Can I retire at 52?

[tigas]

I am 51 years old single man, and would like to retire within a year or two. I invested my money, and lived below my means. My present savings and investments produce $28,000 per year. 60% Cd’s and bonds, and 40% in stocks, mutual funds. Social Security has told me I will collect $1275 monthly at 62 ½ if I stop contributing now. My present cost of living is $1500, per month. I believe my retirement expenses would be less than $1000 per month as I plan to move to a rural area were the costs of living is lower.
My greatest concern is the escalating cost of health insurance and care. Can I retire? And should I make change’s in my investment portfolio to produce more income, and less growth? Thanks

 

[Alan]

Welcome to the forum. Have you run Firecalc to see what it predicts? I would also run the numbers through Fidelity Retirment Income planner or similar tools.

FWIW my mix is 40% equities, 50% bonds, 10% Cash, and I'm 53 within 2 years of RE, but your personal allocation should reflect your own tolerance for risk. Since you are within a year or 2 of wanting to retire, a major change in your allocation is not going to be significant.

 

[Rustward]

You may be close. As Alan recommended, FireCalc or the Fidelity Retirement Income Planner are excellent tools.

If you can live on $1000/month then healthcare costs are probably going to be your main concern. You need to nail down the healthcare side pretty well. Martha provided this FAQ: Buying Private Health Insurance and there are a lot of very good posts in Health and Early Retirement that address healthcare insurance in the time period between RE and Medicare. Much of it depends on the state in which you live. I would be more conceerd with planning for healthcare than the asset allocation at this point.

Welcome Tigas. This is a good place to be.

 

[Rambler]

While you are single and thus in a different situation than us, the most reasonable and comfortable health insurance I have found so far will set us back about $750 or so per month for the two of us. Add to that the cost of co-pays and (not yet but eventually) maintenance drugs, and my conservative guess is about $1,100 per month. I think it may be done cheaper than that if you are especially healthy to begin with (I was, until about 12 months ago when things started falling apart), and have high deductible catastrphic coverage.

On the other hand, say you can get by with health costs of only a couple hundred per month...with $800 per month left to pay for everything, I would hope that you have thought about some very cheap hobbies to keep you occupied. If I were single, being the relatively simple guy that I am, I think I could live pretty cheaply, but I don't think I could live on 800-1000 per month. Being happily married and hoping to stay that way, even $2000 per month is out of the question for me. (BTW, my folks live on about $2000 per month pre-tax and pre-healthcare, incl SS, and a couple of tiny pensions...they can do it because they are in their 70s and can't be as active as they used to be...I plan to FIRE late 40s early 50s, and plan to stay active long after that).

All of that said, your investments look like they are making way more than you feel you need, so I would say congratulations are in order - well, almost...get the healthcare figured out before you pull the pin on the grenade.

R

 

[tigas]

Health Care FireCal

Two years ago I looked into a health savings account. It was under $200 a month, with a $5000 deductible. I will have to look into this again. Has anyone used an HSA?
I have used financial calculators, and went to FireCal. All of them show a 100% success rate, some show that I will use up most of the funds after 30 years, but then I do not expect to live that long! My biggest problem is burnout! I have been at the same job for more then 30 yrs. Working with many of the same people. Its like an episode of the twilight Zone! Thanks for your advice. Tigas

 

[dex]

My biggest problem is burnout! I have been at the same job for more then 30 yrs. Working with many of the same people. Its like an episode of the twilight Zone! Thanks for your advice. Tigas

What is your net worth and how do you have it invested?

Does living on $1K a month give you the fulfilling life you want?

If your biggest problem is burnout you may not be retiring for the right reasons. Have you considered a leave of absense or another job?

Is it burnout or boredom?

 

[ksr]

High-Deductible Health Insurance with HSA

Two years ago I looked into a health savings account. It was under $200 a month, with a $5000 deductible. I will have to look into this again. Has anyone used an HSA?

I have had a high-deductible policy with HSA since last fall. I pay $128/month with a $2500 deductible and feel reasonably comfortable with my choice. And the HSA contribution is tax deductible. It is working for me so far, although I worry about future costs as I'm still relatively young ( 48 ).

 

[Milton]

Can I retire?

And should I make changes in my investment portfolio to produce more income, and less growth?

(1) In a nutshell, "yes".

(2) Since you say your investments already produce 155% of your current cost of living, and your main concern is inflation, I don't understand why you are considering making such a change. If anything, I'd suggest that you re-jig things to place more emphasis on growth.

 

[dex]

Why such a long pause between posts - almost a month.