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Is it time to pull the trigger?
Old 09-30-2014, 09:39 AM   #1
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Is it time to pull the trigger?

Hi, I am 60, will be 61 on March 17th. Been working almost 40 years and my commute to NYC is 1 hr 45 minutes each way. I am contemplating early retirement by 1 year.. I am collecting $40k Gross pension from previous employer, I have $2.8M saved, of which paid off home is 500k of the $2.8m. Live in NJ but want to move to Southport NC. I think i can make ends meet. Any concerns i should be worried about. I will have to buy my own health ins untill i reach 65. Only debt i have is a 14,000k car loan.

Thoughts?
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Old 09-30-2014, 09:42 AM   #2
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Thoughts?
Work your way through these questions and see how you fare.

Some Important Questions to Answer Before Asking - Can I Retire?
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Old 09-30-2014, 10:13 AM   #3
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Big question is what are your expenses? Once you know expenses, it just becomes a math problem, do you have enough in assets to provide the required income to meet those expenses. Just very rough figures, you have $2.3M of income producing nestegg. Your $500K house does not count, although it may be an expense reduction vs paying rent.

If you go with 4% withdrawal of $2.3M you get about $92K/year. Add that to your $40K/year pension and you have approx $132K/year ($11K/mo) for all expenses. All means including taxes, medical insurance, etc.

Just assuming, but I would say you are probably OK at your current levels, assuming you do not have real high expenses. Say after taxes and insurance you have $8K left over, that sure seems to be sufficient for most folks.
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Old 09-30-2014, 10:24 AM   #4
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Thanks 38 Chevy for responding. We have estimated our actual expenses at around 7600 per month wit a little wiggle room. Will be going from 13k a year in Real Estate taxes in NJ to around 2600.00 per year in NC. Pension i will net 3500.00 per month. I have a million dollar annuity (990k) that will pay me around 4 k a month, $950k in Mutual Funds and 350k in a 401k at my present employer. I plan on drawing around 8800.00 per month all combined till i hit 66 and i will draw a additional 2400.00 per month on Social Security. My wife who is 59 now will probably draw at 62. We are not big travelers and both of our children live in NC so most of our travel will be intra state.
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Old 09-30-2014, 10:36 AM   #5
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Income greater than expenses == you can retire.

Plus you have SS coming later in life. Looks good.
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Old 09-30-2014, 12:10 PM   #6
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You might play with Firecalc. Just guessing a little and plugging in some of your numbers, and guessing about timing, I come up with 10 - 12 thousand a month. I'm sure I'm wrong on my guesses, so try yourself. Looks like you have room to spare.

You may be able to get a house you like for quite a bit less than 500 K$ in NC.
What would happen if you rolled $300 K back into your portfolio?

My main concern is that you take good care of yourself with over 3 hours a day of commuting. What about eating well, and exercise, and sleep.

I'm similar age to you, and planning on quitting within 6 months. One benefit is that you don't have a lot of bridge years to pay for like those people retiring at age 50.
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Old 09-30-2014, 02:34 PM   #7
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Quote:
Originally Posted by Flazo View Post
Hi, I am 60, will be 61 on March 17th. Been working almost 40 years and my commute to NYC is 1 hr 45 minutes each way. I am contemplating early retirement by 1 year.. I am collecting $40k Gross pension from previous employer, I have $2.8M saved, of which paid off home is 500k of the $2.8m. Live in NJ but want to move to Southport NC. I think i can make ends meet. Any concerns i should be worried about. I will have to buy my own health ins untill i reach 65. Only debt i have is a 14,000k car loan.

Thoughts?
DH worked in NYC, while our children and I kept the home fires burning in the NJ burbs, many years ago. His commute was similar to yours - soul sucking. He came home one day and said, "I think I'm going to die in the Lincoln Tunnel". After some soul searching we decided that the higher paying job was not worth the toll it was taking on his health and general well being. He found another job and we relocated within 3 months and have never looked back. You are FI and your kids aren't even near your current home - so run, do not walk to the nearest exit.
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Old 09-30-2014, 02:40 PM   #8
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Just do it.
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Old 09-30-2014, 03:09 PM   #9
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I would have been gone last week. I have no intention of being the richest man in the graveyard and the poorest soul while on earth (which would be my case if retired any later than absolutely necessary). Dominguez said it best: your money or your life.
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Old 09-30-2014, 03:17 PM   #10
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Originally Posted by Flazo View Post
Thanks 38 Chevy for responding. We have estimated our actual expenses at around 7600 per month wit a little wiggle room. Will be going from 13k a year in Real Estate taxes in NJ to around 2600.00 per year in NC. Pension i will net 3500.00 per month. I have a million dollar annuity (990k) that will pay me around 4 k a month, $950k in Mutual Funds and 350k in a 401k at my present employer. I plan on drawing around 8800.00 per month all combined till i hit 66 and i will draw a additional 2400.00 per month on Social Security. My wife who is 59 now will probably draw at 62. We are not big travelers and both of our children live in NC so most of our travel will be intra state.
Pension 3,500
Annuity 4,000
Mutual funds/401k 3,800 based on 3.5% WR
Subtotal 11,300
Your SS 2,400
Wife SS 1,200 or more
Total 14,900

Expenses ~8,000

Why are you even going in tomorrow?
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Old 09-30-2014, 03:38 PM   #11
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Have you thought about possible culture shock?
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Old 09-30-2014, 04:03 PM   #12
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Do it.
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