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Really concerned about being able to retire, need advice
Old 05-31-2012, 01:31 PM   #1
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Really concerned about being able to retire, need advice

I am 54 1/2 yrs old single, no kids, in good health, and over the last few years have had some bad luck with jobs between company closing and then getting laid off last year. I just recently started a new job, (pay not that great and have to wait 3 months for healthcare which will cost me $80/week for medical and dental, the most I ever had to pay).

After taxes, healthcare and living expenses, I figure I will have about $6500 yr to save for retirement.

At present, I have $620,000 saved, have no debt, no pension. I guess I am freaking out since I doubt if I will be working steady over the next few years (after what happened in the past) and it seems like a lot of people on this site will have pensions of some sort to rely on and have a lot more saved.

I am estimating spending will be about $30k after taxes and worried if something happens job wise, I will not have enough.

Appreciate any feedback. Thanks
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Old 05-31-2012, 01:44 PM   #2
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Well, you cannot do more than you can do. If the best you can do is tack on another $6500/year, then so be it. To help with the worrying, it might be worth thinking through some alternative scenarios that would allow you to get along. For example, you might be able to get by pretty well by living on very little in a low cost overseas area that might also be an interesting place to spend some time. Or you might be able to semi-retire and do a bit of work to make up the difference. Or there are other options. Way down on the list for me but definitely an option if things go south for me is to live a very low cost lifestyle as a full time camper in a travel trailer, possibly doing some work or campground host stuff to make ends meet. Simply knowing that I have options if things don't work out as planned helps me a lot.
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Old 05-31-2012, 01:56 PM   #3
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Will you be eligible for SS? If so, have you estimated the amount?
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Old 05-31-2012, 01:57 PM   #4
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Quote:
Originally Posted by joecaf53 View Post
I am 54 1/2 yrs old single, no kids, in good health, and over the last few years have had some bad luck with jobs between company closing and then getting laid off last year. I just recently started a new job, (pay not that great and have to wait 3 months for healthcare which will cost me $80/week for medical and dental, the most I ever had to pay).

After taxes, healthcare and living expenses, I figure I will have about $6500 yr to save for retirement.

At present, I have $620,000 saved, have no debt, no pension. I guess I am freaking out since I doubt if I will be working steady over the next few years (after what happened in the past) and it seems like a lot of people on this site will have pensions of some sort to rely on and have a lot more saved.

I am estimating spending will be about $30k after taxes and worried if something happens job wise, I will not have enough.
$620K should probably be able to support an inflation-adjusted $20K a year, give or take a little. You don't state where these savings are located or whether they will be taxed when you withdraw them. If most of this would be non-taxable that and SS at 62+ should get you close to or over the $30K mark, especially if you can save more in the years to come before you retire.

Will you have to fully pay for your own health insurance when you do retire? If so, $30K seems awfully low.
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Old 05-31-2012, 02:08 PM   #5
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Have you tried FIRECalc: A different kind of retirement calculator yourself? I just entered a $620K portfolio, 40 years (age 95), $6500/yr savings, retiring age 62 (SS eligibility) and default everything else and got
Quote:
Looking for a spending level that will result in 95% success rate . . . . .A spending level of $32,838 provided a success rate of 95.0%.
and that's without Soc Sec! I assume you'll have Soc Sec too and Medicare at age 65.

About 1/3rd to 1/2 of the members here don't have pensions IIRC from earlier polls.

You don't need to freak out, you're in better shape than a lot of people (they just don't post here...).

Keep saving, investing and planning - and relax. Freaking out won't help anything...guaranteed.
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Old 05-31-2012, 02:19 PM   #6
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I agree with some, you may have more savings than most people.
The caveat is that your job is unpredictable. You can consider the ff:
1. Work till you are 65
2. Work till 62, then work partime.
3. Continue to save as much as you can.
4. Live a simple life and be frugal.
5. Learn to invest, and do it yourself. Don't let others do it for you.

One the plus side, you are single, and you do not have any dependents.
It is easier and adjustable when people don't depend on you.
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Old 05-31-2012, 02:29 PM   #7
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One the plus side, you are single, and you do not have any dependents.
It is easier and adjustable when people don't depend on you.
This is a huge asset.
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Old 05-31-2012, 04:11 PM   #8
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Quote:
Originally Posted by joecaf53 View Post

At present, I have $620,000 saved, have no debt, no pension. I guess I am freaking out since I doubt if I will be working steady over the next few years (after what happened in the past) and it seems like a lot of people on this site will have pensions of some sort to rely on and have a lot more saved.
You are doing better that the vast majority of people. $620k savings is far more than most people have.

To offer a more complete opinion we'll need to know more about your housing situation, health and access to insurance, SS amount and your spending. I'd advise you to start tracking your spending using one of the many phone apps available. Once you know where you spend money you will know where to economize and if your income will cover your expenses.
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Old 05-31-2012, 06:36 PM   #9
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It is unsurprising that your recent layoff has left you anxious about future curve balls; but as brewer suggests, there is only so much that you can do, and it sounds like you are already doing it.

When mulling over the 'what ifs', keep in mind that - absent unusual circumstances (e.g., severe mental illness, drug addiction, etc.) - very few Americans actually wind up homeless and broke. Your finances may not be all that you would hope, but they should be sufficient to allow you a decent (if not extravagant) standard of living, especially if supplemented with modest income from some form of part-time work in retirement.
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Old 05-31-2012, 06:46 PM   #10
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Joecaf, sorry you are having employment ups and downs, and congratulations on having no debt and a nice nest egg.

Could you see yourself sharing lodgings with a compatible person who's also trying to save money? The money saved from splitting living expenses (rent/mortgage and utilities) can go into your retirement account.

Amethyst

Quote:
Originally Posted by joecaf53 View Post
I am 54 1/2 yrs old single, no kids, in good health, and over the last few years have had some bad luck with jobs between company closing and then getting laid off last year. I just recently started a new job, (pay not that great and have to wait 3 months for healthcare which will cost me $80/week for medical and dental, the most I ever had to pay).

After taxes, healthcare and living expenses, I figure I will have about $6500 yr to save for retirement.

At present, I have $620,000 saved, have no debt, no pension. I guess I am freaking out since I doubt if I will be working steady over the next few years (after what happened in the past) and it seems like a lot of people on this site will have pensions of some sort to rely on and have a lot more saved.

I am estimating spending will be about $30k after taxes and worried if something happens job wise, I will not have enough.

Appreciate any feedback. Thanks
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Old 05-31-2012, 08:33 PM   #11
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Joecaf, I'm pretty much in the same boat as you. I was laid off at 55, single, no children, small pension and about the same $$'s as you. I got busy tracking my spending and whittling my expenses. I calculated what I would be able to spend annually in order to make my money last and then I learned to live on that amount. I'm looking for a job, but am OK with retirement if I don't find anything that I want to do.
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