8 years to go until retirement

[Bimmerbill]

I just turned 52 and plan to retire at age 60, so 8 more years to go.

I'm lucky to have a federal job so I'll get a federal pension equal to 1% of my salary per years worked.

At age 60 I'll have 30 years worked, so will get a pension of $30K based off my $100K salary.

I'll also be able to collect my Army National Guard retirement at age 60 of $10K.

My retirement also provides a retirement supplement approximately equal to social security, which should be $20K. This lasts from 60 to age 62. Plan is to take social security at 62 unless my spend rate is a lot lower than I plan and I end up banking money.

I have $415K in my TSP account, which is the goverment 401k type plan and am adding about $20K per year.

So, things are looking good for an annual spend rate of $80K (80% of my salary) at age 60. It's still 8 years away so I am hoping there are no significant changes to the federal retirement system. FIRECALC gives me a 100% chance of success.

Health insurance will be carried over from my federal job, or I may use Tricare depending on how the plans look when I reach 60. I live in a state without income taxes and which doesn't tax pensions so I think I will be all set tax wise.

I hope there will be an early retirement offer sometime in the next 8 years, but not sure I would qualify. I can hope tho.

What else should I be looking at?

 

[Lukeee]

I personally look at actual expenses vs 80% of salary.

The wife wants to travel, pushing estimated expenses up. That’s offset by eating out less and cutting down to 1 vehicle. My household expenses will actually stay the same or perhaps go up a little after retirement.

 

[YVRRocketSurgery]

Looks like you're pretty set on the income side. As Lukeee mentions, I'd probably review the spend side, not just to align with what you are spending today but what you are going to fill your freed up hours with.

Beyond that, there's planning around POA, long term care, etc if you haven't given that thought yet.

 

[kgtest]

I just turned 52 and plan to retire at age 60, so 8 more years to go.

I'm lucky to have a federal job so I'll get a federal pension equal to 1% of my salary per years worked.

At age 60 I'll have 30 years worked, so will get a pension of $30K based off my $100K salary.

I'll also be able to collect my Army National Guard retirement at age 60 of $10K.

My retirement also provides a retirement supplement approximately equal to social security, which should be $20K. This lasts from 60 to age 62. Plan is to take social security at 62 unless my spend rate is a lot lower than I plan and I end up banking money.

I have $415K in my TSP account, which is the goverment 401k type plan and am adding about $20K per year.

So, things are looking good for an annual spend rate of $80K (80% of my salary) at age 60. It's still 8 years away so I am hoping there are no significant changes to the federal retirement system. FIRECALC gives me a 100% chance of success.

Health insurance will be carried over from my federal job, or I may use Tricare depending on how the plans look when I reach 60. I live in a state without income taxes and which doesn't tax pensions so I think I will be all set tax wise.

I hope there will be an early retirement offer sometime in the next 8 years, but not sure I would qualify. I can hope tho.

What else should I be looking at?

House paid for? The X factor of How will I pay medIns is not on the table for you.



With Pension, SSI, the fact you won't need to save 20K plus no longer contributing to TSP (which means lower COL) plus no need to pay HI, which is really no change (Assuming its paid for today via Fed) it looks like you have a solid 3 legged stool (Investments, SSI, Pension) and a temporary fourth leg of $40k for two years. I would think the new money plus that 40k could be put to use in market, and yes you would have no problem living cheap first two years.


Congrats on such a fruitful career!



My plan is to end with the fed, knowing how the pension works was helpful.

How do they compute that supplement of 20k for two years? How would that relate to someone who has only about 15 years?

 

[Mr._Graybeard]

What's your Bimmer history, Bill?

 

[pb4uski]

I personally look at actual expenses vs 80% of salary. ....

+1 I suspect that $80k of is a much higher percentage of take-home pay after considering tax witholding, TSP contributions and the like.

$20k a year for $415k is high (4.8% WR) but I suspect that the $20k implicitly considers contributions and growth for the next 8 years.

Another good thing is that it looks like most of your income streams are COLAed.

What does FIRECalc say? I suspect that it would say that you are golden.

 

[Bimmerbill]

Thanks

House paid for?
How do they compute that supplement of 20k for two years? How would that relate to someone who has only about 15 years?

Thanks, Yes, house will be paid for when I retire. The FERS special supplement is approximately equal to SS. Here is what I found:

1) Read your SS statement and take note of your projected monthly payout at age 62.

2) Multiple that figure by your year's of FERS service (including months as fractions of a whole year).

3) Divide the figure obtained in Step 2 by 40 and the result is your monthly FERS supplement to a very degree of accuracy.

 

[Bimmerbill]

BMWs

What's your Bimmer history, Bill?

Nothing exotic at all. Had a 1998 528 and a 2001 530. Still lusting after a 540 or M5 but probably won't happen.

 

[Bimmerbill]

COLA pensions

Another good thing is that it looks like most of your income streams are COLAed.

What does FIRECalc say? I suspect that it would say that you are golden.

Yes, both of my pensions are COLA'd. I'm actually making out pretty good with my military pension as it will be based on 2026 pay tables, the year I start drawing it.

FIRECALC gives me 100% chance of success based off my numbers.

 

[Dtail]

Nothing exotic at all. Had a 1998 528 and a 2001 530. Still lusting after a 540 or M5 but probably won't happen.

Got a Z4 with the M engine. Still enjoy it with my DGF down in FLA.

 

[Bimmerbill]

Z series

Got a Z4 with the M engine. Still enjoy it with my DGF down in FLA.

Nice! I always liked the Zs but am very tall so unsure if I'd fit in one.

 

[Dtail]

Nice! I always liked the Zs but am very tall so unsure if I'd fit in one.

I am 6ft even and no issues with height or leg length. My guess is ~ 6ft2in and higher could be an issue.

 

[Vizini]

The Retirement Supplement is quite a bit less than Social Security.

 

[Samko2]

What did you do on the End?

 

[HadEnuff]

Looking good, Bimmer. It will go a lot faster than you think.