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Going to put my notice in Friday or should I?
Old 05-08-2017, 08:29 AM   #1
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Going to put my notice in Friday or should I?

Hello, Long time lurker who is getting close. But I have to ask one question… Am I crazy??
I am 53 years old and going to put in my 3 week notice this Friday. After 25 years in Corporate America, I am done. I have had enough of this life! I plan to never have an updated resume again.
My Wife is 52 and is a stay at home Mom.
I currently make $125k a year and we save close to 45% each year. We are not big spenders on stuff.
I have a Son 16 and a Daughter 14. They are in High School Sophomore and Freshman.

Expenses:
We currently live in a Large Midwestern town with an inexpensive cost of living.
I have estimated our monthly expenses to be around $6500 a month.
Our house is worth $400k and we have a 30 year fixed rate mortgage at 3.625% with a balance of $225k
Mortgage / property taxes and insurance $2000
Healthcare insurance $2000
Remaining bills $2500

Cash Flow:
Dividends from common stock $3300 /month
Part Time Ebay Business $700 /month I would like to work on this more to get it around $2000/month. Seasonal as summers are not as strong as holidays.

Total inbound without job $4000/month.

So we have a $2500 to $3200/month short fall

Non Home Assets:
Net Worth $2.8m
IRA/401K $1.0m need to wait 6.5 years to touch any of this.
Stocks $1.73m accessible currently portfolio consist of 12 blue chip stocks and no mutual funds
Cash/Bonds $70k accessible currently

Separate from Net Worth are 529 plans for each kid’s college education.
Son $105k in Fidelity Mutual Funds
Daughter $95k in Fidelity Mutual Funds

As we get close to Friday the more nervous I get. Am I crazy. I have been a frugal saver my whole life. Now I am going to have to spend and I am not sure I can.

Has anyone else had this issue. How do you break through? Are we going to be ok? I have ran every calculator under the sun and our plans seem to work. What if the markets tank which I expect because we haven’t had a recession in a while?

Ugh I am not sleeping and making myself sick with worry. I have even mentioned the dreaded maybe one more year.
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Old 05-08-2017, 08:40 AM   #2
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If you retire today what is your current monthly cost for health insurance for 4 people? Does the 2000 a month include any out of pocket costs to meet deductibles...you have 12 years until Medicare that's a long time.

Does remaining bills include vehicle replacement or house maintence?
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Old 05-08-2017, 08:45 AM   #3
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You've probably seen this, but in case you haven't, Some Important Questions to Answer Before Asking - Can I Retire?

It would be helpful to know what you expect for Social Security and any other pension related income. T
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Old 05-08-2017, 09:35 AM   #4
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Financially it appears to me that you have far more than you need. My only suggestion is to make sure your allocation to equities is appropriate for someone who is getting ready to retire. With sequence of returns risk being a factor for you, the best way to protect yourself is to lower your equity exposure to a percentage that allows you to sleep at night.
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Old 05-08-2017, 09:53 AM   #5
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Should you? Yes. Crazy? No. Nice job of saving. When the market goes south (it will), you will adjust. No one accumulates what you have without the figure it out gene.


Read your opening paragraph again. Another year, two or three of work isn't going to make a material difference to your burn rate and that reasoning will always be there.


Two years older than you, I'll be retiring next year with less in invested assets and a significantly higher burn rate due to maintaining a snowbird residence and um, a yacht. Insert face palm here.
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Old 05-08-2017, 10:02 AM   #6
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Just a couple of things to consider:
If you are going to withdraw from your "stock bucket" for the 1st 6.5 years, then won't your dividends decrease annually because your shares decrease when you sell to fund your living expenses.
You have two teenagers - have you looked at car insurance for teenagers! Also, have you included cost of cars etc for them.
Health insurance cost looks low for a family of four - and may be very difficult to estimate in the current uncertainty of healthcare.
College - Does this cover just to cost of tuition? Room & Board are also big $ items that hit the budget.
That being said - 3% WD rate on $2.8 is $84k - so that approximates your spend rate and does not include your part time income and future SS.
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Old 05-08-2017, 12:20 PM   #7
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I don't think you are crazy, but why wait until Friday? I suggest that you go ahead and tell them of your plan to retire today...that way you can deal with the feedback sooner rather than later. It will relieve some of the stress that your are currently feeling.
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Old 05-08-2017, 12:39 PM   #8
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Quote:
Originally Posted by StJohnsWood View Post

Non Home Assets:
Net Worth $2.8m
IRA/401K $1.0m need to wait 6.5 years to touch any of this.
Stocks $1.73m accessible currently portfolio consist of 12 blue chip stocks and no mutual funds
Cash/Bonds $70k accessible currently

Separate from Net Worth are 529 plans for each kid’s college education.
Son $105k in Fidelity Mutual Funds
Daughter $95k in Fidelity Mutual Funds
Says YES.
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Old 05-08-2017, 12:45 PM   #9
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Quote:
Originally Posted by StJohnsWood View Post
Currently portfolio consist of 12 blue chip stocks and no mutual funds
I admire the simplicity but that would make me nervous as hell.

Is your $3,300 coming from your $1.73 of stocks (I assume so)? That would make a yield of 2.2%. Frankly you can do much better with a more diversified portfolio.
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Old 05-08-2017, 12:51 PM   #10
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Originally Posted by Cap_Scarlet View Post
I admire the simplicity but that would make me nervous as hell.

