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Teetering in San Diego
Old 07-30-2013, 02:14 PM   #1
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Teetering in San Diego

Hello, I'm originally from England and have been living in the US for 34 years, and San Diego for the last 16 years. I've been divorced for over 10 years, no kids and reached the grand old age of 60 last Dismember. I'm pretty frugal - driven a 2003 Forester from new, cook most everything I eat, bag it to work, etc. I worked out that after I pay off the mortgage, I could probably live on social security which'll be $1963 at 63. After saving my max for a couple of decades, my TA sits around 1.9M less 103K owed on the mortgage, thus NAV 1.8M - with the house representing 500K. Post tax savings and Roth represent around 300K, plus another 1M pre-tax. Overall balance is 55% stocks, 25% bonds, 20% short term - probably need to work on that!

I've suddenly got it into my head that I should cut ties with MegaCorp - in spite of their more than generous 101K salary. Fidelity's Income Planner says that with expenses of $4000/m (a number I've seen bandied around on this forum, but more than I would ever spend) there's a 90% probability that I'll have 2M (+house) at age 90. Firecalc gave me a success rate of 99.1% - but I'm not sure if that takes into account social security?

So I'm teetering. What's always held me back is HI. I think COBRA would run me around $380/m, but now with PPACA, it could run $51/m (646 - 595 tax credit if I keep my 'income' around 16.6k pa ... CoveredCA.com). I've also been oogling houses in England on Zoopla; there I would have access to the NHS fwiw (I think it's worth a lot!), but I wouldn't necessarily have the ocean view! I wonder if I could be reabsorbed into the community after so long? I guess over here people retire to different communities all the time and mostly get absorbed, don't they? Of course, I'm not too sure of any tax implications, so I'm planning to do due diligence on a trip later this year.

I guess I'm looking for is some sort of nudge. Heck, there's a guy here at MegaCorp who's 68 and absolutely wedded to his desk, and thinks I'm crazy. Does 12/31/2013 sound like the date for me?

Anyway, thanks for listening!
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Old 07-30-2013, 02:37 PM   #2
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Welcome Jackanory, from a fellow San Diegan.

Ocean view home that's only worth $500k - that's pretty sweet. Even fixers in less glamourous neighborhoods that have ocean views (eg Clairemont, bay park) tend to be more expensive than that.

$4000/month is doable if you have a paid for house and prop 13 tax rates... especially if you don't have HOA or the dreaded Mello Roos.

For firecalc - there are tabs at the top - one of them lets you enter your projected SS and start date... as well as any pension, or other income streams.

Welcome again, Neighbor.
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Old 07-30-2013, 02:46 PM   #3
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Yep, welcome neighbor! Rodi seems to have answered all your questions.
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Old 07-30-2013, 02:49 PM   #4
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Thanks neighbor! Yes back in 2005 zillow estimated my Bay Park palace at 750k, but now only says 517k. So to be fiscally conservative I marked it down. Perhaps one day it'll go back up - especially if I can persuade myself to do some of that deferred maintenance!
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Old 07-30-2013, 03:00 PM   #5
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Welcome Jackanory! Now you've got me thinking that I should reserve the usernames Blue Peter or Magic Roundabout before anyone else gets 'em
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Old 07-30-2013, 03:02 PM   #6
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Actually, Zebedee would be a good one.........
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Old 07-30-2013, 03:04 PM   #7
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Originally Posted by Jackanory View Post
Hello, I'm originally from England and have been living in the US for 34 years, and San Diego for the last 16 years. I've been divorced for over 10 years, no kids and reached the grand old age of 60 last Dismember. I'm pretty frugal - driven a 2003 Forester from new, cook most everything I eat, bag it to work, etc. I worked out that after I pay off the mortgage, I could probably live on social security which'll be $1963 at 63. After saving my max for a couple of decades, my TA sits around 1.9M less 103K owed on the mortgage, thus NAV 1.8M - with the house representing 500K. Post tax savings and Roth represent around 300K, plus another 1M pre-tax. Overall balance is 55% stocks, 25% bonds, 20% short term - probably need to work on that!

./.

I guess I'm looking for is some sort of nudge. Heck, there's a guy here at MegaCorp who's 68 and absolutely wedded to his desk, and thinks I'm crazy. Does 12/31/2013 sound like the date for me?

Anyway, thanks for listening!
Jackanory, welcome aboard. With your budget,those assets and social security, you don't need a nudge, you should be jumping for joy. That guy at work .. sounds like he's the one that's crazy.
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Old 07-30-2013, 06:13 PM   #8
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Congratulations!!! Glad to hear you are not financially teetering!

If you decide to move back to the UK, I would suggest that you keep your San Diego place for at least a couple of years: to be sure, to be sure as it will be a lot easier to undo that decision.

Since this sounds like a sudden idea, it also might be worth planning for your activities/interests during retirement so that you are retiring to something, not just escaping MegaCorp.

