The “I want to retire soon” thread (2 Viewers)

[fruity pebbles]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

She can if her benefits on her own would be less but regardless it doesn’t affect what you get. Hers isn’t subtracted from yours.

 

[stbugs]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

 

[coopersdad]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

I got custody of both kids full time (18 YO and 15 YO). Both stay w/ me when they come home from college or visit from out of town.

No alimony (Texas) and I don't get child support. She's supposed to help pay for college, but that is hit and miss. She was supposed to set up a savings account for both boys, but did not do that.

A funny from the other day................she sends the boys a text and an attachment saying that she's going to have her cousin (who is a CPA) help her with budgeting................my oldest chimes in "imagine if you only knew someone that was a CPA". I'm a VP / CPA in the finance and budgeting department of a large fortune 500 company.

Kids have jokes.

 

[fruity pebbles]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

I got custody of both kids full time (18 YO and 15 YO). Both stay w/ me when they come home from college or visit from out of town.

No alimony (Texas) and I don't get child support. She's supposed to help pay for college, but that is hit and miss. She was supposed to set up a savings account for both boys, but did not do that.

A funny from the other day................she sends the boys a text and an attachment saying that she's going to have her cousin (who is a CPA) help her with budgeting................my oldest chimes in "imagine if you only knew someone that was a CPA". I'm a VP / CPA in the finance and budgeting department of a large fortune 500 company.

Kids have jokes.

Not to delve too deep but how did you not get child support If you had them full time?

 

[coopersdad]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

I got custody of both kids full time (18 YO and 15 YO). Both stay w/ me when they come home from college or visit from out of town.

No alimony (Texas) and I don't get child support. She's supposed to help pay for college, but that is hit and miss. She was supposed to set up a savings account for both boys, but did not do that.

A funny from the other day................she sends the boys a text and an attachment saying that she's going to have her cousin (who is a CPA) help her with budgeting................my oldest chimes in "imagine if you only knew someone that was a CPA". I'm a VP / CPA in the finance and budgeting department of a large fortune 500 company.

Kids have jokes.

Not to delve too deep but how did you not get child support If you had them full time?

didn't ask for it and didn't want to fight about it.

she cheated, lied, used the kids.

We just wanted to be done. path of least resistance.

She had a very close relationship w/ both boys but they are just starting to do things together, but both always are wary of "what's next".

 

[General Malaise]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

I got custody of both kids full time (18 YO and 15 YO). Both stay w/ me when they come home from college or visit from out of town.

No alimony (Texas) and I don't get child support. She's supposed to help pay for college, but that is hit and miss. She was supposed to set up a savings account for both boys, but did not do that.

A funny from the other day................she sends the boys a text and an attachment saying that she's going to have her cousin (who is a CPA) help her with budgeting................my oldest chimes in "imagine if you only knew someone that was a CPA". I'm a VP / CPA in the finance and budgeting department of a large fortune 500 company.

Kids have jokes.

Not to delve too deep but how did you not get child support If you had them full time?

didn't ask for it and didn't want to fight about it.

she cheated, lied, used the kids.

We just wanted to be done. path of least resistance.

She had a very close relationship w/ both boys but they are just starting to do things together, but both always are wary of "what's next".

Good on you putting your sons first. Too many divorcing spouses weaponize the kids against the other for various reason, many of them are financial. So, props to you for putting them first and your financial considerations to the side so you could focus on their immediate needs.

 

[belljr]

I have no idea what age I want to live to.

My dad did great until 85 and then the dementia slowly kicked in. He is 91 now and needs 24 hour care.

But my mom is amazing mentally and physically at 89 and besides not driving, she is fully functional including providing all the care my dad needs.

My gma made it to 96 and I'd say up until the last year she was sharp as anything...... just slow moving but she would watch every Phillies game, bake us treats plenty of other stuff......

 

[fruity pebbles]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

I got custody of both kids full time (18 YO and 15 YO). Both stay w/ me when they come home from college or visit from out of town.

No alimony (Texas) and I don't get child support. She's supposed to help pay for college, but that is hit and miss. She was supposed to set up a savings account for both boys, but did not do that.

A funny from the other day................she sends the boys a text and an attachment saying that she's going to have her cousin (who is a CPA) help her with budgeting................my oldest chimes in "imagine if you only knew someone that was a CPA". I'm a VP / CPA in the finance and budgeting department of a large fortune 500 company.

Kids have jokes.

Not to delve too deep but how did you not get child support If you had them full time?

didn't ask for it and didn't want to fight about it.

she cheated, lied, used the kids.

We just wanted to be done. path of least resistance.

She had a very close relationship w/ both boys but they are just starting to do things together, but both always are wary of "what's next".

Good on you putting your sons first. Too many divorcing spouses weaponize the kids against the other for various reason, many of them are financial. So, props to you for putting them first and your financial considerations to the side so you could focus on their immediate needs.

Yup. Especially in a situation where the ex was a scoundrel. Many want financial revenge. Good on him. Couldn't have been easy.

 

[Chemical X]

we are shooting for our italian visa application to be filed Feb 2024, if approved, my wife will continue her job remotely, but i will be forced to yield my job into retirement. i might be able to oddjob while in italy for tutoring or teaching, but my current position will be over.

i will miss the money, nothing else.

 

[General Malaise]

we are shooting for our italian visa application to be filed Feb 2024, if approved, my wife will continue her job remotely, but i will be forced to yield my job into retirement. i might be able to oddjob while in italy for tutoring or teaching, but my current position will be over.

i will miss the money, nothing else.

You tutoring children would be a good reality show.

 

[Terminalxylem]

How often did you do the intermittent fasting?

Every day.

Two meals a day, about 4 hours apart. Few days a week I eat one meal. No breakfast, late lunch. Eat at 3 or 4 pm, then 6 or 7 for dinner.

