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Old 08-02-2011, 10:52 AM   #1
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When to Retire

I know this is a little off topic, but probably a question many of you have or will be asking yourselves. I have been in my chosen career 30 years and have the ability financially to retire ---- I think.*

Soon to be 61 and I feel I'm a little young to retire, but just a few years ago the govt would have made me retire at 60.*

I have lost 75% of my defined benefit retirement plan, but with SS, wife's SS, and the remaining company retirement, *I will be able to bring in about 50% of my current income if I wait til 62.5 to draw from these. *

I do not want to go to age 65 the new mandatory retirement age. My biggest concern is medical insurance, which is partially paid for by my company. At age 65 medicare kicks in, but a supplemental plan will still have to be budgeted for.*

So here's the plan. Work til 62.5 and live on savings until 67. Allow SS and my pension to grow which will then combined be about 65% of current income. Until I attain 65, a larger amount will be budgeted for medical insurance. This will of course draw down my savings considerably. And of course Obama and the Dems will take care of me if some catastrophic medical event occures, right??

Anyway, would like to hear some of your thoughts.

BTW, some of you may think you can save enough for retirement. Impossible. You can not save enough to quit work in your 60's and live til your 90's. At some point my savings will run out and hopefully my SS and company retirement will still allow a comfortable life.*


-- Edited by timjet on Tuesday 2nd of August 2011 10:54:37 AM
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Old 08-02-2011, 11:19 AM   #2
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RE: When to Retire

Quote:
superdiver wrote:
my personal thoughts.. no one should retire unless completely debt free, and then retire as soon as you can afford it (assuming you do no want to do your current "job" anymore), live with in your budget and find something to do that keeps you busy (you will probably never make the money you do doing the job you have now). If thats doing the same job that got you there then continue to do that...

*

Retireing dept free is a given. The affordability is the question and is different for different folks.*
*
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Old 08-02-2011, 11:21 AM   #3
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RE: When to Retire

At age 65 1/2, I am about to retire due to economic circumstances, both positive and negative.

As a small town, non litigation, solo practice attorney, my income has about dried up after 37 reasonably profitable years as very few people are currently buying, selling or mortgaging real estate, dying (estates), forming small businesses, or doing estate planning. To wit: my bread and butter. I don't see this picture improving in the foreseeable future.

On the other hand, I have a small bit of savings and investments, the mortgage is almost paid off and I have no other debt.

More importantly, I have a very kind and loving wife who has a good income from a secure job, good investments and a recent fairly sizable inheritance who has agreed to make me a "kept man" by providing me with a small income to supplement the Social Security that I started taking two years ago. I also now have Medicare, with supplemental, until the pols take that (and Social Security) away. In return, I will do much of the maintenance and upgrading on our house and on a small commercial building she owns in our town, which will save having to hire someone to do this. Ditto with the boat, although I have been doing most of the boat work up to now anyway.

Will have to eventually look for some part time work somewhere for additional income (Walmart greeter? No, too far to travel).

Actually, I am looking forward to no longer having the stress of trying to make office ends meet.

Note to self, be very, very nice to wife.
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Old 08-02-2011, 11:25 AM   #4
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RE: When to Retire

Everyone's situation is unique, and I'd suggest that in addition to the great minds available here that you check with local financial advisers, etc. on advice when to pull the plug. You're correct to be wary of medical costs/insurance as one of the real wildcards in this decision.

I have been retired for 10 years, and am debt-free but for a home mortgage. It makes more sense for me to borrow at 4.25% than to withdraw $XXX,XXX from a 401K that's earning well above that, and take the tax hit, just to pay it off.

If you aren't sure, sometimes it's better to keep a few toes in the water (i.e. work part time?) than to get stranded on the beach a few years out.
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Old 08-02-2011, 11:45 AM   #5
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RE: When to Retire

I hope to die flat broke living on SS.

I have enough to live on 50% of income*debt free*till I reach 85 if I make it that long.

If I knew I was going to live so long I would Have taken better care of myself when I was younger.

