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Retiring after 39 years...
Old 01-04-2009, 01:59 PM   #1
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Retiring after 39 years...

I have been with the same basic company (telecomm; Southern Bell> Bellsouth> now AT&T) for 39 years and have had enough. So, at 58 years old I have decided to hang up the phone sometime in Feb '09. I am getting SIPP'd (1 yrs pay) to go out plus my lump sum bye-out ($276k), a cash accumilation acc't ($71.5k) and what's in my Co's 401k (about $80k)... I am married (empty nester) and wife works about 20 to 25 hrs a week and brings home about $1200 per month. I have a very low mortgage ($700 a month), no auto payments and bills amount to about 2k per month (including mortgage).
I'm trying to decide what to do with this lump sum money. I have been thinking and reading alot about these self-directed IRA's as a way to go since my Pop always felt it was "You" you want handling "Your Money" but others say go with a big company like Fidelity or the like.... Just don't know which way to go and am open to all and anyones input... Thanks in advance. JD (aka: peckrhead... That's what a lot of friends started calling me after I started shaving my nugget-vbg)
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Old 01-04-2009, 02:05 PM   #2
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I am an ex-telecommer as well. It surprises me that your pension and 401K is not in Fidelity. However, there are many divisions in the company. FWIW, DH has his pension and 401K in Fidelity and we are very happy with them. Oh...welcome to the forum.
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Old 01-04-2009, 02:32 PM   #3
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Old 01-04-2009, 04:38 PM   #4
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Perkrhead-Congrats on the early retirement. How in the hell did you stand it for 39 years. I was with GM for 34 years, management, and I couldn't wait to get out. Think your financial situation is in good shape. I retired at 52 and it drove me nuts to have a lot of bills. Inherited some money from my folks later, made money on a house and the market in 1995 finally got debt free. Today I have no debt, which is a good feeling (sleep well at night), but always think I'm wrong by not being able to itemize on my tax return. If you don't itemize, there are many deductions that you can't take. Brings me to my point of your mortgage. Keep your mortgage as long as it's 5% or thereabouts. $700/month=$8400/yr. You've got to roll-over your 401k to an IRA to eliminate the tax and penality. I just rolled over my 401k to a Fidelity 5yr 5% CD. Something of that nature would fund half of your mortgage payment.
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Thanks guys...
Old 01-04-2009, 07:33 PM   #5
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Thanks guys...

Appreciate all of your replies. Please keep em coming... JD
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Old 01-05-2009, 08:36 AM   #6
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Hello Surfdog,
Hope it is OK to suggest another forum that might help you with your future investments. Try bogleheads.org . I have been reading about investing on their site for almost a year now, trying to learn what to do with savings and such in retirement. There are some very knowledgeable people at the forum. Much like this retirement forum. Just go there and start reading the post, you'll grow to love it. The longer I've visited there the more I appreciate the folks trying to help everyone.
Good luck with your retirement.
I hope to retire at the end of 2009.
Steve
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Old 01-05-2009, 11:02 AM   #7
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Welcome SurfDog!

Stevewc's suggestion is a good one but I, for one, find that site a bit stuffy. The financial discussions here are very good while folks here do tend to get a little zany. This forum helped me immensely though the financial transition into retirement. Many who post here also spend time on several other financial forums. Hope you enjoy this one.
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Old 01-05-2009, 01:22 PM   #8
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I've always been a Fidelity guy but Vanguard is used by many here. And since Unclemick has not commented.........psst Wellesley. A pretty conservative fund yielding 5.78%. Right now the AA is roughly 37% stocks, 63% bonds. Might be worth looking into. Oh yes, welcome to the forum.

https://personal.vanguard.com/us/fun...NT#hist::tab=0
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Old 01-05-2009, 09:04 PM   #9
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I've always been a Fidelity guy but Vanguard is used by many here. And since Unclemick has not commented.........psst Wellesley. A pretty conservative fund yielding 5.78%. Right now the AA is roughly 37% stocks, 63% bonds. Might be worth looking into. Oh yes, welcome to the forum.

https://personal.vanguard.com/us/fun...NT#hist::tab=0

Ditto....VWIAX for the aggressive part of your investment..
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Old 01-08-2009, 07:06 PM   #10
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Thanks for all the great info. I've been meeting with finance people all week comparing apples to oranges. Wish I could find more info on the so-called Self Directed IRA's... Thanks again and I'm still learning and comparing... JD (aka: SurfDog)
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Old 01-08-2009, 07:30 PM   #11
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Hey Surfdog

