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Jeff and suddenly in ER
Old 04-07-2011, 02:24 PM   #1
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Jeff and suddenly in ER

Hi, I am Jeff. I just got laid off of my job last week. I have been in the software development, maintenance and life-cycle support business almost continuously since I graduated college from Penn State in 1974.

Anyway, I have been lurking here for a few days, looking at the posts about when to take SS, and learning terms like FireCalc, SWR, and DW. I am single, by the way. My Dad passed away recently and I should be inheriting about $350K from the family trust (that probably won't happen for 6 or 8 more months, though). Right now, I have a $600K portfolio (after the inheritance, I'm saying the portfolio would be $950K), invested moderately aggressively, $55K in cash and a $68K 401K from my former employer. I turned 59 in March, 2011. My only significant debt is a $68K home equity line of credit at prime-1/2 (currently 2.25%) .

I'll have to check with some local realtors, but the townhouse I live in should be worth about $250K or so... I'd like to sell it and move to a clothing optional community in Florida!

Judging from the advice I've seen here, I would take SS at 62 ($1695/mo) and I can also choose to begin receiving a pension from my first employer, which at 60 years old would be $7759/yr and it goes up by $665 for each year I delay, so at 62 it would be worth $9089/yr.

How am I doing so far?

Jeff
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Old 04-07-2011, 03:04 PM   #2
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Depends how much you plan on spending.
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Old 04-07-2011, 03:14 PM   #3
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Welcome to the forum, Jeff.

As the previous poster says, how you are doing really depends on how much you need for living expenses. Sounds good from my frame of reference, though. You might want to run your numbers through FIRECalc, our free online program (link at the bottom of the page).

I never like to count on money until it hits the bank, and I imagine you will be relieved when that inheritance clears.
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Old 04-07-2011, 03:16 PM   #4
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Initial numbers look promising, but it depends on what you will spend a year (including taxes, and healthcare) and how long you exepct to live. Have you run the numbers in FireCalc and some other online retirement calculators?

Sounds like your clothing budget might be low at least :-)
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Old 04-07-2011, 04:27 PM   #5
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Initial numbers look promising, but it depends on what you will spend a year (including taxes, and healthcare) and how long you exepct to live. Have you run the numbers in FireCalc and some other online retirement calculators?

Sounds like your clothing budget might be low at least :-)
For my estimation purposes, I have been using $50K per year as the amount I plan to spend, plus $5000 of off-chart spending annually, for things like travel. (I have been averaging about $4000 per month pre-ER). One thing I am worried about is what to do about getting health coverage after COBRA runs out. Any tips on that?
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Old 04-07-2011, 05:43 PM   #6
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For my estimation purposes, I have been using $50K per year as the amount I plan to spend, plus $5000 of off-chart spending annually, for things like travel. (I have been averaging about $4000 per month pre-ER). One thing I am worried about is what to do about getting health coverage after COBRA runs out. Any tips on that?
Welcome to the forum, Jeff. Soundls like you will be OK with your various income sources, and as bizlady mentioned, at least you won't need much for a clothing budget!

Health Insurance is the elephant in the room for many of us. Keep us posted on what you find.


Since you mentioned travel, maybe you can take a trip to India to see where your IT job went....
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Old 04-07-2011, 06:23 PM   #7
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Old 04-07-2011, 06:35 PM   #8
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welcome Jeff. Have you run your numbers here : See Where You Stand | Merrill Edge Retirement
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Very conservative with investments. Not ER'd yet, 48 years old. Please do not take anything I write or imply as legal, financial or medical advice directed to you. Contact your own financial advisor, healthcare provider, or attorney for financial, medical and legal advice.
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Old 04-07-2011, 08:48 PM   #9
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Originally Posted by Jeff_ View Post
Judging from the advice I've seen here, I would take SS at 62 ($1695/mo)
Welcome. I assume you found plenty of advice for taking SS early and for taking it late. What made up your mind?
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Old 04-08-2011, 06:27 AM   #10
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Welcome. I assume you found plenty of advice for taking SS early and for taking it late. What made up your mind?
It was CFB's posts in one of the 'must read' threads; his words impressed me very much.
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Old 04-08-2011, 08:40 AM   #11
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It was CFB's posts in one of the 'must read' threads; his words impressed me very much.
Rather than depend on a long ago poster who was married (different SS options), not near claiming benefits, and also based that the SS program has changed in that time (e.g. payback option eliminated), I would suggest that you confer with folks on the board on that currently have the same situation, in today's SS "environment".

