Is it really so bad to FIRE during a recession?

[Rich_by_the_Bay]

Why is it we medical folk have such a hard time retiring but the mega corps can't wait to leave ??

Cause we like our jobs?

 

[rs0460a]

Why is it we medical folk have such a hard time retiring but the mega corps can't wait to leave ??

I'll tell you my "opinion". I retired from a large multi-national company last year, with almost 30 years of service. The last 10 years were spent "dreaming of ER".

In retirement, I do volunteer work (meals-on-wheels) 2x week, in which I deliver to home-bound, disabled, aged folks.

I can't tell you of the number of people who tell me "thanks" for delivering their meal. Not once (that I could remember) did I get a "thanks" in the normal corporate world. If anybody complained, management would respond with "you get your thanks at the end of the month" (on payday).

I don't get "paid" for my "work" in delivering meals, but the "benefits" (a smile and a "thanks") are well worth my effort.

I would think that medical personnel have more "human interaction". That makes a difference.

- Ron

 

[TromboneAl]

You both had me laughing out loud right in the middle of a critical neurosurgical procedure on a VIP here in Tampa.

There go the piano lessons.

 

[Kwirk]

I'll bet that the greater danger is to retire on marginal assets with everything going well just before a recession hits.

Kwirk
Soon to be 90% retired

 

[Rich_by_the_Bay]

I don't get "paid" for my "work" in delivering meals, but the "benefits" (a smile and a "thanks") are well worth my effort.

I would think that medical personnel have more "human interaction". That makes a difference.

Well said, Ron. It is a huge factor, at least for some of us. My guess that they're thanking you as much for the brief social encounter as for the food.

 

[brewer12345]

Why is it we medical folk have such a hard time retiring but the mega corps can't wait to leave ??

Because only someone who really, really wants to be a doctor and stay one would go through so many years of schooling and wade through so much [-]bull caca[/-] nonsense in order to become one. In contrast, any retard with a BA from Clown College State University can work for megacorp.

 

[Marquette]

If it doesn't work out, I'm sure Andy can change your handle to Poor_in_Tampa =)

Also, it might be worthwhile to check out late-retirement.org. I hear they help with coming up with reasons to work into your 80's.

 

[Rich_by_the_Bay]

Also, it might be worthwhile to check out late-retirement.org. I hear they help with coming up with reasons to work into your 80's.

Now that's funny.

BTW, in my profession and generation, age 60 is considered suitable for premature-retirement.org. I will probably be the first one to ESR that young in recent memory in my institution.

If I retire that young...

 

[W2R]

Now that's funny.

BTW, in my profession and generation, age 60 is considered suitable for premature-retirement.org. I will probably be the first one to ESR that young in recent memory in my institution.

If I retire that young...

If you wait a year and a half longer than that, then you'll retire older than even me. Now that's old!! At least, I am beginning to feel old. I wish I could retire younger than that, but I'll be 61.5 when that lifetime medical finally falls into place for me.

Besides, don't you already qualify as having ESR'd, given that you're 10% retired now?

 

[MGYog]

My 2 pfennigs

Life is about the pursuit of happiness, not the pursuit of money. Money is just a tool used to help achieve happiness.[/quote]

My personal mantra.

Being a newbie here, I have read many of your threads along with Rewahoo, Finance Dude, Moemg, Milton, and many others, picking up gems of ideas in most cases, some of which I had not even considered before. I feel I am now more prepared to end my working career at the end of this year. I have changed my AA to mirror a lot of the advice I have picked up here, and which I think are reasonable and quite logical being an avid DIY.

IMHO you are so well prepared, I sorta envy you. FWIW, just do it!!!

 

[Rich_by_the_Bay]

Besides, don't you already qualify as having ESR'd, given that you're 10% retired now?

I think so, but no one gives me credit for it except the grandkids, who enjoy my rendition of Buzz Lightyear on those extra days off .

 

[rs0460a]

I think so, but no one gives me credit for it except the grandkids, who enjoy my rendition of Buzz Lightyear on those extra days off .