Just google a company called Sterling Trust. I've been looking at self-directed IRAs for real estate.
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Old 01-25-2009, 09:08 PM   #12
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Good evening,

First-timer here. I've chose you, J.D. to be 'my first' because - our situations are similar. I have recently retired (November), 56 then, 57 now. My wife works, too, but ... she subscribes to the "my money is my money and your money is my/our money" adage ... so, we won't count her minor (like your wife, about $1k/month) financial 'contribution.'
Candidly (and ever so kindly), your total worth/reported cash assets (excluding your home equity) may not be sufficient to not entertain supplementing your income (read: a part-time job). One must consider inflation, devaluation of the dollar, questionable viable social security program; etc. Most pundits recommend that one has approximately $1,000,000 in cash holdings (prior to actually retiring). If you put that money in a conservative vehicle at four percent, for example, four percent of $1,000,000 is $40K to live on (without touching the princiapal). Like me, you can't receive social security payments until age 62.
It isimperative then (not an enormous amount of ready cash nor S.S. payments) that you REMAIN LIQUID. Don't TIE UP YOUR MONEY; do not SPECULATE with your money. Financial firms LOATHE for us to hear/know that truth because: they cannot make any money on people who do that, simply. My advice and practice - C.D.s and/or money market accounts. Throughout my entire work career, my peers/family/friends would demean me for FOOLISHLY keeping my money in "fixed investments" (you are loosing to inflation, you are voiding an opportunity to make MORE elsewhere - yada yada). Well ... look who is laughing now!?! In truth, if I had been like them/those "experts," I WOULD NOT HAVE BEEN ABLE TO RETIRE!
Ladder your C.D.s, i.e., divide your money into C.D.s which mature in six months, one in one year, one in two years. Too, open a sizeable money market (paying a small interst rate, but allowing you to withdraw when you need living expenses. DO this and you WILL be successful. GAMBLE and you might be FORCED to return to work - and - full time!! You can thank me later ...

"Rule number one, don't lose any money,
Rule two - NEVER forget rule one." ... Warren Buffett
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Old 01-25-2009, 10:38 PM   #13
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Thanks for all the great info. I've been meeting with finance people all week comparing apples to oranges. Wish I could find more info on the so-called Self Directed IRA's... Thanks again and I'm still learning and comparing... JD (aka: SurfDog)
I assume that you are talking about a brokerage account inside an IRA.

I don't think there is really that much to it. You can open an IRA with Fidelity, Schwab, etc. and then open a brokerage account in that IRA and buy and sell individual stocks and bonds in the IRA. I have one at Vanguard.

But if you want to buy and sell individual stocks you need to be willing to do your homework. There are some on this forum that actively manage their own stock portfolio but unless you are an experienced investor you should probably put most of your money in mutual funds to start.

Also most of the folks on this forum are do-it-your-self types that rightly or wrongly tend to distrust most "finance people."

The VanguardDieHard site mentioned by another poster has a list of recommended books that is a great place to start if you want to learn about investing.
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Old 01-26-2009, 10:16 PM   #14
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What are your plans for health insurance untill you get medicare ? This is as important as investment plans, as going bare could wipe out everything if either of you gets seriously ill. Don't leave the company untill you have coverage in place.
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Old 01-27-2009, 11:43 PM   #15
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Quote:
Originally Posted by 0108 View Post
Financial firms LOATHE for us to hear/know that truth because: they cannot make any money on people who do that, simply. My advice and practice - C.D.s and/or money market accounts. Throughout my entire work career, my peers/family/friends would demean me for FOOLISHLY keeping my money in "fixed investments" (you are loosing to inflation, you are voiding an opportunity to make MORE elsewhere - yada yada). Well ... look who is laughing now!?! In truth, if I had been like them/those "experts," I WOULD NOT HAVE BEEN ABLE TO RETIRE!
Your theory has worked in these recent times of LOW inflation. If you can live on fixed investments when inflation hits a patch of 4-5%, well, ok, but if you live another 40 years inflation will erode your purchasing power in a sizable way..YMMV......
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