The “I want to retire soon” thread (5 Viewers)

[JohnnyU]

My last working day is May 23rd, but my official retirement date is July 1st. I will PTO out after 5/23.

I’ll be 66 in June. Been a software developer most of my career and doing Data Engineer work the last year. It’s time.

 

[-OZ-]

My last working day is May 23rd, but my official retirement date is July 1st. I will PTO out after 5/23.

I’ll be 66 in June. Been a software developer most of my career and doing Data Engineer work the last year. It’s time.

Congrats!
Any ideas what you’ll want to do in retirement?

 

[JohnnyU]

My last working day is May 23rd, but my official retirement date is July 1st. I will PTO out after 5/23.

I’ll be 66 in June. Been a software developer most of my career and doing Data Engineer work the last year. It’s time.

Congrats!
Any ideas what you’ll want to do in retirement?

Dust off my pool cue and take old men’s money down at the Seniors Center now that I’ve had cataract surgery and new lenses inserted in my eyes. Then I’ll probably go down to the local college and pull the fire alarm and run. Oh wait…..I can’t run very well anymore.

Seriously, lots of traveling and probably start painting figurines again now that I have new eyes. I hear people in this thread talking about working after retirement. F that.

One thing about cataract surgery that scared me was that it would cause a divorce. I’ve been married 27 years and feared what she really looked like.

 

[stbugs]

Learned something valuable about the Roth IRA for my daughter, who is now 18, thanks guys.

Wonder if Uncle Sam is going to be able to resist not taxing these accounts over the next 40yrs

Uncle Sam loves Roth accounts - they get their tax revenue now instead of having to wait a few decades like with a traditional IRA/401K. If anything, I could see them upping the limits and making it easier to get money into Roths. Nobody sitting in DC right now really cares about getting that money in 2050, they'd rather see/spend it now.

That said, my crystal ball is busted so

I'd be concerned that they like getting their tax revenue now and then decide that there's no reason they shouldn't get tax on the income growth in the account. 40yrs is a long time and we're gonna have to pay that deficit somehow lol

Just spit balling but I think a federal sales tax would be more likely. And far more politically viable.

I’m sure it won’t happen but it would be a nice result to have or traditional IRA/401k not get taxed as income down the road.

 

[BeTheMatch]

Learned something valuable about the Roth IRA for my daughter, who is now 18, thanks guys.

Wonder if Uncle Sam is going to be able to resist not taxing these accounts over the next 40yrs

Uncle Sam loves Roth accounts - they get their tax revenue now instead of having to wait a few decades like with a traditional IRA/401K. If anything, I could see them upping the limits and making it easier to get money into Roths. Nobody sitting in DC right now really cares about getting that money in 2050, they'd rather see/spend it now.

That said, my crystal ball is busted so

I'd be concerned that they like getting their tax revenue now and then decide that there's no reason they shouldn't get tax on the income growth in the account. 40yrs is a long time and we're gonna have to pay that deficit somehow lol

Just spit balling but I think a federal sales tax would be more likely. And far more politically viable.

I’m sure it won’t happen but it would be a nice result to have or traditional IRA/401k not get taxed as income down the road.

Ah, yeah, that would be pretty, pretty good.

 

[Peggy]

Are there any good rules of thumb, or circumstances to consider when seeing how much of your nest egg is in which tax bucket? I see lots of places talking about your tax buckets and “asset location”, and to not be too heavy with your taxable bucket - but what would that be?

And wouldn’t the optimal allocation shift over time (the closer you get to 59.5 the less of an issue the illiquidity of the IRAs/401k become)?

Quick back of the napkin math has our cash (savings and checking) at 4%, tax free (all Roth stuff, HSAs, cash value life insurance) at 22%, taxable (all traditional stuff) at 49%, and after tax (brokerage and stocks) at about 25%. The past few years the after tax percentage (though not really actual $ amount) has shrunk, while the other two buckets have both grown as those are being funded/maxed - and that trend will likely continue.

Thanks for any thoughts.

- It's not an easy rule of thumb because everyone's goals, numbers, spend and situation is different (and sometimes unpredictable). Kind of like how when SS should be taken.

- it's all about tax avoidance. And the reason, for me anyways, that having too much in taxable is a problem is because I can't possibly roll it all over to Roth, when my income tax bracket is low (tax avoidance) early in retirement before I have to take RMDs.

- the numbers should shift over time. Had I known then what I know now and could do it all over again it would be;

100% 401k Roth early in career when salary is in a lower tax bracket. Switch to regular 401k mid career as salary and tax bracket increase with the plan to roll over to Roth in the first years of retirement when income is low/zero and low taxes again.

Given the scenario above you'd always have substantially more Roth dollars (especially since you'd do Roth IRA too) because it's had the most time to grow. And hopefully, eventually, have it all rolled into Roth before RMDs.

What I did in real life was kind of the exact opposite of that. lol

 

[Judge Smails]

Mentally, it’s going to be tough for me to draw down. I’m just in an in between phase waiting for my separation agreement to be finalized before 6 months of severance and fully paid COBRA to kick in. I’ll get backpay. But just doing the transfers from my Ally account to pay bills gives me the shakes. I’m much better at the accumulation part of life.

 

[Gatorade]

Mentally, it’s going to be tough for me to draw down. I’m just in an in between phase waiting for my separation agreement to be finalized before 6 months of severance and fully paid COBRA to kick in. I’ll get backpay. But just doing the transfers from my Ally account to pay bills gives me the shakes. I’m much better at the accumulation part of life.

One of the hardest things our FA had to overcome was our reluctance to spend money in retirement. It took a couple of years, but now we take trips, eat out often, do things we did not do before. If we don't spend it, who will ? Our kids would just blow it.

 

[jamny]

I'm sure some people will find benefit in it but the audiobook of "How to Live Happy, Wild and Free" didn't do much for me. Besides having too many stories from various retiree's, there were also too many examples of what you might try to do once retired, most of which are pretty obvious. I wound up fast forwarding around halfway through and then started skipping whole chapters once I saw where each was going. I suppose if you have absolutely no idea what to do with yourself, this would be helpful, but I'm rarely bored and don't expect to be once retired.
I had read a bunch of negative reviews about the narrator but I had no problem with him at all.

 

[SFBayDuck]

Mentally, it’s going to be tough for me to draw down. I’m just in an in between phase waiting for my separation agreement to be finalized before 6 months of severance and fully paid COBRA to kick in. I’ll get backpay. But just doing the transfers from my Ally account to pay bills gives me the shakes. I’m much better at the accumulation part of life.

Can you automate those transfers? Create a monthly or quarterly "paycheck" that automatically happens, then you don't have to go in there and (shakily) hit the button yourself.

 

[NutterButter]

Mentally, it’s going to be tough for me to draw down. I’m just in an in between phase waiting for my separation agreement to be finalized before 6 months of severance and fully paid COBRA to kick in. I’ll get backpay. But just doing the transfers from my Ally account to pay bills gives me the shakes. I’m much better at the accumulation part of life.

