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All this retirement talk


12string

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It's always been a concern, will I be able to retire.  During the many years of scrambling for every nickel, it appeared not possible.

I got my 401K review yesterday.  They say it looks like I'll have about $65K/year to live on, if the market doesn't crash.  (I think they're planning on me dying about 8 years into retirement).  My wife's pension should be good for close to $30K by then, SS should kick in another $40K or so.  That works out to about what we live on now, but no more paying into 401K and SS.  That's not counting what I'm saving outside of my 401K.

Maybe I WILL be able to just stay in that WalMart greeter position and not have to deal with the pressure of being a cashier.

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For us it is the healthcare issue to deal with, so we will have to work for a few years until Medicare kicks in.  

We expect to ease out of working so much in a few short years.  Currently, we are trying to practice living within a certain range of spending.  If we can go a year on spending under a certain threshold, we are looking really good.  We will have enough cash to carry us for about 5 years, if we are careful with spending.  Spending really is part of the key to working less or not at all.  Most of our wealth is tied up in accounts that we can not access until we are 59, so having substantial cash reserves is going to carry us through.  

I expect the market to crash before we go, and that should be just fine.  It will have more years to recover, before I start pulling too much of it out.

Having no debt is very important to this goal of working less.

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Nah, they're going to have to carry me outta here toes up.

Wo2 has been retired about 3 years, she worked 1/2 time for 3 years before that just finishing here second year of SS. She gets a 2.8% raise in January

I'ma thinking that if we can get a reverse mortgage & the MiLFH leaves Wo2 what she last said she was going to leave her, then I can get out in about 5-7 years.

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17 minutes ago, Dirtyhip said:

For us it is the healthcare issue to deal with, so we will have to work for a few years until Medicare kicks in.  

Yep - that is sort of the boat we are in (or part of the thought/worry process).

My thinking is that I want out at 55, but none of my retirement stuff kicks in until past 60, and SS is really best waiting to 67 (I think).  So, it then leads back to 1) we have the 65+ years covered but 2) don't have the 55-~65 years covered :(  So, my strategy is adapting to stockpile my wife's income completely into shorter non-retirement accounts from now until 55. Then, use that to roll from 55 to whenever we can start drawing on other "protected" money.  If we are lucky, the health insurance issue becomes as simple as getting "catastrophic coverage" or super high deductible coverage and have a health savings account fully funded to that deductible.  Assuming the HSA rolls over year to year, it would be easy to keep it topped off, and only use it for normal check-ups or to "bridge" to the insurance. 

But that's still all a gray area.  I need to read a lot more about when and what is best to do with the retirement stuff in that 60-67.5 window.

I like that 12 & his wife are looking good, though!

Tom

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3 hours ago, Dirtyhip said:

Having no debt is very important to this goal of working less.

I have a healthy annuity, a 401K investment, and possibly SS when we hit in about 10-15 years.  What is important to me is that wherever we go -- we need to have our home paid off.  I don't care if it's a 700 sq/ft cabin in the woods, I want to own it.  Dealing with medical/dental/health insurance is the key--  and having a home that I only pay property taxes -- is also huge.  If my wife and I own our property and have our medical bills mainly covered, then food and electric bills should also be covered as they are the smaller scope.

In other words, I think I'll be good -- providing the market cycle is up when I retire.  I also wager that the time I decide to step away will be when the market is at a high point and my eligible age is at a low point.  I'm pretty sure we could work an odds and ends part time job for like 10 years if we had to.

 

I am in total agreement with you.  No debt -- including your house/condo/home.  Have good medical/dental insurance when everything starts falling off and/or breaking down, and own your home.  As I get older, that home size can shrink for all I care.  Less to maintain. I honestly don't know how much play money we'll have but I suspect there will be enough to do some fun things from time to time. And if it's biking only -- I can deal with it.

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46 minutes ago, Dottles said:

That $1800 is buying the most important thing there is in retirement, I argue.

Canadians- Just bookmark this thread from AMericans, if you (or someone else in Canad) ever think U.S. had better health care and more cost-effective (to you) than Canada. ?  

