Advice on Early Retirement needed

[Rob]

Hi-
First- I am really in need of some help and advice. I am 57 years old (soon to be 58) single male, and I and have been a high school teacher for 30 years, mostly in international schools. My first question is this. Are there people out there, teachers or otherwise, that get to a point where even one more year of full time work becomes too much? I am a very effective teacher, but the stress of these long days really bothers me. My reason for wanting to continue is primarily to add to my retirement portfolio. Is that a valid reason?
Second Question- I have my money invested in a teacher retirement plan that is great. I have about $680,000 in this plan in the form of annuities, stocks and bonds. I also have about $70,000 dollars in a bank time deposit. I actually have very little loose cash. If I were to semi-retire even now, I am allowed to live off the interest from my $490,000 in annuities after the age of 55, which would not touch the principal. This would give me an initial retirement of $26,000 per year. I would let the stocks and bonds (about $200,000) grow for another 4 to 5 years, and then I would get full retirement at 62 or even later. Do other people do this? Is it something to consider? I do not own a home, and frankly, I do not mind renting the rest of my life.
You suggestions and advice would be most appreciated.

Sincerely,
Rob

 

[BUM]

Hi-
    My first question is this.  Are there people out there, teachers or otherwise, that get to a point where even one more year of full time work becomes too much?    

Welcome Rob,

I used to be a sales rep and called on buyers and engineers of large corporations. There were a number of 50+ guys that used to say to me, "I hate my job, but I only have ELEVEN MORE YEARS to retire." Eleven more minutes would have been too much for me.

Most of us have a family to consider in this planning you don't. Should make the decision only half as difficult. It was me? I'd be gone. You seem to have the resources and there are plenty of others on this board to advise you on Question 2. Question 1 is easy

I'm 53 and bailing next month. Geronimoooooooooo


BUM

 

[Jarhead*]

Hi-
    First- I am really in need of some help and advice.  I am 57 years old (soon to be 58) single male, and I and have been a high school teacher for 30 years, mostly in international schools.  My first question is this.  Are there people out there, teachers or otherwise, that get to a point where even one more year of full time work becomes too much?  I am a very effective teacher, but the stress of these long days really bothers me.  My reason for wanting to continue is primarily to add to my retirement portfolio.  Is that a valid reason?
 
Rob: First off, congratulations for completing 30 years of teaching high schoolers. Having raised two children through their teen-age years, I can only imagine what a class-room of them would be like
You stated you were single, and if you have no outside obligations, (Aging parents that need help, etc. etc.), from what you stated, along with the idea of working part-time if need be you should be in fine shape financially.
Whether you should leave now, or wait a couple more years is the question that you will have to struggle with.
Because this is an early retirement board, with a lot of very young posters with an understandable emphasis on financial ability to retire, what is sometimes lost is what is going to fill up your very considerable time that will be available to you.
I retired almost 18 years ago, and my main reason to retire early, (Was close to 50) was to move to another location to pursue my love of outdoor activities.
I have seen more early retirements derailed eventually by boredom than by financial considerations.
If you are motivated by some such thoughts, you could "financially" leave now. If not, maybe hang in there for a couple more years, and spend some time
working on what can be a very rewarding period of time in your life. (An active retirement).
Good Luck, Jarhead

 

[consejo]

Rob, I'm 52 and less than 3 years away from retirement at 55. I don't consider that "early retirement," just earlier than the norm in most cases.

I posted a comment called, "Three Day Workweek." In it, I wanted to make that point that complete financial independence at retirement is only one way to go and the most expensive.

Instead, I think a partial retirement based on 20 hours of work in a job you enjoy is sound planning for many reasons:

1 - It preserves your assets by whatever part-time income you earn;

2 - It allows you to ease into the reality of increased leisure time;

3 - It lets you find your own right balance of paid employment and leisure;

4 - AND MOST IMPORTANT: It gives you more free time earlier in life!

At our age, this is not a minor consideration. Even if you are in good health, you should count your blessings not count on being that lucky forever!

You don't sound happy - get out now - ASAP! The big question is your costs of living. What is your nut and are you sure? If you are fairly confident that your expenses are under that $26K you're going to get PLUS whatever you might earn in a part-time job you think you might like trying on for size - bail!