Well - you've been "spaced out" :

NASA to put Buzz Lightyear on International Space Station | Crave, the gadget blog - CNET

- Ron

 

[Nords]

I can weather 10-15 years without selling stocks if need be. Health insurance is assured, albeit on my own very heavy nickel. Plan to downsize but that can wait a few years.
I know the pundits say the scenario-from-hell is to retire smack into a recession or long bear market. I understand the arithmetic, but somehow it doesn't seem so bad (unless there's a serious once-in-a-century depression).
Am I missing something?

What REWahoo said. The only thing you're missing is the angels with the trumpets and the heavenly choir performing that classic serenade of "It's OK to retire now".

You're saying that the worst is here and you're doing OK. It sounds like confirmation that all of your planning is working. If it's working now, then hypothetically a recession is the best time to ER-- before Congress cuts your TRICARE & Medicare reimbursments again.

We retired in June 2002 and got to watch the stock market tank again in July & Oct... before watching the war start. (Ironically we were on family vacations for all three of those events.) We had a couple intense discussions about asset allocation but we hung in there and life has been really really good since then.

So, everyone seems to be saying not to worry. Let me mull that over for a year or two - probably things will change by then, and I can add another layer of protection. You never know...

The heck with that-- this recession is nothin' compared to history. If you want to really take your portfolio for a test drive then plug in 1966-1982 and see how the the final number comes out. I believe that chronic anemia was far worse than even the Depression's hemorrhages...

If you're retiring at the rate of 10% per year then this may be a case of that incredibly rare phenomenon, "Just One More Decade Syndrome"! What other sign are you waiting for?

You both had me laughing out loud right in the middle of a critical neurosurgical procedure on a VIP here in Tampa.

There go the piano lessons.

Or maybe they're gonna have to start all over again...

 

[OhSoClose]

Yes; regardless of your portfolio, every day you decide not to retire is another day that you loose doing what you want to do (assuming you rather not be at your current j*b).

Life is finite. Sometimes you have to look at your time left as having value, day by day. Every day you "loose a little".

I've used this cartoon more than once. It says it all...

- Ron

Now that is one awesome cartoon!!

 

[kcowan]

My decision to ER was driven by the experience of my Dad. He worked until 65 then experienced Mom die of breast cancer within a month. Then lived on his own for another 30 years. I vowed to "budget" for 25 years retirement after 35 years of being gainfully employed.

It was 2002 and the portfolio had been declining for two years. So far so good...

 

[TickTock]

Why is it we medical folk have such a hard time retiring but the mega corps can't wait to leave ??

A guess from someone who has worked for a megacorp, but not in the medical field...

In the medical field, you get to see the good results you produce on a regular basis. Much more difficult to see in many megacorp positions.

 

[laurence]

Do it! If you spent six months retired and couldn't handle it, would you be able to jump back into work? It might be less scary if you take it from a "let's try this for six months and see what happens" approach. I mean heck, I bet you could work full time at an urgent care facility if you really needed the money.

 

[laurence]

Because only someone who really, really wants to be a doctor and stay one would go through so many years of schooling and wade through so much [-]bull caca[/-] nonsense in order to become one. In contrast, any retard with a BA from Clown College State University can work for megacorp.

100% agree. Two very close friends are doctors (married to each other). The stories they tell of getting to where they are make me cringe. They are sooo not doing it for the money. I would suspect certain specialties like dermatology and plastic surgery suck up the more fiscally motivated candidates, too.

 

[Moemg]

Do it! If you spent six months retired and couldn't handle it, would you be able to jump back into work? It might be less scary if you take it from a "let's try this for six months and see what happens" approach. I mean heck, I bet you could work full time at an urgent care facility if you really needed the money.

That is the good thing about being in the medical profession . You can always unretire or work part time and nobody thinks anything of it .

 

[AdventuresAddict]

I think when the market is down it's the best time to prepare, because as the other investors are confused, it's easier to see clearly where the market is heading 10, 20 years down the road. Since your plan is supposed not to give you speculative gains but to generate a lifetime income, you should be concerned about whether the market is going up or down 10, 20 years down the road, from today.

 

[Finance Dave]

As my FIRE timer winds down (OK, it's still a little vague but it is still ticking ), one scenario is that things will be economically similar 6-12 months from now to how they are now.

