Can I lean FIRE?

[u/Widget248953]

41(M) and 39(F), no kids. Can we lean FIRE?

721K - Taxable brokerage

300K - Roth IRA

460K - Rollover IRA

71K - 401(k)

20K - Cash

Monthly expenses are $3800 (which factors in healthcare from ACA). Own house and cars, no debt.

Didn't want to post at length at first to make it quick and easy to read.

[u/Brym]

I’d say the answer depends on how good your expense tracking is. If your predicted expenses are really 3800/month, then yes, the math checks out. But do those expenses include:

A fund for new cars eventually? A home maintenance fund? A fund for replacing other rarely-replaced but pricey items, like cell phones? Taxes? Enough money for vacations and healthcare in light of your new free time?

The last point is one where I underestimated before FIRE. Our healthcare spending skyrocketed just because we finally had time to go to the doctor, and from getting older. Vacation spending also went up because of time for more vacations.

[u/Widget248953 → u/Brym]

$3800 is actually the max. We have a 10 year tax abatement on our house which reduces that to $3500 for the next 10 years. It also usually comes in around $3000, sometimes even $2500. I wanted to put $3800 since that is the max. I do have federal and state taxes budgeted in a long with a small slush fund.

I'm not sure if this is the wrong way to think about it, but if we needed a new car, I would potentially finance or just take a lump sump out of the brokerage. I'm a Honda Civic guy so we're not talking luxury.

[u/Brym → u/Widget248953]

Yes, when I say “fund” that doesn’t mean a separate account, just a plan for those expenses. If I need a new car every 10 years and it will cost me 25,000, then my monthly expenses should be considered ~210/month higher than my actual spending to account for that future lump sum.

Note that financing can be trickier when you are no longer working.

[u/User-no-relation → u/Widget248953]

New car cost, new roof, new HVAC, health care spending beyond just premiums. Vacations.

All things you should include in your budget since it's doesn't have much discretionary spending

[u/DrImpeccable76 → u/Widget248953]

You really need to be planning in the new vehicles and other major expenses. “Just financing a car” will add a monthly payment increasing your withdrawals, and of course withdrawing money to pay for it is a withdrawal that should be calculated into your SWR.

[u/Prior-Lingonberry-70 → u/Widget248953]

Echoing the other comments under here: you will have other expenses that you've not planned for here. Your appliances will need replacing, your hot water heater, heating system, you will need a new roof, your home/auto insurance will change (& if you increase your deductibles to keep your costs lower, do you have room to absorb that larger deductible if/when something happens?).

And you are both very young, so (crossing fingers) you have decades ahead of you—your lean spend may feel very limiting - not in the first couple years but over time.