Who wants to critique my post-debt budget?

[riverwed070707]

Because the four-plex is worth so much more than:

• two helocs,
• the primary house,
• a small rental property,
• the boat, and
• savings?

(I'm going through a community-property divorce, and getting all the assets -- we had no debt -- divided takes a lot more lawyer time than I expected.)

In the long run? Yes because the amount it will make in the long term is far more valuable than any of those other things. It was an uncontested divorce which in our state basically means if you put everything on paper for the judge and the assets and debts relatively balance out, they’ll approve. We didn’t fight over anything, he needed immediate assets/money to stay afloat while he looked for a better paying job and I wanted long term assets that didn’t destroy my early retirement plan.

[LivingAlmostLarge]

congratulations on doing so well after the divorce. I hope it is okay.

[riverwed070707]

Felt overdue for a progress update + I'm needing some inspo to keep my head down as I approach the year and a half mark to retirement. Every single day I want to say f* it, I can quit now, but the goal is too close to pull the plug. Dug up this old thread to have something to compare to as I realized my net worth crossed the $1M mark this year When I started here, I had a negative net worth and was in focused debt snowball mode. Here's how I'm sitting heading into 2026.

2011 joint net income=$3000 (was married, divorced in 2016)
2018 primary net income=$4,300 (which doesn't include the $215 /mo child support I pay in our 50/50 custody agreement)
2026 primary net income=$7,000 (I'm not sure what I included previously, but this is after health insurance, HSA, ESPP and 401k. It does not include my partners income since we keep finances separate)

2011 rental income: $134
2018 net rental income: $2,200
2026 net rental income: $4,170

2011 retirement savings: $28,000
2018 retirement savings: $158,000
2026 retirement savings: $550,000 (401k, Roth IRA, SDIRA)

2011 savings: $5,500
2018 savings: $13,000
2026 savings: $130,000 (stockpiling cash for retirement buffer, half of this is in HYSA and half is in short term hard money loans @ 12%)

It is wildly rewarding to track this progress over time and see how far I've come. I leaned into this board heavily in the early days and found inspiration in a number of members who helped me see what was possible, many of which are still around. Wanted to share not to brag, but 1) to say thanks and 2) in case it inspires someone still trying to see what difference everyday choices make toward the larger goal.

[disneysteve]

I was confused when I clicked on the thread and saw it was from 2011 but then saw you had updated today. It's nice to see a progress report. We don't often get follow up.

You've done great, going from a negative NW to over $1M since starting this thread. It looks like you've got 680K in investable assets so the rest is in real estate. How much of that is your primary home?

You've got about 65K in "hard money loans". Is there any liquidity to that money or is it sunk until the borrower pays it back? Do you get monthly payments? If so, is that included in your income figure?

What does the expense side of the balance sheet look like? How much are you spending monthly and what are you projecting for your retirement spending? How much of that, if any, is covered by your partner? As you know all too well, relationships can end, so you want to be sure you've built yourself a budget that still works if the partner is no longer around contributing.

How are you envisioning your retirement? Are you planning to cease working entirely and live off of rental income and investments? Are you thinking about any sort of work for pay arrangement such as a monetized hobby or side gig (like my ebay sales)? How old are you and how will health insurance be covered if you are retiring pre-Medicare age?

[riverwed070707]

Love these questions! Ope - answered in quote and looks like you can't see everything I wrote. Editing for formatting

I was confused when I clicked on the thread and saw it was from 2011 but then saw you had updated today. It's nice to see a progress report. We don't often get follow up.

You've done great, going from a negative NW to over $1M since starting this thread. It looks like you've got 680K in investable assets so the rest is in real estate. How much of that is your primary home? I have approximately $130k equity in my primary home. Sounds small but property is cheap here - the home is valued at $300k, and I paid $225 in 2019. We will sell it when we retire and those proceeds will fund our first 2-3 years. I have about $600k in equity in my rentals which I go back and forth weekly whether I'll sell them or keep them.

