Despite the odds, the situation has changed for the better. My original burn rate estimate has been archived.

Note: my original budget was $500/mo but in 2024-2025 inflationary pressures pushed it closer to $600/mo.

Me thinking out loud about my financial situation.

before Feb 2028 (age 62)

Meet expenses with VA disability compensation. Should no longer have to draw down 457 or savings to make it through the month.

I’m going to describe amounts deposited in my bank as income even though VA payments are nontaxable compensation rather than income proper. Still, I will call this income level 1x.

No tax burden because VA disability is not taxable for the reasons given above. I should probably spend down the 457 before taking SS to avoid the possibility of getting dinged. 457 withdrawals are income proper but it’s only about $10k so I should be able to absorb that in a calendar year.

early Social Security at either 62 (2028), full at 67 (2033) or somewhere in-between

I’ve run the numbers before and for my expected longevity it’s a wash to take it early or wait.

I hadn’t realized this, but my early retirement has caused my estimated SS benefit to decrease. I thought it was based on an average of 40 credits but that’s not the case. 40 is the minimum required to get SS and earning more lifetime income means higher benefit. At any rate, when they assumed I’d work until 62 the estimate was $1,307. By 2024 the official letter said $1,232. So maybe it will have fallen to ~$1,100 by 2028.

So if I take early SS of $1,100 in 2028 my income will be 1.54x.

No tax burden because my total income proper (just SS at this point) would be <25k.

state pension at 65 (2031)

+$585.93 if I collect 50% of it, with the remaining 50% percentage inheritable in perpetuity (reduced to account for her longer life expectancy) by my daughter.

Income is now 1.82x.

Still no tax burden because my total income proper (SS + pension) would be <25k.

timeline

  • 2025 (59.5yo) 401k no longer dinged for withdrawal; use at will. Spend down to asset limit if required (Roth IRA?)
  • 2026 (60yo) set up Escapees residency {completed}
  • 2028 (62yo) early SS1
  • 2031 (65yo) state pension (2/28)
  • 2033 (67yo) SS full retirement age
  • 2036 (70yo) max SS age. Note: retirement capital will be zeroed by this time, but pension will continue to be paid.
  • 2039 (73yo) mandatory 401k distributions, if any remain
  • 2049 (83yo) dead

  1. I was married for >10 years, and it is conceivable that my ex’s SS benefit will be ≥2x mine. So it would be smart to check. Claiming a spousal benefit does not affect their benefit in any way. ↩

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