@jason-co-cfp.bsky.social
Want to learn how to prepare for your own retirement?
Visit coplanning.co for more information on planning strategies, whether you're 3 or 30 years away from your goal.
*This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
Visit coplanning.co for more information on planning strategies, whether you're 3 or 30 years away from your goal.
*This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
CoPlanning Financial – Inclusive Financial Planning
CoPlanning Financial was founded to provide welcoming and inclusive financial planning services for Asian-American families. Founded by Jason Co, we offer a robust and dedicated approach to achieving financial independence. Featuring Mandarin and Cantonese-speaking advisors.
coplanning.co
December 20, 2024 at 3:11 PM
Want to learn how to prepare for your own retirement?
Visit coplanning.co for more information on planning strategies, whether you're 3 or 30 years away from your goal.
*This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
Visit coplanning.co for more information on planning strategies, whether you're 3 or 30 years away from your goal.
*This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
Key lessons:
- Delaying Social Security can be powerful
- Bond ladders provide retirement security
- Clean, simple accounts are easier to manage
- Strategic Roth conversions prevent future tax headaches
- Delaying Social Security can be powerful
- Bond ladders provide retirement security
- Clean, simple accounts are easier to manage
- Strategic Roth conversions prevent future tax headaches
December 20, 2024 at 3:11 PM
Key lessons:
- Delaying Social Security can be powerful
- Bond ladders provide retirement security
- Clean, simple accounts are easier to manage
- Strategic Roth conversions prevent future tax headaches
- Delaying Social Security can be powerful
- Bond ladders provide retirement security
- Clean, simple accounts are easier to manage
- Strategic Roth conversions prevent future tax headaches
After all our planning work, husband decided to keep working! He enjoys his consulting gig & might continue 1-2 more years. Wife will reduce nursing hours to part-time. They're working because they want to, not because they need to. That's financial independence.
December 20, 2024 at 3:11 PM
After all our planning work, husband decided to keep working! He enjoys his consulting gig & might continue 1-2 more years. Wife will reduce nursing hours to part-time. They're working because they want to, not because they need to. That's financial independence.
To prevents massive RMDs at 75+ and provides higher after tax inheritance.
1. Use pre-tax accounts for spending before Social Security
2. Delay Social Security to spend down more pre-tax accounts
3. Convert to Roth strategically. Sweet spot: Convert enough to stay between 12-22% tax brackets
1. Use pre-tax accounts for spending before Social Security
2. Delay Social Security to spend down more pre-tax accounts
3. Convert to Roth strategically. Sweet spot: Convert enough to stay between 12-22% tax brackets
December 20, 2024 at 3:11 PM
To prevents massive RMDs at 75+ and provides higher after tax inheritance.
1. Use pre-tax accounts for spending before Social Security
2. Delay Social Security to spend down more pre-tax accounts
3. Convert to Roth strategically. Sweet spot: Convert enough to stay between 12-22% tax brackets
1. Use pre-tax accounts for spending before Social Security
2. Delay Social Security to spend down more pre-tax accounts
3. Convert to Roth strategically. Sweet spot: Convert enough to stay between 12-22% tax brackets
The verdict on "Can they retire?"
They easily have enough money. Analysis shows they could safely spend $11,300/month pre-tax. Even in worst-case scenarios (like retiring right before 1929 crash), they could maintain $9K/month spending. Currently only spending $5K/month.
They easily have enough money. Analysis shows they could safely spend $11,300/month pre-tax. Even in worst-case scenarios (like retiring right before 1929 crash), they could maintain $9K/month spending. Currently only spending $5K/month.
December 20, 2024 at 3:11 PM
The verdict on "Can they retire?"
They easily have enough money. Analysis shows they could safely spend $11,300/month pre-tax. Even in worst-case scenarios (like retiring right before 1929 crash), they could maintain $9K/month spending. Currently only spending $5K/month.
