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I'm ready, wife isn't so sure - both 58
Old 04-05-2013, 03:52 PM   #1
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I'm ready, wife isn't so sure - both 58

We still have 3 children who would prefer to come back to the house they grew up in when on college breaks - or beyond - but we have so much equity in the house, we can retire now/very soon if we sell the house and downsize.
college costs are fully funded and not part of the #'s below

we have $425k in 401k's, I will max out on SS benefits (wife receiving half) - and the equity in our house is approx $850k. my wife and I are each likely to inherit some family $ (perhaps $150-250k each) in another 5-15 years. Firecalc runs are almost exclusively positive - and I just was let go from a stressful sales job and do not want to go through any more of that, so that adds to the 'sooner than later' attitude of mine.

My wife still enjoys her small/part-time job (5-15 hrs/wk) and is inspired by her mom who is still working at 80+, but doesn't need to (my parents retired at 55, who were my inspiration for this.)

If I have to - I can likely find decent work for another year or 3 - but I really don't want to. I'd love to retire to lifestyle of spending $70k/yr with no mortgage and very low cost of living relative to where we are now (huge). appreciate any comments or advice.
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Old 04-05-2013, 04:35 PM   #2
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a. Welcome to the forum
b. Don't count on the inheritance
c. What are your expenses....have you done a detailed accounting of them, and a budget?
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Old 04-05-2013, 04:54 PM   #3
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Welcome-
And +1 on not counting the inheritance.
And +2 on detailed budget accounting. Might not be bad idea to actually live on that $70k/yr budget for a while before pulling the trigger.
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Old 04-05-2013, 05:02 PM   #4
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and I wouldn't base your decision on whether to sell your house and downsize on your grown kids' preferences.
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Old 04-05-2013, 05:15 PM   #5
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I agree with other posts not to count on the inheritance. I also would look closely at your expected expenses in retirement. What do you plan to do for healthcare?

I would never ever keep an expensive house just because grown or almost grown kids wanted to be able come home/stay in that house. In fact, in order for DH to retire at 62 and for me to semi-retire at 56 we sold our large expensive house. Yes, the kids did grumble soon as they liked the house. But 3 years later things are fine.

What is it your wife is not sure about? Is it the selling the house or something else?
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Old 04-05-2013, 06:07 PM   #6
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I'd go with cash out and retire. If you live in a very high cost of housing compared to wages area, you might be doing your kids a favor by having a post college home base in a more affordable area.

Housing prices may fall once mortgage rates go back to more normal levels in the next few years. I don't have a crystal ball, but I'm betting that the next year or so is a good time to sell, especially in hot real estate markets.

The book Retire on Less Than You Think has lots of good arguments for retiring early by moving to a lower cost of living area.
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Old 04-05-2013, 09:44 PM   #7
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Don't count on the inheritance - LTC can drain financial resources quickly.
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Old 04-05-2013, 10:19 PM   #8
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What will you live on between now (58) and when you can access your 401k penalty free at age 59 1/2?

If you want $70k a year in today's dollars, how much of a gap is there after considering SS at 62? FRA? 70?

+1 on not counting on inheritances. A friend's retirement plan was his inheritance from his wealthy parents - it didn't work out as he planned so he's still working. Also, I've heard horror stories of LTC costs eating up nesteggs and inheritances evaporating into thin air.
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Old 04-05-2013, 10:20 PM   #9
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Sell the house and downsize. Kids can still come and crash - that's what sleep sofas and air mattresses are for. Enjoy your retirement!
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Old 04-06-2013, 08:18 AM   #10
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thanks all for the good advice. Not really 'counting' on inheritance, but it is already in a trust for us. Main issue is downsizing while youngest child is still in college and possibly moving south when home was CT. Other plan is to downsize 'up here' and then take a 2nd step down a few years later...

yes - I've done a detailed budget - $75k will be plenty to live on when there's no mortgage and very low taxes/utilities/overall costs.
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Old 04-06-2013, 08:30 AM   #11
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You are literally at the fork in the road. This is the perfect "excuse" to sell the costly house.
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Old 04-08-2013, 08:13 PM   #12
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I second the downsizing of the house. We did that when our last child entered college. That was almost 5 years ago and has never been an issue. We still have 3 BR's and a finished basement so space hasn't been an issue. Next step is to sell this and move to a more southerly location. Don't mind a chilly morning but like to have warmer afternoons in the winter time.
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Old 04-09-2013, 02:13 AM   #13
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Welcome to the forum, bpares.
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Old 04-10-2013, 07:56 AM   #14
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The biggest thing not mentioned is your kids effect on your budget. A wedding will cost a few grand for the rehearsal dinner if they are guys. Gals? $50,000 each? Once the kids have graduated, you may want to help them get started. We gave each kid a low mileage, one year old car at a cost of $14,000. And we put $20,000 towards the down payment on a small condo/townhouse. So $34,000 each. A friend says I have lost my mind and he is doing $0 for this.
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Old 04-10-2013, 08:30 AM   #15
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2 sons, 1 daughter - and yes - I intend to do pretty much as you've described. (already own 4 cars that the family uses now...) I hope to be able to help them out within reason ($25-50k/child for initial cars, down payment on home, etc. ) That is planned for in the long-term budget.
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Old 04-10-2013, 08:47 AM   #16
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Looks like you have a good plan. As far as a wedding I have 3 daughters and the most expensive one was only around $10K for everything and all have been told that their weddings were some of the most fun to attend! Nice dinner, open bar but the most important aspect was the music and dancing that is what is most remembered.
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Old 04-10-2013, 08:48 AM   #17
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I also contributed about $5000 to each towards their downpayment and of course their first car was a few thousand each. I contributed 50% towards their college educations so that they had a financial stake themselves in their education success.
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Old 04-10-2013, 09:26 AM   #18
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Sounds like it's time to downsize. The kids will survive sleeping on an air mattress when they visit and the downsizing may encourage them to move their "stuff" out (although we still have about 6 large boxes of DD's "stuff" that she isn't ready to move yet). If your wife enjoys her part-time job, I'd let her keep doing it as long as she wants to. Good luck!
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