How many of you can RE now, but are saving to raise your std of living?

[Surfdaddy]

I could probably retire now, and more or less maintain my std of living. But I'm 49, I have two kids 11 and 13, and I'm concerned that even if I buy medical insurance today, it might go up so fast that it harms my standard of living in a few years. A cushion that allows me to make some bigger purchases, cover other larger contingencies, or just travel more, looks really appealing. Plus, if I wait even two more years, with the investments I already have, I may be able to raise my RE standard of living substantially.

Am I unique? As much as I want to retire now, there is a certain *security* about working a bit longer. I keep saying to myself... "just 2 more years!"

 

[dory36]

Don't worry about it.

At my last employer (overseas), folks said that people started out there with two buckets, one in each hand.

One bucket started empty, and gradually filled with b.s. as you worked there.

The other started out with your net worth, and it too continued to fill as you worked there.

Eventually, the b.s. will outweigh the net worth, and you'll know it's time to go.

If you aren't there yet, enjoy what you're doing and keep filling that other bucket.

In the meantime, be careful about reading too much stuff from folks here, as it might make you less and less tolerant for the weight of that b.s. bucket!

 

[audreyh1]

dory - that was priceless!

Audrey

 

[roadkill]

Am I unique? As much as I want to retire now, there is a certain *security* about working a bit longer. I keep saying to myself... "just 2 more years!"

Nope, I am in the same boat.  Can do it now, but feel that two more years will give me the level of comfort I need by adding additional investment dollars to the pot and years in the DB plan. I think it is quite normal to feel aprehensive, however.

 

[macdaddy]

In my 20s I could retire to Costa Rica, buy an oceanfront condo, and have plenty of cash to eat, travel, and surf for the rest of my life... in the face of inflation or whatever... but I feel like I should accomplish something in the world first, which I have yet to do. If anyone has ever been to Jaco in Costa Rica, in particular to a nearby beach called Playa Hermosa ("Beautiful Beach" which is used for a bunch of beaches in their country I believe), where the dirt road meets the beach there is a silver bullet trailer from the 60s that I think some dude drove down from the US. I don't know who lives there now... many times I was paddled out and wondered who lived there and wanted to introduce myself, but never got around to it. It's all by itself with very little development (until recently some has started) within sight. I always thought that would be a cool and cheap place to retire!

 

[free4now]

Dory, I'll remember that bucket analogy for a long time. So true.

I can certainly understand working... I got out early when the BS bucket got too heavy. Once you have a net worth big enough to retire, you are also in a situation where your net worth is increasing faster than it ever has or ever will, if you keep working.

Say you get to a million dollars net worth. If you figure 7% real growth your net worth will double in real terms in about 10 years if you continue working even if you don't make any more contributions. It probably took you 20-30+ years to get to the point of being FI, so working a few more years to greatly increase your future withdrawl level and safety actually is a very reasonable thing to do.

 

[retire@40]

As much as I want to retire now, there is a certain *security* about working a bit longer. I keep saying to myself... "just 2 more years!"

If you could retire now, why not go part-time or earn a living doing something else more enjoyable? Earn enough for vacations and entertainment so you can take that expense out of your ER budget for SWR purposes.  For me it would take a 4% withdrawal rate down to 3% since I have budgeted 1% just for entertainment.

I wrestled with the same question and reality hit that life is short, so I cut down a lot from earning X to earning X/2 just so instead of spending Y time with my family, I could spend 2Y time with them.

It's a choice with which you have to live without regrets.  So far, no regrets.

 

[sgeeeee]

I can't beat Dory's story, so I'll simply add my agreement.

 

[TargaDave]

I have two kids 11 and 13, and I'm concerned that even if I buy medical insurance today, it might go up so fast that it harms my standard of living in a few years.

Just curious whether your "RE now" plan includes 2 college educations fully funded at inflation adjusted out of state school rates ? Are you capping the amount set aside?

 

[shorttimer]

actually we are there as well. My kids are gone and all edumacated and we have crunched the numbers. DH has to go to 55, 3.5 years, to get health coverage, which we all know can be taken away. If it is taken away we'll have the extra money by working these years. My BS bucket is cresting and just about ready to spill over the edge so I am going the next few months. It will be hard in one way because I make a lot of money and it has been very comforting when you get to the point of your net worth line shooting up instead of slowly arching up. The biggest help to our increase in net worth has been having no debt and saving the money most people pay for mortgage, cars etc.

 

[Rich_by_the_Bay]

I could probably retire now, and more or less maintain my std of living. But I'm 49, I have two kids 11 and 13, and I'm concerned... I keep saying to myself... "just 2 more years!"

It is always much safer to wait a bit longer from a financial standpoint. Always. That will never change. If you wait for that equation to tip, it never will and you will die working and rich.

With the usual nod of the head to the fact that everyone is different, my DW and high "live a little larger" than we really should need to. We are fortunate and happy, but not wildly rich by any means. Once we can retire at a comparable lifestyle, we will do so. In our case, the ace in the hole is that we can comfortably reduce our expenses considerably if need be, and still be happy and content. On the other hand, if it looks like it is taking too darn long to get to that point, we will reduce expenses sooner in order to facilitate FIRE.

I guess my bottom line is to make sure we don't fall into the trap of waiting forever until we feel completely "safe" while still waiting long enough to have the cushion you need to sleep at night, accounting for inflation, health care, etc. Flexibility.

 

[Andre1969]

So far this year, I've had something happen that has never happened before. My investments have made more money for me than my job has! I know that could all change in the blink of an eye, but it is a really good, empowering feeling. I can actually see the fruits of my labors, and a light at the end of the tunnel, and all those other tired cliches!