They easily have enough money. Analysis shows they could safely spend $11,300/month pre-tax. Even in worst-case scenarios (like retiring right before 1929 crash), they could maintain $9K/month spending. Currently only spending $5K/month.
How to bridge income until Social Security?
Implementing a 3-bucket strategy:
1. Daily cash
2. 10-year TIPS bond ladder ($800K)
3. Growth portfolio (The rest of $1.7M)
The bond ladder provides secure income & inflation protection while letting growth assets remain untouched.
Implementing a 3-bucket strategy:
1. Daily cash
2. 10-year TIPS bond ladder ($800K)
3. Growth portfolio (The rest of $1.7M)
The bond ladder provides secure income & inflation protection while letting growth assets remain untouched.
December 20, 2024 at 3:11 PM
How to bridge income until Social Security?
Implementing a 3-bucket strategy:
1. Daily cash
2. 10-year TIPS bond ladder ($800K)
3. Growth portfolio (The rest of $1.7M)
The bond ladder provides secure income & inflation protection while letting growth assets remain untouched.
Implementing a 3-bucket strategy:
1. Daily cash
2. 10-year TIPS bond ladder ($800K)
3. Growth portfolio (The rest of $1.7M)
The bond ladder provides secure income & inflation protection while letting growth assets remain untouched.
Social Security: By delaying until 70:
Husband: $4,500/month
Wife: $3,500/month
Combined: $138K/year when they actually claim.
This would cover ALL their expenses! The 8-year delay from 62 to 70 = $1.2M more in lifetime benefits. Break-even point: age 80. 💰
Husband: $4,500/month
Wife: $3,500/month
Combined: $138K/year when they actually claim.
This would cover ALL their expenses! The 8-year delay from 62 to 70 = $1.2M more in lifetime benefits. Break-even point: age 80. 💰
December 20, 2024 at 3:11 PM
Social Security: By delaying until 70:
Husband: $4,500/month
Wife: $3,500/month
Combined: $138K/year when they actually claim.
This would cover ALL their expenses! The 8-year delay from 62 to 70 = $1.2M more in lifetime benefits. Break-even point: age 80. 💰
Husband: $4,500/month
Wife: $3,500/month
Combined: $138K/year when they actually claim.
This would cover ALL their expenses! The 8-year delay from 62 to 70 = $1.2M more in lifetime benefits. Break-even point: age 80. 💰
Investment strategy:
75% global stocks 25% bonds
Despite conventional wisdom suggesting more bonds at their age, their low spending rate & calm investing temperament supports this aggressive allocation. They don't panic sell during market downturns.
75% global stocks 25% bonds
Despite conventional wisdom suggesting more bonds at their age, their low spending rate & calm investing temperament supports this aggressive allocation. They don't panic sell during market downturns.
December 20, 2024 at 3:11 PM
Investment strategy:
75% global stocks 25% bonds
Despite conventional wisdom suggesting more bonds at their age, their low spending rate & calm investing temperament supports this aggressive allocation. They don't panic sell during market downturns.
75% global stocks 25% bonds
Despite conventional wisdom suggesting more bonds at their age, their low spending rate & calm investing temperament supports this aggressive allocation. They don't panic sell during market downturns.
First step was cleaning up their accounts. Previously had multiple 401ks with high fees. Consolidated everything into current employer's low-fee Vanguard plan. Did reverse rollovers of IRA to 401k plan to enable backdoor Roth contributions.
December 20, 2024 at 3:11 PM
First step was cleaning up their accounts. Previously had multiple 401ks with high fees. Consolidated everything into current employer's low-fee Vanguard plan. Did reverse rollovers of IRA to 401k plan to enable backdoor Roth contributions.