Is your $3,300 coming from your $1.73 of stocks (I assume so)? That would make a yield of 2.2%. Frankly you can do much better with a more diversified portfolio.
Oops.
I just realized I read the original post wrong!

$1.73M in 12 stocks is very risky and I would not do it.
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Old 05-08-2017, 01:13 PM   #11
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Originally Posted by StJohnsWood View Post
....As we get close to Friday the more nervous I get. Am I crazy? I have been a frugal saver my whole life. Now I am going to have to spend and I am not sure I can.....Are we going to be ok? I have ran every calculator under the sun and our plans seem to work. What if the markets tank which I expect because we haven’t had a recession in a while? Ugh I am not sleeping and making myself sick with worry. I have even mentioned the dreaded maybe one more year.
Yes I think you are crazy to retire now. You are in too much of a rush. It's NOT that your finances couldn't support your spend rate. It IS that you don't seem mentally prepared yet and clearly haven't thought through all your concerns well enough. Why not take the time to think through all your concerns and get a plan in place to address them BEFORE you retire? Included would be what would you do if the market dropped 30-50% (which it MIGHT). Shouldn't take but a couple months to think through all these things and it might prevent you from making a BIG mistake. Heck, go hire a couple hours of a financial advisors time and hit them with all your specific conerns and ask for a plan to address them. I don't use FA's (I use the knowledge here) but others here do. Your concerns may benefit from such a meeting.

BTW - like others have said, I would NOT have all my taxable assets in 12 stocsks, no matter how blue chip they were. That is not nearly enough diversity in my mind to be comfortable. I also would think long and hard about what to do if one of my children either (a) decided not to go to college or (b) got in a serious car accident and needed quite a bit of $$ and care before they got better. Personally I waited until my kids all graduated to retire.... we could have retired earlier but this was one risk I was personally uncomfortable with.

Don't pull the trigger unless you are very comfortable doing it, can't simply pull it back if it was a mistake for you. Best of luck.
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Old 05-08-2017, 01:18 PM   #12
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What about taxes? is that included in the "Remaining bills"? or is the $3,300 in dividends after taxes?

Personally, I would be a bit nervous doing it in your shoes until I had my portfolio a bit more diversified.
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Old 05-08-2017, 06:00 PM   #13
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Whisper66 said it all. Good luck
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Old 05-08-2017, 06:09 PM   #14
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I was nervous, this was after i stayed 5 years too long. I think nervous is normal. Best of luck you earned it
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Old 05-08-2017, 06:58 PM   #15
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Nervous is very normal like some of the others have said. I looks like to me you will be fine there is a lot of people retiring each day with a lot less then you have. Your EBay business will keep you busy and that is a nice income as well.

It really come down to you but being afraid/nervous is normal.
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Old 05-08-2017, 07:42 PM   #16
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I retired from a screwed up and stressful Fortune 50 tech company after 20 years at about the same age, with a little less in assets, but no kids. The stress of those type of jobs can be hellish and not worth it after a certain point. On the surface you look perfectly fine with the info provided. And if things don't work out at least you'll have a nice breather and can choose to return to work.
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Old 05-10-2017, 11:48 AM   #17
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To me, you look (more than) good to go. I agree with others that you should diversify your stock holdings, but I think you could have retired a few years ago. You mention a monthly shortfall of ~ $3000. Lets bump that up to $4000 month ($48K/yr). On a portfolio of $2.8MM, that is a 1.7% withdrawal rate, which I think pretty much everyone would agree with well within the bounds of acceptable.

I have been giving thought to pulling the trigger with a fairly similar circumstances as yourself, though with a portfolio smaller.
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Old 05-10-2017, 01:27 PM   #18
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A huge thank you to everyone for your input and advice. I appreciate all the different opinions.

I am definitely letting my Boss know Friday. I have had enough and probably should have left a year ago.

When I really look at my anxiety it’s primarily due to spending now instead of saving. Hopefully I reach some equilibrium place.

As my wife has said multiple times I can always go back to work in another field or capacity at a later date.
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Old 05-10-2017, 03:32 PM   #19
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Congrats! Hope you enjoy your retirement
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Old 05-10-2017, 06:53 PM   #20
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If it was me, at 53, with 2.8 million invested, but still 2 kids at home plus a mortgage, I wouldn't retire. Personally, I retired at 51, but with my home paid off, a bigger nest egg (and we do spend more), but the kids were launched. We'd paid the last of the youngest' college tuition and she was already married and on her own for rent and food, we had two more semesters to pay for our oldest, but at a state school that was not too costly. He was also on his own for expenses other than tuition and books.

One thing that we had decided, too, was that even if we had enough to retire, I wouldn't until the kids were out on their own and understood getting up everyday and working for their keep. Everyone has their own opinions on this, but I felt it best to remain an example of work ethic, until they "got it".

YMMV. Hope whatever you choose turns out great for you. Keep the resume polished, though. You never know when you'll want to work, on or at something, just because...even if you don't need the money. (You may find you need the fulfillment...I do struggle with that from time to time, but as you said, the thought of going back to full-on corporate gives me the heebie-jeebies.
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