Retire or look for another job?

[MarieIG]

Your numbers are impressive, but your DH's opinion needs to factor into the equation. An inheritance should not considered, until it is received.

What are the plans for long term care to fund long term care? The Roth/Regular IRA split; will you face a tax bomb; what is your plan for the survivor when there is one SS? That policy pays a lot of money for ten years, but appears to stop before any LTC would be required. The 75 year old you and DH are also important. It's a question of balancing life now and later. Both are important. A more concrete plan may help reassure your DH as well.

Re, the interview, if you decide to take the new job, tell them you aren't starting to the new year. BTW, you can always quit.

 

[FI_RElater]

MTN

I'm assuming that you ran anypia and used zeros for the later ages to get your SS number, right?
... and did you see what the results were with the (stated) SS reductions?

We've got savings like yours, although more of ours is in taxable, also have a pension and I'm already eligible to start SS anytime, and still wouldn't want a nut that large (we have a 3.5% wr max target in my earlier 60's.... you are probably at only 3% wr in your early 50's) but our house is paid off, unlike your more expensive one in a HCOL area.

I would give a cautious yes but note that you would have a longer period for SOR in your early 50's

 

[mtbikelover]

What are the plans for long term care to fund long term care? The Roth/Regular IRA split; will you face a tax bomb; what is your plan for the survivor when there is one SS? That policy pays a lot of money for ten years, but appears to stop before any LTC would be required. The 75 year old you and DH are also important. It's a question of balancing life now and later. Both are important. A more concrete plan may help reassure your DH as well.

Re, the interview, if you decide to take the new job, tell them you aren't starting to the new year. BTW, you can always quit.

We are planning that if we need LTC, that is where the inheritance will come in to play. DH agrees with that as well. We also don’t have to take the life insurance money out at age 70. We can wait to do that later if we don’t need it. If one of us dies, we will be ok without the extra SS. Our travel spending budget is very high and that will go way down if there is only one of us.

I have a super detailed plan but he refuses to look at it. He has a number stuck in his head and refuses to consider retiring until we have hit that number.

I am definitely going to try to push the start of the job off until Jan.

 

[mtbikelover]

MTN

I'm assuming that you ran anypia and used zeros for the later ages to get your SS number, right?
... and did you see what the results were with the reductions

I didn’t use anypia but our financial advisor did. And we took SS down by about 30% as we assume it won’t all be there by the time we collect it.

 

[eleighj416]

It looks to me like it is "party time".

One question, does your severance agreement require you to look for employment on some type of schedule? If not I would take my time and see how the world looks in a couple of years. You may find something that you really want to do.

 

[meleana]

You're loaded. Good riddance to your employment and hello to all the work you have being a homemaker.

I resigned my job in Sept.2018- forced out- age 62. I am so busy being a homemaker and my husband and I are making do on a lot less money than you have. Husband is retiring at age 65 1/2 the end of the year and we are even going to live off savings- again- nowhere near what you have and we live in NY right now. We are paying high rent and living expenses- we just sold our home of 32 years- and waiting for our retirement cottage to finish being built in New Hampshire.


In addition we will have $1000 per month in medical insurance expenses starting in January between my COBRA and hubby's Medicare. Plus even though we will be moving soon, we are obligated to pay this lease until May.


We feel like we are aging fast and this whole moving twice thing is taking a toll, so just enjoy your "youth" and be happy.

 

[watchman3135]

You have 3 million and you are worried? Have you created such a high lifestyle that you now have to maintain on a fixed income? I'm 53 and the same thing happened to me at the end of June with my job I was at for over 18 years. I have less than half of what you have at 1.3 million and I am pretty confident I can make it with a 3.5 - 4% withdrawal rate. I can easily live on $40k or even a bit less since I've passed my toy buying era of my life and have no other debt. If I make it to SS, I can then scale back if needed.
Like you, I was originally planning an early retirement at age 55 but as we learn, those plans don't always work out as we anticipated. My wife is 5 years younger and works a good job so we have her income and insurance. Since I've worked IT for nearly 24 years, I'm actually getting calls from recruiters wanting to put me back to work asap but my wife is honestly telling me she likes me better when I don't work because I'm watching our three 4 legged kids during the day and she said I'm nicer now lol.

 

[mtbikelover]

You have 3 million and you are worried? Have you created such a high lifestyle that you now have to maintain on a fixed income?

We live a very modest lifestyle but we want to have an expensive retirement with lots of travel hence the reason our annual budget is so high.