Give me your account credentials. I'll have no problem spending your money.

 

[Peggy]

I'm sure some people will find benefit in it but the audiobook of "How to Live Happy, Wild and Free" didn't do much for me. Besides having too many stories from various retiree's, there were also too many examples of what you might try to do once retired, most of which are pretty obvious. I wound up fast forwarding around halfway through and then started skipping whole chapters once I saw where each was going. I suppose if you have absolutely no idea what to do with yourself, this would be helpful, but I'm rarely bored and don't expect to be once retired.
I had read a bunch of negative reviews about the narrator but I had no problem with him at all.

I read this and can't help if it's the audible part. Lol. I hate not reading it in my own voice and that book was aok.

 

[Peggy]

Mentally, it’s going to be tough for me to draw down. I’m just in an in between phase waiting for my separation agreement to be finalized before 6 months of severance and fully paid COBRA to kick in. I’ll get backpay. But just doing the transfers from my Ally account to pay bills gives me the shakes. I’m much better at the accumulation part of life.

My wife can help you with the drawdown part if you'd like. Lol. Paid cobra sounds nice, think of that as an extra 1500 a month you can drawdown.

 

[jwb]

I'm sure some people will find benefit in it but the audiobook of "How to Live Happy, Wild and Free" didn't do much for me. Besides having too many stories from various retiree's, there were also too many examples of what you might try to do once retired, most of which are pretty obvious. I wound up fast forwarding around halfway through and then started skipping whole chapters once I saw where each was going. I suppose if you have absolutely no idea what to do with yourself, this would be helpful, but I'm rarely bored and don't expect to be once retired.
I had read a bunch of negative reviews about the narrator but I had no problem with him at all.

I personally think the "bored in retirement" narrative skews older, and will go away as more GenX'ers retire. Think about it - the "digital age" people, which at 58 I'm one of the older ones, have yet to retire en masse. I personally do not expect to be bored.

Think about what people who are not comfortable with technology - a huge percentage of people just a few years my senior - are limited to. Forget games and digital media too. Even a hobby like photography is greatly enriched by technology. I talk with a group of older guys at the gym, and I realize most of them aren't much different from my grandfather in their level of tech knowledge. That cuts off a lot of day-to-day stuff.

 

[jamny]

I'm sure some people will find benefit in it but the audiobook of "How to Live Happy, Wild and Free" didn't do much for me. Besides having too many stories from various retiree's, there were also too many examples of what you might try to do once retired, most of which are pretty obvious. I wound up fast forwarding around halfway through and then started skipping whole chapters once I saw where each was going. I suppose if you have absolutely no idea what to do with yourself, this would be helpful, but I'm rarely bored and don't expect to be once retired.
I had read a bunch of negative reviews about the narrator but I had no problem with him at all.

I read this and can't help if it's the audible part. Lol. I hate not reading it in my own voice and that book was aok.

Nothing to do with the audio, that was fine. It was the content. I'm not sure what I expected but I hoped to learn some stuff and the info was fairly generic and he was very repetitive. And actually, most of what he says, has been the way I've always lived my life. Eat healthy, get exercise, keep learning, travel more, take risks and do things outside your comfort zone, your work doesn't define you, try new things, don't sweat the small stuff, etc. I'm sure someone just thinking about retiring can find value in it. For me, it was just "preaching to the choir"
My mother-in-law probably could have used this book.

 

[Desert_Power]

For those of you keeping notebooks, I quit my job last March while my wife continued working. I was hired at a higher level by a former coworker who had reached out while on our European trip a couple months later. We have long been what folks would call Coast FIRE and would be right at full FIRE if it weren't for daycare expense on our almost 3 year old. I always have made a decent amount more (it's hovered around 2/3 vs 1/3) so this new role really makes me question why she would continue to work.

Well, my wife actually found out (we had suspected since October) that her job and many in their department had been laid off. The package seems quite generous. 6 months paid out at her normal schedule plus a lump sum and something approximating her usual bonus. Ends up being like 75% of what should would make if she worked the entire year.

She has a CPA and a ~13 year career in Audit across a variety of industries. I would not worry about her finding another job although it might not be what she wants in terms of remote and/or pay. I am hopeful she will take time off and ideally not go back full time again. She is a lot more concerned about finances than me. Her parents are super with it conservative (so much it is harmful) and a lot of that seems to have rubbed off on her. Not sure how to get her comfortable with all of the math behind how solid we are.

Really should strive to get laid off next time I hate a job.

 

[Mookie]

For those of you keeping notebooks, I quit my job last March while my wife continued working. I was hired at a higher level by a former coworker who had reached out while on our European trip. We have long been what folks would call Coast FIRE and would be right at full FIRE if it weren't for daycare expense on our almost 3 year old. I always have made a decent amount more (it's hovered around 2/3 vs 1/3) so this new role really makes me question why she would continue to work.

Well, my wife actually found out (we had suspected since October) that her job and many in their department had been laid off. The package seems quite generous. 6 months paid out at her normal schedule plus a lump sum and something approximating her usual bonus. Ends up being like 75% of what should would make if she worked the entire year.

She has a CPA and a ~13 year career in Audit across a variety of industries. I would not worry about her finding another job although it might not be what she wants in terms of remote and/or pay. I am hopeful she will take time off and ideally not go back full time again. She is a lot more concerned about finances than me. Her parents are super with it conservative (so much it is harmful) and a lot of that seems to have rubbed off on her. Not sure how to get her comfortable with all of the math behind how solid we are.

Really should strive to get laid off next time I hate a job.

You should go see a FP, or even two. If she's like my wife, she needs to hear that you are OK to retire from multiple experts - you don't count - in order to believe it. It's a waste of money, but it's well worth it to get her on board. Otherwise, she's going to make you work until your 80.

 

[Sand]

For those of you keeping notebooks, I quit my job last March while my wife continued working. I was hired at a higher level by a former coworker who had reached out while on our European trip. We have long been what folks would call Coast FIRE and would be right at full FIRE if it weren't for daycare expense on our almost 3 year old. I always have made a decent amount more (it's hovered around 2/3 vs 1/3) so this new role really makes me question why she would continue to work.

Well, my wife actually found out (we had suspected since October) that her job and many in their department had been laid off. The package seems quite generous. 6 months paid out at her normal schedule plus a lump sum and something approximating her usual bonus. Ends up being like 75% of what should would make if she worked the entire year.

She has a CPA and a ~13 year career in Audit across a variety of industries. I would not worry about her finding another job although it might not be what she wants in terms of remote and/or pay. I am hopeful she will take time off and ideally not go back full time again. She is a lot more concerned about finances than me. Her parents are super with it conservative (so much it is harmful) and a lot of that seems to have rubbed off on her. Not sure how to get her comfortable with all of the math behind how solid we are.

Really should strive to get laid off next time I hate a job.

With a toddler there is a lot of uncertainty in future costs of child rearing, insurance, etc., so there is that. Not a bad idea to hire a fee only advisor to give y'all a good rundown.

