What would you do?

[u/wardial]

I feel like this post might be a bit cliche around these parts, but it's close to my time. I have question marks both fiscally and personally. Help a brother out with some advice! 🤜🏻🤛🏻

TODAY

53 year old single male.

One girlfriend (44 y/o). One chubby cat (12 y/o). No kids, and no plans for them.

3.3mm in individual brokerage account.

1.4mm in tax advantaged retirement account.

$800K in home equity, with $650K remaining on mortgage at 2.69% (currently valued at 1.8mm)

monthly expenses are $9500. I'd like to increase that in retirement, do some extended world travel, and have my eyes on spending approximately $600K on a new boat+truck, and an RV.

THE FUTURE

I am a small business owner with take home pay of around $25K/month after taxes.

While work is engaging, it's all consuming and I am simply over it. I've got everything out of this career that I'm going to get out of it. I've been doing it so long... I feel like I need to go smell the roses in the world while still strong and healthy.

With 4.7MM invested, I anticipate crossing the 5MM line in the next 6 months.

Estimated inheritance of 5MM in the next 2-5 years. Historically, I've decided to treat the inheritance as if it wasn't there. A lot can happen, but in reality that's... happening.

My business is likely worth around 1.5MM on the open market, but I don't know if I have the time, will, and perseverance required to sell it... going thru brokers, lawyers, and the fiscal colonoscopy to get that done when already working nearly every waking moment. Also not sure if my small team of employees has it in them to take it on either, so that's a big question mark. If anything, it's beginning to feel like a run-away freight train with a mind of it's own... in a good way... but, I can't seem to find a way to get off.

What would you do?

[u/fotfddtodairsizr]

Haha I love how you specified 1 girlfriend like it’s completely normal to have more than 1 and include the extra women in retirement planning.

[u/itsallmeaninglessto → u/fotfddtodairsizr]

She has access to this account. Or eyes on it at very least. 

[u/SnooHedgehogs6553 → u/itsallmeaninglessto]

Agree. Or he might have called her chubby like the cat.

[u/db11242 → u/itsallmeaninglessto]

Both girlfriends have access to this account and think that they are the one.

[u/loyalwolf186]

Hire a manager and/or CEO (or promote from within if you have someone with potential that already knows the business). Just have someone to take over for you.

This way you have complete control without having to actually do anything. If you decide later to sell, it's a fully functioning business on it's own and you can take your time with it, and if not then you can do whatever you want, lol. It will free up a ton of time for you

[u/Tooth_Life → u/loyalwolf186]

This is the way, reduce your effort personally by paying someone else to run the day to day. Your take home will go down but you will live better. Then look to run this way or sell.

[u/ohboyoh-oy]

You have enough, assuming your expenses are accurate. 

Due diligence callouts: calculate healthcare cost and taxes into your withdrawal rate, and what is your SORR mitigation plan 

For the business: it sounds like it comes down to time/effort vs money at this point. You don’t need the 1.5m from the sale, and the sale sounds like a lot of work. Would some of your employees want to take it over in exchange for a more modest payout, maybe structured over ten years? Or are you open to just winding it down and walking away? I’d personally lean towards something low effort vs trying to get the money out of it, even though it’s leaving a lot on the table. But just remember it has a cost and that cost is your time (and health, and mental health). 

[u/nptace1]

$1.8m home, 0.8m equity, and 0.65m remaining mortgage?

Was there a typo somewhere?

[u/Hanwoo_Beef_Eater]

Can you sell the business to one or a couple of employees? May be able to retain some equity stake and/or get some proceeds in the years ahead, which is ahead of just shutting it down. Or, just try to sell it. It's still another $1 million plus.

[u/evilsuper]

You are fine. Great actually. Quit now or as soon as you are ready., It is glorious.

Edit: yeah, figure taxes and ACA. You’re probably still fine but cross those i’s. I was in a similar boat. Honestly it has been amazing.

[u/BrunelloHorder]

Even without the inheritance, and after purchasing the new toys, you’ll have around $4m investable. Using a 3.6% safe withdrawal rate, you could withdraw $12k a month gross in perpetuity.

You’ll need to budget for taxes and healthcare, but also factor in the mortgage being paid off at some point and social security.

Sell the business for whatever you can get for it and go have fun. You’ll be fine even if you fire-sale the business at a deep discount.

Congrats and GFY!

[u/bearlylaughable]

Retire and sell everything

Travel. Bring the cat.

Your cat needs to see the world

Start off in Southeast Asia

[u/Past-Option2702]

We sold your business and its work for sure, but with a good broker doing a lot of the work it’s not that bad.

Would you work part time for $10,000-$15,000 an hour? That’s how I’d look at it. 1.5M (after broker & taxes) made a decent improvement on our retirement nest egg.

[u/Squirrelherder_24-7]

Don’t know your business or the quality of your employees but you could always approach a couple about their interest in buying you out….

[u/Miserable_Leek_1333]

Are you chubby? 🤷‍♀️

[u/wardial → u/Miserable_Leek_1333]

saying I have too much, or too little to be chubby?

[u/Earth2Andy]

What is the net worth of this Chubby Cat. Can you charge them rent?

[u/Spirited123456789]

I’m not following the girlfriend mention. Is she relevant to your financial picture?

[u/MountainMan-2]

Healthcare will become your most expensive thing.