Enjoy!
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Old 07-30-2013, 06:21 PM   #9
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Thanks neighbor! Yes back in 2005 zillow estimated my Bay Park palace at 750k, but now only says 517k. So to be fiscally conservative I marked it down. Perhaps one day it'll go back up - especially if I can persuade myself to do some of that deferred maintenance!
2005 was a special year in San Diego real estate. I live near there (golden triangle), and in 2005 zillow pegged our house at close to a million. Ridiculous. My stepmom lives in Bay Park - right above Costco. I love that neighborhood. Bay/ocean views in cute terraced one story houses. (At least her neighborhood is all 1 story).
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Old 07-31-2013, 11:54 AM   #10
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I've been divorced for over 10 years, no kids and reached the grand old age of 60 last Dismember.
Last dismember? How many of these dismemberings have you had anyway? Regardless, I'm pretty impressed you made it to 60 after losing all those body parts.
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Old 07-31-2013, 12:14 PM   #11
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In many ways it is true that 'you can't go home again' to the community in which we spent our youth. I think Jackanory would be well advised to rent his current home for a year or two while exploring returning to Great Brittan. It may even be possible to do a house trade with GB resident who will be living in San Diego for a couple years - a graduate student or an Expat.
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Old 07-31-2013, 12:48 PM   #12
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I do know someone who went back to the UK in their 60s and is quite happy. He has a big family there plus the National Health Services.

This year we will have total health care costs in the tens of thousands of dollars between our insurance premiums, needing an out of network specialist, and reaching out of pocket max on the in network stuff. It makes a different country with national health care or at least lower health care costs for retirement for us look quite appealing.

This chart on U.S. health care costs has really opened my eyes about how we might save a lot of money for travel or other expenses in retirement living somewhere else -

21 graphs that show America’s health-care prices are ludicrous
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Old 07-31-2013, 02:23 PM   #13
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I would be happy to house sit your San Diego home for you (smile) .....lived in Scripps Ranch for a year and miss the great weather (now in Ohio)
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Old 07-31-2013, 02:38 PM   #14
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Welcome Jackanory! Now you've got me thinking that I should reserve the usernames Blue Peter or Magic Roundabout before anyone else gets 'em
Does that mean I can have the more grown up ones, like The Old Grey Whistle Test and Z Cars?
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Old 07-31-2013, 03:00 PM   #15
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In many ways it is true that 'you can't go home again' to the community in which we spent our youth. I think Jackanory would be well advised to rent his current home for a year or two while exploring returning to Great Brittan. It may even be possible to do a house trade with GB resident who will be living in San Diego for a couple years - a graduate student or an Expat.
This is excellent advice. Do a house swap or rent it out. That way it stays current with the market.

That area is definitely getting more and more trendy. Even families with kids are moving there and sending their kids to the mandarin language magnet school - Barnard Elementary, near there.
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Old 08-01-2013, 10:05 AM   #16
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Thanks for all the tremendous feedback. The advice about renting out the house is well taken, but if I have thoughts of returning, I'd probably have to become a citizen on the way out!

Dismember - I must have read too much Piers Anthony.
Jackanory - my sign-on for many websites.
Sudden decision - well, obviously I decided to retire 'at some point' many years ago; hence the NAV. The Eureka moment was perhaps helped by this and other websites.
Prop 13 - yes, though they've risen over the years to 3k.
Community - actually, I've lighted on a small city nearby; friends and relatives still at arms length - entertainment and culture on doorstep!
Firecalc - adding in SS certainly pushed me up to 100% a similar 'ending' balance to Fidelity.
Sitting - 3 students just rented the house next door for $2995/m; still interested?

Anyway, thanks again for all the advice!
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Old 08-01-2013, 10:38 AM   #17
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The advice about renting out the house is well taken, but if I have thoughts of returning, I'd probably have to become a citizen on the way out!
Why would you need to become the U.S. citizen? You can keep your GC but you would need to visit the US to keep it current. What about seeing your renters once a year?

I'm curious about your SS. Since you came to the US in your 20's, did you work in the UK at the time? Maybe you can qualify for the UK's SS in addition to the US SS...? I honestly have not clue how it works for the UK, but my German MIL sent a booklet for my DH for the potential German SS (again, I don't know how it works, it's too early for him to think about it). I don't know if he'll need to choose one of them or get both of them (the latter sounds too good to be true though).

Based on your assets, all you need is just organize your finances and make a list of your new activities and that's it
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Old 08-01-2013, 10:44 AM   #18
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I guess it's difference in lifestyles vs. cheap or free health insurance.

If you move to England, do the UK and the US both have tax claims on your retirement income?

Some European countries offer visas to people who have retirement assets. But I don't think they let you get into their health care system unless you have citizenship claims (by ancestry).

And I heard they may look at taxing your income on top of the US taxes.

Plus if you buy property, you're looking at property taxes. So it might be better to rent for a couple of months, leave when the 90 days are up, then come back later if you really want to live year round in Europe.
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Old 08-01-2013, 11:16 AM   #19
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I thought I had posted on this thread last night, but the NSA must have forgot to forward it. What I was going to say, is welcome to the forum. And why limit yourself to the two choices? The US of A is a big place, as is the EU. The healthcare in EU might be a wash with the higher taxes. But you have enough assets to live in comfort for a long time, where ever you decide on.
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Old 08-01-2013, 11:26 AM   #20
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It's always been my understanding that you had to limit yourself to 6 months abroad, or your greencard would be forfeit. I'm still working my way through the forums at BritishExpats.com to see how becoming a citizen affects my tax situation. Uncle Sam does love to tax its citizens!

I came over quite early in my career, so I think my UK pension would be around 22. The money is actually moot though, as there is a specific treaty that covers who actually pays people in my position. Later on though, when I reach UK pension age, that minimal pension might allow me to get an S1 - allowing me to get free HI in most of Europe. I hear it's nice in Nice!
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