I'm not at the point yet where I could drop out of the workforce entirely, but if need be, I estimate I could take a long time off, like about 10-15 years. But then that would leave me broke at the age of 46-51, and having been out of the workforce for a decade or more. Which probably wouldn't look too good on a balance sheet OR a resume!

 

[samclem]

I am in the same boat as retire@40. I retired from all-consuming life in the USAF when we had accumulated enough in savings+ pension to be comfortable, but the expected costs of college for DD would have put a big ding in the savings account. So, I've kept working part time to defray those costs and to put a little more aside for vacations/fun stuff. This gives me more time to be at home before our daughter turns 18 and flies the coop (or so we hope).

 

[Eagle43]

Don't worry about it.

At my last employer (overseas), folks said that people started out there with two buckets, one in each hand.

One bucket started empty, and gradually filled with b.s. as you worked there.

The other started out with your net worth, and it too continued to fill as you worked there.

Eventually, the b.s. will outweigh the net worth, and you'll know it's time to go.

If you aren't there yet, enjoy what you're doing and keep filling that other bucket.

In the meantime, be careful about reading too much stuff from folks here, as it might make you less and less tolerant for the weight of that b.s. bucket!

It's taken a while, but now that BS bucket is nearly empty.  Meanwhile, the net worth bucket continues to grow! Outstanding metaphor.

 

[setab]

Just remember, you will always make more if you wait another year, or two, or three. As long as you have a goal in sight, you are probably fine, but don't keep waiting because you will have more tomorrow. The question is, what is enough, not what is optimal. Optimal never comes. In addition, finances are only part of the picture. How many "younger" people do you know who aren't around anymore. They could have been waiting for two more years also. How many "older" people never write their book, never play golf on a Tuesday morning, never fish whenever they get the urge? Lots, because they waited for two more years. All that being said, the bucket analogy works for me too. When you need both hands for the BS bucket, that's a sign. It was an analogy, wasn't it?
setab

 

[Andre1969]

My BS bucket at work is constantly filling up, but the jackass always knocks it over when she jumps and brays.

 

[justin]

I drilled a hole in the bottom of my B.S. bucket. Sometimes I think my wife drilled a hole in the bottom of my net worth bucket.

 

[Nords]

So far this year, I've had something happen that has never happened before.  My investments have made more money for me than my job has!

When my investments started making more than I was making, I found it got really hard to go to work...

 

[Mountain_Mike]

I like that "bucket" analogy, too. This topic is something that I have pondered... sometimes, I almost wish "something" would happen to give me a kick out the door.

I have now basically pinned my retirement date to the date the house is paid off. I'm making mortgate payments of approximately $1000 a month, and owe about $25,000....so that's 2 years more or less. By that time, the pension will have gone up by $1000 a month, and with no house payment....why work?

Still...the thoughts creep in "is it enough? You still have kids to put through college..."

 

[modlair]

A quick comment here. Almost all discussion of this kind talks of kids and spouses. One would think that the single RE aspirants not only exist, but exist in considerable numbers.

The influence on the net worth bucket for singles would be divorce costs and one income. But there is a substantial % of singles now that never married. That's a growing %. One income also means one set of expenditures, too.

I would suspect the two buckets have a different nature for single RE aspirants. The BS bucket may fill at the same rate but be smaller in size. The net worth bucket fills perhaps slower, but doesn't need to be as big to cover medical costs for just one person.

 

[Surfdaddy]

Just curious whether your "RE now" plan includes 2 college educations fully funded at inflation adjusted out of state school rates ? Are you capping the amount set aside?

TargaDave - I have set aside a substantial amount for the 2 kids for college. May not be fully enough, given rising costs and where they may go. I'm assuming that they may need to work/have some loans. It's tough to tradeoff their future debt vs. my retirement! They're also in private schools right now, which is also substantial. I've also accounted for those amounts, including expected tuition increases.

Of course, if the investments do better than expected over the next 2 years we could end up with a greater cushion.

 

[youbet]

I seem to have a third bucket:  non-work interests.  BS hasn't been too bad in my corner of Megacorp, just your normal, everyday BS.  Retirement asset bucket has been filling pretty much as per plan.  But the call of non-work interests, hobbies and just doing something different, is now very, very strong.

Maybe it's just a point of view.  It worked better for me and my mental/physical health to not hate work but rather love being away from work and doing other things.  instead of 

Since Megacorp is cooporating with severance packages and involuntary layoffs (picture me in the back of the room jumping up and down waving my arms and screaming "me, rif me!") the pressure of making a final decision was taken off my shoulders. 

 

[JonnyM]

Am I unique? As much as I want to retire now, there is a certain *security* about working a bit longer. I keep saying to myself... "just 2 more years!"

Ah the trap. Just a bit more... I don't think you're even close to unique. We all have made that decision, based on some criteria of our own, i.e. no more mortgage, health coverage figured out, income more than estimated expenses, I just can't take it any more, etc.

You have to pick the place in space and time that "works" for you. My advice though, is to choose it now, and work to get there. Then you can enjoy the count-down process. Hell for my last year I ran a countdown timer right in my sig on this board, so everytime I logged in I could check my progress. Doesn't really matter what interval you choose, DW and I had a 7 year plan, just determine when you'll have expenses covered with a cushion for the unexpected, set the date, and live a full and enjoyable life getting there, then Break on Thru to the Other Side

 

[audreyh1]

But the call of non-work interests, hobbies and just doing something different, is now very, very strong.

Great point! That's what ultimately motivated me. I wanted to spend a LOT more time OUTSIDE.

Audrey

 

[Spanky]

Surfdaddy,

Your situation is not uncommon. Our kids are little bit older, 17 and 14. We like to work for another 4 years until the younger one is in college. We too have concerns about health insurance.

Spanky