Orange&Blue
Footballguy
I'm 43 and work for the fed as an engineer in a low cost of living location. I'm looking to retire no later than 60.
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The “I want to retire soon” thread (12 Viewers)
- Thread starter fruity pebbles
- Start date
Orange&Blue
Footballguy
it won't impact your MRA, but sick leave adds to time in service for FERS pension.
Orange&Blue
Footballguy
86% pension?!?!
Atomic Punk
Footballguy
People spend so much, and I’m not just talking money but also time and health/stress keeping up with the Joneses that they don’t think to keep life simple. I don’t care if everyone in the neighborhood is spending a grand decorating their house, when I can just run a string of lights out that my granddaughter loves? Spend your assets, again not just money, on the important things in life … health, family, friends, enjoyment.So many people sacrifice health for their job. Be it physical or emotional stress, or just time taken away from developing personal well-being, the results are the same: accumulation of weight, bad habits and medical problems in middle age. Too many worry about paying for health insurance, rather than focusing on optimizing their health. Time and functionality, not money, are our most precious resources.
To be clear, I‘m not talking about those living paycheck-to-paycheck, even though most of what I said still applies. A simple life with purpose, including a commitment to a healthy lifestyle, always trumps the “finer” things.
And yeah, young people are great, especially as activity partners. As long as you can avoid injury, by keeping ego in check, they always push you more than middle-aged peers. They complain at lot less, too.
if there is one thing I need to work on, it is the last piece of advice. Most of my friends are a little older than me, so I need to bring a little youth into my life.
Orange&Blue
Footballguy
I've seen lots of comments about people waiting to travel when you get to retirement. IMO, don't wait. I've seen too many people have medical issues at 65-70 that prevent them from doing all the trips. Doing those trips now will also help the quality of life. Just a thought.
shuke
Black Ice Skeptic
I'm 50, and always assumed I'd be working into my 60's. It hasn't been until recently that I've thought early would even be a possibility. Joined a startup 5 year ago and have a decent equity stake, so if/when we go IPO or get sold is going to play a huge part in this.
Like others have said, I'd still want to do doing something at least part time. Options I've thought of include bartending or like GM said slinging beers at a brewery, local hardware store, or selling antiques and collectibles online, although I'd prefer something with human interaction. Some of the most rewarding work I've ever done has been for nonprofits like Habitat for Humanity and People Working Cooperatively. I'd definitely do more volunteer work, but if I could get a paying job as some time of site lead that would be ideal.
Like others have said, I'd still want to do doing something at least part time. Options I've thought of include bartending or like GM said slinging beers at a brewery, local hardware store, or selling antiques and collectibles online, although I'd prefer something with human interaction. Some of the most rewarding work I've ever done has been for nonprofits like Habitat for Humanity and People Working Cooperatively. I'd definitely do more volunteer work, but if I could get a paying job as some time of site lead that would be ideal.
fantasy stud
Footballguy
I'm 47 and in my 22nd year teaching in Florida. . I have to do a minimum of 30 years. That will put me at age 55. At that point, my pension would only pay me 48% of my top 5 years. In a perfect world, I would enter the deferred retirement option plan offered in Florida and teach another 6 years and that would get almost to 62 and social security. I just don't know if I could do it. i'm already feeling burnt in and pondering a possible second career in my mid 50s. No clue what that would be. No matter what, I'm not working past 62.
coopersdad
Footballguy
Plan a long time ago was for US to retire when the youngest graduated college (3 years from now), but unfortunately (as Eddie Murphy stated) 1/2 is a pretty large number, especially when you get custody of both your kids and minimal help from the ex, but I'm not complaining. I'd never trade the last 5 years of our lives together as a HAPPY "family" just to retire a few years earlier.
So to me, it will probably be 68 to get full retirement and be able to live the current lifestyle and do the things that I want to do.
So to me, it will probably be 68 to get full retirement and be able to live the current lifestyle and do the things that I want to do.
STEADYMOBBIN 22
Footballguy
Yes and I get more than that, free health/dental for life and both my kids are covered until they’re 25 but trust me- I have earned it. My work life is real life mix of GoT and Succession. This **** ain’t for the faint of heart. I have to smile and shake hands with people that I want to strangle with my bare hands. You can’t tell if people are your friend or only being nice to you because they think it will advance their career.
