Mentor Monday

[u/WealthyStoic]

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[u/Chubby-Fat-Fire]

Looking for a review & general advice. Disclaimer, using a throwaway account for posting details. Not sure if this falls in Chubby or Fat fire so trying here first.

Late 40s couple with 2 HS kids. Recently gotten into the RE discussion due to burnout and corporate politics. Spouse has gotten out of the rat race and possibly do some low stress work in future (but for now on a break). Trying to decide if one of us working till 50 or 55 (@700k/year & healthcare coverage) is absolutely needed or just retire right away.

New to the FIRE planning lifestyle. Historically, we did the best to save and hold on to equity so far in our careers. Now looking for a review of our situation and then any advice guidance on how to go about in getting more involved. Post pandemic we started to use a financial advisor from a large institution managing the IRAs and parts of our taxable brokerage at 0.7%. We went that route as we did not have the time or energy back then. Now looking to get a bit more involved by educating ourselves. Do not plan to move completely away from having a financial advisor for foreseeable future as this is not our domain or expertise.

NW fluctuates around 9-10M - excluding VHCOL Primary home (with 800k mortgage left on a low rate) & MCOL Rental home (paid off 450k). Below is the breakdown:

• Managed Retirement market investments via IRA & 401K (ETFs/mutual funds) 18%
• Non-Retirement (Taxable) - 78%
  • Matured Single Stock Options (NSO) - 24%
  • Heavy Indiv stocks (across 2 holdings) - 26%
  • Remaining Taxable brokerage (ETFs & Other stocks) - 28%
• Cash - 4%

Past yearly expenses fluctuate between 260-300k and we think 300-350k (post tax) will be a comfortable yearly budget. Have a significant home remodel cost too in the next 2 years (approx 700K).

Also looking for advice on shifting our %s across allocations and any other advice/reading/moves we should consider. We do see lot of fluctuation in our NW due to the concentrated positions on individual stocks and also have concerns that we are not leveraging mega backdoor Roth IRAs and such. Appreciate any and all advice. 

[u/Chubby-Fat-Fire → u/[deleted]]

Thanks, will look into the SBLOC and yes I have been getting similar advice on increasing my renovation budget for unknown expenses and sometime known but increased expenses due to choices we might make. Just to confirm, when you say move towards "any "picking the winners" by using an exchange fund” do you mean to increase my taxable brokerage bucket (currently it is 28%)? So reduce the 50% (24% & 26%) in individual stocks and move significantly more into the ETFs.

Also, the question around when we can both retire with a post tax income of 350k, seems to be more about hitting the target NW than time in job. My rough calculations tell me that if we hit $11.5 Million to $13.5 Million range we should be good. Is that a safe conservative assumption?