My job is stressful, but we’re closing in on $3.2 million in investments – should we buy or rent when we move for better schools?

Having long-term financial goals can help you sharpen your financial discipline, especially if success is tied to major benefits like significant lifestyle flexibility. A 39-year-old husband wants to retire in the next five years and currently has a $3.2 million net worth. He laid out his finances in the Chubby FIRE Reddit community to gauge if his goal is realistic.

The couple currently generates $900,000 in annual income before taxes. They don’t have any kids but plan to have one in the future. They have $1.27 million in a brokerage account, $1.25 million in company stocks, and $100,000 in a money market fund. That comes to $2.62 million. They also have $580,000 in a 401(k), but those funds won’t be accessible for another 20 years.

They also spend $140,000 per year, but they can expect those expenses to go up when they have a child.

The Wife May Not Want To Work Once They Have A Kid

Multiple commenters requested that the husband factor in that the wife may no longer want to work once they have a kid. She currently earns $120,000 per year, and that financial safety net makes it more feasible for the husband to retire. However, it also puts the wife in an unfavorable position if she wants to work part-time or stop working to raise the child.

It’s important for all of these retirement calculations to assume that the wife will also retire. That will give her more flexibility instead of having to be the breadwinner who can’t cover the family’s annual expenses with her salary alone.

The Couple Is Still Young

When you retire, you need the stock market, inflation, and other factors to cooperate so you don’t burn through too much of your retirement funds. People in their 60s and 70s stress about this, but this couple is in their late 30s. If the husband retires in five years, he is only 42 years old.

That’s a bit early, given that their annual expenses will go up. We don’t know how much the couple saves each year after taxes, but it would be good for them to get closer to $10 million if the husband wants to retire that early.

He can consider looking for a less stressful job in the same field. However, lower-paying jobs don’t always come with less stress. Some of the low-paying jobs are the most demanding jobs of all, so it’s important to be cautious if you want to follow this route.

If the couple plans to pay for their kid’s college tuition, they will also have to invest in a 529 savings plan. They may want to wait until that savings plan has a sufficient balance before the husband retires early.

Invest In Cash Flow Producing Assets

Investing in cash flow producing assets like real estate can make it easier to retire. These assets can generate positive cash flow, which can help you cover living expenses. Real estate investing isn’t for everyone, but it offers plenty of tax advantages, which can offer immediate relief for the Redditor.

Keeping a higher percentage of their $900,000 annual income can make retiring more realistic within the next decade. However, it’s still a tough goal to assume you can retire in your mid-40s when your family is just getting started. A $3.2 million net worth is impressive, but there’s still more climbing to do.

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