Good luck and keep us posted. R/

 

[chris2007]

Dear Rob,
My husband, 52, is also a teacher and we have a plan to retire in 2008, if possibel both of us. Although he is doing well at school he feels that tension increases and the last years will probably cost too much in terms of nerves and health. So we have started saving to make ER happen. Having no kids, 2 salaries and few expensive hobbies make it easier. We keep an eye on all daily expenses and try to implement "simple living" ideas. You may also find www.slnet. helpful to reduce cost of living while adding to your savings and might find other people there who retired just as you described. As for renting - how about homesitting or a "perpetual traveller" lifestyle? We have not tried it yet but might regard it as an option.
Chris

 

[ESRBob]

Rob,
Great post and questions.
Here's one for you: sounds like you are burned out on work -- have you considered just trying to request a sabbatical? A year off? Here is my logic.

If you could arrange such a thing for next school year, you limp through this year with an end in sight. During the next year, you travel, explore hobbies etc etc. and have the security of knowing you have a job to come back to.

If you decide sometime during that year that you have had enough, then let them know you won't be coming back.

Otherwise, use the year to de-tox, make new friends, find new interests and clarify a plan for what you will do when you fully ER. With that clarity of vision, you can probably work a few more years knowing where you are going and adding a bit more to your nestegg.

I am early semi-retired and like Consejo, I think it can be a good plan for some people. It is hard to be a part-time teacher, though, so I am not recommending it in your case.

You might, however find that you can tutor kids for their SATs or something else like that which can pay you 10k or so a year and not be a burden (emotional or time). It would take having some roots in an area, though, so think about whether you want to stay in the area you are in now.

Just some ideas -- good luck in grappling with this challenge and decision!

(ps: I agree with Jarhead that you probably have enough financially, though a little more wouldn't hurt - but don't let that keep you going on into more years of burnout-- not necessary or desirable. But what I think you need is a vision beyond "i am sick of work'. That needs time (time away from work and routine!) to cultivate -- maybe you have it but it didn't show up in your posts -- summer vacations for teachers should provide some good time for reflection -- but I wouldn't ER without a clear vision of what positive things you hope to be able to accomplish in ER.

ESRBob

 

[haha]

Second Question- I have my money invested in a teacher retirement plan that is great.  I have about $680,000 in this plan in the form of annuities, stocks and bonds.  I also have about $70,000 dollars in a bank time deposit.  I actually have very little loose cash.  If I were to semi-retire even now, I am allowed to live off the interest from my $490,000 in annuities after the age of 55, which would not touch the principal.  This would give me an initial retirement of $26,000 per year.  I would let the stocks and bonds (about $200,000) grow for another 4 to 5 years, and then I would get full retirement at 62 or even later.  Do other people do this?  Is it something to consider?  I do not own a home, and frankly, I do not mind renting the rest of my life.       

Sounds like you have lived abroad, and maybe travel is a focus of your interests.

I find though that I can't really understand your financial details. When you say, "and then I would get full retirement at 62 or even later", are you talking about US Soc Sec, or do you have some sort of defined benefit from your job that would kick in a that time?

It would help if you were to show a timeline, of what you will have and when.

If the $26,000 is a hard figure, and not inflation adjusted, I at least would not like to try to pay rent, operate a car, and buy health insurance if limited to that amount. My house and car are paid for, and my car is pretty new. I do buy health insurance. This will be the first year that I am likely to keep total spending under $26,000. And just a few bucks under at that. This is not bare bones, but it is pretty lean.

I know people who do live on less. In a typical US city it might take a roomate, or no car.

All it takes is to break a tooth to send you into the red. (I think I may have finally stopped eating ice cubes

Unless you are really up against it, it would be sad to trade job stress for money stress.

Mikey

 

[riverrat]

Rob,

I retired from my government job in July at age 58 and my wife retired on the same day (she's 57). I liked my job, but after 30 years I was ready to take the golden handshake and leave.

I don't miss the many meetings, the politics, etc. and; although I liked my job, it doesn't compare to the freedom and independence of being retired. If you don't like your job and can swing it leave.

Good Luck

 

[Rob]

Hi-
Your responses have all been very nice. Let me clarify a couple things and see what you think. I am currently in Asia. I have about $690, 000 in my pension plan. Part of the pension plan is made up of annuities, which is about $490,000. In my pension portfolio, I also have $200, 000 in stocks and bonds. I have around $70,000 is a bank but in a timedeposit. The pension plan I am with allows its members to live off the annuity interest after the age of 55. I am 57+. That interest income would be about $26,000/year. I can opt to use my full pension plan anytime after I am 60, and that would be $45,000 to $55,000/year, depending on how the stock and bond markets do the next 2 years.
I am losing patience as a teacher, and it deeply disturbs me. I would love to take up Tai Chi, or meditation or some form of relaxation exercise. However, when you are in a high stress teaching job with long days, you don't have the time or mental state to take up those interests unless you radically adjust my life. Removing myself as a full-time science teacher and still stay in the teaching field is what I'd like to do. I began my teaching career as an English as a Second Language teacher. I'd like to make full circle and do that again. There are ads in the newspapaer all the time for full time or part time English Language teachers, and frankly, that sounds less stressful, and I choose the hours I like to work. I do not have a car here.
The other option is to return to the states and be a substitute teacher in high schools. It's easy to do that. It would allow me to go home and have absolutely no responsibility for grading papers, etc. I would choose the days i want to work.
Your comments on my financial status and plan would be most appreciated. Thank you so much.

