6 years from ER and sky is falling help

[badatmath]

I was on track to be 6 years from ER . . .

PROBLEM: I think I am going to lose my job if I do not relocate to a new city (1K miles away). So it would seem like a no brainer to relocate. HOWEVER it would extend my working years perhaps 5 more (so 11 total) as not having a paid for house would reduce my ability to save at current level AND I would no longer have a paid off place to retire in and thus would need greater income. (Yes I know I will get money if I sell house, I just don't think I can buy one comparable later but ??) AND I have reason to believe that job will not last 11 years in new city anyway (of course I could be wrong). Letting them lay me off by refusing to move would require me to work 16 years to wait for Medicare and also to make up fact pension would stop accruing sooner.

Anything I can do to improve this mess? Only thing I have thought of is to rent present house but not sure I want to worry about it for that long.

Thanks in advance for reading the wall of text. It is POSSIBLE that this will not happen but I feel I should prepare.

 

[mystang52]

Well, if you think you will lose your job, and don't want to relocate, the answer is obvious. Start looking for another job, now. It is much easier to find other employment while still employed.

 

[Meadbh]

Sh1t happens to all of us. The unemployment rate in your country is 4.3%, so the sky is not falling. Update your resume, and start looking for a better job in your current location. If you don't find one, and you have to move, sell your house, invest the proceeds, and rent.

 

[pj.mask]

Sounds like you want to stay with the company for benefits. I would sell current house with homestead deductions. Buy a cheap place or maybe go for a cheap rental in the. New town. Unless your current location is very favorable for rentals.

I would stay put and find a new job but my wife works. Not worth it for us to move. Do you want to stay in same town to retire?

 

[CaliKid]

Move 1k miles, rent, live CHEAP, and buy a new house in 6 years. Prices might even be lower then. You can do it!

 

[Independent]

I'm trying to figure this out. A few facts would help.
- what you think you'd get by selling your current house.
- cost of comparable house in new city
- portion of moving expenses that you'd expect your employer to pay.

 

[daylatedollarshort]

We had to make a decision like that once. We owned a house, had kids in public school and three pets. We were not very mobile. DH found a new job in the existing city. The people that moved ended up getting laid off not long after they moved, uprooted their families and maybe sold their homes back here making it hard for them to interview for jobs where they used to live.

I suppose things could have worked out better the other way given different circumstances but in our case we really dodged a bullet by not moving. Good luck with your decision. I don't think there is one right answer as it really depends on your situation, including your current finances and marketability.

 

[imoldernu]

No advice, but if it were me, and even if I was badatmath, I'd work out a few spreadsheets to balance the dollars (salary and benefits) and the aggravation. The idea of managing a rental from that distance would not be my first choice.

A clearer idea of expenses and lifestyle in a new location might help... try
City-Data.com for some info on the new town.

Assume you're single, otherwise, a tough change for a family.

We had a similar situation when I was 53... took a chance, and tried retirement with the idea I might have to go back to being employed... That was 28 years ago, it all worked out well. Here's how we did it.
http://www.early-retirement.org/forums/f27/sharing-23-years-of-frugal-retirement-62251.html

Best of luck on whatever the future holds.

 

[RenoJay]

My first instinct was keep the current house, find a tenant, and rent in the new town. As long as what you pay in rent doesn't exceed what your tenant pays you, you're in an equivalent financial position and can move home in six years. Best of luck!

 

[Aerides]

If you are laid off, presumably you'd have some sort of severance + find another job. Sounds like you have some tenure, so even a slightly lower salary in the new place might be buffered with some outgoing help.

If you live in the middle-of-nowhere and work virtual, (hence you are being called home to roost as is the new trend), then sure, finding a new job locally might be trickier. So you have to move to stay employed.

But if you uproot +sell + buy something new and move to the job, then you should be about even. Unless you are moving from a very low COL to a very high (not mentioned in your post). Then the difference in COL has to be studied.

You could also uproot, rent for a year, and then decide if the new location is going to work and sell/buy in the new spot. You have a lot of options to play with.

If the COL's are comparable, not sure why you're getting a 5 year add to your career. Sure, there's always a cost to move, but if your company is forcing your hand perhaps there is some assistance that will be offered? Time to talk to HR to know your options.

No one (literally) can be sure they have job security for 11 years. For one year.

 

[badatmath]

There is no way I will quit voluntarily as I am accruing pension benefits and every day of them helps. I would likely get severance if I were laid off, and am owed several hundred hours of vacation pay so no money panic for day-to-day life in the short term. My concern is largely health insurance and RE.

Yes, I wish to retire in current location, would not anticipate buying in new. Employer would likely pay all relocation expenses. My house is worth little, perhaps $150K?? but its main value to me is the fact my anticipated spending in retirement is fairly well known as far as property tax/insurance/maintenance. It would be hard to re-buy a house like this as it is something of a unicorn, 1990s home in the midst of older ones. Plus my pension is quite low so would be concerned to qualify for mortgage since I have heard they look upon assets under your control with disfavor.

