judgejkh
Confused about dryer sheets
Hello,
I have the opportunity to purchase 2 and 1/2 years of Air time with my state which would allow me to retire at age 51 (January 2019). My retirement factor is 2.75% per year and must work 27 years for full retirement (or until reach normal retirement age). I can transfer the funds from my 401k but it would deplete most of my 401k. Basically, by buying the time, I can retire at 75% of my salary (presently $112,500). Most who have bought the air time consider it an 8%+ return on investment. Those who began employment after 2001 are no longer eligible to purchase Air time so I'd imagine it's a good thing, in that sense (actually I'm eligible to buy up to 5 years Air time). Another option is to not buy the time, leave the 401k funds alone (I contribute 5% of my salary and 6% to retirement each month) and retire with a 10% penalty on my monthly benefit at the same age. Considering the deductions that are being taken from my salary for Fed tax, State tax, Social Security, Medicare, Retirement, 401k, etc. the 10% penalty would result in "roughly" my take home pay being what it is now (without some of the related employment expenses such as driving, etc). Of course, I can work part-time (or even full time although full-time is not what I consider early retirement and why I'm here asking the question . I am under no time constraints to do this at the present but am beginning to ponder the thought.
Thanks for having me on the forum. I'm sorry that this somehow ended up under "Confused about dryer sheets"; please excuse me due to being new to the forum. I know others have asked questions about purchase of air time before but I wanted to ask because it would pretty well deplete my 401k funds. Thank you.
I have the opportunity to purchase 2 and 1/2 years of Air time with my state which would allow me to retire at age 51 (January 2019). My retirement factor is 2.75% per year and must work 27 years for full retirement (or until reach normal retirement age). I can transfer the funds from my 401k but it would deplete most of my 401k. Basically, by buying the time, I can retire at 75% of my salary (presently $112,500). Most who have bought the air time consider it an 8%+ return on investment. Those who began employment after 2001 are no longer eligible to purchase Air time so I'd imagine it's a good thing, in that sense (actually I'm eligible to buy up to 5 years Air time). Another option is to not buy the time, leave the 401k funds alone (I contribute 5% of my salary and 6% to retirement each month) and retire with a 10% penalty on my monthly benefit at the same age. Considering the deductions that are being taken from my salary for Fed tax, State tax, Social Security, Medicare, Retirement, 401k, etc. the 10% penalty would result in "roughly" my take home pay being what it is now (without some of the related employment expenses such as driving, etc). Of course, I can work part-time (or even full time although full-time is not what I consider early retirement and why I'm here asking the question . I am under no time constraints to do this at the present but am beginning to ponder the thought.
Thanks for having me on the forum. I'm sorry that this somehow ended up under "Confused about dryer sheets"; please excuse me due to being new to the forum. I know others have asked questions about purchase of air time before but I wanted to ask because it would pretty well deplete my 401k funds. Thank you.
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