Having Retirement Jitters

[KaChing]

I'm new to this forum and I'm hoping to retire at the end of June. I'm not exactly an early retiree at age 62 (62.5 in June), but I've got so many questions my head is spinning.

I could go on working indefinitely in my secure but nerve-wracking civil service job, but I'd much prefer to get out ASAP as I'm concerned about the effects of chronic anxiety on my health.

I'm puzzled about the 4% Rule and the results I get in FireCalc. Assuming I live until age 92, it says that I have a %96+ chance of not outliving my assets. Is that good enough? Comments or suggestions?

I'm also wondering what effect Medicare would have on these calculations in a few years. I would have to get insurance through COBRA and I'm geusstimating a $550 a month premium. I couldn't get an exact figure because I've been off from work for the holidays.

Anyway, I'm glad to be here. I expect to learn a lot.

 

[REWahoo]

Welcome KaChing. Sounds to me like you are in great shape if you're getting something north of 95% from FIRECalc. Less mathematically challenged minds than mine say anything greater than 80% or so is probably good, so anything more than your 96% number is likely just piling on.

You also say you are puzzled about the 4% rule and having retirement jitters. Have you read these?

http://www.early-retirement.org/forums/f35/explain-4-withdrawal-rate-19234.html
http://www.early-retirement.org/forums/f47/faq-archive-how-much-enough-30818.html

 

[KaChing]

Thanks for the welcome and your reassurance. I thought perhaps that hitting 100% in FIRECalc was the goal. Thanks for the links, too. It's so tough to strike a balance between retiring too soon or too late!

 

[boilerman]

Only about 1 in 4 people in the US live past age 90, so a 96% probability of not outliving your money to age 92 is pretty darn good.

What about your expenses? How confident are you of your projections? Health care costs always seem to be the wildcard so I would nail that down before hanging it up.

One of the lessons I've learned from this board is how many people happily live on a lot less money than I would have thought possible. For examples, go to:

http://www.early-retirement.org/forums/f47/faq-archive-how-much-enough-30818.html

Although I'm not interested in cutting back to a $30-40K per year of spending in retirement, I'm comforted by the fact that it's being done by so many.

 

[KaChing]

Health insurance is definitely the wild card. I'm waiting for a return email from HR regarding COBRA premiums and then I'll have to check in with Blue Cross to be sure that my policy will be extended beyond 18 months.

Otherwise, my expenses are fairly predictable. I own my home, a low maintenance manufactured house which sits on a rented lot. The lot rent has routinely gone up $20 a month each year for the past several years. Property and sewer taxes have been the same, with a tax break for the former coming when I'm 65. Heating is another wild card (I'm a Peak Oil believer), but I'm guessing natural gas isn't going to go up dramatically over the next few years. The car, a 2000 Honda Civic with 55,000 miles on it, was purchased new for cash and I've maintained it per Honda. (Eventually I'd like to find a smaller house in an area where the cost of living is lower, but I think it might be wise to stay put for a year or two and get my bearings after I retire).

As for entertainment, I'm a cheap date. I love to read, paint, cook, sew, garden, and do volunteer work with the needy and aged. I've worked as an auditor nearly ten years and I've had all the travel I can stand, so there will be few if any expenses for vacations.

I'm one of those people who expects to get along happily on less than 35k a year. Over 21k of that will come from Social Security and a pension, so there's not a huge difference to make up. I'm a divorced woman with no human dependents, two cats, and no debts, so my true needs are minimal.

 

[Moemg]

Welcome to the board ! Where are you located ?

 

[boilerman]

Health insurance is definitely the wild card. I'm waiting for a return email from HR regarding COBRA premiums and then I'll have to check in with Blue Cross to be sure that my policy will be extended beyond 18 months.

Otherwise, my expenses are fairly predictable. I own my home, a low maintenance manufactured house which sits on a rented lot. The lot rent has routinely gone up $20 a month each year for the past several years. Property and sewer taxes have been the same, with a tax break for the former coming when I'm 65. Heating is another wild card (I'm a Peak Oil believer), but I'm guessing natural gas isn't going to go up dramatically over the next few years. The car, a 2000 Honda Civic with 55,000 miles on it, was purchased new for cash and I've maintained it per Honda. (Eventually I'd like to find a smaller house in an area where the cost of living is lower, but I think it might be wise to stay put for a year or two and get my bearings after I retire).

As for entertainment, I'm a cheap date. I love to read, paint, cook, sew, garden, and do volunteer work with the needy and aged. I've worked as an auditor nearly ten years and I've had all the travel I can stand, so there will be few if any expenses for vacations.

I'm one of those people who expects to get along happily on less than 35k a year. Over 21k of that will come from Social Security and a pension, so there's not a huge difference to make up. I'm a divorced woman with no human dependents, two cats, and no debts, so my true needs are minimal.

It sounds like you're well on your way. Congratulations!

 

[KaChing]

Welcome to the board ! Where are you located ?

I'm about an hour northwest of Philadelphia in an overpriced suburban area dominated by Merck Pharmaceuticals.

 

[beowulf]

Welcome to the Board. Lots and lot of great information available here and many knowledgeable people to bounce ideas off.

Are you a career civil servant - by that I mean have you worked long enough to qualify for a pension and do you have over 5 years of service? The reason I ask is that you can carry your health insurance into retirement as long as you hold it for more than 5 years and get an immediate penion.

I left for the same reasons you did, though I did (and still do) continue to work as a consultant back to the gov. There is a lot less stress as you are just an advisor, can't make any decisions, and are not responsible for anything. Except for the actual having to commute in every day, it's much better for me, though this will probably be my last year.

 

[KaChing]

Welcome to the Board. Lots and lot of great information available here and many knowledgeable people to bounce ideas off.

Are you a career civil servant - by that I mean have you worked long enough to qualify for a pension and do you have over 5 years of service? The reason I ask is that you can carry your health insurance into retirement as long as you hold it for more than 5 years and get an immediate penion.

I'm a state civil servant, not Federal, although I'd consider getting reinstated in the Federal civil service after I retire. I left the auditing branch of the D.o.D. (DCAA) after four and a half years, not understanding the implications. I could have stuck it out another six months if I'd known. (That was seventeen years ago and retirement seemed light years away.)

The state is not nearly so generous with retirement benefits. I'm vested and will get a decent amount of money for only being around ten years, but an employee has to work for twenty years to get retiree health insurance. I can't imagine ten more years of this, and I'd be a very worn out 72 year old.

I left for the same reasons you did, though I did (and still do) continue to work as a consultant back to the gov. There is a lot less stress as you are just an advisor, can't make any decisions, and are not responsible for anything. Except for the actual having to commute in every day, it's much better for me, though this will probably be my last year.

I would love to get some sort of part time consulting work. I may contact some of the companies I've audited and see if there's anything I can do. One company offered me work while I was there (which, of course, I couldn't accept), and I may contact their controller and see if he'd still like some help. I work in a regulatory function of government and meeting the requirements is quite burdensome for small companies. Consulting for the state is not an option as my department director resents people who leave to make better money and refuses to contract with anyone who moves on before they have thirty-five years in. (This is probably illegal but no one has had the nerve or resources to challenge it).

I think what I'd like to do first, though, is just take some time off and get my bearings. I understand there's a period of adjustment for the first year or two, and I don't want to make any major decisions right away. Right now I'm vacillating between being in a nervous sweat and feeling exhilarated about retiring.

I'm delighted with this forum! I've only been participating for about a week and I've already gotten so much out of it!