I'm retired & well-invested for monthly-quarterly cash-flow. I created 3 buckets for my life: Operating-bucket for everyday & recurring expenses, Core-reserve-bucket forever growing - not touched, Emergency-bucket for discretionary & emergencies.
What Nick starts talking about at the 11-minute mark (filling a tax bracket, IRMAA implications) is exactly why I think it's so important to work with a CFP. I don't know about most people, but I don't have the ability to look around corners and do that level of financial planning and tax planning on my own.
Of course, once you retire, you don’t need to cover loss of work income. Emergency- is just for issues that arise with cars and house and maybe a medical emergency (cover the deductible). And, if you go ahead plan for a new roof or a wedding, that’s no longer an “emergency”. It’s a planned expense.
If you own your home get a HELOC before you retire It’s just an additional chunk of money available for nearly nothing I pay 100 dollars a year for mine. Used it this year so I didn’t go higher on IRMA and paid it off in January.
I don't keep an emergency fund, but there's a reason why. I'm retired military with a disability compensation package. That provides me more than enough to pay mortgage, son's private school, car loans, etc! If I ever need money I can go to my taxable brokerage. It has never happened, but ... My wife also earns a $100k+ salary and there is about a .00001% chance of her being unemployed.
I'm retired & well-invested for monthly-quarterly cash-flow. I created 3 buckets for my life: Operating-bucket for everyday & recurring expenses, Core-reserve-bucket forever growing - not touched, Emergency-bucket for discretionary & emergencies.
I also realized in retirement, if going with half a year’s distribution, it really only needs to be half your NET distribution.
What Nick starts talking about at the 11-minute mark (filling a tax bracket, IRMAA implications) is exactly why I think it's so important to work with a CFP. I don't know about most people, but I don't have the ability to look around corners and do that level of financial planning and tax planning on my own.
Great information!! The example you used to re-fill the emergency $ from the IRA within a tax bracket sounds similar to doing Roth conversions.
Of course, once you retire, you don’t need to cover loss of work income. Emergency- is just for issues that arise with cars and house and maybe a medical emergency (cover the deductible). And, if you go ahead plan for a new roof or a wedding, that’s no longer an “emergency”. It’s a planned expense.
Good you are including IRMA
Huge bite if not tracked
If you own your home get a HELOC before you retire
It’s just an additional chunk of money available for nearly nothing
I pay 100 dollars a year for mine.
Used it this year so I didn’t go higher on IRMA and paid it off in January.
I don't keep an emergency fund, but there's a reason why. I'm retired military with a disability compensation package. That provides me more than enough to pay mortgage, son's private school, car loans, etc! If I ever need money I can go to my taxable brokerage. It has never happened, but ... My wife also earns a $100k+ salary and there is about a .00001% chance of her being unemployed.