 

[watchman3135]

We live a very modest lifestyle but we want to have an expensive retirement with lots of travel hence the reason our annual budget is so high.

As others have said, without details, it's a bit harder to determine success but my guess is you'll be fine with those numbers.

 

[rpguy4]

OP:



It sounds like you'll be able to cover your expenses for the next 3 years,
but how do you plan to cover those expenses afterwards until 59 1/2 ?



You won't be able to use the 401k/IRA money without a 10% penalty until 59 1/2. Also don't forget about taxes on the withdraws.



( maybe I just need another cup of coffee )

 

[Pellice]

Would it help your husband emotionally to consult a fee-only financial planner and get a "professional" opinion?

Also, have you compared your budget from now that you are doing so much yourself from when you were working? Presumably you are not spending nearly so much.

You really sound on top of things. How long have you been not working? I'll bet it's decreased stress for your husband too, though he may not realize it. Just having someone home to take the car in for an appointment, to run errands, to take advantage of sales, to be home for repair visits - surely that is stress-reducing for him also.

 

[Rio2016]

I suggest doing much more research on a 1031 Exchange. You cannot exchange for a
personal residence.

 

[mtbikelover]

I suggest doing much more research on a 1031 Exchange. You cannot exchange for a
personal residence.

I’m very aware of that. We are doing an exchange into another rental property in Colorado. We will rent it out for 2 years then move there. But it will also be a part time rental or house exchange during retirement when we take long travel trips.

 

[mtbikelover]

OP:
It sounds like you'll be able to cover your expenses for the next 3 years,
but how do you plan to cover those expenses afterwards until 59 1/2 ?

We have a lot of cash/after tax accounts that will be used along with withdrawals from my husbands 401k. You can do early withdrawals on a 401k with a 72t. Our plan is to balance it out to keep our taxable income low enough to get cheap health insurance on the exchange.

 

[watchman3135]

We have a lot of cash/after tax accounts that will be used along with withdrawals from my husbands 401k. You can do early withdrawals on a 401k with a 72t. Our plan is to balance it out to keep our taxable income low enough to get cheap health insurance on the exchange.

Thank you for mentioning SEPP 72t. I swear it blows me away on how many so called financial experts and early retirement planners aren't even aware of it or purposelessly withhold this option from their clients because of their own personal fears of screwing it up.
It's an option on the table for those who wish to retire pre 59 1/2, make it available as one to use. If they (client or individual) don't follow the rules laid out by the IRS to the t, its their own fault and they were warned. If they do, it works perfectly as intended.

 

[GR111]

mtbikelover, looks like you have great options. It all comes down to the time vs money question. We only get one life so make the right choice for you.

 

[mtbikelover]

Would it help your husband emotionally to consult a fee-only financial planner and get a "professional" opinion?

Also, have you compared your budget from now that you are doing so much yourself from when you were working? Presumably you are not spending nearly so much.

You really sound on top of things. How long have you been not working? I'll bet it's decreased stress for your husband too, though he may not realize it. Just having someone home to take the car in for an appointment, to run errands, to take advantage of sales, to be home for repair visits - surely that is stress-reducing for him also.

We have a full time financial planner. Not interested in debating that with anyone here because husband is self employed and needs someone to manage his company 401k so it serves both purposes. Not all our money is with them so I’m comfortable paying the fee. He ran numbers before I lost my job and we were more than ok. I will probably have him re-run numbers once I decide if I’m going back to work or not

I have done the budget for less expenses. We save about $18k a year with me not working so of course it would still be beneficial for me to find a job.

I left end of September so it’s been almost 3 months. I’m still super busy all day with housework, my side business, the dog, and running household errands. I keep waiting for a day when I’m actually bored .

I do think DH likes me being home...it frees him up to spend lots of time on his hobby since he doesn’t have to do any cooking or dog care. And I do run errands for him as well. He said to me the other night that if I don’t find something that makes sense (financially, closer to home, etc) and that I would love, he is ok with me not working.

 

[Pellice]

We have a full time financial planner. Not interested in debating that with anyone here because husband is self employed and needs someone to manage his company 401k so it serves both purposes. Not all our money is with them so I’m comfortable paying the fee. He ran numbers before I lost my job and we were more than ok. I will probably have him re-run numbers once I decide if I’m going back to work or not

I have done the budget for less expenses. We save about $18k a year with me not working so of course it would still be beneficial for me to find a job.

I left end of September so it’s been almost 3 months. I’m still super busy all day with housework, my side business, the dog, and running household errands. I keep waiting for a day when I’m actually bored .

