Ready to Retire at 62?

[vcponsardin]

I know being 62 is a bit old for this forum, but I've come to a major point in my life where I think I must decide whether to retire.

Forgive my financial bluntness. My situation is pretty straight forward: I now have a guaranteed retirement income of about $90,000/year for the rest of my life (with about 3% COLA on top). I am single, live alone, and have no debts--paid off the mortgage last year. No kids or dependents. I live in a moderately priced part of the country (neither downtown Manhattan nor Duluth, MN). I'm assuming this is a pretty good income for retirement--especially for a single guy. Am I correct? In other words, would most people accept this as a good, solid income for retirement? Or am I way off base and looking for financial trouble 10 years down the road? Am I not anticipating something that I should?

 

[jim584672]

Sounds great to me. Most people live on a lot less.

 

[REWahoo]

Good grief, man - hang up your spurs and start enjoying the good life! Congratulations, you're golden financially.

To help convince yourself of that fact, see this: http://www.early-retirement.org/for...-answer-before-asking-can-i-retire-69999.html

 

[Dawg52]

90k cola pension for life? That's gold man. Enjoy.

 

[2017ish]

Objectively, that is a great situation.

Subjectively, is it? I'm guessing your hobby isn't collecting Ferrari classics or drinking grand cru Bordeaux for breakfast, lunch, and dinner.... (OK, 90K wouldn't support those, but you know what I mean.)

As long as your spending is not too outlandish (and the payor of that pension is financially sound) you are set--even without a portfolio.

 

[braumeister]

Four years ago, you said you really enjoyed your job. Still the case?

 

[vcponsardin]

Four years ago, you said you really enjoyed your job. Still the case?

Not so much anymore. Though I could hang in there for another few years if needed. I'm mostly concerned about whether I'm cutting myself off at the shins by giving up work. But by most measurements, it seems my retirement income will be more than enough--I think. Perhaps there are other things causing me to hesitate that I'm not aware of.

 

[braumeister]

Perhaps there are other things causing me to hesitate that I'm not aware of.

Desire for travel, which may or may not be expensive, would be the main thing that occurs to me. It eats up a very large share of our annual budget, but that's what we enjoy (instead of other uses for it like fancy dining, expensive hobbies, etc.).

 

[travelover]

Sounds good, but why don't you take a few hours to see what your necessary spending is, yearly?

 

[REWahoo]

Sounds good, but why don't you take a few hours to see what your necessary spending is, yearly?

+1

Always a good idea to know how much water runs out of the pool to be sure the inflow is enough to prevent draining it.

 

[vcponsardin]

Sounds good, but why don't you take a few hours to see what your necessary spending is, yearly?

Hard to do with any accuracy at this point, since there may be changes ahead--moving out of state, buying and selling property, etc. I currently own two houses, for instance, but I intend to sell both and consolidate which should reduce my monthly expenses. What is evident is that this projected retirement income is better than what I'm currently making at my job. Sounds like a slam-dunk decision when I word it like this, but the job is a solid reality, while retirement seems like stepping off into the void.

 

[ABQ2015]

My situation is similar. I could retire today with a conservative retirement income in the mid-$80K range but am delaying a year to age 62 to increase it to the mid-$90K range. My decision was based on high taxes on a pension as a single person, the desire to travel which I estimated at $10-15K per year, the desire to relocate to a higher COL area, the need to budget for future expenses like roof repairs and replacement cars, etc. I tracked my expenses for 3 years and decided that I would feel more comfortable with the extra money. However if the results had meant that I would have to work beyond age 62, I would have gone to plan B and cut expenses to include less travel. No way am I working past age 62.

You may want to at least take a look at your current expenses and estimate future expenses before making a final decision. However given that you previously you stated that your pensions would be 125% of what you are currently making, I don't see a reason to keep working unless you really enjoy it.

 

[travelover]

Hard to do with any accuracy at this point, since there may be changes ahead--moving out of state, buying and selling property, etc. I currently own two houses, for instance, but I intend to sell both and consolidate which should reduce my monthly expenses. What is evident is that this projected retirement income is better than what I'm currently making at my job. Sounds like a slam-dunk decision when I word it like this, but the job is a solid reality, while retirement seems like stepping off into the void.