Terminalxylem
Footballguy
Remind me what you do?
STEADYMOBBIN 22
Footballguy
I work for one of the largest and oldest labor unions.
SFBayDuck
Footballguy
Between that info and your user name……c’mon, it’s just us, you can tell us. What happened to Hoffa?
Yo Mama
Footballguy
Early retirement
NutterButter
Footballguy
Absolutely. Unless you're one of the few folks that still has dependents to work around during those later years, get out there and start seeing places if that's your desire.
tri-man 47
Footballguy
A general reminder that social security, which is available at age 62, automatically increases by 8% each year until it maxes out after age 70. The trade off becomes life expectancy.
ChiefD
Footballguy
Are you meaning that if I choose to start drawing at 62, that payment will increase 8% each year?
I've always thought that whatever number you start at is the number you get. So for me, if I draw at 62 my number right now is like $1600 and stays that way forever (other that normal cost of living increases). If I wait til 67 it's something like $2700
coopersdad
Footballguy
I did the math on my SS figures one time.............I think if I can live until 78 it pays to put it off until 70 (but then again, I was not reinvesting the payments for 8 years and working.........I was just retiring, so I'm not sure that is totally accurate).
gianmarco
Footballguy
No, you have it right. He was saying the same thing but didn't clarify that it's if you wait.
However, having looked at the numbers before, I'm pretty sure it makes sense to just start taking it early If you can take it and invest. By the time the increased amounts catch up (assuming 5% market vs. 8% higher amounts), the break even is like 85 years old IIRC.
coopersdad
Footballguy
No, if you delay until the next year, then your payment starts out 8% higher than the previous year. Wait 2 years and it goes up 16% over age 62. Stops that at 70. So your age 70 payment would be much more than your 62 payment...................but you've also recieved those 62 year payments for 8 years............................it takes about 8-9 years to get back to even (does not take into account reinvesting the 8 years of payments).
gianmarco
Footballguy
Yep.
And, with the risk of death, that difference isn't worth it to me. Investing it doubles that breakeven. And if you can't invest it because you need it, well, then you're better off getting it earlier anyway.
Right, and this is probably another thread all on it's own, but for those that put off collecting SS for 6,7, 8 years, you are really making a tremendous bet on your health/luck.
SS is also indexed for inflation, so if you draw early, not only are you getting paid all of those years, you are getting potential raises of a few percent per year.
Lastly, the one "flaw" I find in all of these retirement calculators is they expect you to be spending the same per year at 65 as you are at 85. I really don't think this is going to be the case at all. I expect to spend at least 20% less per year for every decade after retirement.
Government wants you to wait till last possible moment to draw SS because they are betting against you
fruity pebbles
Footballguy
Yup and there are some other smaller curveballs as well, like it you still have a dependent at home at 62 you can collect your current benefit and an additional 50% of your full retirement benefit until they turn 18.
Orange&Blue
Footballguy
I don't make as much as my engineering friends in the private sector (about 25% less), but retiring with social and fers making up about 70% of my current gs-14 salary alone is nice
NutterButter
Footballguy
The type of care you need will certainly be a huge factor. In home care could run you 30k. Then there's a full blown nursing home which is easily a 100k for something nice.Right, and this is probably another thread all on it's own, but for those that put off collecting SS for 6,7, 8 years, you are really making a tremendous bet on your health/luck.
SS is also indexed for inflation, so if you draw early, not only are you getting paid all of those years, you are getting potential raises of a few percent per year.
Lastly, the one "flaw" I find in all of these retirement calculators is they expect you to be spending the same per year at 65 as you are at 85. I really don't think this is going to be the case at all. I expect to spend at least 20% less per year for every decade after retirement.
Government wants you to wait till last possible moment to draw SS because they are betting against you
Sure, or you could drop dead without every spending a penny in home care. Or buy an insurance policy to help offset these costs. Two sides to every coin.The type of care you need will certainly be a huge factor. In home care could run you 30k. Then there's a full blown nursing home which is easily a 100k for something nice.Right, and this is probably another thread all on it's own, but for those that put off collecting SS for 6,7, 8 years, you are really making a tremendous bet on your health/luck.
SS is also indexed for inflation, so if you draw early, not only are you getting paid all of those years, you are getting potential raises of a few percent per year.