 

[SFBayDuck]

Sat in on my retired parents meeting with their financial advisor today, was interesting to go through the process. They hadn't met in a couple of years so I pushed for them to set this up and include me. I don't love that they're paying an AUM fee but they seem comfortable with and trust him, and I was impressed with the workflow he took them through. I had a few questions on things they wouldn't think to ask about, particularly around tax planning, and he answered each one well.

Biggest takeaway is that he was able to show them how well situated they are, including modeling a few different scenarios like not selling the beach cabin in 5 years (part of their initial plan put together 5 years ago), downsizing their primary residence at some point, LTC beyond the 3-years they each have insurance for, etc. They got to a point where they saw that they could safely spend more money than they are today, and I even brought up charitable options to reduce RMDs/taxes if they are so inclined. I'm guessing the advisor doesn't see a ton of kids telling their parents to spend and donate more money! I think my mom in particular was relieved to walk through all of the scenarios and see how well positioned they are (helped by three small pensions and two SS payments). And there was zero mention of selling them products, consolidating some other smaller accounts outside of his management, etc. I suppose the piece of mind that it's all being handled is worth the money they pay the guy annually, as despite being bright people that each have advanced degrees they really don't know much about this stuff.

 

[Judge Smails]

Mentally, it’s going to be tough for me to draw down. I’m just in an in between phase waiting for my separation agreement to be finalized before 6 months of severance and fully paid COBRA to kick in. I’ll get backpay. But just doing the transfers from my Ally account to pay bills gives me the shakes. I’m much better at the accumulation part of life.

Can you automate those transfers? Create a monthly or quarterly "paycheck" that automatically happens, then you don't have to go in there and (shakily) hit the button yourself.

I’m not there yet but that’s exactly what I need to do.

 

[Sand]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

 

[SFBayDuck]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

 

[Sand]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

 

[SFBayDuck]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

Great position to be in, congrats!

 

[Bluesbomber]

Looking at May, June, but not caring as much plus my 2 months PTO makes work...much less like work. And the one individualwho benefits most if I leave, and does the least while I cover his scthuff wafts in the wind..., it is like the tide has shifted, I might ride the tide a bit...lol...and can walk out...in a minute...very uplifting to have finally had the tides turned...Peace, be well and have fun...D.

 

[-OZ-]

But I'm pushing hard for more vacation

while I don’t push for more PTO (26 vacation days plus federal holidays isn’t bad), our priorities right now are making the most of the time we get.

 

[NutterButter]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

How much vacation do you get now and what are you looking to get? Do people use their sick days for vacations or is that just me? I can't remember the last time I used a sick day for actually being sick. I get 21 vacation days but also 5 designated sick days which is a pretty good amount. Mix in some remote work during the trip and I get 3 or 4 long vacations. My problem at the moment is that my girlfriend still has a daughter in high school so she can't get away too much. Got to wait a few years before we can really let loose.

 

[Sand]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

How much vacation do you get now and what are you looking to get? Do people use their sick days for vacations or is that just me? I can't remember the last time I used a sick day for actually being sick. I get 21 vacation days but also 5 designated sick days which is a pretty good amount. Mix in some remote work during the trip and I get 3 or 4 long vacations. My problem at the moment is that my girlfriend still has a daughter in high school so she can't get away too much. Got to wait a few years before we can really let loose.

22 PTO days now. We don't get sick days. Working on adding a week to that.

My biggest issue is that my effective vacation days are negative and have been for the last couple decades. If I net the vacation days I take with the off days, weekends, and holidays I work that's always below zero. I gotta change that.

 

[-OZ-]

Do people use their sick days for vacations or is that just me?

I don’t use my sick days, almost ever. We save them up, never lose them, and they can add towards retirement. I have 666 sick hours right now and get 104 each year. I use regular leave for doctors appointments.

Today, it’s good to be a Fed. That feeling may change soon.

 

[NutterButter]

Do people use their sick days for vacations or is that just me?

I don’t use my sick days, almost ever. We save them up, never lose them, and they can add towards retirement. I have 666 sick hours right now and get 104 each year. I use regular leave for doctors appointments.

Today, it’s good to be a Fed. That feeling may change soon.

I wouldn't use them either. Come end of the year, I always have one or two hanging around that I just use b/c otherwise its gone. I try to plan it a little better so I use them for more enjoyable experiences, but like I said earlier the gf actually has people who depend on her so opportunities are limited. Is it 1-1 when you cash in? I never use off time for appointments; its just a long lunch. That would stink if you had to do that especially for all the crap I've had to do with the kids over the years. I always thought of that as one of the big perks of having kids.

 

[NutterButter]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

How much vacation do you get now and what are you looking to get? Do people use their sick days for vacations or is that just me? I can't remember the last time I used a sick day for actually being sick. I get 21 vacation days but also 5 designated sick days which is a pretty good amount. Mix in some remote work during the trip and I get 3 or 4 long vacations. My problem at the moment is that my girlfriend still has a daughter in high school so she can't get away too much. Got to wait a few years before we can really let loose.

22 PTO days now. We don't get sick days. Working on adding a week to that.

My biggest issue is that my effective vacation days are negative and have been for the last couple decades. If I net the vacation days I take with the off days, weekends, and holidays I work that's always below zero. I gotta change that.

22 is still solid. Plan those around some holidays like memorial, labor, mlkjr, presidents to add a few more days for actual vacations. You just need to get those working hours down if that's an issue for you. I work some extra hours here and there but its more like time I wouldn't be doing much otherwise so its no big deal; just part of job.

 

[SFBayDuck]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

How much vacation do you get now and what are you looking to get? Do people use their sick days for vacations or is that just me? I can't remember the last time I used a sick day for actually being sick. I get 21 vacation days but also 5 designated sick days which is a pretty good amount. Mix in some remote work during the trip and I get 3 or 4 long vacations. My problem at the moment is that my girlfriend still has a daughter in high school so she can't get away too much. Got to wait a few years before we can really let loose.

22 PTO days now. We don't get sick days. Working on adding a week to that.

My biggest issue is that my effective vacation days are negative and have been for the last couple decades. If I net the vacation days I take with the off days, weekends, and holidays I work that's always below zero. I gotta change that.

22 is still solid. Plan those around some holidays like memorial, labor, mlkjr, presidents to add a few more days for actual vacations. You just need to get those working hours down if that's an issue for you. I work some extra hours here and there but its more like time I wouldn't be doing much otherwise so its no big deal; just part of job.

That vacation planning around holidays is an opportunity I consistently miss. There are a handful of times a year you can take off like 4 days of PTO and get 10-11 days off of work in a row. Going to try and change that this year.

My company “blesses” us with unlimited PTO. How great! Or, every study shows people take less PTO with this structure, and the company doesn’t have to pay you for any “unused” PTO when you leave.

 

[-OZ-]

limited. Is it 1-1 when you cash in?

Not for pay, but for the pension calculation it is. Leave gets paid out.