SD
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Old 08-02-2011, 12:14 PM   #6
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RE: When to Retire

Quote:
dwhatty wrote:
At age 65 1/2, I am about to retire due to economic circumstances, both positive and negative.
******** Since I have had the pleasure of getting to know David & Emily, I wish them all the best in Dave's retirement. Two nicer people I have never met! Both my wife and I thoroughly enjoyed their visit this year and were surprised as to how easy they are to have as guests. We had a lot of laughs, fun on the boat, eating out and some spirited conversations. (Don't worry about your SS & Medicare , Dave, it will be taken care of in November of 2012. ray: )

*
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Old 08-02-2011, 01:19 PM   #7
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RE: When to Retire

We have been planning retirement for several years. I am 58 (59 in November) , she is 57.* 4 years ago we downsized homes to be mortgage free. 5 years ago we bought this boat to be our first couple of retirement years home while criuising the great loop.

I have been working with a couple of financial advisors (they all have different theories) and I think we are there....ready to retire in June 2012. A little scary as we will have to self fund medical, but that is just another line in the calculations. According to my advisors we should be able to swing it and still have way too much left in the 401K so I think we'll be ok. So we will do another reality check this December.

We plan on using the home sale proceeds to fund the first year, maybe 2 years if we can stretch it.* I was planning on pulling SS at 62 but David M presented a point of view that I never considered so I'll have to think about that.

It is a little scary thinking about leaving a pretty well paying job (I am an mechanical engineer), however we want to make the move while we are still healthy enough to cruise and anjoy a few years.

After a couple of years of cruising I may decide to go back to work...who knows.

*
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Old 08-02-2011, 01:45 PM   #8
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When to Retire

ASAP because we aren't getting any younger! We recently sat down with our adviser and ran the numbers with a planned retirement of 2 years from now while we are both in our mid to late 50's. Looks like it'll work so we're going for it. I kind of hit the wall mentally on my career - 30 years of writing freelance computer code and I can't handle the way the new computer world is heading (upsets my sensibility scale). My wife is mentally tired of her business so we have allotted 2 years to get it sold or closed. Our recent trawler purchase was really the first step in this plan and now all we need do is follow it through and see where it takes us. As jleonard said, who knows what we'll want to do in a couple of years - maybe go back to work. But for now it is time for a change.

Dave


-- Edited by magicbus on Tuesday 2nd of August 2011 01:46:03 PM
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Old 08-02-2011, 01:51 PM   #9
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RE: When to Retire

David touched on a good point about allowing SS to grow. Many I've talked to recommend taking it as soon as you can. Unless you have to, I've never understood that thinking.
I can never go back to my current job so when I pull the plug I'm done.

Thanks Dave for your insights, I'll need to so some figuring.
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Old 08-02-2011, 01:56 PM   #10
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RE: When to Retire

Tim, don't forget your taxes if you have earned income.* I am looking at 70 and still paying SS and medicare tax.* Being that I pay both sides the SS is $15,300/yr and Medicare Tax is 2.9% with no cap on earnings.* That can get to be a significant figure.* They also give me the privelege of paying about $3600/yr extra for medicare.* Of course that is not means tested or anything like that.* Just remember, if you work, you will still pay.

I am not a good one on advising when to retire.* I haven't, but then again I'm in the booming real estate development business.* Am I an optomist or what?

I'm blowing mine on diesel fuel.* How about the rest of you guys.
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Old 08-02-2011, 02:03 PM   #11
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RE: When to Retire

During the last five years of my employment, I've known people in our office (with a staff of*16 to 18)*who have died within a couple of years of retirement from my office*who were in their fifties and sixties.* One died in an automobile accident and the other from brain tumors.* Two died before retirement, also in their fifties and sixties: heart attack and cancer.

Life is short.* Every year of retirement delayed is one less year of retirement.* If your job is stressful, you are probably losing 1+ years of retirement for each additional year at work.

Retire as soon as you can afford to, assuming you have healthy diversions to keep active.* I retired at 55 with a 58% pension (and never eligible for social security benefits).* The kids had finished college and the house was paid for.
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Old 08-02-2011, 02:05 PM   #12
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RE: When to Retire

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Tim, don't forget your taxes if you have earned income.* I am looking at 70 and still paying SS and medicare tax.* Being that I pay both sides the SS is $15,300/yr and Medicare Tax is 2.9% with no cap on earnings.* That can get to be a significant figure.* They also give me the privelege of paying about $3600/yr extra for medicare.* Of course that is not means tested or anything like that.* Just remember, if you work, you will still pay.