At that point, the nest egg won't be quite as fat as I might have hoped but I would have been buying-in low for a year or more. I'd have plenty of cash on hand because that was the plan right along. No debts, probably a fun but modest part-time gig a couple days a week. I can weather 10-15 years without selling stocks if need be. Health insurance is assured, albeit on my own very heavy nickel. Plan to downsize but that can wait a few years.

I know the pundits say the scenario-from-hell is to retire smack into a recession or long bear market. I understand the arithmetic, but somehow it doesn't seem so bad (unless there's a serious once-in-a-century depression).

Am I missing something?

I think it would be worse to retire just BEFORE a recession. In that case, you'd go off thinking your nest egg would be X, and then whammo...10% less immediately. Hopefully you have diversified to the point that the recent downturn didn't affect you too badly.

At least now you know what you're getting into. And even though it's possible for the markets to go down further, it's more likely that they will go up given the market's "mean reversion" method over history.

Good luck, bet you can't wait to hit the magic day! O0

 

[Danny]

go ahead and jump...

I put it off and finally did it June 2001 during the dot-com bubble burst... sp500 went from 1,527 to about 800 to now at 1360..Nasdaq went from 5050 to about 1200 to now at 2454, Dow went from 11722 down to about 7500 and now 12307..

. and Just before 9/11....I don't know if there is ever a good time.

 

[aenlighten]

Another way of looking at this

Is to consider an investment that normally provides a certain 7% real return, but is subject to infrequent instantaneous declines or rises and one of these declines occurs at the transition from accumulation to decumulation. A safe withdrawal rate of 4% would correspond to a 1-7/4, or 43% decline, not far from the decline of a recessionary bear market. The 4% predecline withdrawal rate would equal a 7% real postdecline rate, or 10% including 3% inflation. One this severe would occur over a few years rather than instantaneously, but that is basically what you are protecting yourself against.

 

[bosco]

I pulled the plug last July 6 at 54. The ink was hardly dry on my termination papers before the US dollar plummeted and the Canadian dollar went above par. DW and my income for the first few years of retirement is fixed income from a US source, and we are living in Canada.

I am one of those (on this forum, at least) frequently scorned dinosaurs that has a pension from a state government. It has no inflation protection until 2013, then 1/2 of the CPI until 2018, then 3/4 of the CPI thereafter.

So we are very vulnerable to inflation, especially in the next few years. We do have significant investments (not enough to retire on alone, but great to augment our other cash-flows), but hope to leave them alone for 10 years. We have some (very modest) pension money from Canadian sources as well. I have mapped out our cash-flows over the next 15 years including said pensions, US social security, Canada OAP, Canada CPP (the last 2 won't amount to much), IRAs, RRSPs, etc. The hope is to let the investments mature and work on the consumption end for a few years.

As you can see, the perfect storm for us would be 1) plummeting US dollar 2) high inflation 3) low market returns. It would seem that something approaching that is occurring.

Despite all of this, I have no plans to return to work. We have taken the following steps to ensure that neither of us will need to work unless they want to:

1) house is paid for
2) starting a garden
3) I am going to start hunting deer (they're like rats around here)
4) heat with wood as much as possible--carbon neutral activity as well
5) exact expense tracking and budgeting
6) extra cash on hand for emergencies
7) overweight portfolio in international, commodities, oil, to help mitigate decline of US dollar

I find that I do not pay all that much attention to the market since pulling the plug. I pay much more attention to the budgeting spreadsheet, how to combine trips to save gas money, how to eat cheaply and healthy, and I am now getting much more exercise (have lost 13 lbs since retiring. In other words, I am living much more in the here-and-now and not obsessing about the future.

If I had spent one more construction season north of the arctic circle (and not quit in July last summer but held out until November), I would have received an extra $600/month or so (but hell--I'd be THERE now instead of here). But when I look at all I've done since I quit, and look in the mirror and see how many years have fallen off my face, I know I made the right decision.

The bottom line is that despite the adverse economic climate, my confidence level in being able to contend with whatever has come up has gone way up.

If you are thinking about pulling the plug, don't underestimate your resilience.

 

[Rich_by_the_Bay]

Thanks, Bosco. Good real-world observations.