 

[NutterButter]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

How much vacation do you get now and what are you looking to get? Do people use their sick days for vacations or is that just me? I can't remember the last time I used a sick day for actually being sick. I get 21 vacation days but also 5 designated sick days which is a pretty good amount. Mix in some remote work during the trip and I get 3 or 4 long vacations. My problem at the moment is that my girlfriend still has a daughter in high school so she can't get away too much. Got to wait a few years before we can really let loose.

22 PTO days now. We don't get sick days. Working on adding a week to that.

My biggest issue is that my effective vacation days are negative and have been for the last couple decades. If I net the vacation days I take with the off days, weekends, and holidays I work that's always below zero. I gotta change that.

22 is still solid. Plan those around some holidays like memorial, labor, mlkjr, presidents to add a few more days for actual vacations. You just need to get those working hours down if that's an issue for you. I work some extra hours here and there but its more like time I wouldn't be doing much otherwise so its no big deal; just part of job.

That vacation planning around holidays is an opportunity I consistently miss. There are a handful of times a year you can take off like 4 days of PTO and get 10-11 days off of work in a row. Going to try and change that this year.

My company “blesses” us with unlimited PTO. How great! Or, every study shows people take less PTO with this structure, and the company doesn’t have to pay you for any “unused” PTO when you leave.

Those I listed are my personal favorites. Kids are in school so the crowds and cost are less and you're either talking nice shoulder scene weather with Memorial and Labor or a great time to hit a warm destination to get a break from the cold for us notherners for the other two. Some people also get Columbus which is nice as well.

I've never had that unlimited plan; not sure I'd like it. I kinda like knowing the days I'm allowed and just taking those days. With unlimited, I think I'd feel like I'm either taking too much or not enough. Could also just be the case of what I'm used to. How many days have you taken in a year?

 

[SFBayDuck]

Just hit a new milestone on investments. Crazy, just crazy. Getting close to 50x current expenses and I'd certainly be there if I could kick the kids off the payroll.

I keep trying to spend more but the market just laughs and keeps jacking the numbers up further.

You must really love working!

I think you know when you're done. I don't think I'm done yet. But I'm pushing hard for more vacation and if that doesn't happen I'll go to a 30 hour work week.

How much vacation do you get now and what are you looking to get? Do people use their sick days for vacations or is that just me? I can't remember the last time I used a sick day for actually being sick. I get 21 vacation days but also 5 designated sick days which is a pretty good amount. Mix in some remote work during the trip and I get 3 or 4 long vacations. My problem at the moment is that my girlfriend still has a daughter in high school so she can't get away too much. Got to wait a few years before we can really let loose.

22 PTO days now. We don't get sick days. Working on adding a week to that.

My biggest issue is that my effective vacation days are negative and have been for the last couple decades. If I net the vacation days I take with the off days, weekends, and holidays I work that's always below zero. I gotta change that.

22 is still solid. Plan those around some holidays like memorial, labor, mlkjr, presidents to add a few more days for actual vacations. You just need to get those working hours down if that's an issue for you. I work some extra hours here and there but its more like time I wouldn't be doing much otherwise so its no big deal; just part of job.

That vacation planning around holidays is an opportunity I consistently miss. There are a handful of times a year you can take off like 4 days of PTO and get 10-11 days off of work in a row. Going to try and change that this year.

My company “blesses” us with unlimited PTO. How great! Or, every study shows people take less PTO with this structure, and the company doesn’t have to pay you for any “unused” PTO when you leave.

Those I listed are my personal favorites. Kids are in school so the crowds and cost are less and you're either talking nice shoulder scene weather with Memorial and Labor or a great time to hit a warm destination to get a break from the cold for us notherners for the other two. Some people also get Columbus which is nice as well.

I've never had that unlimited plan; not sure I'd like it. I kinda like knowing the days I'm allowed and just taking those days. With unlimited, I think I'd feel like I'm either taking too much or not enough. Could also just be the case of what I'm used to. How many days have you taken in a year?

That’s part of why most people take less with “unlimited” PTO than with a defined number of days. There’s no sense of “I have this many left I should use them.” But companies really do it because there’s no liability on the balance sheet for unused PTO.

I’ve taken 15-20 days each of the past two years, so in line with what I did at my prior company that gave 20 days PTO.

I’m in sales, so part of the challenge is that time not working could directly lead to less in commissions down the line. There are also “unwritten rules” of not taking time off at the end of a quarter or end of fiscal year, regardless of whether you’re actively working to close a deal in that timeframe, because of the optics.

 

[Riffraff]

I don’t use my sick days, almost ever. We save them up, never lose them, and they can add towards retirement.

Sick days are only for retirement purposes if not taken. If you don't use them - you do lose them upon retirement. No lump sum parting gift like your annual leave.
Make sure you read the retirement conversion chart correctly to see what qualifies as each full year (2087 hours) and use up the rest. You will lose the excess and feel dumb for not using the time off. Just an overage of a measly 80 hours = two weeks off. Lots of people throw away time they could have had more fun with.

----
In terms of the extra year worked to plus up the retirement pension. Every GS has to decide for themselves when a good time to exit the workforce is - if they don't need the paycheck (the goal). This is the retire early thread after all.

For some, morale days while they are healthy now are worth more than the 1% gain years in the future.

For easy math - take the paychart/COLA, divide by 10, divide by 10 more - that's 1%. Now divide by 365 to see the daily pocket change you'll be getting - before taxes. Vast majority of GS are $1 to $3 after taxes (locality matters a lot here). You'd spend that in gas money or a coffee/soda - today.

If you could take the next 10 work days off for $20, would you?
Heck, put the $20 bill away, you don't even have to pay now... you can pay after you retire when the future dollar is worth even less.

If one doesn't need the paycheck... and met the minimum pension criteria (MRA +10years), what's it worth for one to work another 365 day period?

Fun to ponder.

 

[-OZ-]

I don’t use my sick days, almost ever. We save them up, never lose them, and they can add towards retirement.

Sick days are only for retirement purposes if not taken. If you don't use them - you do lose them upon retirement. No lump sum parting gift like your annual leave.
Make sure you read the retirement conversion chart correctly to see what qualifies as each full year (2087 hours) and use up the rest. You will lose the excess and feel dumb for not using the time off. Just an overage of a measly 80 hours = two weeks off. Lots of people throw away time they could have had more fun with.

----
In terms of the extra year worked to plus up the retirement pension. Every GS has to decide for themselves when a good time to exit the workforce is - if they don't need the paycheck (the goal). This is the retire early thread after all.

For some, morale days while they are healthy now are worth more than the 1% gain years in the future.

For easy math - take the paychart/COLA, divide by 10, divide by 10 more - that's 1%. Now divide by 365 to see the daily pocket change you'll be getting - before taxes. Vast majority of GS are $1 to $3 after taxes (locality matters a lot here). You'd spend that in gas money or a coffee/soda - today.

If you could take the next 10 work days off for $20, would you?
Heck, put the $20 bill away, you don't even have to pay now... you can pay after you retire when the future dollar is worth even less.

If one doesn't need the paycheck... and met the minimum pension criteria (MRA +10years), what's it worth for one to work another 365 day period?

