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I'M DONE !!! I think !!!
Old 08-07-2012, 08:30 AM   #1
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I'M DONE !!! I think !!!

Hi All
Well I have been a part of this forum for 5 years and have learned a lot (thank you all). I think I m ready to fire ? The firm I work for is going to cut out health care for anyone 55 and older retiring after Sept 1 2012, This was the main factor I asked for an early exit, I figure its worth at least 220 K to me over 10 years at a mimimum,. I pay only 15 % of current premiums. If I take it, everything stays the same till Medicare and then they will supplement above that level. I m a resident here in the USA been here since 1998. I put most everthing into cash last week and will look to re allocate more proactivly to my new life situtation. My wife and I are in great health and very active so I don't see any major health problems for us, both our parent are alive and in their late 80's, it’s a good chance with will make it there as well. I am figuring our living expenses will be 80k but willing to adjust lower if need be. I ran everything through firecalc before I unloaded everything into cash and excluded SS for now and planned out 35 years. Seems to be ok

1) question on SS I have paid yearly max since 1998 -2014 my wife has never worked and I can't seem to figure out what I would receive at age 62 or 66 years of age

2) New asset allocation I have my view but looking for consensus ( I m not to conservative willing to take a little risk)

3) CAN I DOOOS IT ( is really what I m asking ?)
 
 
AGE 55
DW 52
 
401K / RRSP (Canadian version 401K) 600k IN CASH
CASH BALANCE PLAN 225K IN CASH
SCHWAB DIVIDEND PORTFOLIO 150K ( AVERAGE YIELD 7.9 % )
VANGUARD CASH ACCOUNT 750K ( CASH ACCOUNT)
COMPANY STOCK 300K ( FULLY VESTS IN 2 YEARS)

SEVERANCE PAY OF TWO YEARS ( WILL LIVE ON MY EXPECTED LAST 3 YEARS EXPENSES) SHOULD LAST ME 4.0YEARS
MEDICAL FOR LIFE ( PART OF EXIT PACKAGE)
HOME VALUE 900K ( NO MORTGAGE) HOUSE UP FOR SALE AND MOVING TO SARASOTA FL GOING TO SPEND AT LEAST 750K ON A HOME
CONDO CANADA 450K (NO MORTGAGE)


I got to tell you all up to making the decision I was nervous as hell, now that i have made it............ I m can't wait to get out of here in 3 weeks !!!


thanks Harry
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Old 08-07-2012, 11:21 AM   #2
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Hmm...

$600,000 in RRSP
$225,000 in cash
$150,000 in dividend portfolio
$750,000 in Vanguard cash account
$300,000 in company stock
$150,000 in cash you should pocket from exchange of homes

I will leave out the extra home in Canada and your severance pay for now. If you add all that up, you have $2,175,000 that you won't start using for 2 years because you will live on your severance pay for 2 years (which is good because you can't get the $300,000 for another 2 years).

If you take 4% of that then you will have $87,000 per year. You should have this invested so that you can give yourself a little raise each year. If you could make it on $76,125 a year, then just take 3.5% initially. With no money going toward housing or medical, this seems VERY doable to me. I would really look closely in Florida, because that state was hit HARD with falling home prices, and you might be able to get a GREAT home for MUCH less than $750,000. You can get some REALLY nice homes there now for half that if not less than half (and with a good, not great income in retirement, you don't want to pay too much in taxes).

I say go for it. I could do it easily, but it appears my tastes aren't quite as expensive as yours. If it were me (not saying you should do this), I'd sell BOTH homes in Canada, buy a $300,000 home or cheaper in Florida and be VERY happy then with 4% of what would then be closer to $3,000,000 in investments, so $120,000 a year. If you've got NO debt and no need to pay for medical expenses and more money coming in the form of SS later on and you live in a not-too-expensive house, that will enable you to do lots. Want to spend time in Canada again, then rent up there.

Man, to be retired at 55. I'd LOVE it...shooting for 60 for me.
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Old 08-07-2012, 12:57 PM   #3
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Thanks LeavingOhio

Yeh yeh yeh, I thought it would never happen really. Thanks for analysis, I guess was just trying to get an outside perspective and another pair of eyes on things. Sometimes when you have to look at personal finances you tend to skew things in your favor to make things work. Still trying to get a grasp on SS and what sort of monthly income that would provide.
Also don t know if I should roll my 401k and cash balance plan into a IRA with Vanguard. Looking also at a new asset alocation going forward and want to make it simple as possible, I gather thats is easier said than done, but will do my homework before I pull the trigger on that.

thanks again
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Old 08-07-2012, 01:08 PM   #4
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If you're curious about what you would get on social security, go to ssa.gov and run the estimator. The site will tell you how much you'll get in just a minute or so.
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Old 08-07-2012, 02:05 PM   #5
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3) Congratulations. I would say that you are set.

2) Have Vanguard do a financial plan for you and see what they say for AA. I retired 8 months ago and my AA is 45% Total Stock, 15% International Stock and 40% fixed income.

1) As others have suggested go to ssa.gov and follow the prompts to get a projection of your SS.
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Old 08-07-2012, 02:58 PM   #6
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I agree with what the others say about SS. I also agree that you should contact Vanguard and talk to them about asset allocation. Vanguard is the best. I believe you have done enough! Sounds awesome.