If I break my routine, I break my routine, no big whoop. Late dinner, Sunday brunch, whatever.

i tried that but couldn't do it. how do you avoid snacking? i tried fasting several times and I always end up having the munchies outside that 4 hour timeframe

I can't answer that question for you, but it really helps me not having snack food around - we rarely buy stuff like sweets and chips, for example. It's also helpful to engage in something to take your mind away from eating.

Just like everything else, over time your body adapts to eating less frequently.

 

[Chemical X]

we are shooting for our italian visa application to be filed Feb 2024, if approved, my wife will continue her job remotely, but i will be forced to yield my job into retirement. i might be able to oddjob while in italy for tutoring or teaching, but my current position will be over.

i will miss the money, nothing else.

You tutoring children would be a good reality show.

you think very little of me, i like that.

 

[Terminalxylem]

I have a friend who believes carbs are a detriment to longevity and I tell him if I can't have pizza and beer why would I even want to go on.

I see this argument a lot, and it's easy to make when you're feeling fine, decades away from the consequences of your decision. But I've never met a person on their deathbed asking for more pizza.

And you're friend is incorrect, anyway. Both high and low carbohydrate intake are detriments to longevity. The longest lived populations in the world typically consume most of their calories from carbohydrates, FWIW.

You just need to consume the right ones (FTR, cauliflower crust pizza is pretty damn good, and has fewer "bad" carbohydrates. Can't help you with the beer substitute).

 

[Desert_Power]

So a question for you experts..........................divorced 4 years ago after 19 years. For most of the time she made more/year than I, but recently I've caught up in annual pay (lets not worry about the fact that she hasn't worked full time the last few years burning through the 1/2 of my retirement that she received).

When I retire at age 68/70, does she get part of my social security? How does that work with divorced couples?

If so, I need to readjust my savings plan.

How did she get half your retirement when she made more money than you? Doesn’t seem like a good divorce result. Do you also owe alimony?

I got custody of both kids full time (18 YO and 15 YO). Both stay w/ me when they come home from college or visit from out of town.

No alimony (Texas) and I don't get child support. She's supposed to help pay for college, but that is hit and miss. She was supposed to set up a savings account for both boys, but did not do that.

A funny from the other day................she sends the boys a text and an attachment saying that she's going to have her cousin (who is a CPA) help her with budgeting................my oldest chimes in "imagine if you only knew someone that was a CPA". I'm a VP / CPA in the finance and budgeting department of a large fortune 500 company.

Kids have jokes.

Not to delve too deep but how did you not get child support If you had them full time?

didn't ask for it and didn't want to fight about it.

she cheated, lied, used the kids.

We just wanted to be done. path of least resistance.

She had a very close relationship w/ both boys but they are just starting to do things together, but both always are wary of "what's next".

Sounds like you made an expensive and worthy purchase. I don't think your SS benefits can be reduced in this instance.

 

[Peggy]

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

I should do an AMA for you guys but I bet healthcare is going to be the main question.

The short answer is, as always, it depends on your state.

The longer answer is that is takes a little work. IMO, the best way to find out what you qualify for is to pseudo apply for healthcare and see what plan you land in for your state. The applications for each state are online and after you answer a bunch of questions (similar to applying for college financial aid), you should end up with a large summary at the end. You can use that summary to look at a chart for your state and see where you land.

You will find many tiered plans, ranging from free health care to reduced cost health care. See which plan you land in and that should help you determine the cost.

Note that anyone who intends to work part time, this will effect your numbers obviously and may push you out of a tier or even out of the program entirely.

I'm 53 and thinking about retiring soon or, at least, taking some years off and working later on if I get too bored. I think I've saved enough to live off investment income perpetually although doing that might be tighter than ideal. I'm naturally frugal, though, so I'd probably be fine.

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

If you wait to retire at 59.5 and have Roth IRAs/401ks, can't you draw on them during the gap between when you retire and Medicare age? It is my understanding, since drawing on a Roth is tax free and doesn't apply to income, you could qualify for low ACA insurance. Also, if you have an HSA, max it out now and use that savings to help pay for healthcare premiums during the gap years.

Just a thought...

You can’t pay for healthcare premiums from an HSA. You can pay for COBRA premiums if you accept cobra from a now prior employer, though. You can also pay Medicare premiums once you turn 65, but you can’t pay for regular private health insurance premiums.

Circling back around to this. I have to figure out the health care soon.
Does the 60 day cobra kick in automatically when you retire?
You can then pay the company rate to keep the insurance (cobra) up to 18 months, the rate you'd find out from the company/pay stub?
If you retire at the end of 2024 and have zero income in 2025 (living off cash) you'd qualify for the lowest cost in the government provided healthcare store, by state? They don't look back at income?
TIA!

 

[mr. furley]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

 

[supermike80]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

I'm planning to retire at 62 and have budgeted for 25 years after that. Now knowing how I live there is no chance I will see 87. but the budget is in place for it. IF I happen to outlive that, then yeah...there won't be anything left. Oh well.

 

[guru_007]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

I'll post my budget below - and yes I'm not leaving an inheritance behind other than my house. I intend on gifting the money yearly so my young adult children can use it as they need/want (and hopefully not murder me). This is a rough outline of what I'm thinking.

	Cost per month	Cost per year
Food	$1,000​	$12,000​
Utilities	$200​	$2,400​
Cable/Internet	$150​	$1,800​
Cell phone	$125​	$1,500​
Health Care	$2,000​	$24,000​
Prop Taxes	$425​	$5,100​
Income Taxes	$1,500​	$18,000​
Car Payment	$500​	$6,000​
HomeInsurance	$200​	$2,400​
Car Insurance	$125​	$1,500​
Mortgage	$3,500​	$42,000​
Big Vacation 1	$1,700​	$20,400​
Nice vacation 2	$550​	$6,600​
Weekend getaways	$250​	$3,000​
Misc	$500​	$6,000​
Gifts	$300​	$3,600​
Year End Bonus - kids	$1,000​	$12,000​

 

[fruity pebbles]

I’m planning on 62 as well. I’ll start taking social security and my pension at that age. Both together will be around $5000 a month. The goal is to keep my monthly expenses to less than that and keep my 403B, HSA and Roth IRAs as backup that can continue growing and I’ll leave that to my kids.