Lastly, the one "flaw" I find in all of these retirement calculators is they expect you to be spending the same per year at 65 as you are at 85. I really don't think this is going to be the case at all. I expect to spend at least 20% less per year for every decade after retirement.
Government wants you to wait till last possible moment to draw SS because they are betting against you
NutterButter
Footballguy
Not sure about you but I never want to be a burden to my kids so just something you need to plan for if you have the same mindset. As far as ltc insurance, I'd avoid that; way too many gotchas.Sure, or you could drop dead without every spending a penny in home care. Or buy an insurance policy to help offset these costs. Two sides to every coin.The type of care you need will certainly be a huge factor. In home care could run you 30k. Then there's a full blown nursing home which is easily a 100k for something nice.Right, and this is probably another thread all on it's own, but for those that put off collecting SS for 6,7, 8 years, you are really making a tremendous bet on your health/luck.
SS is also indexed for inflation, so if you draw early, not only are you getting paid all of those years, you are getting potential raises of a few percent per year.
Lastly, the one "flaw" I find in all of these retirement calculators is they expect you to be spending the same per year at 65 as you are at 85. I really don't think this is going to be the case at all. I expect to spend at least 20% less per year for every decade after retirement.
Government wants you to wait till last possible moment to draw SS because they are betting against you
NewlyRetired
Footballguy
My aunt was never married and had no children so as she aged she needed help taking care of her finances and my dad asked me to take over control of all her finances.
She was in good health, had excellent savings for a single woman and a nice fully paid two family house where we rented out one unit, along with a Long Term Health care policy she got many years before.
As the years went on everything was going great until she started having health problems. We progressed from some one coming in every few days, to every day, to eventually over night care until she had to move into a nursing facility as she needed professional nursing care.
The cost difference between a nice assisted living place and just a regular nursing home is very very large in my area. Skilled nursing is very very expensive. My aunt passed away a few years ago, but even back then it was $150k a year and climbing quickly.
She passed away before she wiped out all her assets but I could see how fast they were draining. The long term health care plan she got for herself when she was 70 seemed solid at the time but it got blown through extremely quickly.
-OZ-
Footballguy
85 isn’t old. The average 62 year old can expect to live to 80. If you’re healthy and take care of yourself you have a really good chance to make it past 85.
If you’re married, there’s a 50% chance one makes it to 95. (Stats for heterosexual couples, I’d assume higher for FF, lower for MM)
Life expectancy for couples: why it's surprisingly long and what you should do about it - Monevator
Do you love your partner? Enough to want them to be secure in retirement? Then you need to read this post about how long at least one of you is likely to live.
monevator.com
NutterButter
Footballguy
I'm betting on us living past the break even. I ain't gonna need it before then so might as well max it out.85 isn’t old. The average 62 year old can expect to live to 80. If you’re healthy and take care of yourself you have a really good chance to make it past 85.
If you’re married, there’s a 50% chance one makes it to 95. (Stats for heterosexual couples, I’d assume higher for FF, lower for MM)
Life expectancy for couples: why it's surprisingly long and what you should do about it - Monevator
Do you love your partner? Enough to want them to be secure in retirement? Then you need to read this post about how long at least one of you is likely to live.
-OZ-
Footballguy
I'm betting on us living past the break even. I ain't gonna need it before then so might as well max it out.85 isn’t old. The average 62 year old can expect to live to 80. If you’re healthy and take care of yourself you have a really good chance to make it past 85.
If you’re married, there’s a 50% chance one makes it to 95. (Stats for heterosexual couples, I’d assume higher for FF, lower for MM)
Life expectancy for couples: why it's surprisingly long and what you should do about it - Monevator
Do you love your partner? Enough to want them to be secure in retirement? Then you need to read this post about how long at least one of you is likely to live.
I start drawing my civilian pension in my 60s and will pull from the traditional IRA and TSP. then at 70 (or older if they push the age back more) I’ll take SS. At that point, between SS, my wife taking half my SS, civilian pension, military pension and VA; our income will be almost 90% of our current income, and these all have COLA.
Considering we invest more than 10%, we’ll be able to spend more than we currently do without touching investments.
That is assuming SS remains untouched. Which seems doubtful, I wouldn’t be surprised to see a means test added.
