Law of diminishing returns and taxes..and I'm a schmuck

[Toddtheformeraccountant]

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Originally Posted by pb4uski I agree with your conclusion, but not all of you math (the last part, from .53 to .35). You are on to the very reason that I retired... since we were well funded, continued work enriched the federal and state governments and our heirs but did little for me... the freedom of time being retired is worth more to me than our heirs getting more. So what are you waiting for?

I will not be waiting! Going to give notice following payment of my year-end bonus in mid January.

On my math...it's a little sketchy I agree but defensible...what I'm saying is that, those 53 cents that are left, the earnings thrown off from those 53 cents will be taxed 35% so it's just like having 34 cents (65% times 53 cents) of income generating potential pretax. Said another way, Uncle Sam owns 35% of that 53 cents, I own 65% of that 53 cents. Hope that helps.

[Toddtheformeraccountant]

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Originally Posted by Dtail You have posted other times in various forms on this subject. Admit that you have OMY syndrome. lol Then you can move forward to the best part of your life. Never know when the health quotient changes.

Thank you! You are right. I've had OMY syndrome for the last year. But no more.

[Toddtheformeraccountant]

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Originally Posted by ERD50 Agreed that financials look good. If the $150,000 expenses are high side, then even disregarding the tax deferred, 150K of the $5,400K taxable is a very, very conservative 2.7% WR. But you didn't mention age, and I don't feel like digging for it. I assume you aren't very young though, with those $. Back to the math above. You're the accountant (I assume), but that doesn't look right to me. The earnings were not taxed twice. Seems like double counting to me. -ERD50

what I'm saying is that earning $1, and paying the tax on the earned $1 and the taxes on the future earnings of what's left, it's like I invested 35 cents. Math is simply $1 * (1-48%)*(1-35%). I'm left with 52 cents of the dollar....I invest it and the earnings that it generates are assessed 35% taxes (retirement tax rate) so I effectively get to "keep" 34 cents of every dollar earned in terms of income generating potential.

[Toddtheformeraccountant]

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Originally Posted by ivinsfan Why you would continue to work, because evidently it's not about the money. When you figure out what else you are getting from continuing to work, only you can decide if you should stop. My DH is 70 and continues to farm and believe me, with prices at this level it's not about the money. We just invested in a different tractor which on paper was a really dumb decision. Yet, he's happy as a clam about it... Can I ask why you even started this thread, word for its almost a duplicate of a thread you started last Spring? What do you hope to gain from another couple of pages of virtually identical responses?

You are correct...and the criticism you are hitting me with, I definitely deserve...I guess I'm just looking to people who think alike for confirmation. I don't need the money. And it's sad to think that I would continue working just because I have nothing else to do but slave away at a desk. I just need to get out and figure out what I want to do with the rest of my life. I'm up to the challenge! I guess I know the answer!

[Toddtheformeraccountant]

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Originally Posted by Masquernom I remember at my former megacorp, the old hands would always say they planned to work a few more years. Then HR would come to our department and put on a retirement seminar. The old guys would sit around their cubicles and be thinking really hard afterward. They'd tell me "I'm only working for the difference between my pension and my salary, I'm only making $XX dollars an hour now." A few months later they'd be retired and gone.

Masquernom: That's a great analogy and not really that far off from where I'm at, even though I'm not getting a pension. Our investment pool is our pension. To some extent it's even worse for me....I would be surprised if we could spend $150,000 per year, and it's already well covered with our funds now, so to some extent I am working for zero marginal benefit. Geez, I'm really convincing myself here....time to go!

[Toddtheformeraccountant]

Thank you all for your responses. My plan is to give my notice as soon as my bonus and last vesting of restricted stock is vested...I'll give them reasonable notice. But time to pull the rip cord and get my behind out of there.

[ivinsfan]

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Originally Posted by Toddtheaccountant You are correct...and the criticism you are hitting me with, I definitely deserve...I guess I'm just looking to people who think alike for confirmation. I don't need the money. And it's sad to think that I would continue working just because I have nothing else to do but slave away at a desk. I just need to get out and figure out what I want to do with the rest of my life. I'm up to the challenge! I guess I know the answer!

I don't know why you said I criticized you, I'm just wondering how you think a duplicate thread will help you decide to retire. I'm pointing out it's a internal thing with you since it isn't about the money.

[Toddtheformeraccountant]

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Originally Posted by ivinsfan I don't know why you said I criticized you, I'm just wondering how you think a duplicate thread will help you decide to retire. I'm pointing out it's a internal thing with you since it isn't about the money.

I think it was a good comment, you just pointed out that I asked the same thing about a year ago....and I had! Fair comment. I appreciate your thoughts...it's definitely not about the money. thanks!