Fun to ponder.

That’s 1% every year for the rest of your life, but that does take the full 2087 to get there. I’m not skipping out on taking leave just for the extra pension, but I do use the regular leave instead of sick leave. Plus, there’s always the chance that one of us gets sick enough to use the time saved.

I’m not going over 2087, I won’t be in that long. But your point is a good one, for my purposes I’ll need to look at the monthly hours calculation as the leftover after accounting for full months gets lost.

The back of the napkin math for the value of my hours gets them close to 73¢ per hour every year for hopefully 30 years. Which is roughly equal to 1/3 of our hourly wages total. You’re right that it gives a different perspective.

 

[New Binky the Doormat]

Not long ago I asked guys/gals here if there was concern about the potential government shift towards the support of crypto currently and its impact on the value of the US dollar.

At that point there seemed to be little interest or concern.

Here is some further discussion that is fairly straight-forward. As someone that is retired, I find it concerning. Can a few of you guys talk me down and tell me why this isn't a really bad thing for the value of my savings if I'm not in crypto?

 

[SFBayDuck]

Not long ago I asked guys/gals here if there was concern about the potential government shift towards the support of crypto currently and its impact on the value of the US dollar.

At that point there seemed to be little interest or concern.

Here is some further discussion that is fairly straight-forward. As someone that is retired, I find it concerning. Can a few of you guys talk me down and tell me why this isn't a really bad thing for the value of my savings if I'm not in crypto?

First off - the source obviously has a very clear political lean and agenda. As all cable news on either end of the spectrum does.

That being said, this does seem likely to be just another in a long line of “opportunities” to transfer wealth. Look at the latest meme coin that was launched literally hours before the inauguration to take advantage of that window of opportunity.

So what do we as individuals do about it? Diversify! Buy some bitcoin, it’s easy to do via an etf now. Buy some gold (also can be done via etfs). Diversify equity holdings outside of the US, so if the dollar does fall you may benefit.

Very questionably sourced as a translation of an ancient Chinese curse, but sure seems to apply to this decade: “May you live in interesting times”.

 

[coopersdad]

I've worked at 2 places in my 36 years of work experience. 1st place let you bank your sick time. I used 1 day in my 14 years there. When I left I suggested that we split them and pay me for 1/2 of them, which they approved since I gave them 3 months notice of my departure, so I got paid for over 35 days of sick time when I left. Current place gives us 5 days / year, but no banking. I've used 2 in 22 years, both to take care of a sick kid (note that we don't have to take "time" to go to the dr, or run errands, etc..........that is just part of the deal as long as I'm getting my job done). However, I'll be severed in the next year or so, and since the package (very crappy to say the least) that I'll be offered will be "appealed", you can guarantee that I'll mention in the appeal that they had an employee that they could count on to be there every day getting their job done.

As a side note, last October they changed upper mgmt (directors and above........one level above mine) to the unlimited vacation method, and released the BS liability to help the bottom line. Glad they didn't do that to me, as I've got the max of 40 vacation days in my bank (I get 30/days/year that I have not taken all of), that they sure as heck will be paying me for them upon severance.

 

[Desert_Power]

Not long ago I asked guys/gals here if there was concern about the potential government shift towards the support of crypto currently and its impact on the value of the US dollar.

At that point there seemed to be little interest or concern.

Here is some further discussion that is fairly straight-forward. As someone that is retired, I find it concerning. Can a few of you guys talk me down and tell me why this isn't a really bad thing for the value of my savings if I'm not in crypto?

https://www.cato.org/blog/digital-gold-fallacy-or-why-bitcoin-cant-save-us-dollar-1

 

[SFBayDuck]

Not long ago I asked guys/gals here if there was concern about the potential government shift towards the support of crypto currently and its impact on the value of the US dollar.

At that point there seemed to be little interest or concern.

Here is some further discussion that is fairly straight-forward. As someone that is retired, I find it concerning. Can a few of you guys talk me down and tell me why this isn't a really bad thing for the value of my savings if I'm not in crypto?

https://www.cato.org/blog/digital-gold-fallacy-or-why-bitcoin-cant-save-us-dollar-1

Thanks for posting. Might have to read that a 2nd (and 3rd) time to pick it all up.

My smooth brain doesn't see gold or bitcoin as tools to prop up the dollar. I see them primarily as assets that may hold value if/when the dollar loses value.

 

[SFBayDuck]

Not long ago I asked guys/gals here if there was concern about the potential government shift towards the support of crypto currently and its impact on the value of the US dollar.

At that point there seemed to be little interest or concern.

Here is some further discussion that is fairly straight-forward. As someone that is retired, I find it concerning. Can a few of you guys talk me down and tell me why this isn't a really bad thing for the value of my savings if I'm not in crypto?

First off - the source obviously has a very clear political lean and agenda. As all cable news on either end of the spectrum does.

That being said, this does seem likely to be just another in a long line of “opportunities” to transfer wealth. Look at the latest meme coin that was launched literally hours before the inauguration to take advantage of that window of opportunity.

So what do we as individuals do about it? Diversify! Buy some bitcoin, it’s easy to do via an etf now. Buy some gold (also can be done via etfs). Diversify equity holdings outside of the US, so if the dollar does fall you may benefit.

Very questionably sourced as a translation of an ancient Chinese curse, but sure seems to apply to this decade: “May you live in interesting times”.

@New Binky the Doormat , to follow up a bit more....diversification of uncorrelated assets is pretty widely accepted as the best way to preserve (not grow) wealth, and in retirement should theoretically maximize your safe withdrawal rate. The short history of BTC makes it tough to run correlations, but I used GBTC (oldest BTC proxy ticker), TLT (20 year treasuries), GLD (gold), and SPY (S&P 500) and you can get a 2015-today correlation matrix on portfoliovisualizer. A zero is completely uncorrelated and any negative number is inversely correlated, and you can see that those four asset classes, over the past 10 years, are essentially uncorrelated.

Will that continue to hold? Who knows? But it's a good starting point in how to think about this, imho.

 

[Desert_Power]

Not long ago I asked guys/gals here if there was concern about the potential government shift towards the support of crypto currently and its impact on the value of the US dollar.

At that point there seemed to be little interest or concern.

Here is some further discussion that is fairly straight-forward. As someone that is retired, I find it concerning. Can a few of you guys talk me down and tell me why this isn't a really bad thing for the value of my savings if I'm not in crypto?

https://www.cato.org/blog/digital-gold-fallacy-or-why-bitcoin-cant-save-us-dollar-1

Thanks for posting. Might have to read that a 2nd (and 3rd) time to pick it all up.

My smooth brain doesn't see gold or bitcoin as tools to prop up the dollar. I see them primarily as assets that may hold value if/when the dollar loses value.

Yeah. I basically agree with Selgin here. It would be dumb for the Treasury to buy a bunch of BTC and increase the debt, but it likely won't have a big impact on the dollar.

