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All Encompassing Investment and Financial Planning Thread for the Surly 99.5%


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If you’re tracking the value of your home for personal reports, I would be very conservative and drop 15-20% from the ever-changing websites. In my case I just use the annual Harris county appraisal # each year which has almost always been a bit lower than I know I could dump my house.

for their primary home, I heard some advice to just use the purchase amount, assuming you didn’t buy the house 20 years ago.

Now if you’re applying for a loan and listing your assets, use whatever number you can back up.

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20 minutes ago, UTPhil2006 said:

If y’all need me to run comps for you guys I can… in Austin and Houston (don’t have access to SABOR or NTREIS).. I don’t mind. Just shoot me a PM or email 

Thanks, but it's no big deal. I just do a monthly net worth spreadsheet so having a spot to easily access the number is nice. Used Redfin for the past couple of years and it seemed fine, but now these huge swings. But in general between Zillow and Redfin, I come to a number that makes sense to me based on what I see in the neighborhood.

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2 hours ago, UTPhil2006 said:

If y’all need me to run comps for you guys I can… in Austin and Houston (don’t have access to SABOR or NTREIS).. I don’t mind. Just shoot me a PM or email 

15 yo doublewide in Dumas on a 5 acre lot outside town.  I have my own well.  Small detached garage with an old Chevy.

What's it worth?

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58 year old teacher in Alaska, away from the wife for year 2, except for Christmas and summers.  Year 3 is almost certainly my last year away from the wife and I will come back to teach special ed in Texas.  I am thinking no problem getting a teaching job in Texas, but we will see. 

Total of 6 years in Alaska(1st 3 were with the wife) will need to be purchased from Texas TRS.....no problem, because by then I will most likely not be maintained in the Alaska system.  The "maintained rule"  says I cannot purchase more than 5 years of service while maintained in a retirement system in another state.  Alaska does have a bill in the legislature to give all public servants a pension, but this is all very iffy.  This governor reminds me of Bill Clements, with his anti-spending stances on just about everything.   I will take the retirement acct. from Alaska and roll into an IRA. After the first semester teaching in Texas, I am able to apply to buy the years and the service purchase should be complete by March 1. 

Have been very fortunate in my ability to save for retirement the last 2 years.  Am trying to figure out how much emergency fund to bring with me to Texas.  No housing ready in Texas at the moment.  Wife has been staying with relatives, working, and paying off her debt.  wife will most likely have an apt. mostly furnished, sometime in the next 4-6 months. 

Since I worked for the state of Texas for 6 years, I can choose which retirement system to retire from.  I am that guy who calls ERS and TRS about once every 6-9 months and takes about 20 minutes to run down everything I have been told and at this moment I am still looking at being able to choose which system and the obvious choice is to retire from ERS, with the promise of a free health insurance premium for life for me and 1/2 off for the wife.  We are both very lucky the legislature has not taken that benefit away.  

I still like the traditional, deductible IRA.  I plan to contribute $7000 for 22 and $7500 for 23.  Doing that reduces my possible emergency fund down to maybe $40k instead of $54k or so.  When I land in Texas I will be 59.5 years.  

My income tax bracket now is much higher than I plan for it to be in retirement.  

One variable is the summer job market.  I am looking for a summer job this summer for the first time in a while.  In Texas I always worked at least one part-time job and sometimes 2. I don't care what I do, but it would be really cool to teach summer school as well as work another job to stay busy and continue to save money.   Any guesses on Texas summer job market? From now to June 2025 is the final push to save as much $ as I can, and the plan is to retire from education June 2025 at age 60.5. Wow!   As recently as July 2021 I had age 67 in mind to retire from education.  

Will continue to work in retirement, and defer all new income up to the max per year.  Retire from everything at age ? 

Questions:

1. What holes do you guys see? 

2. How bad are the utility bills?  I was the guy who had the lowest possible utility bill.

3. Any guesses on job markets-specifically summer jobs this summer? 

4. I keep up with inflation wrt grocery prices, so that doesn't scare me.  Other areas of severe inflation? 

 

 

 

 

 

 

 

 

 

 

 

 

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@JGrayDBU you didn’t share numbers which is perfectly cool but the real test is whether you will earn enough retirement income to pay your expected expenses, including standard inflation.  And it doesn’t matter if the expected expenses is living in a trailer in rural Texas  or penthouse in NYC. Will you be able to afford your plan.

For your question on utility bills, they’re as bad as I’ve seen in Texas since deregulation started but the bill amount itself depends on your individual use.

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3 hours ago, Nice Guy Eddie said:

@JGrayDBU you didn’t share numbers which is perfectly cool but the real test is whether you will earn enough retirement income to pay your expected expenses, including standard inflation.  And it doesn’t matter if the expected expenses is living in a trailer in rural Texas  or penthouse in NYC. Will you be able to afford your plan.

For your question on utility bills, they’re as bad as I’ve seen in Texas since deregulation started but the bill amount itself depends on your individual use.