I further guess rent on a small aparment in new city would increase my expenses by $900-$1000 a month so hence the issue saving at the same rate and the need for higher post-retirement income.

The additional years I would expect to work is perhaps not mathmatically sound as my pension accrues at varying rates (more now because I have not hit max years of countable service and less later as only need meet age requirement) and I am rather notably bad at math and perhaps not thinking about it correctly.

 

[Texas Proud]

You could do what I did and move and not rent out your place....

Mine was different in that I was only supposed to go 6 months... but it extended to 14 months.... and when I was supposed to go home they asked me to come to corporate... I spent 3 years there... all while keeping my home... now, I did come home once a month to visit family and friends so it was not empty all the time... plus I had a sister and BIL that lived close and kept track of things...

If you really do want to stay with the firm and leave in 6 or so years, keep the house, either rent or not... and rent a small place at your new location....


OR, as others have said, find another place to work and do the 6 or so years at the new place but the old house...


In reality you only have a couple of real options... the rest are just tangents of these two....

 

[badatmath]

And to answer a few other things both cities are large, but one has a higher COL than the other per online "compare" calculators and my own personal COL is much higher due to not having paid for place in new city.

I would rather be laid off in a city I want to live in where life is affordable . . . but retiree health insurance is huge in my book. Maybe it is more common than I thought?

Thanks to those who have contributed stories, suggestions and well wishes. No matter what I do this is a hard decision to make.

 

[badatmath]

You could do what I did and move and not rent out your place....

I thought my home insurer would drop me if I left if empty (even with regular check ins on the house and good neighbors). I also might be able to let family vacation there in winter. . . .

 

[FlaGator]

I was on track to be 6 years from ER . . .

PROBLEM: I think I am going to lose my job if I do not relocate to a new city (1K miles away). So it would seem like a no brainer to relocate. HOWEVER it would extend my working years perhaps 5 more (so 11 total) as not having a paid for house would reduce my ability to save at current level AND I would no longer have a paid off place to retire in and thus would need greater income. (Yes I know I will get money if I sell house, I just don't think I can buy one comparable later but ??) AND I have reason to believe that job will not last 11 years in new city anyway (of course I could be wrong). Letting them lay me off by refusing to move would require me to work 16 years to wait for Medicare and also to make up fact pension would stop accruing sooner.

Anything I can do to improve this mess? Only thing I have thought of is to rent present house but not sure I want to worry about it for that long.

Thanks in advance for reading the wall of text. It is POSSIBLE that this will not happen but I feel I should prepare.

I worked on the opposite side of the country for a CA-based company. There were periodic discussions about "future opportunities", but little tangible. Knowing the salary structure, I ran some numbers and determined I would be money ahead getting a home equity loan, converting it to cash and burning those $100 bills in my front yard, instead of moving.

Intuitively, your 11 and 16 year alternative horizons seem excessive, even given a worst case of moving to the Bay Area or NYC. Suggest you thoroughly explore your options, including finding a new job locally as well as taking the relo and gutting it out with the lowest cost situation that will work. Having that floor may make it easier to evaluate your options. Taking the relo and renting the current house is one of them, but has it's own risks.

Good luck as you sort through this. Have found that staying calm and thoughtful, not emotional, when your environment changes will be helpful.

 

[FIREd]

A few years before her planned retirement date, DW's job moved across country. At the time we lived in a fully paid house which we expected to become our retirement home. But DW liked the job, so we moved and rented an apartment in our new location. We decided to keep the house and, five years later, we moved back in for retirement. Being a long distance landlord was made easier by hiring a property manager, but it was still a pain. If you love your current location, it might be worth the trouble. Also, the rent you collect on the house might help offset the rents you have to pay at the new location and therefore you may not fall behind on the saving front as much as you think.

 

[48Fire]

I was on track to be 6 years from ER . . .

PROBLEM: I think I am going to lose my job if I do not relocate to a new city (1K miles away). So it would seem like a no brainer to relocate. HOWEVER it would extend my working years perhaps 5 more (so 11 total) as not having a paid for house would reduce my ability to save at current level AND I would no longer have a paid off place to retire in and thus would need greater income. (Yes I know I will get money if I sell house, I just don't think I can buy one comparable later but ??) AND I have reason to believe that job will not last 11 years in new city anyway (of course I could be wrong). Letting them lay me off by refusing to move would require me to work 16 years to wait for Medicare and also to make up fact pension would stop accruing sooner.

Anything I can do to improve this mess? Only thing I have thought of is to rent present house but not sure I want to worry about it for that long.

Thanks in advance for reading the wall of text. It is POSSIBLE that this will not happen but I feel I should prepare.

I think you are overestimating the impact. Suck it up, take the new job, and make the best of it. Just my opinion with limited information good luck

 

[cyber888]

This just happened to me last year. Still 4-5 years away from retirement and house not paid. I quit my job and found another one beginning of this year. I was lucky not to move as the new job is just 20 minute drive, so I wont be moving. I plan to pay off my house in 15 months and should have 20x expenses immediately after I pay my house off. Then, I will just work for another 2-3 years to get to 25x expenses

 

[badatmath]

cyber888, how will you get health insurance in retirement?

