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Old 02-28-2013, 03:50 PM   #1
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Hi. I can retire at 52 with a defined benefit pension of $25000 annually. COLAs are at the whim of my state legislature, so that's a long shot. I'm also in a lot of credit card debt. I think of retiring now since my job's the pits, but it could cost me in the long run given the debt. Thoughts?
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Old 02-28-2013, 03:56 PM   #2
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Hi. I can retire at 52 with a defined benefit pension of $25000 annually. COLAs are at the whim of my state legislature, so that's a long shot. I'm also in a lot of credit card debt. I think of retiring now since my job's the pits, but it could cost me in the long run given the debt. Thoughts?

First of all think if 25000 will make ends meet. Will your state take any of that in taxes? Do you have any other sources? Will you be able to get SSA when eligible? You have not given us much to work with. I will say though at 52 and only 25k to me would not make it. The job may be tough and tiresome but will you be able to find other work? That is a long time to scrimp if you are eligible for SSA.
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Old 02-28-2013, 04:00 PM   #3
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I live in Texas, so no state income tax headache. My medical premium's covered as a single person too. I can scrimp til SSA @ 62.
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Old 02-28-2013, 04:05 PM   #4
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Hi. I can retire at 52 with a defined benefit pension of $25000 annually. COLAs are at the whim of my state legislature, so that's a long shot. I'm also in a lot of credit card debt. I think of retiring now since my job's the pits, but it could cost me in the long run given the debt. Thoughts?
That CC debt is real dead weight on a fixed budget with limited cola. Why not work a bit longer, just to make enough to pay the debt?
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Old 02-28-2013, 04:29 PM   #5
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That CC debt is real dead weight on a fixed budget with limited cola. Why not work a bit longer, just to make enough to pay the debt?
I concur. That debt is not going to go away.
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Old 02-28-2013, 04:32 PM   #6
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How much are you making now? Probably more than what the pension is going to pay, right?. If you can't live within your means on your current income, what makes you think you can live on less without going further in debt?
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Old 02-28-2013, 04:37 PM   #7
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How much are you making now? Probably more than what the pension is going to pay, right?. If you can't live within your means on your current income, what makes you think you can live on less without going further in debt?
+1

As others have suggested, pay off your CC and all other debts, then take another look at the possibility of retiring. You haven't given us much information to go on (what your annual expenses are, any retirement savings, etc.) but I suspect living on $25k would be very, very difficult.
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Old 02-28-2013, 05:45 PM   #8
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How much are your annual expenses ?
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Originally Posted by Burpleson View Post
Hi. I can retire at 52 with a defined benefit pension of $25000 annually. COLAs are at the whim of my state legislature, so that's a long shot. I'm also in a lot of credit card debt. I think of retiring now since my job's the pits, but it could cost me in the long run given the debt. Thoughts?
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Old 02-28-2013, 07:29 PM   #9
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If nothing else, you should draw the pension and then get another job, that maybe you would enjoy more. Use the pension to pay off your debt, and build some reserves with, while living on your new job's salary. Your plan appears a little shaky, more directed at your frustration with your job, than a planned out retirement.
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Old 02-28-2013, 07:59 PM   #10
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You are far, far away from being able to retire. If you can't pay off your credit cards while working, what makes you think you'll do any better living on a fixed income? It sounds as if you are most unlikely to get signficant COLAs, so your $25,000 pension figures to lose most of its purchasing power over the years. I am highly skeptical that you will even be able to "scrimp til SSA @ 62", let alone fund anything close to a comfortable retirement for the next three or four decades.

In your situation you should be actively looking for a job that you will be able to tolerate until you really can retire. And, with or without a different job, you urgently need to get your debt under control, live below your means, and build some emergency savings.
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Old 02-28-2013, 10:36 PM   #11
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You are far, far away from being able to retire. If you can't pay off your credit cards while working, what makes you think you'll do any better living on a fixed income? It sounds as if you are most unlikely to get signficant COLAs, so your $25,000 pension figures to lose most of its purchasing power over the years. I am highly skeptical that you will even be able to "scrimp til SSA @ 62", let alone fund anything close to a comfortable retirement for the next three or four decades.

In your situation you should be actively looking for a job that you will be able to tolerate until you really can retire. And, with or without a different job, you urgently need to get your debt under control, live below your means, and build some emergency savings.
+1

Sorry, but karluk is right.
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Old 03-01-2013, 06:08 AM   #12
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If nothing else, you should draw the pension and then get another job, that maybe you would enjoy more. Use the pension to pay off your debt, and build some reserves with, while living on your new job's salary. Your plan appears a little shaky, more directed at your frustration with your job, than a planned out retirement.
You are correct. But he should not outright quit to begin drawing pension until he has a bird in the hand if for no other reason than that he will dig himself a deeper hole.


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+1

Sorry, but karluk is right.
As well as Mulligan. The two of them have it but first the OP needs to get that other job then retire to draw the pension. That should help him pay down his CC debt.
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Old 03-01-2013, 06:16 AM   #13
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Hi. I can retire at 52 with a defined benefit pension of $25000 annually. COLAs are at the whim of my state legislature, so that's a long shot. I'm also in a lot of credit card debt. I think of retiring now since my job's the pits, but it could cost me in the long run given the debt. Thoughts?


As Suze says, Are you kidding me!!!!!!
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Old 03-01-2013, 07:09 AM   #14
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That CC debt is real dead weight on a fixed budget with limited cola. Why not work a bit longer, just to make enough to pay the debt?
Also agreed. I'd suck it up and keep plugging along. Get rid of the cc debt, the interest on that will keep bleeding you until it's paid off.

Can you survive? Sure. Many people do live on that or less. Will you enjoy it? Probably not.
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Old 03-01-2013, 08:37 AM   #15
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I agree with the above....at least pay off the debt before you visit this idea again....come up with a budget and annual expenses, and then see if you can do any tweaking to cuts costs. It will be better if you had a solid plan before you resigned.
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Old 03-01-2013, 08:43 AM   #16
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I agree with the above....at least pay off the debt before you visit this idea again....come up with a budget and annual expenses, and then see if you can do any tweaking to cuts costs. It will be better if you had a solid plan before you resigned.

Or at least another job.
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Old 03-01-2013, 10:18 AM   #17
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You are correct. But he should not outright quit to begin drawing pension until he has a bird in the hand if for no other reason than that he will dig himself a deeper hole.

As well as Mulligan. The two of them have it but first the OP needs to get that other job then retire to draw the pension. That should help him pay down his CC debt.
Yep, I agree. Stay on the job until another one is secured then fill out the retirement forms. OP never mentioned the "ramp up" in pension payout by hanging on a few more years. If that is significant, hanging on a year or two more then getting a new job, may be the prudent thing to do.
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Old 03-01-2013, 10:36 AM   #18
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Thanks for the input. I'll hang in there, since I'm better off in the long haul.
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Old 03-09-2013, 08:24 AM   #19
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Burp,

Your original question makes me think you could benefit from these 10 short videos:
Video:Bogleheads® investment philosophy - Bogleheads

Hang in there!
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