You can do both. I prefer income, the average income of the last three years, because pushes me to save more and invest more as income gross overtime generally. I don’t want to cheat my way to financial independence.

Using a multiple of income is also the third rule of FIRE that I established back in 2009.

Neale,
As of Oct 2023, about 4% of American households have a $5MM+ Net Worth.
There are about 131.4 MM American households, so 4% of 131.4MM = about 5,256,000 American households have a net worth over $5MM.
That is a whoooooole lot more people than just “CEOs through VPs” of the S&P 500.
Read every page of Financial Samurai here, and also read The Millionaire Nextdoor if you are interested to lean how it is done and what these households typically look like.
Getting rich was the easiest thing I ever did, but it took 22 years to do it (from age 22 – 44).

Hello John Q,

Your question was: “should I be worried”.
–> I don’t think you should be worried, just be vigilant.

You are young and seem to be reasonable and responsible with your expenses and debt.

My assumptions:
* I am assuming you have been working for about 8 years, and have saved up (130K + 110K = 240K), or about $30K per year.
* Over the next 16 years, along with some compounding, you should be way past the $1 million dollar mark. At 59.5, you’ll have penalty-free access to your 401k, in case you need more funds than your pensions provide.
* I am assuming your pension has health benefits to cover you and spouse between 57 and 65
* I am assuming that college expenses are not too excessive in 2035
* I am assuming you have (or will have) a 15-year term life insurance policy of $2million to hedge against not reaching the age of 57 to claim the pension.

Keep up the great work, and Thank You for your contributions and dedication to the US Air Force.

Hi Thomas. Thanks for the reply. Please see the following:
1) Both pensions start at 57 (when i’d like to retire) and they are inflationary adjusted ($85k in today’s dollars).
2) After-tax take home income is around $9k per month and I try to limit monthly expenses to $7.5k per month.
3) I plan on helping my daughter with her college expenses.
4) There is a survivor benefit to my pensions.
5) Right now, wife is a substitute teacher – makes maybe $10k per year. We may start a home business or something (day-care?)
6) I keep $30k for emergency fund and have $130k in the market.
7) I have $0 debt other than my mortgage ($2.7k per month – $460k balance)

If you need more info, let me know! Thanks!

Need some more information:

1 “on track” for _what_ and _when_

2 what are your expenses and typical cash flow per month?

3 do you plan to pay for some, or all, of your child’s college?

4 does your pension apply to your spouse if you were to die?

5 does your spouse have an income, or future plans to?

6 is your cash your emergency fund?

7 any other debts ?