More aware Canadians do value their employer benefits which some employer plans do include some additional health care which public health care in Canada doesn't provide universally ..ie. dental care, all prescription drugs, prescription glasses, your own semi-private rm. and mental health counselling. There are public special programs aimed for low-income, certain patient populations for limited time period which required eligibility criteria.  

I will be getting some specialized cardiac testing after seeing my family physician plus a 2nd ultrasound examination (breast), both next month.  I will not be charged. This would happen to another Canadian without any employer-sponsored health care benefit plan.

When I saw my family physician I brought forward 3 medical problems.  She examined me and also gave me prescriptions.  She did not ask me to book for 3 separate appointments.  She answered all my questions  (I usually ensure I have a few useful questions to ask as a patient.  No patient should expect doctor to read their mind.)  

I pay my taxes to federal, provincial govn't….parties who figure out how much each province gets in total from federal govn't for health care.   Yea, some CAnadians get into a snit about high taxes (federal, provincial) depending on their income and life situation....  but honestly I don't think the general public understands the operating cost of health care..  My response is:  you're not really getting it "free":  it's paid by your taxes.  (Same for national,provincial highways, etc. and other stuff.)

 

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14 minutes ago, shootingstar said:

U.S. had better health care and more cost-effective (to you) than Canada

Don't confuse "better" with "cost-effective".  That's the crux of the healthcare crisis - in the US and abroad.  Likewise, just because you don't see a cost in your hospital/doctor/pharmacy bill, rest assured you paid somehow at some point.  When you buy a gallon of gas or a bushel of wheat, the price tag - like that of medical care - is not remotely the actual cost you have paid.

Tom

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7 minutes ago, Dottles said:

@shootingstar: it's definitely a thing as you get older.  I'll sacrifice my living conditions provided I can ensure my health insurance.

I'm sure you and wifey will be fine.  Not having any children at this time (or ever) makes it a tad simpler.

Myself and all siblings each are in different stages of home ownership.  I think only 1 sibling (out of 4 who are alive)  has a mortgage and she's 2 years younger than I. Because of public health care n Canada (even without her employer, she works for a hospital), it is made abit less burdensome for her especially when she had abdominal surgery a few years ago and another problem where she is now nearly deaf in 1 ear.  Her salary is lower since she is a receptionist but she has no children.

Dearie has a brother who gave up his Canadian citizenship and became an American.  He will be working probably for unforseeable future beyond retirement...he's 65.  But in a 2nd marriage to an American...he has a child that's only 10 yrs. old...  I've said to dearie...how on earth will/is he dealing with health care  in the U.S.  

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8 minutes ago, Razors Edge said:

Don't confuse "better" with "cost-effective".  That's the crux of the healthcare crisis - in the US and abroad.  Likewise, just because you don't see a cost in your hospital/doctor/pharmacy bill, rest assured you paid somehow at some point.  When you buy a gallon of gas or a bushel of wheat, the price tag - like that of medical care - is not remotely the actual cost you have paid.

Tom

I just finished saying that our taxes pay for a lot of health care in Canada..more than the mass public is even aware of.  The different levels of government in Canada don't get other sources of major funding for health care: it comes from our taxes and employers who pay their portion for any plans they sponsor for employees.  And not all employees get any additional health care benefits.  Certain employees industries/sectors may get nothing  ie. restaurants, retail and whatever.  It's entirely in control of the employer in Canada.  No rules on this one....at all..except maybe workers' compensation for accidents happening on the job.  I believe employers do pay...this varies per province... Workers' compensation law is at the provincial level.

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2 minutes ago, shootingstar said:

I just finished saying that our taxes pay for a lot of health care in Canada..more than the mass public is even aware of. 

So what's "better" about the US or the CAnadian systems?

Also, if your brother-in-law qualifies, he should have Medicare to cover his health care. Not sure what his kid gets, but kids are cheap to insure in the US.