I do think DH likes me being home...it frees him up to spend lots of time on his hobby since he doesn’t have to do any cooking or dog care. And I do run errands for him as well. He said to me the other night that if I don’t find something that makes sense (financially, closer to home, etc) and that I would love, he is ok with me not working.

All that is to the good! It may be that your husband just takes time to think over a big change such as this. And that is fine. You've already gotten three months in, with no problems. If you think it would help, promise your husband that you and he will do a six month review (or whatever time frame makes sense) with your planner and (important) get that on the schedule (which will relieve pressure to do anything immediately). Then you will have six months of being fine under your belt. You can then schedule another review in six months. Your message is that "we can go forward like this without making any immediate or irrevocable decisions."

You have a clear goal and it seems your task is to gently edge your husband towards it. (But, what do I know, I'm not married.)

 

[SpinDoctorTX]

I have saved us a lot of money by doing the cleaning myself, cooking dinner every night, and taking care of the dog (used to use daycare and dogwalkers). Plus, my 2 hour commute is gone so I am saving gas money. I am shocked at how busy I am just taking care of the house and family. I am also way less stressed.
I would love to "retire" now and not go back to work but my husband is freaked out.
Since husband will keep working for another 3 years, he will put in an additional $50k/year into our retirement account. I won't be adding anything but I won't need to take money out as I got a great severance package as well as will get my stock payout every year for the next 3 years.

Our budget includes health insurance and both kids college is already paid for with a 529. Does it seem realistic that I could stay home and retire now?

One other thing that is not in our numbers it that my husband is going to get a very large inheritance when his parents pass. He doesn't want to include any of that in our planning but it will be significant (7 figures) so if something were to happen and we did run out of money when we are 75, we do have a safety net.

It seems that you have it pretty much all in hand, so I'd go for it. I retired at 56 with significantly fewer resources than you, but it was enough that I could pull the trigger and have been enjoying my retirement for 3 years now.

Our spending went down more than expected (due to work related expenses- no travel/commute $, biz suits, lunches out, etc...), and my stress level has been reduced to practically nothing. Since you desire a much larger spend rate, YMMV.

All the best as you work on this not so bad to have dilemma! One can't put a price on the freedom of being retired. My stress is almost nonexistent, and my hair went from almost total gray/white to ash blonde with grey/ white highlights- in only a year. My health is so much better now too... no excuses about being to tired after work to get in some exercise!

Oh sure, I don't mean literally no one is hiring, but for the kind of job where the OP would justify re-upping doggie day care, cleaning service, and commuting costs, I read between the lines that only a higher salary position would be worth it. And those kind of corporate gigs often go on hold and open up in the new year.

Exactly... Also when not working- and older- you will become the blue light special and your offers may be what you made i your 30s. I don't think so.

Exactly right! I'm not going back to work for a $10-20/hr job. I can make that just by saving money with the other expenses. Plus, I have a side gig that pulls about $10k/year. I can do that with a corporate job but definitely not an hourly, on my feet job.

Yep.

We are planning that if we need LTC, that is where the inheritance will come in to play. DH agrees with that as well. We also don’t have to take the life insurance money out at age 70. We can wait to do that later if we don’t need it. If one of us dies, we will be ok without the extra SS. Our travel spending budget is very high and that will go way down if there is only one of us.

I have a super detailed plan but he refuses to look at it. He has a number stuck in his head and refuses to consider retiring until we have hit that number.

I am definitely going to try to push the start of the job off until Jan.

Inheritances can vanish when there are super bad health events, the economy tanks,we get into yet another war, & so many others, I wouldn't count it in as a fail safe when you need it. Life happens. 3mm is a lot, so I'd be inclined to earmark a chunk of that as your umbrella. If things go perfectly, of course you can be living on easy street!

I'm actually getting calls from recruiters wanting to put me back to work asap but my wife is honestly telling me she likes me better when I don't work because I'm watching our three 4 legged kids during the day and she said I'm nicer now lol.

Me too- even after leaving the corporate world over 3 years ago! There must be quite a shortage of credit analysts in the Houston area. I can guarantee you that my SAP and advanced excel skillset is be by now a bit rusty. My DH is thrilled for me to be home... the house sparkles. I consider cleaning as exercise, b/c I really get into the nitty gritty and get things clean that our awesome housekeeper wasn't even expected to do (bigger jobs).... And we have healthy home cooked meals almost every day.