Sincerely,
Rob

 

[consejo]

I like ERSBob's idea of taking a year off. The other thing is that at your age and with the money you have, you might consider spending some of your capital.

Yes, I know it's risky but read the book, Die Broke. It is about a plan to spend it all instead of hoarding it and living on some PRESUMED SWR.

But the question of having enough is all about expenses. How much is your present annual cost of living and how close is that to what you would get at this point and is it enough and are you comfortable with it? Those are the sort of bottom line questions you need to answer and only you can do that.

 

[Rob]

My school I am in does not really give Sabatticals, and so that is not an option. Also, at my age getting a job in a school at 58 might prove difficult, but part-time easy.

Rob

 

[haha]

My school I am in does not really give Sabatticals, and so that is not an option.  Also, at my age getting a job in a school at 58 might prove difficult, but part-time easy.

Rob

I'm fairly conservative, but it appears to me that you have plenty. You have less cash but more income than many here, and you only have yourself to think about. If the $26,000 isn't enough, you can break your $70,000 CD to tide you over until you get your generous pension at 60 or whenever. And, you can sub.

One question- is the social environment of the school a plus in your life? Sometimes the easiest and best thing is to adjust one's attitudes, rather than the life situation. Compared to what many people have to do, correcting papers looks to me like a walk in the park.

Mikey

 

[JohnP]

Rob

My wife retired from teaching in June '03 and went back the following Sept for three days a week - she is the envy of all the other teachers and enjoys her work more than when she worked full time! It just may work for you also if the full-time pace is getting you down.

On the second subject: my wife had a 403(b) retirement system that mainly funded an insurance company annuity account. This account had little flexibility for income or provision for leaving part of that cash to the children in case of her demise. As retirement loomed, we looked into the annuity account closely and decided that it was better to change from that annuity. Her annuity account had been funded with before-tax monies and so all of the proceeds would be taxed as income. We were able to transfer the entire annuity account into a low cost Vanguard roll-over IRA without paying any surrender fees. Now she has control of these retirement monies and they can be a healthy part of her estate.

Wishing you great success in moving into your new life

JohnP

 

[tenative]

Rob,
I like you had had enough of the teaching career. The last few years have seen accountability increase with little support. My wife retired due to a disability (health) this year at 53. She was a teacher and loved it. She is getting a small retirement of 23,000. I left my full time position and had mixed feeling-- between possible boredom and wanting to have a secure retirement, I am 52. No kids and about 700,000 in assets, house is paid. At the time of my notice to leave a neighboring school district contacted me, I was lucky, and offered me a part time job. I took it and like the hours and new freedom. The job is less stressful because it is part time. It sounds like you could retire and look for something-part time to allow you some added resources and peace of mind. It is a liitle scary to see your pay check cut so much especially since my wife and I were saving regularly for a retirement at 55.

 

[John Galt]

Hi Rob! I would have hung it up long ago with a fraction
of your assets, but that's just me. Most people I have found on this board can't do it. So, no financial advice,
just a couple short stories. When I was single I dated a couple of teachers (my wife thinks I covered every
known occupation - but I digress). One in particular had
been teaching her whole career, didn't like it much and
seemed to be just going through the motions. I asked her once about retirement (I was already retired).
I think she said she had 7 years and then she was out.
Blew my mind! Seven more years of doing something you did not like just to get a bigger pension. I don't
think that way. Yesterday I saw a guy on TV who wrote a book called NOW. An adventurer type. The theme was to make a list of what you want to do with your
life and then start in doing it while you still can. I sat right down and made my list. Then I realized that I had
either already done it or was actively working on
every single item. So, I tossed the list away. That's
the way to use your unknown time on earth, not waiting
and working and worrying about a bigger pension.
If you like what you do fine. If you want to hang in a year, maybe. If you have 7 years by your plan
or someone else's, bail out. I did,

JG

 

[Michael]

I think she said she had 7 years and then she was out.

