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The current situation
My wife and I currently work in an industry foreign to most: the military. It’s a completely different type of work environment than most people would expect. The military, in essence, is just a business, just one that doesn’t produce anything for retail purposes. But other than that, it’s just like a normal job. We have bosses, meetings, coffee breaks, drama, and everything else that normal jobs have.
Through our employer we have a few awesome benefits including:
- Tuition Assistance ( to help pay for college )
- Healthcare ( medical/dental )
- Housing allowance ( adjusted for physical location )
- Job security ( renewable contracts every 4ish years )
- Retirement ( for those willing to stay in for at least 20 years )
The 7 year plan
Mrs. Moneyseed’s contract runs out at the end of 2015. Mine is up almost exactly one year later. From that point, we either decide to renew our contracts, or seek employment elsewhere. We’ve planned our life to include both paths, but we’re on the optimistic side and planning to separate from the military after this tour.
I will run through a year-by-year future-casting of our “7 years till retirement” plan. I’ll use round numbers, and a lot of estimations. So hopefully I’m as confident after I write this as I am right now. The plan has already begun. It started when this site started, January 2013. We aren’t starting from scratch, as we’ve spent a few years paying off debts and starting to save vigorously. We will assume a 3% growth in both income and expenses, 7% growth in savings annually, and starting with $70,000 already in savings/investments.
Year 1
- Income: $125,000 (Joint, post-tax)
- Expenses: $46,000 (Mortgage, child care, utilities)
- Consumables: $16,500 (Food, gas, misc. spending)
- Savings: $62,500
- Total Saved: $139,000
Year 2
- Income: $128,500 (Joint, post-tax)
- Expenses: $47,500 (Mortgage, child care, utilities)
- Consumables: $17,000 (Food, gas, misc. spending)
- Savings: $64,000
- Total Saved: $217,000
Year 3
- Income: $132,500 (Joint, post-tax)
- Expenses: $49,000 (Mortgage, child care, utilities)
- Consumables: $17,500 (Food, gas, misc. spending)
- Savings: $66,000
- Total Saved: $303,000
Year 4
- Income: $136,500 (Joint, post-tax)
- Expenses: $52,000 (Mortgage, child care, utilities)
- Consumables: $18,000 (Food, gas, misc. spending)
- Savings: $66,500
- Total Saved: $392,000
Year 5
- Income: $140,500 (Joint, post-tax)
- Expenses: $52,000 (Mortgage, child care, utilities)
- Consumables: $18,500 (Food, gas, misc. spending)
- Savings: $70,000
- Total Saved: $494,000
Year 6
- Income: $145,000 (Joint, post-tax)
- Expenses: $40,000 (Mortgage, utilities)
- Consumables: $19,000 (Food, gas, misc. spending)
- Savings: $86,000
- Total Saved: $620,000
Year 7
- Income: $149,000 (Joint, post-tax)
- Expenses: $41,500 (Mortgage, utilities)
- Consumables: $19,500 (Food, gas, misc. spending)
- Savings: $88,000
- Sell house and downsize: $0
- Total Saved: $758,000
Conclusion
$750,000 may not seem like enough money to retire on, especially when you’re only 35. Shenanigans I say! Without a mortgage, and having the children all in elementary school, our monthly expenditures will drop significantly. Plus, we now have the next 7 years to learn how to live on less.
The next 7 years will also give me a better idea about what I want to do when I grow up. In retirement we still plan on working, but it will be because we want to work, and it will be on our terms. Maybe we’ll start a business. Maybe we’ll work part-time jobs at the mall. Maybe we’ll start flipping and selling houses like we’ve always wanted to. Whatever we do, we will do our best at it, because we will only do things we are passionate about.
Maybe I will stick to writing, or maybe we will just become professional travelers. Maybe both. The good thing about this public forum is that it is not only a place for me to talk about my family and our finances, it’s a place for me to challenge myself. Every January from now on I will create a post to show our progress (and hopefully achievements).
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