 

[General Malaise]

What I know about Medicare you can fit inside a shot glass, but it seems like $2,000 a month is on the very high side if you have Medicare and buy a supplemental policy to go with it.

Or is this what you pay now, @guru_007?

 

[guru_007]

2,000/month is estimate for private healthcare until I reach medicare age
Figure ~10 years.
NOTE- I haven't started shopping around yet.

 

[tri-man 47]

What I know about Medicare you can fit inside a shot glass, but it seems like $2,000 a month is on the very high side if you have Medicare and buy a supplemental policy to go with it.

Or is this what you pay now, @guru_007?

Good point. I just started on Medicare Part B in January as it was just slightly more than my employer coverage but with a much, much larger network. Part A is free (signed up for that when I turned 65); I pay about $175/month now for Part B. I then added a $30/month supplement from Humana, so all-in is $205/month. [Note: This is not Medicare Advantage, which is a costlier option.]

 

[supermike80]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

I'll post my budget below - and yes I'm not leaving an inheritance behind other than my house. I intend on gifting the money yearly so my young adult children can use it as they need/want (and hopefully not murder me). This is a rough outline of what I'm thinking.

	Cost per month	Cost per year
Food	$1,000​	$12,000​
Utilities	$200​	$2,400​
Cable/Internet	$150​	$1,800​
Cell phone	$125​	$1,500​
Health Care	$2,000​	$24,000​
Prop Taxes	$425​	$5,100​
Income Taxes	$1,500​	$18,000​
Car Payment	$500​	$6,000​
HomeInsurance	$200​	$2,400​
Car Insurance	$125​	$1,500​
Mortgage	$3,500​	$42,000​
Big Vacation 1	$1,700​	$20,400​
Nice vacation 2	$550​	$6,600​
Weekend getaways	$250​	$3,000​
Misc	$500​	$6,000​
Gifts	$300​	$3,600​
Year End Bonus - kids	$1,000​	$12,000​

Below is mine. I didn't include taxes, rather just matched my expenses Vs my income after taxes to see if we have enough to cover. we are way off as far as health costs, but I figured medicare would help cover some of that. No mortgage by that time either.

Monthly	Annually
Housing
$600.00​	$7,200.00​
Housing Maintenance
$500.00​	$6,000.00​
Healthcare
$1,500.00​	$18,000.00​
Food
$900.00​	$10,800.00​
Transportation
$1,200.00​	$14,400.00​
Cable
$225.00​	$2,700.00​
Utilities
$400.00​	$4,800.00​
Entertainment
$1,000.00​	$12,000.00​
Gas
$350.00​	$4,200.00​
Clothing
$300.00​	$3,600.00​
Cell Phones
$200.00​	$2,400.00​

 

[Peggy]

2,000/month is estimate for private healthcare until I reach medicare age
Figure ~10 years.
NOTE- I haven't started shopping around yet.

It can't be that much. I'd just self insure at that cost.

What I know about Medicare you can fit inside a shot glass, but it seems like $2,000 a month is on the very high side if you have Medicare and buy a supplemental policy to go with it.

Or is this what you pay now, @guru_007?

Good point. I just started on Medicare Part B in January as it was just slightly more than my employer coverage but with a much, much larger network. Part A is free (signed up for that when I turned 65; I pay about $175/month now for Part B. I then added a $30/month supplement from Humana, so all-in is $205/month. [Note: This is not Medicare Advantage, which is a costlier option.]

$200/month sounds more reasonable.

 

[Peggy]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Step #1 is to know how much you are spending. Once you know that all the projection does is take into account inflation.
We've been tracking our spend for 5 years or so now so we have a very good idea what it cost for us to live in today's dollars.

There are apps and all sorts of way to track spending. We do it old-school using a spreadsheet hung on the refrigerator each month and we turn in paper receipts and/or bills for everything we spent money on.

The added benefit is that spending went down once we started tracking.

 

[supermike80]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Step #1 is to know how much you are spending. Once you know that all the projection does is take into account inflation.
We've been tracking our spend for 5 years or so now so we have a very good idea what it cost for us to live in today's dollars.

There are apps and all sorts of way to track spending. We do it old-school using a spreadsheet hung on the refrigerator each month and we turn in paper receipts and/or bills for everything we spent money on.

Same here. I have a excel file on my computer called "retirement estimator" where I calculate out my current wage, the current tax rates, my contributions to our HSA and 401k, what our 401K and investments are at, as well as the current expected SS income if we start to draw as planned(me at 62, wife at 67). I update the SS each year, and project a modest COL Increase annually. On a separate tab, I have our budget numbers, or at least expected budget numbers. We are using the 4% rule for our 401K withdrawls.
I should add. I also calculate what our tax burden would be when we hit 62 and 67 and don't count any savings or possible inheritance dollars.

 

[mr. furley]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Step #1 is to know how much you are spending. Once you know that all the projection does is take into account inflation.
We've been tracking our spend for 5 years or so now so we have a very good idea what it cost for us to live in today's dollars.

There are apps and all sorts of way to track spending. We do it old-school using a spreadsheet hung on the refrigerator each month and we turn in paper receipts and/or bills for everything we spent money on.

Same here. I have a excel file on my computer called "retirement estimator" where I calculate out my current wage, the current tax rates, my contributions to our HSA and 401k, what our 401K and investments are at, as well as the current expected SS income if we start to draw as planned(me at 62, wife at 67). I update the SS each year, and project a modest COL Increase annually. On a separate tab, I have our budget numbers, or at least expected budget numbers. We are using the 4% rule for our 401K withdrawls.
I should add. I also calculate what our tax burden would be when we hit 62 and 67 and don't count any savings or possible inheritance dollars.

good stuff, both you and @Peggy, thank you

haven't, to this point, considered any of this stuff and don't really know where to begin. still a ways off but never too soon to start projections. feeling way behind on savings and trying to get my arms around how much i should be worried but hadn't really come up with a way to calculate short of paying a financial advisor.

