I am still very early in FI journey, but I am trying to understand how I will bridge the gap between my FI date and 59.5.
Right now I am maxing my 401(k), Roth IRA, HSA, and contributing to a brokerage. This means I am leaning pretty heavy into pre-tax assets in the 401(k). I am doing this because it saves me some taxes in the 22% federal bracket and some state income tax. I also believe that when I am FI I can basically fill up the standard deduction and the 10% and 12% federal tax brackets. Obviously ACA will be in play, too. I am basically saying that I am forgoing the 22% federal bracket now to in theory pay a lower rate in the future with a Roth conversion ladder strategy. TBD on state income tax. I have family in states with no state income tax, but I don't think a 4-6% state income tax is what makes or breaks my plan.
I plan to bridge the ~5 year gap by having a year or two of living expenses in cash, using my brokerage, and using my Roth IRA contributions. Once I get through those first 5 years I would then live on the Roth conversions and continue doing this until 59.5. I also think this could mitigate a big RMD tax bomb in the future. I would also like to do this with a paid off house and car to keep my baseline expense very reasonable.
For a plan that is still far away in the future does this sound like the write way to go about this? I will have no pension and do think that ~20-25 years of social security contributions should get me something.