Tom

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1 hour ago, shootingstar said:

Canadians- Just bookmark this thread from AMericans, if you (or someone else in Canad) ever think U.S. had better health care and more cost-effective (to you) than Canada. ?  

I am not sure what you are trying to say here to me.  It seems that you are ripping on my health care, which is good coverage on a group plan with low deductibles and a low max out of pocket.  In regards to the care I receive, it is excellent.  We have good hospitals and good docs.  I even get things like acupuncture and chiropractic care. PT is paid for at 90% coverage.

My health care is actually very good.  I am very very lucky to have such great coverage through my employer.  I know this is going to cost me, because I am leaving my employer many years before I can take medicare.  Although, things are changing fast, so we will see what happens in the next few years.

How much are prescriptions in Canada?  My plan has a copay of $100, for a drug that costs about 63K a year, retail cost.  That is not bad.

Pay for insurance or pay in taxes.  Someone is paying.  

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I find some of this retirement talk really depressing.  I did not even contemplate retirement until I was in my early to mid 60s.  I liked my career and lifestyle and was happy to keep working,  I finally got both mentally and physically tired, and decided to retire. Retirement at 55 did not even cross my mind. It is obvious that some folks have a 'bone to pick' when it comes to health insurance.  Folks need to shop and find what works and not get too concerned about some of the sniping that is going on in this thread.  Good Luck to all of you.  I hope you meet your goals and have a Great Life.

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13 minutes ago, sheep_herder said:

I find some of this retirement talk really depressing.  I did not even contemplate retirement until I was in my early to mid 60s.  I liked my career and lifestyle and was happy to keep working,  I finally got both mentally and physically tired, and decided to retire. Retirement at 55 did not even cross my mind. It is obvious that some folks have a 'bone to pick' when it comes to health insurance.  Folks need to shop and find what works and not get too concerned about some of the sniping that is going on in this thread.  Good Luck to all of you.  I hope you meet your goals and have a Great Life.

SS comments were hurtful.  It felt like, your health care sucks, we have it better.  Ouch.

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14 minutes ago, sheep_herder said:

I find some of this retirement talk really depressing.  I did not even contemplate retirement until I was in my early to mid 60s.  I liked my career and lifestyle and was happy to keep working,  I finally got both mentally and physically tired, and decided to retire. Retirement at 55 did not even cross my mind. It is obvious that some folks have a 'bone to pick' when it comes to health insurance.  Folks need to shop and find what works and not get too concerned about some of the sniping that is going on in this thread.  Good Luck to all of you.  I hope you meet your goals and have a Great Life.

I'm going to work until I'm probably 65.  I'd like to say how cool it'd be if I could do it at 60 -- but why?  I work another 5 years, I get another 5 years of income and I now don't have to worry about my retirement savings last another 5 years.  I always plan on being active.

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As I approached retirement, I was pumping as much money as I could into my IRA and stock investments, 5% of my salary went into my pension, and was paying a mortgage that I paid of several months after retirement.

When those "expenses" ended, that meant a big difference in the cost of living, which was important because I retired at 56 and lived frugally until all my income streams kicked-in and didn't want to deplete my savings.  Now, at 68, I'm fortunate enough to save more than I spend in retirement

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I think the cost of medical insurance coverage will make me work longer than I initially desired. But I’m still almost 12 years from 59 1/2 anyway, so while I have nickels saved, most of it is relatively unaccessable for a bit. So I think downsizing my work responsibilities and taking longer winter vacations to tropical destinations will be my 5-10 year plan. In that time my kids will be done with college, which will help guide if I stay in the area or move.

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11 hours ago, Dirtyhip said:

I am not sure what you are trying to say here to me.  It seems that you are ripping on my health care, which is good coverage on a group plan with low deductibles and a low max out of pocket.  In regards to the care I receive, it is excellent.  We have good hospitals and good docs.  I even get things like acupuncture and chiropractic care. PT is paid for at 90% coverage.

My health care is actually very good.  I am very very lucky to have such great coverage through my employer.  I know this is going to cost me, because I am leaving my employer many years before I can take medicare.  Although, things are changing fast, so we will see what happens in the next few years.