Here's a home for sale in Sarasota, FL for $299,900 - http://www.realtor.com/realestateand...1_M54839-77326

Here's a home I would buy for $122,000 - http://www.realtor.com/realestateand...1_M53223-27540

Here's one for $619,000 - http://www.realtor.com/realestateand...1_M53198-99446

Here's a $750,000 condo on the water - http://www.realtor.com/realestateand...2_M52105-68478

Lots of choices!
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Old 08-07-2012, 04:35 PM   #7
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Congratulations ! Sarasota prices have dropped but they are starting to creep up . There are still a lot of short sales around especially at the higher price range . Have you decided on where in Sarasota you will be buying ?
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Old 08-07-2012, 06:20 PM   #8
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Welcome, Harry.
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Old 08-07-2012, 06:45 PM   #9
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I think you're in great shape Harry. There's always a leap of faith in giving up a job. Nothing is certain in life. Well, except the Stones are still a great band....
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Old 08-08-2012, 05:32 AM   #10
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Hi all,

I am taking a leap of faith, been working for 33 years and have woke up every moring with a place to go a plan and a routine, come Sept 1 that all changes I have gone from not sure I'm doing the right thing to elated and feeling much more confident in my decision. I'm not sure how its going to affect me mentally but I'm up for the challenge (yahoooo).

I have not found anything yet in Sarasoto, winging it really. I have lots of friends down there just waiting for us to come down. We have been looking really all over but want to be close to Seista Key (5-10 minutes drive max) we are going to take our time and find the right fit. I have a decent budget set for a really nice home.

My next challenge really is going to get an easy portfolio put together with the right stock bond mix and figure out how much my SS will be and how to withdraw from my portfolio and at what ratel. I'll have a few years to figure that one out.

thanks
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Old 08-08-2012, 11:00 AM   #11
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Quote:
Originally Posted by harry06880 View Post
 
AGE 55
DW 52
Quote:
Originally Posted by LeavingOhio View Post
If you take 4% of that then you will have $87,000 per year. You should have this invested so that you can give yourself a little raise each year. If you could make it on $76,125 a year, then just take 3.5% initially.

I say go for it.
May not make any difference, but a 4% WR for a couple ages 55 & 52 would be considered aggressive by historical standards, and whether history will repeat in the decades ahead is unknown. 3.5% less so, many people consider 3% the WR that can go on forever...FWIW
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Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
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Old 08-08-2012, 11:33 AM   #12
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Thanks Midpack

I was looking at the 3 % as well depends on what SS will provide... should work
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Old 08-27-2012, 08:12 AM   #13
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Well Friday 12.00 pm is my last day with the global megacorp I have worked for the last 28 years. I got out with a terrific package and can't say enough about how well treated I got by the firm on my exit, still I feel a sense of sadness and purpose. Working every day for the last 3 decades gave me a sense of worth and drive to wakeup with a mission.

I can only relate this to being a addict and having to break the habit cold turkey. Anyone else felt the same on exit from Megacorp and how did you get over that feeling ? I know its time for me to leave but I have to say in the last few days I have been strugglng with it.
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Old 08-27-2012, 08:32 AM   #14
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Harry:

Congratulations. I agree that, if you can, using 3% will give you a safety margin.

Can I ask about the investment you listed :
SCHWAB DIVIDEND PORTFOLIO 150K ( AVERAGE YIELD 7.9 % )
Is this a fund managed by Schwab? 7.9 seems like an awesome yield!
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Old 08-27-2012, 09:49 AM   #15
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Hi David1961, its a small divide& MLP portfolio I put together that has been pretty good to me over last couple years, going to stick to it for a tiny part of my portfolio

BP, RDSA.A,PVR,VNR,NAT(JUST ADDED),EXC,ETP,BMY,PFL,PGP,TWO,IVR ,CIM,PNNT,GOOD

Not all equal weighting and I ve had on top of the yield about 3 % capital appreciation over last couple of years
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Old 08-27-2012, 12:29 PM   #16
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Originally Posted by harry06880 View Post
Well Friday 12.00 pm is my last day with the global megacorp I have worked for the last 28 years. I got out with a terrific package and can't say enough about how well treated I got by the firm on my exit, still I feel a sense of sadness and purpose. Working every day for the last 3 decades gave me a sense of worth and drive to wakeup with a mission.

I can only relate this to being a addict and having to break the habit cold turkey. Anyone else felt the same on exit from Megacorp and how did you get over that feeling ? I know its time for me to leave but I have to say in the last few days I have been strugglng with it.
We for sure all have different views on this. For me, very little of my self worth comes from my job, so I don't envision that being a big problem for me when I do retire someday. I suppose for you and for other people like you, you could always get a part-time job if you feel you need that. I am a volunteer track and field coach, and I get more satisfaction from that than just about anything else I do, so maybe there's a volunteer situation in your future that will fill that void.

OR, you could just decide that hey, I've worked long and hard so that I could retire, so I don't need to have a mission to tackle every day. You've worked and saved so that you could retire. You're allowed now to relax and not feel bad about it.
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Old 08-31-2012, 02:57 PM   #17
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Hi, harry ... I can partly relate to your situation, since I'm retiring October 1st from a corporate job that I've been at for 32 years. No severance package and no continuation of medical insurance, and I don't have as high of an asset base as you do - but, our expenses look to be quite a bit less, so I'm in good shape.

I'll miss some of the people and some of the tasks I worked on over the years, but I can't wait to get away from the deadlines and having to work on projects that really aren't all that interesting. It's always been a job to me, so I actually am eager to not have to go in and do it every day. I'll be working on other things for a sense of mission in the future - and I'm looking forward to figuring out what that will be.
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Old 08-31-2012, 03:24 PM   #18
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Harry, I'm thinking about the retiree Health Benefits. Are you confident they will be around for 10 years? This is one stumbling block in my plans. At this point I am eligible but I'm waiting to see what 2014 will bring. Granted your situation requires a more immediate response. Good luck
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