 

[dgreen]

My wife and I have a desire to live more of a city life once our kids are all out of the house. We've lived suburban life for a long time and we both look back and wish we had lived in the city before kids. We're nearing that point as our youngest kid is about to graduate HS.

I'm not looking to make the decision that maximizes my financial bottom line, but I also don't want to do anything that causes big damages. Here are some things that impact the financial aspect of this.

I have no concerns about retirement. I can retire in 8 years. I fully expect my pension and TSP to provide solid income. Add in SS for me and my wife and a small 401K from my wife and we're good there.

We own a house. I'd say we currently have at least $350k in equity. We have a sub-3% interest rate and our mortgage is under $1700/month. It's a nice financial situation.

An apartment that we'd want will probably be $3,000+.

In order to keep that low interest rate and mortgage, and the tax deduction, we could rent our house. I think that would return around $3,000/month. However, I think there are a ton of things we'd need to improve about the house to make it a good rental, so it would take a while for monthly profits to pay off those things and we'd need to make sure we're prepared for any upcoming big things like a furnace, windows, roof, etc that I know aren't too far off in the future. While I'm comfortable with my retirement picture, we don't have a lot of cash savings. Keeping the house and renting it would also allow us to keep the mortgage interest deduction (although it's value isn't what it used to be with such a high standard deduction) and gains from the housing market.

If we sold the house, that $350k would be under the $500k limit for married capital gains, so it would be ours tax-free (at least from what I understand from my little bit of research). So, the question there becomes what to do with that money. Could that be invested in something that isn't took risky but gives good enough returns to counter what gains we would have seen by keeping it invested in our house? A 5-year CD would give us about $75k gains. But that would be taxable, right? I could split out some of it to fund Roths for both us. My TSP is almost all traditional. I started Roth TSP really late and haven't contributed much to it. My wife is 50+ and I turn 50 at the end of this year. So, we could direct $8k/year into a Roth IRA for my wife and I could do $30k/year through Roth TSP once I turn 50. Are there other good vehicles for tax-free earnings? Another thought I've had is that I could pay land somewhere for retirement, but we don't know where we want to retire. I guess we could even but some kind of vacation home that also serves as an Airbnb, but that sounds like a hassle.

We both really want a lifestyle change. That's the primary motivation. Maybe I've made the mistake of looking at apartments online and getting excited about doing something new. But, even little things like getting new appliances so often has become annoying to me. With apartment life, that $3000 refrigerator can be a vacation instead. That room that needs to be painted can be a nice dinner out.

Anyway, interested in any thoughts. I lean towards selling the house and investing the capital gains, but I think the idea of the importance of home ownership is so strong that it makes it seem like a horrible decision. Am I crazy? Anyone else done something like this? In reality, we probably aren't ready to do this once our youngest starts college this Fall because we have our middle child who still have a couple years of college who will also need a place to live during breaks. The difference between a 2BR and 3BR apartment is pretty big and makes this a lot less likely. Our oldest is about to graduate college and is engaged, so we don't need a room for her. We've talked about how we can just get kids nearby hotel rooms when they come visit, which is much different than them needing a place to live for a couple months.

 

[Sand]

My wife and I have a desire to live more of a city life once our kids are all out of the house. We've lived suburban life for a long time and we both look back and wish we had lived in the city before kids. We're nearing that point as our youngest kid is about to graduate HS.

I'm not looking to make the decision that maximizes my financial bottom line, but I also don't want to do anything that causes big damages. Here are some things that impact the financial aspect of this.

I have no concerns about retirement. I can retire in 8 years. I fully expect my pension and TSP to provide solid income. Add in SS for me and my wife and a small 401K from my wife and we're good there.

We own a house. I'd say we currently have at least $350k in equity. We have a sub-3% interest rate and our mortgage is under $1700/month. It's a nice financial situation.

An apartment that we'd want will probably be $3,000+.

In order to keep that low interest rate and mortgage, and the tax deduction, we could rent our house. I think that would return around $3,000/month. However, I think there are a ton of things we'd need to improve about the house to make it a good rental, so it would take a while for monthly profits to pay off those things and we'd need to make sure we're prepared for any upcoming big things like a furnace, windows, roof, etc that I know aren't too far off in the future. While I'm comfortable with my retirement picture, we don't have a lot of cash savings. Keeping the house and renting it would also allow us to keep the mortgage interest deduction (although it's value isn't what it used to be with such a high standard deduction) and gains from the housing market.

If we sold the house, that $350k would be under the $500k limit for married capital gains, so it would be ours tax-free (at least from what I understand from my little bit of research). So, the question there becomes what to do with that money. Could that be invested in something that isn't took risky but gives good enough returns to counter what gains we would have seen by keeping it invested in our house? A 5-year CD would give us about $75k gains. But that would be taxable, right? I could split out some of it to fund Roths for both us. My TSP is almost all traditional. I started Roth TSP really late and haven't contributed much to it. My wife is 50+ and I turn 50 at the end of this year. So, we could direct $8k/year into a Roth IRA for my wife and I could do $30k/year through Roth TSP once I turn 50. Are there other good vehicles for tax-free earnings? Another thought I've had is that I could pay land somewhere for retirement, but we don't know where we want to retire. I guess we could even but some kind of vacation home that also serves as an Airbnb, but that sounds like a hassle.

We both really want a lifestyle change. That's the primary motivation. Maybe I've made the mistake of looking at apartments online and getting excited about doing something new. But, even little things like getting new appliances so often has become annoying to me. With apartment life, that $3000 refrigerator can be a vacation instead. That room that needs to be painted can be a nice dinner out.

Anyway, interested in any thoughts. I lean towards selling the house and investing the capital gains, but I think the idea of the importance of home ownership is so strong that it makes it seem like a horrible decision. Am I crazy? Anyone else done something like this? In reality, we probably aren't ready to do this once our youngest starts college this Fall because we have our middle child who still have a couple years of college who will also need a place to live during breaks. The difference between a 2BR and 3BR apartment is pretty big and makes this a lot less likely. Our oldest is about to graduate college and is engaged, so we don't need a room for her. We've talked about how we can just get kids nearby hotel rooms when they come visit, which is much different than them needing a place to live for a couple months.

Sounds like you need to split the baby - keep the house and rent for a year. Then see if it's what you really want before you sell.

BTW, the only real way for you to get tax free earnings off that house sale is muni bonds. Probably ok for some portion of your 300k, but only some small portion. Maybe some low risk fund like Wellington or Wellesley.

 

[NutterButter]

My wife and I have a desire to live more of a city life once our kids are all out of the house. We've lived suburban life for a long time and we both look back and wish we had lived in the city before kids. We're nearing that point as our youngest kid is about to graduate HS.

I'm not looking to make the decision that maximizes my financial bottom line, but I also don't want to do anything that causes big damages. Here are some things that impact the financial aspect of this.

I have no concerns about retirement. I can retire in 8 years. I fully expect my pension and TSP to provide solid income. Add in SS for me and my wife and a small 401K from my wife and we're good there.

We own a house. I'd say we currently have at least $350k in equity. We have a sub-3% interest rate and our mortgage is under $1700/month. It's a nice financial situation.