How much are prescriptions in Canada?  My plan has a copay of $100, for a drug that costs about 63K a year, retail cost.  That is not bad.

Pay for insurance or pay in taxes.  Someone is paying.  

You are on an employer benefit plan. That is my point.  That's all.

Of course, Canadians pay by our income taxes and whatever extra. I'm just saying some (or a lot.) Canadians are incredibly naïve to think they can get same level of health care in U.S. without paying a lot if they didn't have an American employer with a health care plan.

For Canadians who can afford to have a home in U.S., they make sure they can fly back to Canada for health care. A lot of them engineer their stay  that way. 

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We have a few years before our house is paid off. Until then, I’m working. 

mr. retired in February to manage our son’s care and employment. It’s enough of a job for him that he couldn’t do both that and teach. 

His pension and my income are enough, and I have health care through my school district. But our 401k accounts aren’t enough to make not working an option, even with no mortgage. 

Our son contributes his share of home expenses through his disability and he has an income from his own job, but neither of those is a long-term guarantee. Especially if the GOP has its way with enacting limits and repeals of social security.

 

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19 hours ago, 12string said:

It's always been a concern, will I be able to retire.  During the many years of scrambling for every nickel, it appeared not possible.

I got my 401K review yesterday.  They say it looks like I'll have about $65K/year to live on, if the market doesn't crash.

 

First off, congrats!  It sounds like you will be in great shape and that the years of hard work by you and your wife will pay off in the future that you envisioned.  One word of caution for people on the income estimates that come with some 401(k) statements - the estimates that we get from Financial Engines assume that we take our entire 401(k) balance and purchase an annuity.  If that is the person's plan, then no issue.  But if the person is not planning to purchase an annuity, then the safe withdrawal rate is likely below the estimated income.  There were some employees at my job who didn't realize that and had to recalculate their plans accordingly.

One good thing about your plan is that you have a couple different "legs" to your retirement stool, so if anything happens to one of them, you've got other supports for your plan.

To Sheep_herder's issue re planning for an early retirement, one of my main drivers isn't that I necessarily want to retire at that age, but if I lost my current job, it would likely be hard to find a comparable one at this age.  Part of my planning for early retirement is to make sure that I'll be ok if things happen beyond my control.

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17 hours ago, Dirtyhip said:

Pay for insurance or pay in taxes.  Someone is paying.  

Exactly.  And for employer paid plans, your salary is reduced by what they have to pay for insurance.

But there's a more equitable way to pay for it than employee sponsored plans.  In those, people who have jobs and income only pay a fraction of their insurance cost.  People who don't have jobs and income pay 100% of tehir insurance, and it's more expensive because it's not pooled.  Kind pf backwards.  Paying for insurance from taxes makes sure that people pay based on their ability to pay.

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And what's all this retire at 55 stuff?  No way!  My pleasant surprise was that I could probably retire at 65, instead of 70-ish that I had expected.  I'm not going to retire until I can afford to enjoy it, instead of sitting home eating cat food.

My mortgage will be paid off a couple years prior to 65, but the P&I part is only about $300.

I got all of my kids to start their careers with a max 401K contribution, they'll never miss it.  And THEY can retire at 55!

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1 hour ago, 12string said:

And THEY can retire at 55!

With threats to entitlements never ending, I doubt they will feel any more secure than you do, TBH. I just discovered last night that the retirement age will be 67 by the time I cash in, which wasn't terrible new because I had anticipated waiting for 70 before starting SSI for maximal benefits, but now the difference in payments have narrowed, so it may be a new calculation when 67 comes. But that's 20 years for me, so I'll live a little more for the now knowing that the working/savings phase will be a bit longer than previously planned. 

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I turned 66 in July, but will work full time until Dec of this year.  I have been asked to consider part time for at least the first part of 2019. this may help keep me mentally sharp and I can ease into full retirement.  it will also give me more free time.

Since Mrs_Az_cyclist is also 65 we have Medicare (and now are concerned they dont take that away) and we will have to look at suplimental health insurance.

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