 

[Flotuspa]

Hi, I was in a similar situation to yours last year at age 54. To ensure a harmonious relationship with your DH and to gain his full support in your decision, I would suggest you have a financial planner run the numbers with your budgeted $167K/yr of expenses as extra insurance. Retirement planning is complex and it is worth seeing a professional to assess your situation. I also am of the mindset that one should never bank on an inheritance.
In my case, Megacorp cut several hundred employees last year making me eligible for the 1 year severance after 24 years with the company. I also qualified for the Retirement Health care benefits which subsidized pre-Medicare and post Medicare health insurance for me and my family.
Before making the decision to volunteer for the severance, DH and I had several financial scenarios done by Fidelity and an independent financial advisor (to be super sure). We have a similar spending level to yours, 1 fully funded 529 over $275K for our DD who will be going to college in 3 years and over $5M across our accounts and a fully paid home. And still , I was nervous despite all of the green lights from Fidelity and the other independent advisor.

One year into it, life is good. I am happy, healthier, renewed friendships, taking cooking lessons and volunteering because staying at home cleaning the house was not fulfilling for me. DH will be retiring in May at age 57. I also track our expenses monthly using Quicken and so far are under our budget by $3k/month which is how I like it.

Life is good. but I would not have done it if DH had cold feet and was not fully supportive.
Also, have a conversation with your DH about spending mindset. That has to change when one goes from 2 high incomes down to 1 and eventually none. It takes some getting used to. For myself, I was used to spending with out thinking about it twice, now I really think about whether things are truly a need or a want.

I wish you the best in your decision making and whatever the outcome, good luck.

 

[mtbikelover]

Thanks!

We actually are pretty close to making the decision for me to retire. DH got a nice gift from his parents inheritance plus the market performance last year took our portfolio to just over $3 million. When I re-ran firecalc yesterday with all our final year end numbers, we are 99%. We have decided to re-evaluate it in 3 months. But right now, I’m just going to enjoy it.

It still blows me away at how busy I am and I wonder every day how I got everything done while working out of the house.

 

[MI-Roger]

One other thing that is not in our numbers it that my husband is going to get a very large inheritance when his parents pass. He doesn't want to include any of that in our planning but it will be significant (7 figures) so if something were to happen and we did run out of money when we are 75, we do have a safety net.

Don't count your chickens before they hatch!

If one or both of his parents require Skilled Nursing care as they age, that $1M plus inheritance can be sucked dry fast. $100K per year per patient is not unusual depending upon their locale. That is equivalent to ~$8K per month, and the cost for my Dad's care in a Skilled Nursing Facility was ~$3K per month in the early 1990's in a LCO area!

You said your Husband got a nice gift from his parent's inheritance but you didn't say if his parents died. Assuming they are still alive and they bequeathed him a sizable sum, please be aware there is a 5-year look-back period for any large value asset transfers or gifts if his parent's require Medicaid coverage for SNF care in the future. That gift may be disallowed and the money may have to be returned.

I fear our kids are making the same plan to fund their retirement (use the inheritance from Mom & Dad) but we had our children early in life and we may live well beyond the point at which the kids hope to retire.

 

[mtbikelover]

Don't count your chickens before they hatch!

If one or both of his parents require Skilled Nursing care as they age, that $1M plus inheritance can be sucked dry fast. $100K per year per patient is not unusual depending upon their locale. That is equivalent to ~$8K per month, and the cost for my Dad's care in a Skilled Nursing Facility was ~$3K per month in the early 1990's in a LCO area!

You said your Husband got a nice gift from his parent's inheritance but you didn't say if his parents died. Assuming they are still alive and they bequeathed him a sizable sum, please be aware there is a 5-year look-back period for any large value asset transfers or gifts if his parent's require Medicaid coverage for SNF care in the future. That gift may be disallowed and the money may have to be returned.

I fear our kids are making the same plan to fund their retirement (use the inheritance from Mom & Dad) but we had our children early in life and we may live well beyond the point at which the kids hope to retire.

We are not counting on that money and it isn’t in our retirement plan. But there is no way there wouldn’t be something. And they already have a plan in place for long term assisted care.

 

[rkser]

To the OP,

If you have going Part Time as an available option, without any work obligations on your days off, you can consider it.

I understand money wise you are very well set, but filling up the whole week of free time may not be easy, for some it may be daunting.

Although money is a important aspect in life, one needs activities, preferably ones which give purpose, satisfaction & pleasure. This is more true for some who have worked most of their lives & have reached a well heeled position.

After a few months/years you will know more clearly what to do next.

Many of us do not have an option of going Clean Cut Part Time, i.e either you are working most of the time or you are not.