Key challenge: At age 75, Required Minimum Distributions (RMDs) would force them to withdraw $276K/year combined - way more than they need! This creates a major tax inefficiency since they'd have to reinvest most of it in taxable accounts. 🤔
December 20, 2024 at 3:11 PM
Key challenge: At age 75, Required Minimum Distributions (RMDs) would force them to withdraw $276K/year combined - way more than they need! This creates a major tax inefficiency since they'd have to reinvest most of it in taxable accounts. 🤔
Their situation:
- $300K combined income
- Very modest $60K/year spending
- $2.1M in pre-tax accounts (401k/IRA)
- $130K cash
- $290K in Roth accounts
- Total net worth ~$3M
- $300K combined income
- Very modest $60K/year spending
- $2.1M in pre-tax accounts (401k/IRA)
- $130K cash
- $290K in Roth accounts
- Total net worth ~$3M
December 20, 2024 at 3:11 PM
Their situation:
- $300K combined income
- Very modest $60K/year spending
- $2.1M in pre-tax accounts (401k/IRA)
- $130K cash
- $290K in Roth accounts
- Total net worth ~$3M
- $300K combined income
- Very modest $60K/year spending
- $2.1M in pre-tax accounts (401k/IRA)
- $130K cash
- $290K in Roth accounts
- Total net worth ~$3M
Visit coplanning.co for more information on retirement planning strategies, whether you're 3 or 30 years away from it.
*Disclaimer: This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
*Disclaimer: This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
CoPlanning Financial – Inclusive Financial Planning
CoPlanning Financial was founded to provide welcoming and inclusive financial planning services for Asian-American families. Founded by Jason Co, we offer a robust and dedicated approach to achieving ...
coplanning.co
December 12, 2024 at 2:21 AM
Visit coplanning.co for more information on retirement planning strategies, whether you're 3 or 30 years away from it.
*Disclaimer: This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
*Disclaimer: This is for educational purposes only and not financial advice. Consult a professional before making investment decisions.
Key Takeaway: This couple has "won the game" with their savings. The focus should shift from accumulation to preservation, ensuring they don't risk what they've already achieved for marginal gains.
December 12, 2024 at 2:21 AM
Key Takeaway: This couple has "won the game" with their savings. The focus should shift from accumulation to preservation, ensuring they don't risk what they've already achieved for marginal gains.
Final Recommendation:
- Preserve wealth instead of aggressive growth to maintain financial independence options anytime between 50-55
- Consider working until 55 for simplified planning
- Focus on work-life balance and health
- Preserve wealth instead of aggressive growth to maintain financial independence options anytime between 50-55
- Consider working until 55 for simplified planning
- Focus on work-life balance and health
December 12, 2024 at 2:21 AM
Final Recommendation:
- Preserve wealth instead of aggressive growth to maintain financial independence options anytime between 50-55
- Consider working until 55 for simplified planning
- Focus on work-life balance and health
- Preserve wealth instead of aggressive growth to maintain financial independence options anytime between 50-55
- Consider working until 55 for simplified planning
- Focus on work-life balance and health
Alternative Strategy: Working until 55 offers significant benefits:
- Rule of 55 for penalty-free 401k withdrawals
- 5 more years of savings
- Simpler withdrawal strategy
- Employer merger allows husband to stay on company health insurance after retiring at 55 until Medicare at 65
- Rule of 55 for penalty-free 401k withdrawals
- 5 more years of savings
- Simpler withdrawal strategy
- Employer merger allows husband to stay on company health insurance after retiring at 55 until Medicare at 65
December 12, 2024 at 2:21 AM
Alternative Strategy: Working until 55 offers significant benefits:
- Rule of 55 for penalty-free 401k withdrawals
- 5 more years of savings
- Simpler withdrawal strategy