 

[supermike80]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Step #1 is to know how much you are spending. Once you know that all the projection does is take into account inflation.
We've been tracking our spend for 5 years or so now so we have a very good idea what it cost for us to live in today's dollars.

There are apps and all sorts of way to track spending. We do it old-school using a spreadsheet hung on the refrigerator each month and we turn in paper receipts and/or bills for everything we spent money on.

Same here. I have a excel file on my computer called "retirement estimator" where I calculate out my current wage, the current tax rates, my contributions to our HSA and 401k, what our 401K and investments are at, as well as the current expected SS income if we start to draw as planned(me at 62, wife at 67). I update the SS each year, and project a modest COL Increase annually. On a separate tab, I have our budget numbers, or at least expected budget numbers. We are using the 4% rule for our 401K withdrawls.
I should add. I also calculate what our tax burden would be when we hit 62 and 67 and don't count any savings or possible inheritance dollars.

good stuff, both you and @Peggy, thank you

haven't, to this point, considered any of this stuff and don't really know where to begin. still a ways off but never too soon to start projections. feeling way behind on savings and trying to get my arms around how much i should be worried but hadn't really come up with a way to calculate short of paying a financial advisor.

Maybe nerdy but it's kinda fun. I started the "retirement estimator" years ago and find myself adding to it with new stuff often. Of course I am 56, so retirement is closer than maybe it is for you, so I feel it's important to get a handle on it sooner than later.

 

[Peggy]

Here was my budget/spend for 2023 which will end in April. Then we will adjust based on the results for 2024.

Regular Expenses	$ Spent Per Month
garbage	$45.00
water	$55.00
internet	$83.00
power	$200.00
phone	$110.00
car insurance	$120.00
prop tax	$625.00
home ins	$145.00
Irregular Expenses	$ Spent Per Month
medical	$300.00
vacation	$625.00
airstream major	$100.00
emergency	$100.00
home remodel	$250.00
auto	$48.00
Variable Expenses	$ Spent Per Month
gas/car	$148.00
grocery	$1,700.00
store/amzn	$400.00
beauty	$180.00
clothing	$150.00
entertain	$175.00
dining out	$350.00
home depot	$250.00
dogs	$250.00
airstream	$100.00

 

[supermike80]

Here was my budget/spend for 2023 which will end in April. Then we will adjust based on the results for 2024.

Regular Expenses	$ Spent Per Month
garbage	$45.00
water	$55.00
internet	$83.00
power	$200.00
phone	$110.00
car insurance	$120.00
prop tax	$625.00
home ins	$145.00
Irregular Expenses	$ Spent Per Month
medical	$300.00
vacation	$625.00
airstream major	$100.00
emergency	$100.00
home remodel	$250.00
auto	$48.00
Variable Expenses	$ Spent Per Month
gas/car	$148.00
grocery	$1,700.00
store/amzn	$400.00
beauty	$180.00
clothing	$150.00
entertain	$175.00
dining out	$350.00
home depot	$250.00
dogs	$250.00
airstream	$100.00

You're spending too much on beauty!!
No Mortgage?

 

[matttyl]

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

I should do an AMA for you guys but I bet healthcare is going to be the main question.

The short answer is, as always, it depends on your state.

The longer answer is that is takes a little work. IMO, the best way to find out what you qualify for is to pseudo apply for healthcare and see what plan you land in for your state. The applications for each state are online and after you answer a bunch of questions (similar to applying for college financial aid), you should end up with a large summary at the end. You can use that summary to look at a chart for your state and see where you land.

You will find many tiered plans, ranging from free health care to reduced cost health care. See which plan you land in and that should help you determine the cost.

Note that anyone who intends to work part time, this will effect your numbers obviously and may push you out of a tier or even out of the program entirely.

I'm 53 and thinking about retiring soon or, at least, taking some years off and working later on if I get too bored. I think I've saved enough to live off investment income perpetually although doing that might be tighter than ideal. I'm naturally frugal, though, so I'd probably be fine.

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

If you wait to retire at 59.5 and have Roth IRAs/401ks, can't you draw on them during the gap between when you retire and Medicare age? It is my understanding, since drawing on a Roth is tax free and doesn't apply to income, you could qualify for low ACA insurance. Also, if you have an HSA, max it out now and use that savings to help pay for healthcare premiums during the gap years.

Just a thought...

You can’t pay for healthcare premiums from an HSA. You can pay for COBRA premiums if you accept cobra from a now prior employer, though. You can also pay Medicare premiums once you turn 65, but you can’t pay for regular private health insurance premiums.

Circling back around to this. I have to figure out the health care soon.
Does the 60 day cobra kick in automatically when you retire?
You can then pay the company rate to keep the insurance (cobra) up to 18 months, the rate you'd find out from the company/pay stub?
If you retire at the end of 2024 and have zero income in 2025 (living off cash) you'd qualify for the lowest cost in the government provided healthcare store, by state? They don't look back at income?
TIA!

If I’m understanding your questions -
You have 63 (I think) days from your employer coverage ending to decide if you want COBRA or not. If you do, it will be retroactive back to the day you lost coverage. Cost will be the same it’s always been, just without your employer paying their portion (which can be substantial). Take a look at line DD on your W-2 to see how much your employer paid on your behalf for your coverage.

Yes.

If you have zero income in 2025 you wouldn’t quality for any subsidy, you’d be eligible for Medicaid. If you want to maximize a subsidy for private insurance, you want your income to be about 150-200% of the poverty line, depending on your filing status. Be careful of on exchange policies, they tend to be extremely small network HMOs with huge max OOPs.