For instance W2R has a similar situation in some ways as you. She is retired (great! ) and is also single (at this time, but who knows what the future may bring ).

She has mentioned that at this time, she is delaying SS. While I/DW are delaying SS (we're both SS age) in order to "maximize benefits" in our situation, W2R may give you some ideas on why she is currently choosing to delay, as a single person.

I've always said that if you expect a restricted lifespan (based upon known disability) that you should take SS early. If you are a married couple, you should explore the options to combine SS benefits (as DW/I are doing) to maximize your joint benefit.

For the single person, who expects a normal/long lifespan? There are other considerations. Since I'm not in that situation, I would suggest you converse with those that are to give you some current ideas/opinions, based upon today's SS "rules"...
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Old 04-08-2011, 09:04 AM   #12
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Our intent is to delay SS in good times, then if things go really bad, take SS. However, that is just a goal, and we're only 53 now, not yet retired. We intend to retire in 3 years at the age of 56. I'll let you know in 9 to 15 years how this plan works out.

- Stephen
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Old 04-08-2011, 09:21 AM   #13
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I'll let you know in 9 to 15 years how this plan works out.

- Stephen
I'll be waiting ...

Seriously, DW/me are a decade older than you, but it will seem like a "moment" when you reach our age (and review your post)...
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Old 04-09-2011, 11:08 AM   #14
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I asked for similar input about my retirement portfolio here not long ago. My age is exactly the same to the month and my funds aren't all that different, with a similarly modest pension as well. I find that if I keep an eye on expenses, no problem in making it.

My first suggestion is to eliminate that 68K home equity loan as soon as possible. You really need to retire debt free and clear, with absolutely no outstanding loans.

Healthcare is the next issue. Here, I'd check your local county or state for low income health care benefits. They may provide free medical coverage as my county did for me. Also, in 2014 the new Obama health care law should fully kick in, where the federal government will subsidize health insurance, depending on income level. See if you can somehow hold out for that with COBRA or an interim high deductible policy until then.

Also don't forget LIHEAP and other federal programs that assist low income earners with gas and electricity bills.

Finally, live modestly (but not unenjoyably). Look at monthly bills and see what you can cut out. Identify if those restaurant outings and other entertainment expenses that can be eliminated or reduced, and substitute them with free but fun activities.

Based on the funds you have and if you can follow these guidelines, I think you'll be just fine.
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Old 04-09-2011, 11:30 AM   #15
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Originally Posted by Ubuntu View Post
For my estimation purposes, I have been using $50K per year as the amount I plan to spend, plus $5000 of off-chart spending annually, for things like travel. (I have been averaging about $4000 per month pre-ER). One thing I am worried about is what to do about getting health coverage after COBRA runs out. Any tips on that?
Your estimate of expenses is one of the most cruicial variables, so if you haven't already, start tracking your expenses. I use Quicken to do so - use whatever works for you, but track you must (as Yoda may have said)

Look at eHealthInsurance.com to see what individual health insurance will cost. Look for an insurance agent to help you with the application process. You may find insurance cheaper than COBRA if you are healthy.

All the very best.
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Old 04-09-2011, 12:50 PM   #16
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Healthcare is the next issue. Here, I'd check your local county or state for low income health care benefits. They may provide free medical coverage as my county did for me. Also, in 2014 the new Obama health care law should fully kick in, where the federal government will subsidize health insurance, depending on income level. See if you can somehow hold out for that with COBRA or an interim high deductible policy until then.

Also don't forget LIHEAP and other federal programs that assist low income earners with gas and electricity bills.

.

?? ??

Understand from your post that you may believe this is the "Land of the Free", but the OP has stated over 1M in retirement assets and a comfortable income stream with SS starting in a few years...
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Old 04-09-2011, 02:45 PM   #17
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track you must (as Yoda may have said)
Amen. You can't plan on going somewhere if you don't know where you've been...
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Old 04-09-2011, 03:23 PM   #18
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?? ??

Understand from your post that you may believe this is the "Land of the Free", but the OP has stated over 1M in retirement assets and a comfortable income stream with SS starting in a few years...

+1
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Old 04-09-2011, 05:58 PM   #19
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Regarding health insurance: talking with an independent health insurance agent who will prescreen you with various companies could be the best solution. That's what I did and it saved me a lot of time. If you want to find out what others your age are experiencing in the individual market go to the "Health" forum and do a search on individual health insurance. There have been many threads on it.
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Old 04-09-2011, 06:37 PM   #20
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Rather than depend on a long ago poster ...........
Boy, one day you are one of the top, loved posters and the next, just "a long ago poster"..........a moment of silence, please.
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