- Employer merger allows husband to stay on company health insurance after retiring at 55 until Medicare at 65
- Rule of 55 for penalty-free 401k withdrawals
- 5 more years of savings
- Simpler withdrawal strategy
- Employer merger allows husband to stay on company health insurance after retiring at 55 until Medicare at 65
Growth Portfolio: Remaining funds after bond allocation:
- $600k in traditional 401k/IRA
- $300k in Roth accounts
➡️ Can be invested more aggressively as won't be needed for 10+ years
- $600k in traditional 401k/IRA
- $300k in Roth accounts
➡️ Can be invested more aggressively as won't be needed for 10+ years
December 12, 2024 at 2:21 AM
Growth Portfolio: Remaining funds after bond allocation:
- $600k in traditional 401k/IRA
- $300k in Roth accounts
➡️ Can be invested more aggressively as won't be needed for 10+ years
- $600k in traditional 401k/IRA
- $300k in Roth accounts
➡️ Can be invested more aggressively as won't be needed for 10+ years
Bond Ladder Strategy: $1.15M allocated to bonds:
- Taxable savings for ages 50-55
- 72(t) payments until 59½
- Roth conversion funds This secures 10 years of retirement needs without market risk
- Taxable savings for ages 50-55
- 72(t) payments until 59½
- Roth conversion funds This secures 10 years of retirement needs without market risk
December 12, 2024 at 2:21 AM
Bond Ladder Strategy: $1.15M allocated to bonds:
- Taxable savings for ages 50-55
- 72(t) payments until 59½
- Roth conversion funds This secures 10 years of retirement needs without market risk
- Taxable savings for ages 50-55
- 72(t) payments until 59½
- Roth conversion funds This secures 10 years of retirement needs without market risk
Early Withdrawal Strategy: Two main approaches to avoid 10% penalty:
- 72(t) SEPP payments: $60k/year ($50k after tax)
- Roth conversion ladder: Convert $50k annually for 5 years
- 72(t) SEPP payments: $60k/year ($50k after tax)
- Roth conversion ladder: Convert $50k annually for 5 years
December 12, 2024 at 2:21 AM
Early Withdrawal Strategy: Two main approaches to avoid 10% penalty:
- 72(t) SEPP payments: $60k/year ($50k after tax)
- Roth conversion ladder: Convert $50k annually for 5 years
- 72(t) SEPP payments: $60k/year ($50k after tax)
- Roth conversion ladder: Convert $50k annually for 5 years
Key Income Timeline:
- Age 62: Pension starts ($30k/year)
- Age 65: Wife's pension kicks in
- Age 70: Both Social Security benefits begin
- Total guaranteed income after 70: $136k/year (today's dollars)
- Age 62: Pension starts ($30k/year)
- Age 65: Wife's pension kicks in
- Age 70: Both Social Security benefits begin
- Total guaranteed income after 70: $136k/year (today's dollars)
December 12, 2024 at 2:21 AM
Key Income Timeline:
- Age 62: Pension starts ($30k/year)
- Age 65: Wife's pension kicks in
- Age 70: Both Social Security benefits begin
- Total guaranteed income after 70: $136k/year (today's dollars)
- Age 62: Pension starts ($30k/year)
- Age 65: Wife's pension kicks in
- Age 70: Both Social Security benefits begin
- Total guaranteed income after 70: $136k/year (today's dollars)
Social Security Strategy:
- Husband's benefit at 70: $4,797/month
- Wife's benefit at 70: $4,072/month
➡️ Recommendation: Delay until 70 for both, resulting in $2M more in lifetime benefits if living to 95
- Husband's benefit at 70: $4,797/month
- Wife's benefit at 70: $4,072/month
➡️ Recommendation: Delay until 70 for both, resulting in $2M more in lifetime benefits if living to 95
December 12, 2024 at 2:21 AM
Social Security Strategy:
- Husband's benefit at 70: $4,797/month
- Wife's benefit at 70: $4,072/month
➡️ Recommendation: Delay until 70 for both, resulting in $2M more in lifetime benefits if living to 95
- Husband's benefit at 70: $4,797/month
- Wife's benefit at 70: $4,072/month
➡️ Recommendation: Delay until 70 for both, resulting in $2M more in lifetime benefits if living to 95
Wife's Pension:
- Can take lump sum or monthly payments
- If started at 50: $65k lump sum or $353/month
- If delayed to 65: $152k lump sum or $1,053/month
➡️ Recommendation: Delay to 65 for guaranteed 5.8% growth and take lump sum or annuity income based on preference.