An apartment that we'd want will probably be $3,000+.

In order to keep that low interest rate and mortgage, and the tax deduction, we could rent our house. I think that would return around $3,000/month. However, I think there are a ton of things we'd need to improve about the house to make it a good rental, so it would take a while for monthly profits to pay off those things and we'd need to make sure we're prepared for any upcoming big things like a furnace, windows, roof, etc that I know aren't too far off in the future. While I'm comfortable with my retirement picture, we don't have a lot of cash savings. Keeping the house and renting it would also allow us to keep the mortgage interest deduction (although it's value isn't what it used to be with such a high standard deduction) and gains from the housing market.

If we sold the house, that $350k would be under the $500k limit for married capital gains, so it would be ours tax-free (at least from what I understand from my little bit of research). So, the question there becomes what to do with that money. Could that be invested in something that isn't took risky but gives good enough returns to counter what gains we would have seen by keeping it invested in our house? A 5-year CD would give us about $75k gains. But that would be taxable, right? I could split out some of it to fund Roths for both us. My TSP is almost all traditional. I started Roth TSP really late and haven't contributed much to it. My wife is 50+ and I turn 50 at the end of this year. So, we could direct $8k/year into a Roth IRA for my wife and I could do $30k/year through Roth TSP once I turn 50. Are there other good vehicles for tax-free earnings? Another thought I've had is that I could pay land somewhere for retirement, but we don't know where we want to retire. I guess we could even but some kind of vacation home that also serves as an Airbnb, but that sounds like a hassle.

We both really want a lifestyle change. That's the primary motivation. Maybe I've made the mistake of looking at apartments online and getting excited about doing something new. But, even little things like getting new appliances so often has become annoying to me. With apartment life, that $3000 refrigerator can be a vacation instead. That room that needs to be painted can be a nice dinner out.

Anyway, interested in any thoughts. I lean towards selling the house and investing the capital gains, but I think the idea of the importance of home ownership is so strong that it makes it seem like a horrible decision. Am I crazy? Anyone else done something like this? In reality, we probably aren't ready to do this once our youngest starts college this Fall because we have our middle child who still have a couple years of college who will also need a place to live during breaks. The difference between a 2BR and 3BR apartment is pretty big and makes this a lot less likely. Our oldest is about to graduate college and is engaged, so we don't need a room for her. We've talked about how we can just get kids nearby hotel rooms when they come visit, which is much different than them needing a place to live for a couple months.

Sounds like you need to split the baby - keep the house and rent for a year. Then see if it's what you really want before you sell.

I'd agree with this. Just like when moving to a new area, you really need to immerse yourself for an extended period of item before knowing for sure that you'll truly like it. What city were you thinking?

 

[dgreen]

My wife and I have a desire to live more of a city life once our kids are all out of the house. We've lived suburban life for a long time and we both look back and wish we had lived in the city before kids. We're nearing that point as our youngest kid is about to graduate HS.

I'm not looking to make the decision that maximizes my financial bottom line, but I also don't want to do anything that causes big damages. Here are some things that impact the financial aspect of this.

I have no concerns about retirement. I can retire in 8 years. I fully expect my pension and TSP to provide solid income. Add in SS for me and my wife and a small 401K from my wife and we're good there.

We own a house. I'd say we currently have at least $350k in equity. We have a sub-3% interest rate and our mortgage is under $1700/month. It's a nice financial situation.

An apartment that we'd want will probably be $3,000+.

In order to keep that low interest rate and mortgage, and the tax deduction, we could rent our house. I think that would return around $3,000/month. However, I think there are a ton of things we'd need to improve about the house to make it a good rental, so it would take a while for monthly profits to pay off those things and we'd need to make sure we're prepared for any upcoming big things like a furnace, windows, roof, etc that I know aren't too far off in the future. While I'm comfortable with my retirement picture, we don't have a lot of cash savings. Keeping the house and renting it would also allow us to keep the mortgage interest deduction (although it's value isn't what it used to be with such a high standard deduction) and gains from the housing market.

If we sold the house, that $350k would be under the $500k limit for married capital gains, so it would be ours tax-free (at least from what I understand from my little bit of research). So, the question there becomes what to do with that money. Could that be invested in something that isn't took risky but gives good enough returns to counter what gains we would have seen by keeping it invested in our house? A 5-year CD would give us about $75k gains. But that would be taxable, right? I could split out some of it to fund Roths for both us. My TSP is almost all traditional. I started Roth TSP really late and haven't contributed much to it. My wife is 50+ and I turn 50 at the end of this year. So, we could direct $8k/year into a Roth IRA for my wife and I could do $30k/year through Roth TSP once I turn 50. Are there other good vehicles for tax-free earnings? Another thought I've had is that I could pay land somewhere for retirement, but we don't know where we want to retire. I guess we could even but some kind of vacation home that also serves as an Airbnb, but that sounds like a hassle.

We both really want a lifestyle change. That's the primary motivation. Maybe I've made the mistake of looking at apartments online and getting excited about doing something new. But, even little things like getting new appliances so often has become annoying to me. With apartment life, that $3000 refrigerator can be a vacation instead. That room that needs to be painted can be a nice dinner out.

Anyway, interested in any thoughts. I lean towards selling the house and investing the capital gains, but I think the idea of the importance of home ownership is so strong that it makes it seem like a horrible decision. Am I crazy? Anyone else done something like this? In reality, we probably aren't ready to do this once our youngest starts college this Fall because we have our middle child who still have a couple years of college who will also need a place to live during breaks. The difference between a 2BR and 3BR apartment is pretty big and makes this a lot less likely. Our oldest is about to graduate college and is engaged, so we don't need a room for her. We've talked about how we can just get kids nearby hotel rooms when they come visit, which is much different than them needing a place to live for a couple months.

Sounds like you need to split the baby - keep the house and rent for a year. Then see if it's what you really want before you sell.

BTW, the only real way for you to get tax free earnings off that house sale is muni bonds. Probably ok for some portion of your 300k, but only some small portion. Maybe some low risk fund like Wellington or Wellesley.

Ha, the idea of renting the house for a while and selling later never even crossed my mind. Makes sense, though. Once I sell, I can't change my mind.

Your second paragraph is basically Greek to me. I've always kept my investments simple so I have no familiarity with muni bonds. Why are they the only real way to get tax free earnings here?

 

[dgreen]

My wife and I have a desire to live more of a city life once our kids are all out of the house. We've lived suburban life for a long time and we both look back and wish we had lived in the city before kids. We're nearing that point as our youngest kid is about to graduate HS.

I'm not looking to make the decision that maximizes my financial bottom line, but I also don't want to do anything that causes big damages. Here are some things that impact the financial aspect of this.

I have no concerns about retirement. I can retire in 8 years. I fully expect my pension and TSP to provide solid income. Add in SS for me and my wife and a small 401K from my wife and we're good there.

We own a house. I'd say we currently have at least $350k in equity. We have a sub-3% interest rate and our mortgage is under $1700/month. It's a nice financial situation.