 

[Peggy]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Step #1 is to know how much you are spending. Once you know that all the projection does is take into account inflation.
We've been tracking our spend for 5 years or so now so we have a very good idea what it cost for us to live in today's dollars.

There are apps and all sorts of way to track spending. We do it old-school using a spreadsheet hung on the refrigerator each month and we turn in paper receipts and/or bills for everything we spent money on.

Same here. I have a excel file on my computer called "retirement estimator" where I calculate out my current wage, the current tax rates, my contributions to our HSA and 401k, what our 401K and investments are at, as well as the current expected SS income if we start to draw as planned(me at 62, wife at 67). I update the SS each year, and project a modest COL Increase annually. On a separate tab, I have our budget numbers, or at least expected budget numbers. We are using the 4% rule for our 401K withdrawls.
I should add. I also calculate what our tax burden would be when we hit 62 and 67 and don't count any savings or possible inheritance dollars.

I might have to "borrow" that excel file, lol. All mine does is track expenses and I downloaded it a long time ago - It's called PearBudget.

All my forecasting is done in software my Financial Advisor has, but, the spend is obviously a very important input that needs to be figured out plus updating him with the other things you mention.

 

[supermike80]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Step #1 is to know how much you are spending. Once you know that all the projection does is take into account inflation.
We've been tracking our spend for 5 years or so now so we have a very good idea what it cost for us to live in today's dollars.

There are apps and all sorts of way to track spending. We do it old-school using a spreadsheet hung on the refrigerator each month and we turn in paper receipts and/or bills for everything we spent money on.

Same here. I have a excel file on my computer called "retirement estimator" where I calculate out my current wage, the current tax rates, my contributions to our HSA and 401k, what our 401K and investments are at, as well as the current expected SS income if we start to draw as planned(me at 62, wife at 67). I update the SS each year, and project a modest COL Increase annually. On a separate tab, I have our budget numbers, or at least expected budget numbers. We are using the 4% rule for our 401K withdrawls.
I should add. I also calculate what our tax burden would be when we hit 62 and 67 and don't count any savings or possible inheritance dollars.

I might have to "borrow" that excel file, lol. All mine does is track expenses and I downloaded it a long time ago - It's called PearBudget.

All my forecasting is done in software my Financial Advisor has, but, the spend is obviously a very important input that needs to be figured out plus updating him with the other things you mention.

If youd like, I can email it to you. I will take out the numbers, but the breakdown is there. PM If interested

 

[Peggy]

Here was my budget/spend for 2023 which will end in April. Then we will adjust based on the results for 2024.

Regular Expenses	$ Spent Per Month
garbage	$45.00
water	$55.00
internet	$83.00
power	$200.00
phone	$110.00
car insurance	$120.00
prop tax	$625.00
home ins	$145.00
Irregular Expenses	$ Spent Per Month
medical	$300.00
vacation	$625.00
airstream major	$100.00
emergency	$100.00
home remodel	$250.00
auto	$48.00
Variable Expenses	$ Spent Per Month
gas/car	$148.00
grocery	$1,700.00
store/amzn	$400.00
beauty	$180.00
clothing	$150.00
entertain	$175.00
dining out	$350.00
home depot	$250.00
dogs	$250.00
airstream	$100.00

You're spending too much on beauty!!
No Mortgage?

Lol. Yeah talk to the wife about that one. There is a reason I broke it out as it's own category. No mortgage and the plan is to sell and buy something at a similar price in a substantially lower cost of living area when we retire.

 

[supermike80]

Here was my budget/spend for 2023 which will end in April. Then we will adjust based on the results for 2024.

Regular Expenses	$ Spent Per Month
garbage	$45.00
water	$55.00
internet	$83.00
power	$200.00
phone	$110.00
car insurance	$120.00
prop tax	$625.00
home ins	$145.00
Irregular Expenses	$ Spent Per Month
medical	$300.00
vacation	$625.00
airstream major	$100.00
emergency	$100.00
home remodel	$250.00
auto	$48.00
Variable Expenses	$ Spent Per Month
gas/car	$148.00
grocery	$1,700.00
store/amzn	$400.00
beauty	$180.00
clothing	$150.00
entertain	$175.00
dining out	$350.00
home depot	$250.00
dogs	$250.00
airstream	$100.00

You're spending too much on beauty!!
No Mortgage?

Lol. Yeah talk to the wife about that one. There is a reason I broke it out as it's own category. No mortgage and the plan is to sell and buy something at a similar price in a substantially lower cost of living area when we retire.

Ditto. We will sell when I retire, and expect to have enough equity to buy with cash and keep the rest. Probably a smallish ranch is what we are thinking. Ah old age...aint it grand?

 

[⚡DEADHEAD⚡]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

 

[matttyl]

I’m planning on 62 as well. I’ll start taking social security and my pension at that age. Both together will be around $5000 a month. The goal is to keep my monthly expenses to less than that and keep my 403B, HSA and Roth IRAs as backup that can continue growing and I’ll leave that to my kids.

If I may, you may want to rethink that last little bit. Inheriting an HSA (from anyone other than spouse) means you have to account for that full account value in the year the person dies. That could be a huge tax headache for them. Add to that inheriting your 403b (since the secure act) means they need to liquidate all of that over 10 years. If they get both during their 50s (typical), and in their generally hugest earning years - could mean 30-40+% going to IRS, and could limit or eliminate their ability to contribute to a Roth, or get subsidies for individual health insurance.

If you have room in your tax bracket, and you do in fact want to leave that money to kids (and you’re healthy) - take money out of 403b and fund a permanent life insurance policy with it. Death benefits are totally income tax free. And if you do in fact need additional money due to longevity in your later years - it will have a cash value.

 

[matttyl]

What I know about Medicare you can fit inside a shot glass, but it seems like $2,000 a month is on the very high side if you have Medicare and buy a supplemental policy to go with it.

Or is this what you pay now, @guru_007?