I'd bet you could make an pretty close estimate for your needs following the relocation. Hint - average family income in the USA = $52,000 and that includes rent / mortgage, income taxes, saving for retirement / kid's educations, FICA / Medicare taxes......

I'm guessing you'll survive on $90K.

 

[nash031]

My situation is pretty straight forward: I now have a guaranteed retirement income of about $90,000/year for the rest of my life (with about 3% COLA on top). I am single, live alone, and have no debts--paid off the mortgage last year. No kids or dependents...

I know who I'm going to for a loan if my plan doesn't work out! Sounds golden to me... but that's said not knowing what your expenses truly are.

 

[supernova72]

I'm just a bit younger at 55 and live in what is becoming a higher cost region (housing wise) in Seattle WA. Other elements are the same as you (single etc).


I'm budgeting $60K which includes taxes and medical. My expense has a 10-15% buffer built in since I think I could get by on $52K. Like the others I'd say $90K is Golden!

 

[Sunset]

You can retire today.
Seriously, 90K pension that is cola'd is like gold raining from the sky !!

On top of that you have 2 houses, plus possibly other savings ??.

You are good to go....

 

[pb4uski]

Agree with others that you are good to go unless you plan to live really high on the hog... but it doesn't sound like that is the case... change is hard.

Take an hour and noodle through what your annual spending will be with all the changes you anticipate.... I suspect that you'll conclude that $90k is plenty... we spend about that for 2 including vacations, wintering in Florida, etc.

 

[vcponsardin]

Agree with others that you are good to go unless you plan to live really high on the hog... but it doesn't sound like that is the case... change is hard.

Take an hour and noodle through what your annual spending will be with all the changes you anticipate.... I suspect that you'll conclude that $90k is plenty... we spend about that for 2 including vacations, wintering in Florida, etc.

Thanks. This is good to know. I just need a ballpark idea that I'm retiring at a reasonable level. I don't live in SF or NYC--so my expenses are more moderate than some. And while I enjoy traveling overseas, I'm fine with one good trip every year. Plus I'm not the sort who dines out every night either.

 

[Markola]

And there's SS out there in the not-too-distant future to provide further financial insurance.

Maybe you are stymied by your plan to so radically reconstruct your life and should slow the pace of change, i.e. quit then just live for a year, sell one house next year, sell the other the following year and move, etc. DW and I try to only deal with "one big variable at a time," which keeps stress manageable. Congrats! You've won the race.

 

[medved]

From someone else who is also trying to figure all this out: Aside from money, you also need to figure out what you are going to do with your time. You don't want to be bored and wish you were back at work with the social interaction, schedule, sense of purpose, etc. So you need to think about what you do every day now, and how you like it, and what you would do every day in retirement, and which you would enjoy more. For a single person, I suppose having a good social network would also be important (maybe for everyone, but perhaps especially for someone who is single). I think sometimes when people have enough money to retire but are hesitant, the hesitancy relates to some of these "what am I going to do" and "what if I get bored and regret it" concerns. I myself am thinking through those issues.

 

[vcponsardin]

From someone else who is also trying to figure all this out: Aside from money, you also need to figure out what you are going to do with your time. You don't want to be bored and wish you were back at work with the social interaction, schedule, sense of purpose, etc. So you need to think about what you do every day now, and how you like it, and what you would do every day in retirement, and which you would enjoy more. For a single person, I suppose having a good social network would also be important (maybe for everyone, but perhaps especially for someone who is single). I think sometimes when people have enough money to retire but are hesitant, the hesitancy relates to some of these "what am I going to do" and "what if I get bored and regret it" concerns. I myself am thinking through those issues.

Yes. That's been a big issue for me--what to do after I retire. I've been working in my profession for almost 40 years. I was hoping to take a year off from everything just as a sabbatical from life. But I don't think I'll need it, to be honest. I have fun alternate work--a former avocation that is now becoming a paid sideline, along with new colleagues and associates who are beginning to constitute a new cohort of friends. It's leaving a field that I worked in for so long, in which I earned a doctorate, and spent so long doing, that I find it tough to let go--even though I am tired, bored, and have exhausted my patience with the field and profession. I'm done, I know. I just have to make that final step into the void. Thanks for the insights.