Teachers in some states have to be careful, because they don't get Medicare. They have to make sure they have enough money to pay the ever rising private health insurance premiums that their teachers groups subscribe to.

Of course, Medicare may be "modernized" after Social Security is. That was what happened in Chile, the country that is held up as the prototype for proposed changes in Social Security. If so, we may all be in the same boat as the teachers.

 

[Ol_Rancher]

Were have all the young men go? ... long time passing

The words to that song bring me to describe the conundrum facing many men in public teaching in the U.S.

When a male teacher is 20 something he is usually eager, volunteers for extra duties like club sponcerships and commitee work. His pay is affordable for the district and he typically relates well to his students - often seen as an older brother type figure.

By the time his career reaches the point that he is mid-fifties, he has seen a dozen principals come and go. He knows his curriculum and can anticipate most student behaviors before problems arise. However, he is now seen by students as a grandfather type figure and is seen as 'out-of-it'.

His new 36 year old female principal (white males need not apply) greets the staff at years beginning with yet another reinvention of the wheel approach. Her 'exciting' new plans are but another rehash of what has gone on before and if the teacher dares to point out problematic areas, he is seen as less than a 'team player' His salary is now a burden on the district's budget and many times the young new principal sees him as a threat to her authority.

Unlike during his youth, any perceived transgression would likely put his boss on the side of the student who figures he is a lawyer and/or the parent who has an agenda which demands special consideration.

Go into any elementary, middle-school and count the men on the staff. 90% will be twenty to thirty years old. A small handfull will be in their 40s and one maybe two will be 50. Not a one will be 60 and no one will be able to recall a man teaching at 60.

I first realized this in my late thirties as I realized that after observing several thousand teaching years, I had not ever been to a retirement party for a male teacher. I remembered many good male teachers all of whom left angry or bitter. I retired at 53 when the numbers worked for me and before I would have been 'forced' out. ...

My advice, retire .. before things go downhill. You are already feeling the pressure (signs of burn out) and you are in good shape money-wise.

 

[Bob_Smith]

Ol_Rancher, that was a terrific post. What you say makes sense and explains many things. I wasn't a teacher, but I worked with many, and the part about the 36 year old boss threatened by the wisdom of someone like yourself is something I can definitely relate to. Anyway, kudos for the great post. I plan to copy it and send it to my son-in-law who is 29 and a teacher. He is already seeking an exit. Your words may help him understand the dynamics he'll likely be faced with if he stays. Actually, I think what you've described relates to many occupations.

 

[rockpile]

I never thought I'd say this, but I agree with John Galt on this one

 

[Anita]

Actually, I think what you've described relates to many occupations.

Bob & Ol Rancher,
You are "spot on" with this comment. I'm an engineer working in a Fortune 50 corporation. At my age (50+), I, too, have seen the same "stuff" rolled over and over again. At this point in my life, I have figured out that every new initiative is a "flavor of the month" and will soon be replaced by the next one. I'm no longer reacting to every new initiative as though it's the greatest thing since sliced bread (unlike the managers in their mid-30's-mid 40's). I may starting to be perceived as a non-team player. I do great work and work hard at my job. At the same time, I cannot pretend any longer (not do I feel I need to, as I am starting to feel the age-discrimination thing as well.)

Fortunately, I am FI and can RE at the end of next year with the smallest pension available. This has put me in a very comfortable position work-wise. It's disheartening, though, to feel "sidelined" in favor of the younger set.

 

[Zipper]

Ol_Rancher, you have brought back many memories.

I was a male Ontario elementary teacher from 1964 to 1997.

We probably have the best run pension plan in North America so pensions are not a problem for us.

But the politics are/were.

We have had our fill of goofy re-invent the wheel educrats!

My experience as a young buck was, I took on all the coaching jobs and then some.

And then the men stopped coming into the profession, and I continued coaching in the 80's and 90's.

Hell, I was the cross-country coach in my retirement year and ran with the kids every day.

A big problem I think is family structure and parental support. In 1964, every kid I had was from a two parent unit. By 1997, more than half the parents had split, and the kids were running the show. Dress down a kid, and the principal was afraid of the parents or administration.

My point is Rob!............what are you waiting for??

 

[tenative]

Zipper and Ol Rancher,
You are right. The atmosphere in schools has changed. Testing accountability, new programs and evaluations based on "outcomes' The administration in many cases are afraid of everyone but the teachers.
Rob, are you happy? What is the point.
I have been happier since working part time. I can say that if this position became a burden I would leave.