Good point. I just started on Medicare Part B in January as it was just slightly more than my employer coverage but with a much, much larger network. Part A is free (signed up for that when I turned 65; I pay about $175/month now for Part B. I then added a $30/month supplement from Humana, so all-in is $205/month. [Note: This is not Medicare Advantage, which is a costlier option.]

That $30 a month for the supplement seems extremely low. Is that a traditional Medicare supplement, or a part D (drug) plan?

 

[supermike80]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

18K a month? Wow...I am at around 7K. Whats driving that so high if I might ask? Mortgage? Kids?

 

[General Malaise]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

$15,000 a MONTH??? Why?

 

[Peggy]

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

I should do an AMA for you guys but I bet healthcare is going to be the main question.

The short answer is, as always, it depends on your state.

The longer answer is that is takes a little work. IMO, the best way to find out what you qualify for is to pseudo apply for healthcare and see what plan you land in for your state. The applications for each state are online and after you answer a bunch of questions (similar to applying for college financial aid), you should end up with a large summary at the end. You can use that summary to look at a chart for your state and see where you land.

You will find many tiered plans, ranging from free health care to reduced cost health care. See which plan you land in and that should help you determine the cost.

Note that anyone who intends to work part time, this will effect your numbers obviously and may push you out of a tier or even out of the program entirely.

I'm 53 and thinking about retiring soon or, at least, taking some years off and working later on if I get too bored. I think I've saved enough to live off investment income perpetually although doing that might be tighter than ideal. I'm naturally frugal, though, so I'd probably be fine.

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

If you wait to retire at 59.5 and have Roth IRAs/401ks, can't you draw on them during the gap between when you retire and Medicare age? It is my understanding, since drawing on a Roth is tax free and doesn't apply to income, you could qualify for low ACA insurance. Also, if you have an HSA, max it out now and use that savings to help pay for healthcare premiums during the gap years.

Just a thought...

You can’t pay for healthcare premiums from an HSA. You can pay for COBRA premiums if you accept cobra from a now prior employer, though. You can also pay Medicare premiums once you turn 65, but you can’t pay for regular private health insurance premiums.

Circling back around to this. I have to figure out the health care soon.
Does the 60 day cobra kick in automatically when you retire?
You can then pay the company rate to keep the insurance (cobra) up to 18 months, the rate you'd find out from the company/pay stub?
If you retire at the end of 2024 and have zero income in 2025 (living off cash) you'd qualify for the lowest cost in the government provided healthcare store, by state? They don't look back at income?
TIA!

If I’m understanding your questions -
You have 63 (I think) days from your employer coverage ending to decide if you want COBRA or not. If you do, it will be retroactive back to the day you lost coverage. Cost will be the same it’s always been, just without your employer paying their portion (which can be substantial). Take a look at line DD on your W-2 to see how much your employer paid on your behalf for your coverage.

Yes.

If you have zero income n 2925 you wouldnt quality for any subsidy, you’d be eligible for Medicaid. If you want to maximize a subsidy for private insurance, you want your income to be about 150-200% of the poverty line, depending on your filing status. Be careful of on exchange policies, they tend to be extremely small network HMOs with huge max OOPs.

You answered the questions about Cobra, thanks!

Let me clarify about private Insurance. I'm trying to nail down what to do for insurance for 10 years or so before I qualify for Medicare. I thought they looked at your net worth for Medicaid? But yeah, if it helps I can have very low income for the first 5+ years or so before I start drawing from retirement accounts that count as income. But you're saying for private insurance you need to have income? What about the ACA, does it lower the cost for low income? And in either of those is it the expected income for that year or do they look at previous years? Sorry for being all over the place.

 

[supermike80]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

$15,000 a MONTH??? Why?

Hookers and blow? I mean you do have to account for that.

 

[⚡DEADHEAD⚡]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

$15,000 a MONTH??? Why?

Embarrassed to say mortgage and property tax are about $10k. The Bay Area...

(Note I had to edit my estimate in my post. I thought it was $18k, convinced myself that was absurd and I meant $15k so I changed it, and then logged into Fidelity to doublecheck, and it actually is $18k).

 

[matttyl]

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

I should do an AMA for you guys but I bet healthcare is going to be the main question.

The short answer is, as always, it depends on your state.

The longer answer is that is takes a little work. IMO, the best way to find out what you qualify for is to pseudo apply for healthcare and see what plan you land in for your state. The applications for each state are online and after you answer a bunch of questions (similar to applying for college financial aid), you should end up with a large summary at the end. You can use that summary to look at a chart for your state and see where you land.

You will find many tiered plans, ranging from free health care to reduced cost health care. See which plan you land in and that should help you determine the cost.

Note that anyone who intends to work part time, this will effect your numbers obviously and may push you out of a tier or even out of the program entirely.

I'm 53 and thinking about retiring soon or, at least, taking some years off and working later on if I get too bored. I think I've saved enough to live off investment income perpetually although doing that might be tighter than ideal. I'm naturally frugal, though, so I'd probably be fine.

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

If you wait to retire at 59.5 and have Roth IRAs/401ks, can't you draw on them during the gap between when you retire and Medicare age? It is my understanding, since drawing on a Roth is tax free and doesn't apply to income, you could qualify for low ACA insurance. Also, if you have an HSA, max it out now and use that savings to help pay for healthcare premiums during the gap years.

Just a thought...

You can’t pay for healthcare premiums from an HSA. You can pay for COBRA premiums if you accept cobra from a now prior employer, though. You can also pay Medicare premiums once you turn 65, but you can’t pay for regular private health insurance premiums.

Circling back around to this. I have to figure out the health care soon.
Does the 60 day cobra kick in automatically when you retire?
You can then pay the company rate to keep the insurance (cobra) up to 18 months, the rate you'd find out from the company/pay stub?
If you retire at the end of 2024 and have zero income in 2025 (living off cash) you'd qualify for the lowest cost in the government provided healthcare store, by state? They don't look back at income?
TIA!

