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Some early retirees have second thoughts
Old 08-27-2008, 08:57 AM   #1
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Some early retirees have second thoughts

Some early retirees have second thoughts - USATODAY.com

Does this apply to anyone here?
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Old 08-27-2008, 09:48 AM   #2
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From the article (my emphasis added):

The Adamsons tried to buy individual health insurance policies but were rejected because both have high blood pressure and high cholesterol levels. They were able to get coverage through Adamson's former employer. But the premiums have risen each year, from $800 a month a few years ago to $1,300 a month now.


"We're paying close to 30% of my husband's pension" on health care, Rainee Adamson says. "It's a lot, and it goes up all the time."
--


(1300 / 30%) * 12 = 52,000.



Let me get this straight. I'm supposed to feel sorry for someone with a $52,000 pension?? I think not.
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Old 08-27-2008, 09:54 AM   #3
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The article fails to mention the stock/bond allocation of the early retirees. Bear markets are all part of the stock market cycle and should be fully expected without surprise. I wonder if some of the people who were interviewed allocated more to stocks than what is prudent when taking their personal circumstances into consideration.
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Old 08-27-2008, 09:56 AM   #4
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The article fails to mention the stock/bond allocation of the early retirees. Bear markets are all part of the stock market cycle and should be fully expected without surprise. I wonder if some of the people who were interviewed allocated more to stocks than what is prudent when taking their personal circumstances into consideration.
Either that or they grossly underestimated what they needed to retire comfortably with relatively conservative drawdown rates.

Or they grossly overestimated their emotional ability to ride out down markets without panicking.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

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Old 08-27-2008, 10:07 AM   #5
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A good article for someone to read before they retire at any age, if they havent really given the matter much thought.

Obviously you need a plan that can handle big ticket items like health care (which one might want to line up before retiring rather than after), the emotional and financial preparedness to handle down markets, and the emotional/intellectual issues around disconnecting the stimulation of working life.

I'd have written this more as a "things to consider and prepare for before and during early retirement" article rather than an "early retirees ran into all these unexpected snake pits and want to run away" article.
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Old 08-27-2008, 10:09 AM   #6
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Let me get this straight. I'm supposed to feel sorry for someone with a $52,000 pension?? I think not.
Ziggy, I agree. Their pension alone gives them more income than the average American household. According to the census bureau, the median household income in the U.S. for 2007 is $50,233.

Income 2007
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Old 08-27-2008, 10:23 AM   #7
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Someone I w*rk with retired at the end of last year and then came back 3 months later. He was driven insane by the gyrating stock market. Before he retired, I know he had a 60/40 asset allocation and had a decent pension.

Just watching the market go sideways drove him back. I talked to him and he admitted that intellectually he could easily weather the drops but when he watched his portfolio drop he became unnerved by the whole process.

Just as well, somebody needs to pay for my SS.
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Old 08-27-2008, 10:35 AM   #8
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Ziggy, I agree. Their pension alone gives them more income than the average American household. According to the census bureau, the median household income in the U.S. for 2007 is $50,233.

Income 2007
What never gets mentioned in these discussions is how much uncounted income there is. For example, health insurance, life insurance and many other job benefits. Then on the low end, Medicaid, food stamps, etc.

As a self funded retiree you are going to get none of that stuff.

Ha
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Old 08-27-2008, 10:50 AM   #9
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What never gets mentioned in these discussions is how much uncounted income there is. For example, health insurance, life insurance and many other job benefits. Then on the low end, Medicaid, food stamps, etc.

As a self funded retiree you are going to get none of that stuff.

Ha
You've brought up a very valid point and one that is more often than not overlooked. Gifts/handouts/charity/w*rking under the table, and other unreported income fail to be reported on government statistics.
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Old 08-27-2008, 11:10 AM   #10
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Originally Posted by 2B View Post
Someone I w*rk with retired at the end of last year and then came back 3 months later. He was driven insane by the gyrating stock market. Before he retired, I know he had a 60/40 asset allocation and had a decent pension.

Just watching the market go sideways drove him back. I talked to him and he admitted that intellectually he could easily weather the drops but when he watched his portfolio drop he became unnerved by the whole process.
We had a single guy posting on here a few years back who retired with a couple million plus in his nest egg. It declined by a few thousand dollars and he couldn't stand it - panicked went looking for a job almost immediately.

"To supplement their retirement income, Frye has helped some of his clients find part-time jobs as teachers or expert witnesses."

Hey, if disaster strikes and I'm forced back to w*rk, that expert witness gig sounds great. I think I'd prefer to work for the defense: "Yes, he definitely needed killing."
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Old 08-27-2008, 11:16 AM   #11
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I think you need to be reputable to be an expert witness.

Although I remember one lawyer in a corporate civil case talking about expert witnesses. He said one was $7000 but he was very reputable and respectable. One was $5000 and he was pretty credible. One was $3000 and had a very bad reputation but had the benefit of being "a whore that will say anything we want him to say".

So maybe you'd make it.
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Old 08-27-2008, 11:19 AM   #12
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I think you need to be reputable to be an expert witness.

Although I remember one lawyer in a corporate civil case talking about expert witnesses. He said one was $7000 but he was very reputable and respectable. One was $5000 and he was pretty credible. One was $3000 and had a very bad reputation but had the benefit of being "a whore that will say anything we want him to say".

So maybe you'd make it.
For $3k I can fake the reputable part...
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Old 08-27-2008, 11:21 AM   #13
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Well see, I'd do it for $2k and act like I really enjoyed it.
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Old 08-27-2008, 12:19 PM   #14
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Old 08-27-2008, 12:35 PM   #15
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Well see, I'd do it for $2k and act like I really enjoyed it.
Oooh Counselor! You are so good on direct, and your cross was a-a-a-amazing!
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Old 08-27-2008, 01:35 PM   #16
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[qoute]
Let me get this straight. I'm supposed to feel sorry for someone with a $52,000 pension?? I think not.[/quote]


No, but do you think the insurance company will charge less if you have a pension? I think we should all feel sorry for ourselves.

It's outrageous for any of us to have to pay that much for insurance period.
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Old 08-27-2008, 02:06 PM   #17
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[qoute]
Let me get this straight. I'm supposed to feel sorry for someone with a $52,000 pension?? I think not.

No, but do you think the insurance company will charge less if you have a pension? I think we should all feel sorry for ourselves.

It's outrageous for any of us to have to pay that much for insurance period.[/quote]

Before we feel sorry for ourselves we first should understand the numbers. For example,
1. What deductible do they have on that policy?
2 What would the premium be if they did not have a pre existing condition? To be used as a point of comparison.
3. Wouldn't a person with a pre existing condition use the benefits more than a person that doesn't? Shouldn't they pay more; similar to a person with a bad driving record?
4. Did lifestyle choices lead to their health problems?

Finally, what should they pay? And who or how do you suggest to fund the difference between the premium income and the overall cost incurred by the insurance company?
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Old 08-27-2008, 02:47 PM   #18
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Someone I w*rk with retired at the end of last year and then came back 3 months later. He was driven insane by the gyrating stock market.
Just as well, somebody needs to pay for my SS.
I bitch a lot about the market but it sure doesn't make me want to go back to work. I just like to bitch.
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Old 08-27-2008, 02:50 PM   #19
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I bitch a lot about the market but it sure doesn't make me want to go back to work. I just like to bitch.
Really? Hadn't noticed...
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Old 08-27-2008, 02:59 PM   #20
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Really? Hadn't noticed...
And another thing.........
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