NutterButter
Footballguy
Just another reason to move more money into a roth. I actually made 72 the year I start collecting just to recognize something is gonna be done.That is assuming SS remains untouched. Which seems doubtful, I wouldn’t be surprised to see a means test added.I'm betting on us living past the break even. I ain't gonna need it before then so might as well max it out.85 isn’t old. The average 62 year old can expect to live to 80. If you’re healthy and take care of yourself you have a really good chance to make it past 85.
If you’re married, there’s a 50% chance one makes it to 95. (Stats for heterosexual couples, I’d assume higher for FF, lower for MM)
Life expectancy for couples: why it's surprisingly long and what you should do about it - Monevator
Do you love your partner? Enough to want them to be secure in retirement? Then you need to read this post about how long at least one of you is likely to live.
-OZ-
Footballguy
Our investments are currently 60% Roth. We’ll be going more traditional the next decade and do conversions in our 60s.
tri-man 47
Footballguy
Guys, thanks for clarifying my comment on SS (and answering @ChiefD 's question with my lack of clarity). As you've pointed out, each year that SS is delayed, the amount rises by 8%. A consideration for me, too, is that SS is based on the best 35 years of earnings. For me, each current year has been replacing one of my first years in higher ed when I was making peanuts, so I'm benefiting by more than just the 8% factor. Ultimately, though, deciding when to start is a crapshoot where you're betting on your longevity. But as some of you pointed out, starting earlier and investing the funds has merit. Someone also mentioned the cost-of-living increases, and those were rather robust the past two years (5.9% and 8.7% ..upcoming is 3.2%).
My wife started her SS early, knowing that if she outlives me, she'll be the surviving spouse and can switch to my benefit.
My wife started her SS early, knowing that if she outlives me, she'll be the surviving spouse and can switch to my benefit.
-OZ-
Footballguy
If one spouse starts on their own at 62, can they switch to half their spouse’s when their spouse claims?
tri-man 47
Footballguy
I don't believe that's the case. Each spouse claims SS based on their own indexed earnings. But when one spouse dies, the surviving spouse (assuming full retirement age) can switch over to the deceased' benefit, if it's higher. Basically, the larger benefit continues for the surviving spouse.
STEADYMOBBIN 22
Footballguy
Speaking of SS….
A divorced spouse may be eligible to collect Social Security benefits based on the former spouse's work record. The marriage must have lasted for at least 10 years and the divorced spouse must be at least 62 years old.
A (ex) relative of mine did this. They were married to a dude back in the 70s for ten years. They divorce. That dude got remarried, started a family, had 3 kids and then died.
The ex got half of the new wife’s dead husbands SS.
A divorced spouse may be eligible to collect Social Security benefits based on the former spouse's work record. The marriage must have lasted for at least 10 years and the divorced spouse must be at least 62 years old.
A (ex) relative of mine did this. They were married to a dude back in the 70s for ten years. They divorce. That dude got remarried, started a family, had 3 kids and then died.
The ex got half of the new wife’s dead husbands SS.
jwb
Footballguy
Yea, this part is never mentioned in the overwhelming amount of "wait" advice I see. In raw dollars, the break even only occurs if you exceed life expenctancy by a decent amount.
Sand
Footballguy
FICalc is a great calculator on this stuff. When I do kick off I plan on using some form of VPW (Variable Percentage Withdrawal - Bogleheads concept). It's rational and looks to work well.
SFBayDuck
Footballguy
You obviously know this, but for those that don't you can see and model your estimated SS benefits at ssa.gov. If you've never checked it out, it's kind of fun to review your full earnings record. I still have no idea how I survived in the Bay Area on the $26K I made in my first full year out of college in '97.
I've still got two years of zeros and another handful of 4-figure college years to replace. Just as an example of the effect tri-man is referencing, If I did continue to work until 62 (I sure hope not!) and continue to earn near what I am now, replacing those low-earning years means a difference of $400 a month at 62 and $900 at 70!
dgreen
Footballguy
But isn't there a max social security benefit? At some point, does replacing lower years with higher years make no difference to what someone might receive in SS?