If I’m understanding your questions -
You have 63 (I think) days from your employer coverage ending to decide if you want COBRA or not. If you do, it will be retroactive back to the day you lost coverage. Cost will be the same it’s always been, just without your employer paying their portion (which can be substantial). Take a look at line DD on your W-2 to see how much your employer paid on your behalf for your coverage.

Yes.

If you have zero income n 2925 you wouldnt quality for any subsidy, you’d be eligible for Medicaid. If you want to maximize a subsidy for private insurance, you want your income to be about 150-200% of the poverty line, depending on your filing status. Be careful of on exchange policies, they tend to be extremely small network HMOs with huge max OOPs.

You answered the questions about Cobra, thanks!

Let me clarify about private Insurance. I'm trying to nail down what to do for insurance for 10 years or so before I qualify for Medicare. I thought they looked at your net worth for Medicaid? But yeah, if it helps I can have very low income for the first 5+ years or so before I start drawing from retirement accounts that count as income. But you're saying for private insurance you need to have income? What about the ACA, does it lower the cost for low income? And in either of those is it the expected income for that year or do they look at previous years? Sorry for being all over the place.

You can buy a full price private individual insurance policy without any regard to income/assets - but like I said, it’s full price.

If you want a subsidy, the amount of that subsidy is on a sliding scale depending on your expected income (which you’ll need to square up at end of year when you do your taxes). You need to be over (I think) 133% of the poverty live, depending on your filing status. Sweet spot is between 150-200% of poverty line.

 

[supermike80]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

$15,000 a MONTH??? Why?

Embarrassed to say mortgage and property tax are about $10k. The Bay Area...

(Note I had to edit my estimate in my post. I thought it was $18k, convinced myself that was absurd and I meant $15k so I changed it, and then logged into Fidelity to doublecheck, and it actually is $18k).

My goodness. Well good to hear you have that nut covered. That's a big hit

 

[Peggy]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

$15,000 a MONTH??? Why?

Embarrassed to say mortgage and property tax are about $10k. The Bay Area...

(Note I had to edit my estimate in my post. I thought it was $18k, convinced myself that was absurd and I meant $15k so I changed it, and then logged into Fidelity to doublecheck, and it actually is $18k).

I was about to provide my guess that 18K is a large home coupled with a high tax and cost of living area. Which is usually comes along with high salary (used to living that way/do you spend extravagantly other than home and taxes?). But for retirement you can solve most of those by simply moving if you wanted to.

 

[New Binky the Doormat]

how the hell does one project monthly budget in retirement?

do you budget for 30 years? 10 years? 13.5 years?

are you spending with no regard for leaving any potential inheritance?

Firecalc was discussed at length in the past here - its free and you can make as detailed or as simple as you want. I loved this thing and used it quite a bit in my retirement planning. You can run all kinds of scenarios with Monte Carlo simulations and get % level of confidence of success for your proposed scenario.

* do you track your expenses already? if not, you're going to at least need to do that

* if you like to dream about your retirement and yet plan for reality? if so, this is for you.

FIRECalc: A different kind of retirement calculator

www.firecalc.com

 

[⚡DEADHEAD⚡]

Had a chat with a Fidelity rep recently, which is who manages my employer's 401k. We are going to need ~$18k/month, a shocking figure. But given we have a defined benefit and a defined contribution, I can retire at 67 and my wife at 61 and we will have 115% of our need.

If you are a Fidelity person, suggest you make an appointment with their people. Very bright folks and they have built tools that seem pretty sharp, detailed.

I'm lucky in that I love my job. I'm ok working until 67.

$15,000 a MONTH??? Why?

Embarrassed to say mortgage and property tax are about $10k. The Bay Area...

(Note I had to edit my estimate in my post. I thought it was $18k, convinced myself that was absurd and I meant $15k so I changed it, and then logged into Fidelity to doublecheck, and it actually is $18k).

I was about to provide my guess that 18K is a large home coupled with a high tax and cost of living area. Which is usually comes along with high salary (used to living that way/do you spend extravagantly other than home and taxes?). But for retirement you can solve most of those by simply moving if you wanted to.

Very true. Where our kids wind up living, what the rest of my family does (local) and where our friends go will factor significantly into whether we leverage our home's equity or not.

 

[Peggy]

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

I should do an AMA for you guys but I bet healthcare is going to be the main question.

The short answer is, as always, it depends on your state.

The longer answer is that is takes a little work. IMO, the best way to find out what you qualify for is to pseudo apply for healthcare and see what plan you land in for your state. The applications for each state are online and after you answer a bunch of questions (similar to applying for college financial aid), you should end up with a large summary at the end. You can use that summary to look at a chart for your state and see where you land.

You will find many tiered plans, ranging from free health care to reduced cost health care. See which plan you land in and that should help you determine the cost.

Note that anyone who intends to work part time, this will effect your numbers obviously and may push you out of a tier or even out of the program entirely.

I'm 53 and thinking about retiring soon or, at least, taking some years off and working later on if I get too bored. I think I've saved enough to live off investment income perpetually although doing that might be tighter than ideal. I'm naturally frugal, though, so I'd probably be fine.

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

If you wait to retire at 59.5 and have Roth IRAs/401ks, can't you draw on them during the gap between when you retire and Medicare age? It is my understanding, since drawing on a Roth is tax free and doesn't apply to income, you could qualify for low ACA insurance. Also, if you have an HSA, max it out now and use that savings to help pay for healthcare premiums during the gap years.

Just a thought...

You can’t pay for healthcare premiums from an HSA. You can pay for COBRA premiums if you accept cobra from a now prior employer, though. You can also pay Medicare premiums once you turn 65, but you can’t pay for regular private health insurance premiums.