I am not a good one on advising when to retire.* I haven't, but then again I'm in the booming real estate development business.* Am I an optomist or what?

I'm blowing mine on diesel fuel.* How about the rest of you guys.
*Yep. Gallon Gallon Gallon *ad*infinitum.

SD
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Old 08-02-2011, 02:17 PM   #13
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RE: When to Retire

Quote:
markpierce wrote:*I retired at 55 with a 58% pension (and never eligible for social security benefits).* The kids had finished college and the house was paid for.
******* I retired at 51, wife deceased, kids grown & gone, no pension, good investments (at that time) & no debt. That was in 1992, the year I sold out to my partners. I've never regretted retiring early. My health was declining, diabetes, chest pains, etc. Except for my weight (too fat!) my health has markedly improved. (No stress!) I'm staring down the barrel of completing my 19th year, in September. Almost every day I report for work in my new office which is pictured below.

*

*******
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Old 08-02-2011, 03:18 PM   #14
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RE: When to Retire

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SeaHorse II wrote:*(Don't worry about your SS & Medicare , Dave, it will be taken care of in November of 2012. ray: )
*That's what I do worry about.* A tea party victory = :fear:
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Old 08-02-2011, 03:18 PM   #15
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RE: When to Retire

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I'm staring down the barrel of completing my 19th year, in September. Almost every day I report for work in my new office which is pictured below.
*Walt you are my hero.

SD
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Old 08-02-2011, 05:20 PM   #16
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RE: When to Retire

Mike,
Your O-5/FedEx friend is set with military retirement and Tri-care. No worries for him.

The retire now before something dreadful happens plan sounds good, and we.can all name friends whom that has happened to. But far more likely is the guy who.retires early and soon runs out.of money and now must go back to.work at the bottom of the pay scale being a janator or restocking at Wal-Mart. We've all seen them. I'm going to work 2 more years and hopefully avoid that fate.
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Old 08-02-2011, 05:28 PM   #17
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When to Retire

This was a recent blog by Scot Burns...pretty disturbing:

http://assetbuilder.com/blogs/scott_...n-poverty.aspx
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Old 08-02-2011, 05:32 PM   #18
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RE: When to Retire

Tim, we are looking at a crap shoot here.* Just today our 401Ks and IRAs took about a 2% hit.* That is probably about an 8% hit in the last month.* We could be headed for a double dip recession.* I would say for the foreseable future that anyone that has a job should keep it. By 2014 we should have some answers.

In the mean time the Tampa Bay area is great.* I would not be averse to living aboard in St. Pete.
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Old 08-02-2011, 08:14 PM   #19
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RE: When to Retire

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It will all work out for you. The politicans are difficult to influence and or control, so don't over worry that angle. Concentrate on those areas you can control.
******* Sage advise.
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Old 08-03-2011, 12:48 AM   #20
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RE: When to Retire

Quote:
dougd1 wrote:
This was a recent blog by Scot Burns...pretty disturbing:

http://assetbuilder.com/blogs/scott_...n-poverty.aspx
*But that has been pretty much true for a long time. *$1 million dollars in a bank account CD is not a retirement investment. *The return is too low and interest rate fluctuation affects your earnings, if you can call it that, and is*not a good hedge against inflation. That said, yes, you need some cash in the bank, at least several months' worth of living expenses. *

I was fortunate enough to grow up in a family who worked in and valued real estate investment as a long term hedge. While growing up, I learned early on that house rentals can be painful at times. *But they are a very dependable return on investment, which is running greater than 10% on the dollar, regardless of the status of the national economy.

Since the economy crashed, the rental market has been flying high. *Everybody needs someplace to live, regardless of economic conditions. *Granted you want to be careful where you own rentals. *Some areas are severely depressed and you wouldn't want to be in that market. *The real estate buyers rule of thumb still is, location, location, and location.

Socking cash away is a great start, but you have got to do something with it, if you intend to use it in your retirement years. *An IRA, 401K, stock and bond market, etc. all derive their earnings from the same source and are heavily influenced by the economy. *They're really great returns while things are good, but a recession can drop the bottom out of your fund and leave you stranded on the beach with the tide running out. *

For you younger folks, you only get one chance at it, so choose your investments wisely and start now.
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