 

[Floridatennisplayer]

I've seen way too many people in your situation that felt like the company really cared about them and they made the move ......six months .....eight months later they got laid off now they're stuck in a faraway city and up a creek. I would never move for any company so many things corporate wise could change the economy could turn, your company could get bought out and then no one knows you or feels like they owe you anything that you were told.

Update your resume if you live in a large city like you said that there should be plenty of opportunities to find something and then wait and see if you get laid off

 

[Doc0]

I retired on Medicare, but my wife and kids are covered in a concierge medical practice for primary care with major medical. It's aca compliant but it is not obamacare. the cost is $399 per month for 3. Maybe there is something similar in your area. You don't say if your married and if your healthy. If you're single and healthy this kind of plan is probably about $200 per month. My primary care plan is called MyDirectMD and the major medical is Liberty Healthshare. beware there are scammers out there, you have to understand completely what you are buying.

I have no opinion on moving, but if your property tax situation is good I would have to think long and hard about buying something else. If your taxes are for example 1K per year and a new place is 2K per year, that extra 1K difference pays for your apartment expense in the new city and once you retire and move home that extra 1K expense goes away, where as in a new property it would continue to erode your purchasing power. Renting your place could be a major disaster. Maybe you could move, live cheap and work in the new city until you find something in the old one within a couple years. It will slow you down but not knock you out.

After I sold my company in 2010. I had 8 years to cover before I felt I could pull the trigger. I wound up taking a 50% pay cut, but stayed put in my low tax house. The hours and stress were much better and I didn't have to move. I had adequate cash flow and medical coverage in the new job till I closed on my end game. I was going to work another year but it became evident I was just gilding the lily and the extra year of work wasn't worth the extra year of my life. So I worked until I maxed out SS for the year and quit.

Each year you move forward closing on your goal, the following year becomes less and less important to the goal. In other words going from 98% to 100% is less important to independence than going from 90% to 98%, at least that was my experience.

Best

 

[bmcgonig]

My first instinct was keep the current house, find a tenant, and rent in the new town. As long as what you pay in rent doesn't exceed what your tenant pays you, you're in an equivalent financial position and can move home in six years. Best of luck!

You have to pay taxes on the rent of your house unfortunately. Don't forget.

 

[Dd852]

Sorry you have this stress. My two cents is that the sky always seems closer to falling if I feel I have no control. So grab some control back. The best way is to be armed with facts -- what is the job situation like in the place where you want to live, for someone with your skills? i.e. worse comes to worst, could you find work?
-- what is the rental situation? What could you make on your current house. Would it wash its own face? i.e. could you keep it warm for you for that time when you wanted to retire to it?
-- Do you even like "new place"? Take a weekend or more and really explore. Could you imagine yourself there? Are there neighbourhoods you like? What would a decent place cost you to rent or to buy?
-- Do you have close friends and a community that would really hurt to leave?
and on and on. The more blanks you can fill in, the more armed you will be for making a decision, or having a negotiation. But you need to wrest as much control as you can back. Don't let yourself be a passive player in this; it is far too important

 

[Independent]

There is no way I will quit voluntarily as I am accruing pension benefits and every day of them helps. I would likely get severance if I were laid off, and am owed several hundred hours of vacation pay so no money panic for day-to-day life in the short term. My concern is largely health insurance and RE.

Yes, I wish to retire in current location, would not anticipate buying in new. Employer would likely pay all relocation expenses. My house is worth little, perhaps $150K?? but its main value to me is the fact my anticipated spending in retirement is fairly well known as far as property tax/insurance/maintenance. It would be hard to re-buy a house like this as it is something of a unicorn, 1990s home in the midst of older ones. Plus my pension is quite low so would be concerned to qualify for mortgage since I have heard they look upon assets under your control with disfavor.

I further guess rent on a small aparment in new city would increase my expenses by $900-$1000 a month so hence the issue saving at the same rate and the need for higher post-retirement income.

The additional years I would expect to work is perhaps not mathmatically sound as my pension accrues at varying rates (more now because I have not hit max years of countable service and less later as only need meet age requirement) and I am rather notably bad at math and perhaps not thinking about it correctly.

It appears that your biggest problem with moving is that you believe your current house is unique.

Otherwise, you could sell it, put the $150k proceeds in CDs while you're renting in the other town. Then move back to your current city after you retire, using the $150k to pay cash for a new house there. No mortgage required.

Regarding rent, we have a paid-for $150k house. Our RE tax + HO insurance + utilities + maint/repairs is at least $600 per month. Most of that goes away if we rent. Are you sure renting is $1,000 more?

 

[flyingaway]

I would not move if I am 50 years old and close to FIRE. When I was young, I did not mind moving to new locations.