We’re in our mid-50s with $4M+ and solid dividends – are we missing anything before early retirement?

A Reddit user with $4 million invested and an estimated $160K in dividend income is wondering if he is missing anything when it comes to being prepared for retirement.

The Redditor has explained that he’s in his mid-50s and has not worked for a few years, while his wife is currently working and earning around $200K.  She’s planning to stop work soon, but he wants to make sure that his wife will never need to worry about her finances, even if she lives into her mid-80s, and even if something happens to him, as he has heart problems. 

So, is he ready to stop working, or is there more he needs to do to be ready?

Can the Redditor retire with his investments and dividend income?

Based on the numbers the Reddit poster shared, it seems pretty clear that the Redditor is in a good position for both him and his wife to retire early.

The couple has a $2 million house they owe less than $300K on, but are expecting to move out of state and likely downsize once they see where their child has settled.  

He has also indicated he has $100K in cash, $1 million in individual stock, $2 million in a 401(k), and around $100K in a Roth IRA. His wife has $1.7 million in her 401(k) and under $100K in her Roth IRA. As mentioned above, he has $160,000 in dividend income, and he doesn’t really want to diversify into different investments at this point.  He is looking into Roth conversions, though, and the couple has three more years of car payments and the mortgage, but no other debt.

Other Reddit users also pointed out that he’ll free up more cash once he downsizes his house, and will eliminate a payment, which means he is likely to be able to cover his spending easily at a safe withdrawal rate — especially given that he said he and his wife tend to be pretty frugal and since he’s built a solid portfolio that provides enough dividend income to sustain his spending. 

Talking to a financial advisor is helpful

Although the Reddit user looks like he is in good shape, there are a few potential red flags, including the fact that he’s planning to fund long-term care out of his savings. Since he wants to be sure he doesn’t leave his wife in the lurch, and he also posed some questions in the thread about the best age to claim Social Security, the best course of action would be for him to talk with a financial advisor. 

An advisor can carefully review his finances, his current asset allocation, and his plan to maintain his spending until he reaches age 59 1/2. The advisor can assess whether he will truly be prepared for his senior years — including covering long-term care if needed.

Since there’s a lot at stake when it comes to retiring because it can be hard to just jump back into a high paying job, it’s always best to consult with a professional before making the final choice — especially if, like the Redditor, you are wondering if you’re missing anything and concerned about providing for a spouse. 

With the right help, this Redditor can make sure his hefty nest egg lasts through retirement and that he leaves the legacy he wants for his wife and child. 

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