I have plans and spreadsheets!
In short, my plan is to begin saving $26,500 per year beginning in January of 2015 (roughly $2,210 per month). This will be done in order to save just about $600k to live off of the interest. I have worked out the time frame to do this starting from zero to starting with $50k already invested. Starting from zero, the $600k date is end of month (eom) June 2028; starting with $10k = eom Feb. 2028; starting $30k = eom May 2027; $50k = eom Sept. 2026. What I already have saved for ‘retirement’ is in my 401(k), life insurance, a slight pension, and physical items, so the theoretical $50k based upon those ‘investments’ should actually be a pretty conservative figure.
I have a present, mid-term, and future household budgets worked out, but need to tighten up the numbers quite a bit in order to hit the goal of saving $2210 per month (I’m currently about $440 short on the mid-term budget! [based upon a 40% savings rate = $2330 in savings per month from all savings sources]). In order to do this, I need to get a slightly better handle of where our money is going and how to decrease the expenses that we currently have. The assumptions that would change in our present and mid-term budgets are a decrease in the phone bill ($120 to $65), our van will be paid off in Aug. 2014 ($478 to $0), groceries will decrease a bit ($546 to $425), and the internet/
cable bill has decreased ($78 to $59 – eliminated cable). All of the outlined decreases will go into savings/investing ($673 per month).
This is merely the beginning. I will continue to plan more and learn more as I go forward.