- Can take lump sum or monthly payments
- If started at 50: $65k lump sum or $353/month
- If delayed to 65: $152k lump sum or $1,053/month
➡️ Recommendation: Delay to 65 for guaranteed 5.8% growth and take lump sum or annuity income based on preference.
December 12, 2024 at 2:21 AM
Wife's Pension:
- Can take lump sum or monthly payments
- If started at 50: $65k lump sum or $353/month
- If delayed to 65: $152k lump sum or $1,053/month
➡️ Recommendation: Delay to 65 for guaranteed 5.8% growth and take lump sum or annuity income based on preference.
- Can take lump sum or monthly payments
- If started at 50: $65k lump sum or $353/month
- If delayed to 65: $152k lump sum or $1,053/month
➡️ Recommendation: Delay to 65 for guaranteed 5.8% growth and take lump sum or annuity income based on preference.
Pension Analysis: Husband's options:
- Start at 55: $30k/year
- Start at 62: Higher benefit
- Start at 65: Highest benefit but loses 10 years of income
➡️ Best option: Start at 62 with 100% survivorship benefit
- Start at 55: $30k/year
- Start at 62: Higher benefit
- Start at 65: Highest benefit but loses 10 years of income
➡️ Best option: Start at 62 with 100% survivorship benefit
December 12, 2024 at 2:21 AM
Pension Analysis: Husband's options:
- Start at 55: $30k/year
- Start at 62: Higher benefit
- Start at 65: Highest benefit but loses 10 years of income
➡️ Best option: Start at 62 with 100% survivorship benefit
- Start at 55: $30k/year
- Start at 62: Higher benefit
- Start at 65: Highest benefit but loses 10 years of income
➡️ Best option: Start at 62 with 100% survivorship benefit
Current Portfolio Breakdown:
- $105k cash
- $207k taxable investments
- $1.1M in 401k
- $140k Roth 401k
- $91k Roth IRAs
- $109k HSA
- $242k in 529 college savings
For their daughter's education, they've saved $242k in a 529 plan. They're comfortable with her taking student loans if needed.
- $105k cash
- $207k taxable investments
- $1.1M in 401k
- $140k Roth 401k
- $91k Roth IRAs
- $109k HSA
- $242k in 529 college savings
For their daughter's education, they've saved $242k in a 529 plan. They're comfortable with her taking student loans if needed.
December 12, 2024 at 2:21 AM
Current Portfolio Breakdown:
- $105k cash
- $207k taxable investments
- $1.1M in 401k
- $140k Roth 401k
- $91k Roth IRAs
- $109k HSA
- $242k in 529 college savings
For their daughter's education, they've saved $242k in a 529 plan. They're comfortable with her taking student loans if needed.
- $105k cash
- $207k taxable investments
- $1.1M in 401k
- $140k Roth 401k
- $91k Roth IRAs
- $109k HSA
- $242k in 529 college savings
For their daughter's education, they've saved $242k in a 529 plan. They're comfortable with her taking student loans if needed.
Their main challenge? $1.3M of their savings are in retirement accounts with 10% early withdrawal penalties if accessed before 59½.
*This is for educational purposes only and not meant to be financial advice.
*This is for educational purposes only and not meant to be financial advice.
December 12, 2024 at 2:21 AM
Their main challenge? $1.3M of their savings are in retirement accounts with 10% early withdrawal penalties if accessed before 59½.
*This is for educational purposes only and not meant to be financial advice.
*This is for educational purposes only and not meant to be financial advice.