that this forum is filled with overachievers.

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                  • #10
                    Originally posted by FireFox View Post

                    Yacht..ouch!! But in seriousness, I was feeling like I didn't invest enough when I was young. Not that I bought shiny new cars or took expensive vacations, but never lived like a resident for 4-5 years after being an attending as has been advised many times. I could have more frugal and have had some larger nest eggs, but again there is no point thinking about it at this point.
                    Immigrant doc and there was no student loans when came out of residency. But had kids and day care cost all along. So had only 30k net worth( retirement account) when finished residency
                    Sure, it could be even better but you are in good shape and on a good trajectory. You are also now at a point on that trajectory where you can do even more. I think I accumulated 70% of my wealth in the last decade. If you want to double down on a taxable account, just do it (pardon the Nike commercial).

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                    • #11
                      Yea, don't count your residence toward your nest egg. But you've still got a $3M nest egg just 12 years out of training. Not sure why you feel behind. Yes, Backdoor Roths are nice and a taxable account is nice, but you're much better than the average doc. You're doing much better than the average WCIer. Stay the course. Get a written plan. Follow it. You're going to be very wealthy. Might even end up with an estate tax problem the rate you're going.
                      Helping those who wear the white coat get a fair shake on Wall Street since 2011

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                      • #12
                        Originally posted by The White Coat Investor View Post
                        Yea, don't count your residence toward your nest egg. But you've still got a $3M nest egg just 12 years out of training. Not sure why you feel behind. Yes, Backdoor Roths are nice and a taxable account is nice, but you're much better than the average doc. You're doing much better than the average WCIer. Stay the course. Get a written plan. Follow it. You're going to be very wealthy. Might even end up with an estate tax problem the rate you're going.
                        Great word of encouragement. This why people love this forum. I will follow all your advise and will have a written financial plan. Finished residencies in mid 30's( yes painful to be resident again after doing one) and slowly started on the path of financial freedom. WCI has been such an eye opener for us in such short time I have been on the site and podcast.

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                        • #13
                          So, how much do you need per year in retirement?

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                          • #14
                            Originally posted by CordMcNally View Post
                            So, how much do you need per year in retirement?
                            About $120k in today's money, considering the fact that we will not have any loans but will have to pay for healthcare and travel

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                            • #15
                              Originally posted by FireFox View Post

                              About $120k in today's money, considering the fact that we will not have any loans but will have to pay for healthcare and travel
                              You should be able to generate that now (4% of $3M), not even counting SS or your primary residence.

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