You've got about 65K in "hard money loans". Is there any liquidity to that money or is it sunk until the borrower pays it back? Do you get monthly payments? If so, is that included in your income figure? I actually have about $265k out in HMLs, but the bulk of it is in retirement funds so I accounted for it in that bucket. $65k is a separate bucket of personal/taxable income I didn't know where else to include. It's not liquid while its lent out but I do receive monthly interest only payments. The money goes out in typically 6 month cycles, so I have access to it (and the choice not to lend it out again) about twice a year. I did not include the interest payments in my income figure.

What does the expense side of the balance sheet look like? How much are you spending monthly and what are you projecting for your retirement spending? How much of that, if any, is covered by your partner? As you know all too well, relationships can end, so you want to be sure you've built yourself a budget that still works if the partner is no longer around contributing. My partner is a little spoiled in this scenario and is not expected to contribute to funding our retirement, though our arrangement makes his monthly expenses very low and he socks away most of what he earns. If I had to ballpark, he has somewhere around $50k in the bank. He was not a saver when we met and this is a huge achievement for him. Our current spending is higher than target retirement spending at around $4500/mo, with $2400 of that going toward housing (mortgage, insurance, taxes, utilities all included), $600 toward food, $500 toward travel and entertainment, and the remaining not diligently tracked or budgeted anymore toward cars, kid expenses, etc.

Hoping to keep retirement spend to around $3,500/mo.

How are you envisioning your retirement? Are you planning to cease working entirely and live off of rental income and investments? Are you thinking about any sort of work for pay arrangement such as a monetized hobby or side gig (like my ebay sales)? How old are you and how will health insurance be covered if you are retiring pre-Medicare age? We plan to sell the house and nomad for a while both because we love it and to your point, we won't have any health coverage. We'll use geoarbitrage to create an affordable slow travel lifestyle, keeping housing expenses low by housesitting and participating in volunteer opportunities. We're not set on never working again, but I need a LONG break. My ideal scenario would be to travel for 5-10 years, see everything we want to see and hopefully have found a place along the way we can see ourselves settling for a while outside of the US. I have a lot of business ideas I'd love to put into action but I need to put my wanderlust to bed before I can get motivated to put any effort into it. There are of course some variables, like where DD decides to go to college and settle down may play a role in our long term plans and I like that we can stay flexible. My only wish for her is that she not stay in Iowa because once I leave, I'm not coming back I've revisited the FIRE calc a few times over the years and have now hit a level where we have a 99% success rate so while I feel like this doesn't sound like a well thought out plan as I'm writing it, I feel good about where we're sitting. Undoubtedly, a health situation is our biggest risk, but I feel like that is minimized if we're in places with affordable care and odds are in our favor doing this now instead of 20 years from now. I'll be 40 in February and DH is turning 43 next week.

[disneysteve]

I think it sounds quite well thought out. If Firecalc has you are 99%, you're in great shape assuming everything goes as planned. The biggest unknown that could sink you would be medical bills if your plan is to remain uninsured. But if you establish residence in another country and would be covered there, since the US is the only developed country without universal healthcare, then you'd be good. I'm not sure what happens if you need care while visiting your daughter back in the US.

42 is quite early for retirement, even among the FIRE crowd. If you aren't already active on early-retirement.org (also home of Firecalc) I would highly recommend joining the forums there. Incredible wealth of experience and knowledgeable folks who can answer pretty much any question you can think of.

[LivingAlmostLarge]

Congrats and brilliant job! The rentals have you considered what happens when you zero out the depreciation and have to pay taxes on the full rental income and not taking a paper loss? Or if the mortgage is done before then? How that affects your income and taxes?