Circling back around to this. I have to figure out the health care soon.
Does the 60 day cobra kick in automatically when you retire?
You can then pay the company rate to keep the insurance (cobra) up to 18 months, the rate you'd find out from the company/pay stub?
If you retire at the end of 2024 and have zero income in 2025 (living off cash) you'd qualify for the lowest cost in the government provided healthcare store, by state? They don't look back at income?
TIA!

If I’m understanding your questions -
You have 63 (I think) days from your employer coverage ending to decide if you want COBRA or not. If you do, it will be retroactive back to the day you lost coverage. Cost will be the same it’s always been, just without your employer paying their portion (which can be substantial). Take a look at line DD on your W-2 to see how much your employer paid on your behalf for your coverage.

Yes.

If you have zero income n 2925 you wouldnt quality for any subsidy, you’d be eligible for Medicaid. If you want to maximize a subsidy for private insurance, you want your income to be about 150-200% of the poverty line, depending on your filing status. Be careful of on exchange policies, they tend to be extremely small network HMOs with huge max OOPs.

You answered the questions about Cobra, thanks!

Let me clarify about private Insurance. I'm trying to nail down what to do for insurance for 10 years or so before I qualify for Medicare. I thought they looked at your net worth for Medicaid? But yeah, if it helps I can have very low income for the first 5+ years or so before I start drawing from retirement accounts that count as income. But you're saying for private insurance you need to have income? What about the ACA, does it lower the cost for low income? And in either of those is it the expected income for that year or do they look at previous years? Sorry for being all over the place.

You can buy a full price private individual insurance policy without any regard to income/assets - but like I said, it’s full price.

If you want a subsidy, the amount of that subsidy is on a sliding scale depending on your expected income (which you’ll need to square up at end of year when you do your taxes). You need to be over (I think) 133% of the poverty live, depending on your filing status. Sweet spot is between 150-200% of poverty line.

Got it!
150% poverty line is only like $22K so it should be easy to make that happen. Coincidently, that's around the same number before it's starts eating into SS if you were trying to walk that tightrope between ages 62 and 65.

 

[matttyl]

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

I should do an AMA for you guys but I bet healthcare is going to be the main question.

The short answer is, as always, it depends on your state.

The longer answer is that is takes a little work. IMO, the best way to find out what you qualify for is to pseudo apply for healthcare and see what plan you land in for your state. The applications for each state are online and after you answer a bunch of questions (similar to applying for college financial aid), you should end up with a large summary at the end. You can use that summary to look at a chart for your state and see where you land.

You will find many tiered plans, ranging from free health care to reduced cost health care. See which plan you land in and that should help you determine the cost.

Note that anyone who intends to work part time, this will effect your numbers obviously and may push you out of a tier or even out of the program entirely.

I'm 53 and thinking about retiring soon or, at least, taking some years off and working later on if I get too bored. I think I've saved enough to live off investment income perpetually although doing that might be tighter than ideal. I'm naturally frugal, though, so I'd probably be fine.

The biggest expense I still have to figure out is healthcare since I wouldn't have any until medicare. I'm healthy now but obviously I need some protection in case things change. I could use some advice on this. Someone mentioned in another thread that I could likely qualify for ACA subsidies in retirement since my income would go down so much. After the first retirement year, my income would be very low as it would just be investment income and the majority of that is tax sheltered. Is that correct that assets don't matter, only income? What is the best to get an idea on realistic hypothetical premiums?

If you wait to retire at 59.5 and have Roth IRAs/401ks, can't you draw on them during the gap between when you retire and Medicare age? It is my understanding, since drawing on a Roth is tax free and doesn't apply to income, you could qualify for low ACA insurance. Also, if you have an HSA, max it out now and use that savings to help pay for healthcare premiums during the gap years.

Just a thought...

You can’t pay for healthcare premiums from an HSA. You can pay for COBRA premiums if you accept cobra from a now prior employer, though. You can also pay Medicare premiums once you turn 65, but you can’t pay for regular private health insurance premiums.

Circling back around to this. I have to figure out the health care soon.
Does the 60 day cobra kick in automatically when you retire?
You can then pay the company rate to keep the insurance (cobra) up to 18 months, the rate you'd find out from the company/pay stub?
If you retire at the end of 2024 and have zero income in 2025 (living off cash) you'd qualify for the lowest cost in the government provided healthcare store, by state? They don't look back at income?
TIA!

If I’m understanding your questions -
You have 63 (I think) days from your employer coverage ending to decide if you want COBRA or not. If you do, it will be retroactive back to the day you lost coverage. Cost will be the same it’s always been, just without your employer paying their portion (which can be substantial). Take a look at line DD on your W-2 to see how much your employer paid on your behalf for your coverage.

Yes.

If you have zero income n 2925 you wouldnt quality for any subsidy, you’d be eligible for Medicaid. If you want to maximize a subsidy for private insurance, you want your income to be about 150-200% of the poverty line, depending on your filing status. Be careful of on exchange policies, they tend to be extremely small network HMOs with huge max OOPs.

You answered the questions about Cobra, thanks!

Let me clarify about private Insurance. I'm trying to nail down what to do for insurance for 10 years or so before I qualify for Medicare. I thought they looked at your net worth for Medicaid? But yeah, if it helps I can have very low income for the first 5+ years or so before I start drawing from retirement accounts that count as income. But you're saying for private insurance you need to have income? What about the ACA, does it lower the cost for low income? And in either of those is it the expected income for that year or do they look at previous years? Sorry for being all over the place.

You can buy a full price private individual insurance policy without any regard to income/assets - but like I said, it’s full price.

If you want a subsidy, the amount of that subsidy is on a sliding scale depending on your expected income (which you’ll need to square up at end of year when you do your taxes). You need to be over (I think) 133% of the poverty live, depending on your filing status. Sweet spot is between 150-200% of poverty line.

Got it!
150% poverty line is only like $22K so it should be easy to make that happen. Coincidently, that's around the same number before it's starts eating into SS if you were trying to walk that tightrope between ages 62 and 65.

That’s $22k as an individual. Do you file “single” or “married filing jointly “?