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05-31-2004, 06:32 AM

thanks for the comments, malakito.

"Using that rule, your $400k in your 401k could support $16k. Add to that your $25k pension would give you $41k annually. How much do you spend annually? If it's $41k or less, you've got a decent chance, I'd say."

The only problem with that scenario is that, because of my age I can't simply withdraw the amount that I want from the 401K. I have to get the "equal payments" thing, which they calculate for me, or else I can buy an annuity. If I use the 4% withdrawal technique and change it each year, I'll have to pay a penalty. This is all "as I understand it" of course...

"1. Is the $25k inflation adjusted? If not, it will get ravaged by inflation over the next 30-40 years, and so you'd have to account for that. I think the firecalc can help you with that calculation."

The 25K pension is frozen for 10 years; after that there's a modest inflation adjustment feature (up to 3%/yr, I think). So this is definitely an issue for me.

"2. How long are you "guaranteed" the employee rate for health care, and how much do you believe the guarantee?"

It's for the duration of retirement. And, if I ever drop it I can't get it back. I'd say I trust this as much as I trust the pension--pretty much 100%. But the cost of the BCBS plan could certainly go way up over the years.

05-31-2004, 06:32 AM	#6
Bill J. Guest Posts: n/a	thanks for the comments, malakito. "Using that rule, your $400k in your 401k could support $16k. Add to that your $25k pension would give you $41k annually. How much do you spend annually? If it's $41k or less, you've got a decent chance, I'd say." The only problem with that scenario is that, because of my age I can't simply withdraw the amount that I want from the 401K. I have to get the "equal payments" thing, which they calculate for me, or else I can buy an annuity. If I use the 4% withdrawal technique and change it each year, I'll have to pay a penalty. This is all "as I understand it" of course... "1. Is the $25k inflation adjusted? If not, it will get ravaged by inflation over the next 30-40 years, and so you'd have to account for that. I think the firecalc can help you with that calculation." The 25K pension is frozen for 10 years; after that there's a modest inflation adjustment feature (up to 3%/yr, I think). So this is definitely an issue for me. "2. How long are you "guaranteed" the employee rate for health care, and how much do you believe the guarantee?" It's for the duration of retirement. And, if I ever drop it I can't get it back. I'd say I trust this as much as I trust the pension--pretty much 100%. But the cost of the BCBS plan could certainly go way up over the years.