General Malaise
Footballguy
Not sure about you but I never want to be a burden to my kids so just something you need to plan for if you have the same mindset. As far as ltc insurance, I'd avoid that; way too many gotchas.Sure, or you could drop dead without every spending a penny in home care. Or buy an insurance policy to help offset these costs. Two sides to every coin.The type of care you need will certainly be a huge factor. In home care could run you 30k. Then there's a full blown nursing home which is easily a 100k for something nice.Right, and this is probably another thread all on it's own, but for those that put off collecting SS for 6,7, 8 years, you are really making a tremendous bet on your health/luck.
SS is also indexed for inflation, so if you draw early, not only are you getting paid all of those years, you are getting potential raises of a few percent per year.
Lastly, the one "flaw" I find in all of these retirement calculators is they expect you to be spending the same per year at 65 as you are at 85. I really don't think this is going to be the case at all. I expect to spend at least 20% less per year for every decade after retirement.
Government wants you to wait till last possible moment to draw SS because they are betting against you
Yup. Probably a good thread topic as we get older. My mom championed her Long Term Care policy that she bought for herself after spending 15+ years taking care of her father who was an ogre to her. She died at 71 after a short battle with an insidious disease and I am pretty sure that LTC policy didn't do diddly poo for her.
SFBayDuck
Footballguy
Sure, if you've earned the maximum income (table here) for 35 years you'd have topped it off is my understanding.
Sand
Footballguy
Personally I'm looking at claiming at 70. Looking at from the perspective of longevity insurance for the wife. Like most of the guys in here you can count on your wife outliving you, many times by many years. Luckily I don't think I'll need the income before then.
On the general topic of retirement I could kick off right now, though I really want to have the largesse to really help my kids get started in life (help with house down payments, etc.). So a bit more time to build that up. I do get a sense of purpose from my job and, frankly, it is my sole social outlet - that happens when I'm here 50-60 a week. The words I'll be keying on with my boss on my next review are "32-hour-weeks" and "sabbatical". The last 20 years of 2700-3000 hours a year are just grinding me to dust. And I really want to try and do the Great Divide Mountain Bike Race at some point in my life and that probably is a no-go when I'm 70.
supermike80
Footballguy
I'm 56 and have a plan to walk at 62. Wife is 5 years older so she will be 67. She will not take her SS at 62 and instead hold out until 67(we don't need it).
I keep a spreadsheet with my goals that I update regularly. Things like current anticipated SS outlays for us both, retirement account balances (which I assume a 4% reduction annual from) as well as current salary, taxes, and HSA contribution and balance. I assumed a modest 1.7% increase in SS annually.
I also calculate the estimated taxes we would expect to pay in 6 years. That can of course change.
When I do retire, our house will be fully paid off. So that's a bonus. We carry almost no debt outside of car loans and the mortgage I mentioned.
So I feel pretty safe if all goes to plan. Almost nothing ever does but we will adjust as needed to that I suppose.
I keep a spreadsheet with my goals that I update regularly. Things like current anticipated SS outlays for us both, retirement account balances (which I assume a 4% reduction annual from) as well as current salary, taxes, and HSA contribution and balance. I assumed a modest 1.7% increase in SS annually.
I also calculate the estimated taxes we would expect to pay in 6 years. That can of course change.
When I do retire, our house will be fully paid off. So that's a bonus. We carry almost no debt outside of car loans and the mortgage I mentioned.
So I feel pretty safe if all goes to plan. Almost nothing ever does but we will adjust as needed to that I suppose.
Sand
Footballguy
That's correct, though you have to have a pretty nice income for a long time to hit that. If looking at this actuarily and with time in mind I'd aim for getting over the second bend point in benefits. Once over that the benefit accrues very slowly and isn't worth it to chase from then on.
supermike80
Footballguy
Besides the financial "worries" I agree with this 100%. I don;t know what I will do. And that is a big concern for me. We like to travel sure, but you cant do that 24/7--and the warm months make things easier. But we are in Michigan with no plans to leave here (yet) just don't know what we will do all winter. need hobbies
SFBayDuck
Footballguy
From here I'd have to max out every year until age 71 to get there. Pretty sure I'm not looking to do that.
Can you explain what you mean by "getting over the second bend point in benefits"?
-fish-
Footballguy
55, hoping to retire by 60, although I'd probably be ok to just cutting down to half time. I co-own a law practice, and my partner is ready to wind down too. We have a couple largish cases in the pipeline, so if they hit we can start thinking about this more seriously. Also have a kid going to NYU who is trying as hard as she can to drain my bank account.
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