Long time no post. There are plenty of financial coals in the fire lately, I just haven’t found the time to sit down and document them. I will eventually get around to posting our 2022 top expense categories and a 2022 tax summary once I finish our income tax returns. Tick tock.
I have remained barely employed enough to bank my 2022 year-end 401k employer match (8%) and 2023 HSA employer match ($1600) in January. When we last talked, I had bumped my 2023 401k contributions up to 70% of my paycheck (80% is the maximum allowed by my employer to leave headroom for taxes and health insurance premiums). This was an interesting experiment as I hit the $22,500 401k employee contribution limit on March 15. For 4 paychecks my net income dropped to $1,215 and I paid all of $54 in federal income taxes and $24 in state taxes. I drew down short term cash savings to cover expenses. I have now maximized my 401k contributions for 12 years and not maximized for 12 years. A silly metric but one I wanted to hit just for grins. My employer and I are playing an awkward game of chicken on whether they push me out or I walk away. Either way it’ll happen any time between now and mid August.
This is because I enrolled in preschool in September. Well technically I enrolled our soon to be 4 year old but on Mondays a parent must visit the classroom for an hour before breaking out to listen to a parent educator and the other parents. Old dog, old tricks. Our $20k annual day care expense will stop ($10k per child). I will stay plenty busy with a senior and sophomore in high school, a kindergartner, a preschooler and a baby. Professional minivan driver pays in priceless smiles and tears.
Mrs. Dress Pockets will remain gainfully employed and I will switch over to her medical insurance. Contributions to my HSA will stop and I hope to delay HSA withdrawals for a couple years to let the market and dividends bring the balance up to $100k (another completely arbitrary number). For medical or cash flow emergencies I will make withdrawals for prior year medical expenses I have been paying with cash savings.
As to whether my *retirement* is early, independent, official and permanent? Meh. I don’t really care to be honest. Hopefully it brings a change in family life focus and pace. If my retirement falters on any number of fronts, I can always go back to work. Most likely when the 2 youngest kids finally get on the school bus. The important thing is that I don’t *need* to go back to work thanks to financial independence. Returns on my investments will more than replace my paycheck.