I also assume that the reversal of the subsidies makes this interesting with regards to trying to manage income to get a full subsidy on the obamacare. Will the medical outside the us be easily accessible if you are not a citizen? I think you are fine but the caveat being you go back to work if something should arise. 42 is a lot of years where things can go wrong. And no MMM you can't control cancer or other health scares by working out. His answer was "work out, eat healthy, and you'll live super well forever." unfortunately i've recently seen a few friends have breast cancer, prostate cancer, in their 40s who do exercise, eat right, did everything "right" and their luck has been bad. Sometimes that part of ER irks me. Is people assuming bad health is because you are "overweight", out of shape, not exercising., etc. In full disclosure I'm not in perfect health, but I also realize that some of it is pure luck. My cousin had kidney cancer this year and lost a kidney. 54 years old. He drinks but not excessively, doesn't smoke, works out, eats well, isn't overweight (used to be ex military) and healthy. Then wham. His dad died at 74 of prostate cancer, another guy super skinny, good health and bad luck. I'm not sure i believe you can eat right, be thin, exercise and still not die with bad luck.

[riverwed070707]

The health bit is so real. I have a good friend who's husband just died at 55 from a heart attack. He worked out, was an utter health nut, looked 15 years below his actual age, worked outside in construction. If nothing else, it just reinforces for me that life is too short to wait until you're old to retire. If I were going to insert a financial tie here, he spent 2 weeks in ICU following the heart attack and her out of pocket bill was $88,000. I should make a separate post about this - if you got an $88k bill after your spouse died, are you paying it or just saying f* it? 0% chance I'm paying that bill.

Re your questions, by the time the depreciation runs out on the rentals, either I will have sold them or it will be our sole source of income and it will be low enough we'll barely owe any taxes at all. They only gross about $78,000/yr and will still have expenses to deduct, plus a standard deduction. No concerns there.

With or without subsidies, ACA is not affordable for our retirement income, nor is the cost of healthcare in this country with or without insurance. The incredible thing about healthcare in other countries is that even if you aren't a citizen, you can have quality medical care for hundreds of dollars instead of tens of thousands. I've looked into establishing residency in places like Spain and Portugal and you can buy private insurance for a few hundred a year and the cost to just pay cash for treatment should make American's weep for how bad we've failed our citizens.

Congrats and brilliant job! The rentals have you considered what happens when you zero out the depreciation and have to pay taxes on the full rental income and not taking a paper loss? Or if the mortgage is done before then? How that affects your income and taxes?

I also assume that the reversal of the subsidies makes this interesting with regards to trying to manage income to get a full subsidy on the Obamacare. Will the medical outside the us be easily accessible if you are not a citizen? I think you are fine but the caveat being you go back to work if something should arise. 42 is a lot of years where things can go wrong. And no MMM you can't control cancer or other health scares by working out. His answer was "work out, eat healthy, and you'll live super well forever." unfortunately i've recently seen a few friends have breast cancer, prostate cancer, in their 40s who do exercise, eat right, did everything "right" and their luck has been bad. Sometimes that part of ER irks me. Is people assuming bad health is because you are "overweight", out of shape, not exercising., etc. In full disclosure I'm not in perfect health, but I also realize that some of it is pure luck. My cousin had kidney cancer this year and lost a kidney. 54 years old. He drinks but not excessively, doesn't smoke, works out, eats well, isn't overweight (used to be ex military) and healthy. Then wham. His dad died at 74 of prostate cancer, another guy super skinny, good health and bad luck. I'm not sure i believe you can eat right, be thin, exercise and still not die with bad luck.

[disneysteve]

With or without subsidies, ACA is not affordable for our retirement income

Can you explain that comment? What is your anticipated retirement AGI? Have you priced out ACA coverage for that income?

[riverwed070707]

Can you explain that comment? What is your anticipated retirement AGI? Have you priced out ACA coverage for that income?

I have. Estimated AGI at $60k. Last time I checked it was $10-15k with subsidies and $20-25k without. Cannot fathom paying 1/3 of our income toward insurance or having such an unpredictable variable expense.

[disneysteve]

I have. Estimated AGI at $60k. Last time I checked it was $10-15k with subsidies and $20-25k without. Cannot fathom paying 1/3 of our income toward insurance or having such an unpredictable variable expense.