An apartment that we'd want will probably be $3,000+.

In order to keep that low interest rate and mortgage, and the tax deduction, we could rent our house. I think that would return around $3,000/month. However, I think there are a ton of things we'd need to improve about the house to make it a good rental, so it would take a while for monthly profits to pay off those things and we'd need to make sure we're prepared for any upcoming big things like a furnace, windows, roof, etc that I know aren't too far off in the future. While I'm comfortable with my retirement picture, we don't have a lot of cash savings. Keeping the house and renting it would also allow us to keep the mortgage interest deduction (although it's value isn't what it used to be with such a high standard deduction) and gains from the housing market.

If we sold the house, that $350k would be under the $500k limit for married capital gains, so it would be ours tax-free (at least from what I understand from my little bit of research). So, the question there becomes what to do with that money. Could that be invested in something that isn't took risky but gives good enough returns to counter what gains we would have seen by keeping it invested in our house? A 5-year CD would give us about $75k gains. But that would be taxable, right? I could split out some of it to fund Roths for both us. My TSP is almost all traditional. I started Roth TSP really late and haven't contributed much to it. My wife is 50+ and I turn 50 at the end of this year. So, we could direct $8k/year into a Roth IRA for my wife and I could do $30k/year through Roth TSP once I turn 50. Are there other good vehicles for tax-free earnings? Another thought I've had is that I could pay land somewhere for retirement, but we don't know where we want to retire. I guess we could even but some kind of vacation home that also serves as an Airbnb, but that sounds like a hassle.

We both really want a lifestyle change. That's the primary motivation. Maybe I've made the mistake of looking at apartments online and getting excited about doing something new. But, even little things like getting new appliances so often has become annoying to me. With apartment life, that $3000 refrigerator can be a vacation instead. That room that needs to be painted can be a nice dinner out.

Anyway, interested in any thoughts. I lean towards selling the house and investing the capital gains, but I think the idea of the importance of home ownership is so strong that it makes it seem like a horrible decision. Am I crazy? Anyone else done something like this? In reality, we probably aren't ready to do this once our youngest starts college this Fall because we have our middle child who still have a couple years of college who will also need a place to live during breaks. The difference between a 2BR and 3BR apartment is pretty big and makes this a lot less likely. Our oldest is about to graduate college and is engaged, so we don't need a room for her. We've talked about how we can just get kids nearby hotel rooms when they come visit, which is much different than them needing a place to live for a couple months.

Sounds like you need to split the baby - keep the house and rent for a year. Then see if it's what you really want before you sell.

I'd agree with this. Just like when moving to a new area, you really need to immerse yourself for an extended period of item before knowing for sure that you'll truly like it. What city were you thinking?

We'd be staying in the DC area where we've lived our entire lives, so not as big as if we moved across country. But, it is a good point that we could be one year into it and hate it and then not have a house to go back to. I've also been looking at an apartment building in a urbanish area near us in the suburbs. I don't think there'd be as much risk moving into that place than if we moved into DC.

 

[NutterButter]

My wife and I have a desire to live more of a city life once our kids are all out of the house. We've lived suburban life for a long time and we both look back and wish we had lived in the city before kids. We're nearing that point as our youngest kid is about to graduate HS.

I'm not looking to make the decision that maximizes my financial bottom line, but I also don't want to do anything that causes big damages. Here are some things that impact the financial aspect of this.

I have no concerns about retirement. I can retire in 8 years. I fully expect my pension and TSP to provide solid income. Add in SS for me and my wife and a small 401K from my wife and we're good there.

We own a house. I'd say we currently have at least $350k in equity. We have a sub-3% interest rate and our mortgage is under $1700/month. It's a nice financial situation.

An apartment that we'd want will probably be $3,000+.

In order to keep that low interest rate and mortgage, and the tax deduction, we could rent our house. I think that would return around $3,000/month. However, I think there are a ton of things we'd need to improve about the house to make it a good rental, so it would take a while for monthly profits to pay off those things and we'd need to make sure we're prepared for any upcoming big things like a furnace, windows, roof, etc that I know aren't too far off in the future. While I'm comfortable with my retirement picture, we don't have a lot of cash savings. Keeping the house and renting it would also allow us to keep the mortgage interest deduction (although it's value isn't what it used to be with such a high standard deduction) and gains from the housing market.

If we sold the house, that $350k would be under the $500k limit for married capital gains, so it would be ours tax-free (at least from what I understand from my little bit of research). So, the question there becomes what to do with that money. Could that be invested in something that isn't took risky but gives good enough returns to counter what gains we would have seen by keeping it invested in our house? A 5-year CD would give us about $75k gains. But that would be taxable, right? I could split out some of it to fund Roths for both us. My TSP is almost all traditional. I started Roth TSP really late and haven't contributed much to it. My wife is 50+ and I turn 50 at the end of this year. So, we could direct $8k/year into a Roth IRA for my wife and I could do $30k/year through Roth TSP once I turn 50. Are there other good vehicles for tax-free earnings? Another thought I've had is that I could pay land somewhere for retirement, but we don't know where we want to retire. I guess we could even but some kind of vacation home that also serves as an Airbnb, but that sounds like a hassle.

We both really want a lifestyle change. That's the primary motivation. Maybe I've made the mistake of looking at apartments online and getting excited about doing something new. But, even little things like getting new appliances so often has become annoying to me. With apartment life, that $3000 refrigerator can be a vacation instead. That room that needs to be painted can be a nice dinner out.

Anyway, interested in any thoughts. I lean towards selling the house and investing the capital gains, but I think the idea of the importance of home ownership is so strong that it makes it seem like a horrible decision. Am I crazy? Anyone else done something like this? In reality, we probably aren't ready to do this once our youngest starts college this Fall because we have our middle child who still have a couple years of college who will also need a place to live during breaks. The difference between a 2BR and 3BR apartment is pretty big and makes this a lot less likely. Our oldest is about to graduate college and is engaged, so we don't need a room for her. We've talked about how we can just get kids nearby hotel rooms when they come visit, which is much different than them needing a place to live for a couple months.

Sounds like you need to split the baby - keep the house and rent for a year. Then see if it's what you really want before you sell.

I'd agree with this. Just like when moving to a new area, you really need to immerse yourself for an extended period of item before knowing for sure that you'll truly like it. What city were you thinking?

We'd be staying in the DC area where we've lived our entire lives, so not as big as if we moved across country. But, it is a good point that we could be one year into it and hate it and then not have a house to go back to. I've also been looking at an apartment building in a urbanish area near us in the suburbs. I don't think there'd be as much risk moving into that place than if we moved into DC.

That's at least what I'd do. I'd rather eat 6 months of rent to ensure I was making the right decision. I like to visit the city (nyc in my case) and the thought had crossed my mind about living there, but I came to the conclusion that I'd rather just visit a couple of times a month. Besides nearly twice the living costs, the idea of living in an apartment where you have less space and privacy and now you're dealing with a landlord and neighbors didn't seem worth it.