Depending upon inflation, the numbers are solid, as in pensions from both my wife and myself equaling $47,000 per year - Non COLA and every time I calculate every expense known to this man I get a number just south of $40,000 if buying a small home with cash-----if renting a small apartment the expenses number is more like $45,000.  Then the second wave of benefits comes in a few years later- with social security---hers $12000 per year and mine about $6000 per year.  Mine is low because of the GPO.  Those numbers do not count my job during retirement, which should yield at least 20k per year in deferred income. 

Deferred accounts project to total $320k  at age 60 for me before buying a house with cash and buying years of service.  After those two big ticket items, deferred accounts should be in the 100-150k range.  I have heard of Monte Carlo simulations and wonder if that is realistic thing to look into?  I imagine planners charge a lot of dough to do Monte Carlo simulations? 

 

 

 

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8 hours ago, JGrayDBU said:

Depending upon inflation, the numbers are solid, as in pensions from both my wife and myself equaling $47,000 per year - Non COLA and every time I calculate every expense known to this man I get a number just south of $40,000 if buying a small home with cash-----if renting a small apartment the expenses number is more like $45,000.  Then the second wave of benefits comes in a few years later- with social security---hers $12000 per year and mine about $6000 per year.  Mine is low because of the GPO.  Those numbers do not count my job during retirement, which should yield at least 20k per year in deferred income. 

Deferred accounts project to total $320k  at age 60 for me before buying a house with cash and buying years of service.  After those two big ticket items, deferred accounts should be in the 100-150k range.  I have heard of Monte Carlo simulations and wonder if that is realistic thing to look into?  I imagine planners charge a lot of dough to do Monte Carlo simulations? 

 

 

 

There are free calculators and simulators all over the internet, do some research to see which are more valid and respected. 
 

Here is one that gets referenced a lot:

https://firecalc.com

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13 hours ago, Archer said:

There are free calculators and simulators all over the internet, do some research to see which are more valid and respected. 
 

Here is one that gets referenced a lot:

https://firecalc.com

whats the suggestion on how to use that calc?  I went with estimating my annual expenses, backing off non-retirement accounts income, and then estimating my funds balance at retirement.

I was getting between 0-9% failure scenarios depending on different numbers. What feels tough to estimate is what I need. I really don't spend much but who knows living costs will be when I'm 75 or 80.   53 now.   And if I need assisted living, forget about it.

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23 hours ago, JGrayDBU said:

Depending upon inflation, the numbers are solid, as in pensions from both my wife and myself equaling $47,000 per year - Non COLA and every time I calculate every expense known to this man I get a number just south of $40,000 if buying a small home with cash-----if renting a small apartment the expenses number is more like $45,000.  Then the second wave of benefits comes in a few years later- with social security---hers $12000 per year and mine about $6000 per year.  Mine is low because of the GPO.  Those numbers do not count my job during retirement, which should yield at least 20k per year in deferred income. 

Deferred accounts project to total $320k  at age 60 for me before buying a house with cash and buying years of service.  After those two big ticket items, deferred accounts should be in the 100-150k range.  I have heard of Monte Carlo simulations and wonder if that is realistic thing to look into?  I imagine planners charge a lot of dough to do Monte Carlo simulations? 

 

 

 

Some of the big questions: 

1)Is it worthwhile to buy extra years service in the TRS system?  Most calculations I've done show it's not the best use of money.  

2)Does it make sense to buy a home with cash when you can utilize those funds elsewhere to create solvency on the property rather than 0 debt?  

3)Monte Carlo simulations are fine, but you have to consider sequence of return simulations in the mix. 

4)A few others as well that I'll add as I have time.  

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"1)Is it worthwhile to buy extra years service in the TRS system?  Most calculations I've done show it's not the best use of money." 

 Here are the assumptions:  Buy five years at a cost of $64k (calc. from last year).   The pension without buying years or working in Texas is $30k.  That is a pension based on 23 years.   Because of adding one year of working at a much higher salary than existed in 2018 that increases the high five avg. salary, the new pension amount is a minimum of $40k.   If I get a high paying teaching job, the pension goes up from there.   How long does it take to recoup 64k?  With those numbers it takes only 6.4 years, not including potential gains. (10k of gains x 6.4 = 64k) However, I don't plan to be super aggressive with my retirement funds in my 60s, so I am not including the gains in my calculation.   Am I going to live longer than 6.4 years after I start drawing the pension?  This plan has me starting the pension at age 61.  My family tree indicates I should live to at least mid 70s, so that is a no-brainer.  

   If you say you're talking apples to oranges, because of the difference in the high five salary I suppose we could take out the increased salary to simulate making the purchase of credit neutral wrt the high-five salary.  

If you were to do that, then the 28 years of pension is worth $36,717.66 per year. That is not considering the 29th year, which is the year I work when I come back to Texas.  However, a person is not allowed to purchase service credit unless the person is currently working for the state, so it is hard to justify making that calculation, imo.

 

 

 

 

 

 

 

 

 

 

 

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