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The Street: Early Retirement Is Still an Option for Many
Old 10-18-2010, 01:52 PM   #1
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The Street: Early Retirement Is Still an Option for Many

Hey, we're fashionable again!

Early Retirement Still an Option for Many - TheStreet
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Old 10-18-2010, 03:02 PM   #2
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I read this article through a yahoo-finance link this morning.

Surprise, the big conclusion, is that if you get your expenses down then you don't have to work till you drop. Expenses drive what you'll need.

This should be well traveled news to the ER crowd.
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Old 10-18-2010, 03:19 PM   #3
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They lost me when they started talking about people getting boosts to their "lump sum pensions" or getting employer-subsidized health insurance coverage into retirement. If you already have these things in your future, you're probably not the one with the most retirement angst... to the rest of us, the author may as well be on another planet...
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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 10-18-2010, 03:31 PM   #4
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He said companies are increasingly looking to trim payroll, and churn their work force, by offering these packages. In many cases, depending on their expertise, retirees are brought back into the fold as consultants or to help train younger employees, essentially doing much of the same work but without the cost of benefits.
"They can't defeat the union, so they just buy it one worker at a time," Cox says. "That's essentially what the larger companies are doing. They are using the opportunity presented by the economy being the way it is to turn over their work force a little bit faster in the areas that are either lagging or are legacy parts of the business that really aren't producing the revenue they want."
I'd sign up for that...
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Old 10-18-2010, 06:20 PM   #5
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Expenses drive what you'll need.
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Old 10-19-2010, 09:43 AM   #6
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I hate articles like this one that speak in generalities and fantasy. The conclusion that expenses are a driving factor in meeting personal financial goals is utterly banal. I want to know how much the folks who ERed had in their portfolios. What does "by no means uber wealthy mean". The accountant who ERed must have had a > $1M nest egg to support ER at 45. To most people that's "uber wealthy". Let's face it, ER is not an option for most and if it's imposed by layoffs it probably means poverty rather than "ice skating in Rome".
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Old 10-19-2010, 09:46 AM   #7
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I hate articles like this one that speak in generalities. I want to know how much the folks who ERed had in their portfolios. Notice none of them were blue collar workers.
I think blue collar/white collar has less to do with it than whether or not there is a pension and retiree health insurance in the picture. Though it probably is true that many white collar occupations may have had the income to fund retirement savings even without those blessings.
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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)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
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Old 10-19-2010, 09:58 AM   #8
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I think blue collar/white collar has less to do with it than whether or not there is a pension and retiree health insurance in the picture. Though it probably is true that many white collar occupations may have had the income to fund retirement savings even without those blessings.
I agree, I removed my original "blue collar" comment before I read your post as some blue collar workers are in a fairly good retirement position if they have grandfathered benefits that can overcome their lower lifetime incomes.
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Old 10-19-2010, 11:45 AM   #9
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What I continue to find interesting about this topic and articles like this is how it's clearly not "one size fits all" when it comes to ER. There are so many ways someone might position themselves to RE. White collar or blue may not play a huge role one way or another. Controlling spending, LBYM, a saving mindset, inheritance, pensions, severance packages, etc. all get factored in. The common thread seems to be a desire to do it and the willingness to put together a plan to make it happen.
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Old 10-19-2010, 11:50 AM   #10
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What I continue to find interesting about this topic and articles like this is how it's clearly not "one size fits all" when it comes to ER. There are so many ways someone might position themselves to RE. White collar or blue may not play a huge role one way or another. Controlling spending, LBYM, a saving mindset, inheritance, pensions, severance packages, etc. all get factored in. The common thread seems to be a desire to do it and the willingness to put together a plan to make it happen.
Early retirement is like Buddhism: there are many paths to the enlightened state.
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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)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
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Old 10-19-2010, 11:57 AM   #11
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Talked to an old medical school friend last night for the first time in a couple of years, shared that I was retired (recalling that 60 is considered early in my profession).

He took a long time to register this news, and finally said "if you don't mind my asking, do you get pensions from each of the three state universities you worked for?"

Translation: there is no way he can even consider retiring now, and I must have some kind of trick, inheritance or other means, besides LBYM and saving hard. I told him no, but we're not planning the lavish life many of our peers are counting on.
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Old 10-19-2010, 12:27 PM   #12
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Originally Posted by lowflyer View Post
What I continue to find interesting about this topic and articles like this is how it's clearly not "one size fits all" when it comes to ER. There are so many ways someone might position themselves to RE. White collar or blue may not play a huge role one way or another. Controlling spending, LBYM, a saving mindset, inheritance, pensions, severance packages, etc. all get factored in. The common thread seems to be a desire to do it and the willingness to put together a plan to make it happen.
These are all other ways of saying that you need an income stream to support your spending. With the poverty rate going up it's increasingly difficult for people to ever save (ie earn) enough to support their spending, however frugal.
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Old 10-19-2010, 04:43 PM   #13
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I am one of the many few that will exercise that FIRE option next year!
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Old 10-19-2010, 09:05 PM   #14
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Translation: there is no way he can even consider retiring now, and I must have some kind of trick, inheritance or other means, besides LBYM and saving hard. I told him no, but we're not planning the lavish life many of our peers are counting on.
You are so right. Every single conversation I have with anyone regarding our ER eventually includes some comment from me like "Well, ya know, we live a fairly modest lifestyle...." Seems to make more sense to people when they hear that.
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Old 10-19-2010, 09:19 PM   #15
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sigh...i thought the article was a welcome change. no more, "you need $10MM to be 'free.'"

i too meet nay sayers at every corner. the last guy i talked to thinks he needs a $300k/yr income in retirement. this morning in my meeting, i decided the people i slave away with are masochists. they think it is "cool" and "in" to have a blackberry and use it. also, they think it is cool to drive expensive cars. at least they came to the conclusion that it isn't cool to use the blackberry and drive.

sometimes i think sailing away on what we have and just making it work would be the best thing...sometimes, these things have a way of working themselves out. you never know until you try.
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Old 10-19-2010, 10:36 PM   #16
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The severance packages are to ensure that they company does not get sued for age discrimination. In exchange for the package, you give up that right i.e. they sort of admit there might be a problem but pay to have the problem go away.
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Old 10-19-2010, 10:47 PM   #17
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Originally Posted by nun View Post
I hate articles like this one that speak in generalities and fantasy. The conclusion that expenses are a driving factor in meeting personal financial goals is utterly banal. I want to know how much the folks who ERed had in their portfolios. What does "by no means uber wealthy mean". The accountant who ERed must have had a > $1M nest egg to support ER at 45. To most people that's "uber wealthy". Let's face it, ER is not an option for most and if it's imposed by layoffs it probably means poverty rather than "ice skating in Rome".
I'm currently planning to be FI -- not sure if I will retire or what -- on July 19, 2015 at age 46.15 with $497,771.32 in my FI stash. My budget will be $19,648.64 a year, which works out to a 3.95% WR.

I have no plans to go ice skating in Rome.

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