New here- 55 looking at my options

[2K1N1K]

Hi all -

New here, but trying to catch up quick.

Thanks in advance to any and all thoughts you guys have. Seems like there is a lot of information that is shared on a daily basis.

About me - 55 - spouse 56 both working in corp America. Current salary between the 2 of us is around 250,000.

Investments - approx - 3.3 mill - 70/30 stock allocation
Cash - $270k
House value - $400k
We don't owe anything other than credit cards that get paid of monthly.

Both have pensions that will have a value of around $7500 monthly once we turn 65

Since turning 55 I have the ability to retire early from position with retiree medical that gives a considerable discount compared to the open market.

Thanks and I look forward to sharing ideas...

 

[pb4uski]

Welcome. You probably haven't browsed around enough because you are missing a key piece of information.... if you retire, how much do you need to live on?

If it is $50,000 a year then you can safely put in your papers before you leave today... if you need $500,000 a year then you should plan to keep working!

Have you run your situation through FIRECalc?

 

[Out-to-Lunch]

Welcome! You do appear to have options to look at!

 

[2K1N1K]

Thanks - forgot to add that info.

I'm thinking $170,000 per year gets us everything we want in retirement.

FIRECalc gives a 94% success rate.

 

[Dtail]

Thanks - forgot to add that info.

I'm thinking $170,000 per year gets us everything we want in retirement.

FIRECalc gives a 94% success rate.

Did a quick calculation on Firecalc. If your pensions are Cola'd, then you are at 100% without any Social Security. Even with no cola, I would think you would be at 100% with some SS.

Did you enter your pension total at 7500 monthly, or the correct amount of 90k yearly?

 

[2K1N1K]

good catch - I put in the monthly amount vs yearly for pensions. They are not Cola'd but does give me 100%.

BTW do others use Personal Capital to track everything on a periodic basis. Works well for me.

Thanks.

 

[CaliKid]

good catch - I put in the monthly amount vs yearly for pensions. They are not Cola'd but does give me 100%.

BTW do others use Personal Capital to track everything on a periodic basis. Works well for me.

Thanks.

I use PC for most assets as it's not a nice screenshot of where things are at. However, for my bigger accounts I manually update it every month or two rather than giving PC my password info.

 

[Golden sunsets]

Thanks - forgot to add that info.

I'm thinking $170,000 per year gets us everything we want in retirement.

FIRECalc gives a 94% success rate.

Does the $170,000 include taxes?

 

[Lawrencewendall]

BTW do others use Personal Capital to track everything on a periodic basis. Works well for me.

Thanks.

Been using the free version for 4 years now. Highly recommend it.

 

[cnocmmz]

Hi all -

New here, but trying to catch up quick.

Thanks in advance to any and all thoughts you guys have. Seems like there is a lot of information that is shared on a daily basis.

About me - 55 - spouse 56 both working in corp America. Current salary between the 2 of us is around 250,000.

Investments - approx - 3.3 mill - 70/30 stock allocation
Cash - $270k
House value - $400k
We don't owe anything other than credit cards that get paid of monthly.

Both have pensions that will have a value of around $7500 monthly once we turn 65

Since turning 55 I have the ability to retire early from position with retiree medical that gives a considerable discount compared to the open market.

Thanks and I look forward to sharing ideas...

*It seems you have a nice amount in investments and cash at 55. Tell us about the pension; what if you wanted to retire at 58, how much would the pension be
then?
-Is the home paid off?
-What age were thinking of retiring?
*. Truly believe you could call in and start packing out lol if you wanted to live on 125K annually. Only you know your expenses!
Medical expenses until 65 may be an issue if something catastrophic happened. A lot of folks have pulled the plug on less

 

[2K1N1K]

Pensions are both frozen, so no changes on number of years of service.
Home is paid off.
We are thinking of retirement in 2 years, unless there is a real bad day in the home office
Thanks for the assistance.

 

[Big_Hitter]

how secure is the retiree medical? i.e. is the company's cost "capped" at some current or future fixed dollar amount, etc ?

As young as you are, you may want to try modeling firecalc with an extra load for medical expenses if your plan has a cost cap or the plan is subject to future negative amendments

 

[2K1N1K]

Assuming at this time it's fairly secure. 4 years ago the company stated if you needed to be 50 at the time with at least 10 years of service. So the number is capped on both the low and high end with people falling off at 65 every year.

To your point, I've changed firecalc and we still shouldn't have much of an issue if we wait 2 years for retirement. Also currently we have a little under $70k in our HSA.

 

[Whisper66]

Your numbers suggest to me you are good to retire today if you wish.
I use https://www.longevityillustrator.org/Profile/ReportResults to pick a time frame that savings will need to finance. I look for a time frame that gives me and spouse at least a 5% chance of both me and spouse living over that time. For your situation, I'd need savings to support 37 yrs (both live to ~92). If one dies earlier, you can run those cases too but usually they will be easier to finance than if both live to a ripe old age.
Then I run your numbers in Firecalc. I use the "investigate" tab to see how much you could spend each year. I use the default ~95% success rate which is plenty. I am retired and I rerun analysis every year. That way I can always adjust average yearly spend rate if things don't look as good as when I retired. With those assumptions, Firecalc shows you could spend $182,690 yearly for the rest of your live and have a success rate of 95.6%.
I personally never trust one program and use https://www.i-orp.com to confirm Firecalc findings are reasonable. Best of luck to you!

 

[Ready2Go]

Any kids that are still "on the payroll"?

 

[2K1N1K]

Kids have successfully transitioned and totally off the payroll. Both are out of college and contributing to society..

 

[OldShooter]

how secure is the retiree medical? i.e. is the company's cost "capped" at some current or future fixed dollar amount, etc ? ...

This is something to look at and understand but probably not a huge factor in decisions.

The way it worked for us when DW retired from the megabank at 55YO was that she could continue to carry our health insurance at megabank's cost less a fixed dollar subsidy. IIRC it was $400/month. So if/when the insurance premium went up, we paid dollar for dollar. The subsidy didn't change. Always $400.

There was a sort of hidden "gotcha" though: The risk pool was not all megabank employees as we thought, it was only retired employees participating in this plan. So over the 10 years we needed it, the insurance cost went up faster than we expected.

 

[Big_Hitter]

There was a sort of hidden "gotcha" though: The risk pool was not all megabank employees as we thought, it was only retired employees participating in this plan. So over the 10 years we needed it, the insurance cost went up faster than we expected.

yes, when those premiums are annually underwritten one has to look at aggregate claims for just the covered group or Mega is on the hook for (potentially WAY) more than just the $400 - that's the kind of stuff actuaries do