Wow. That's way higher than here in NJ. I don't know where you are but I just ran an estimate for us, 61 and 62 years old, with a 60K income for 2026. The cheapest bronze plan is $56.50/month so $678/year. That is with the subsidy.

You might want to take another look.

[riverwed070707]

Wow. That's way higher than here in NJ. I don't know where you are but I just ran an estimate for us, 61 and 62 years old, with a 60K income for 2026. The cheapest bronze plan is $56.50/month so $678/year. That is with the subsidy.

You might want to take another look.

While this is wildly lower than what I found, would you not also take the deductible into account? Why would I only look at the cost if I didn't use the medical coverage I'm paying for? Bronze plans included a $100 co pay just for regular doc visits and didn't cover standard preventative care until the deductible was met. Bronze were around $250/mo with a $15k deductible. Gold plans were around $600/mo with $1000 deductible. And with the subsidies being a political pawn at the moment, feel like I might as well wait until we're closer to retirement to see what the current situation is. Guessing we'll end up just keeping some kind of global emergency care plan.

[disneysteve]

While this is wildly lower than what I found, would you not also take the deductible into account? Why would I only look at the cost if I didn't use the medical coverage I'm paying for? Bronze plans included a $100 co pay just for regular doc visits and didn't cover standard preventative care until the deductible was met. Bronze were around $250/mo with a $15k deductible. Gold plans were around $600/mo with $1000 deductible. And with the subsidies being a political pawn at the moment, feel like I might as well wait until we're closer to retirement to see what the current situation is. Guessing we'll end up just keeping some kind of global emergency care plan.

Deductibles might come into play if you experience unforeseen medical issues. We met our deductible last year (2024) because I had some health issues. We didn't even come close this year (2025). So yes, you need to be prepared for the max cost that could potentially occur but also realize that you are very unlikely to actually encounter that cost.

I agree that the whole system is a big unknown due to insane political games being played. It makes future planning with any level of certainty impossible.

[riverwed070707]

Deductibles might come into play if you experience unforeseen medical issues. We met our deductible last year (2024) because I had some health issues. We didn't even come close this year (2025). So yes, you need to be prepared for the max cost that could potentially occur but also realize that you are very unlikely to actually encounter that cost.

I agree that the whole system is a big unknown due to insane political games being played. It makes future planning with any level of certainty impossible.

That's one way to look at it. The other would be that you might as well take your premium to the casino and hope for the best Sorry but as someone coming from the medical field, surely you don't believe you are "very unlikely" to meet your deductible? OOP max, sure, low odds, but deductible? We've done that every single year someone in our household needed an ER visit which is every 2-3 years. One accident or unplanned test would set you over. I've been told I need an MRI every 5 years to monitor the size of the tumor on my pituitary gland, I made the decision a decade ago not to get it unless I have other symptoms come up because it costs $5k with a HDHP. Its a health risk I take because care is unaffordable in this country. I'm not betting on luck or that shifting once I don't have a w2 income to quickly recover from the unforeseen.

[disneysteve]

Sorry but as someone coming from the medical field, surely you don't believe you are "very unlikely" to meet your deductible?

Yes, I think it's generally unlikely, especially with a HDHP, unless you have some chronic illness. And even before meeting your deductible, your insurance still saves you a ton of money because you get the contracted rate for services, not the full cash price.

You mentioned an MRI. My last one was in May. The amount billed was $3,116. The plan discount was $2,104. My responsibility was $1,012, which got applied to my deductible. That was my only major medical expense for the year. Then I had a couple of PCP visits and a couple of specialist visits and labs a couple of times (at the discounted insurance rate) so those bills didn't come anywhere near my deductible.

I can't imagine needing the ER every 2-3 years. I'm 61 and 've never been to an ER. My daughter was once in 2000 from a car accident. My wife was a couple of times with her back issue in 2022/2023 and that was the first time in many years.