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Old 03-05-2015, 03:43 PM   #1
Confused about dryer sheets
Join Date: Mar 2015
Location: middletown
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almost I think

So am seeking a bit if advice. I will b entitled to a state pension of $48000 non cola this year. I would like to semi retire and work part time in a related field. I will finish my mortgage thus year. But still b left with 48k equity loan not due for twelve years. I pay interest and some principal every month. Payyment is $120. Per month. Real estate taxes are 7700. Per year. Get health benefits with pension for about 800 per year. I figure without mortgage and commute my recurring monthly bills are under $1500 per month including car insurance.
Savings r 457 plan at 335k and about 200 in mutual funds and 115 in a variable annuity I bought years ago. So its a little over 650k total. House is worth 375000. Eventually I would like to step down to condo w lower taxes. I am 50 years old with whopping commute and am ready for something different. Have no other debt and no dependents. Its not a lot to live on but if supplemented with part tine work or another full time job if needed or wanted I think I can b fine. I have been careful with money to date. After removing mortgage and commute from my monthly bring home I make a few hundred less in the pension. Investments are to b left until 60 at least o
allow to grow. I am entitled to sic security. I guess my q is am I crazy to go now? Btw there is talk of freezing the defined plan and moving to a 401k type plan. Thanks!!

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Old 03-05-2015, 03:58 PM   #2
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First, welcome. It doesn't make much sense that you are only paying $120/month on your home equity loan as that likely wouldn't or would barely cover the interest on a $48k principal balance. Also, what you infer for expenses ($18k for recurring monthly bills + $7,700 for real estate taxes for a total of say, $26k) seems out of line with the statement that your $48k pension would be about what you are currently spending but there isn't sufficient clarity to assess it. Also, $800/year for health insurance would be very low.

So I think you need to spend some time making sure you have your expenses right. Be sure to cover off medical deductibles and co-pays in addition to medical insurance and periodic replacements of cars, home appliances, major home repair costs, etc.

Have you run your situation through firecalc or Quicken Lifetime Planner?

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Old 03-05-2015, 05:54 PM   #3
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Welcome to the forum!

In addition to the above suggestions here are some other things to consider.
I heard the call to do nothing. So I answered it.
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Old 03-06-2015, 06:56 AM   #4
Confused about dryer sheets
Join Date: Mar 2015
Location: middletown
Posts: 2
Sorry for the lack of clarity oh dear it was not very clear. And thank you for your response. The 120. Is interest payment on the equity loan. I try to pay a bit extra every month. The 7700. Property tax bill is included in the monthly expenses. So 18000 overhead if you will per year. I am figuring I will bring home about 3400 per month in retirement versus 4800 now.
The first mortgage currently is 790 prin plus interest payment that would be satisfied by retirement. Also my commute is costly easily 300 per month fuel and tolls plus 100 miles on my car per day.. My car is a volks j etta tdi. They usually last a pretty long time.
With reduced driving it sho uld last another 5 years. So hoping for no car purchase expense for this period though of course
some ma intainence will be needed.
any thoughts or suggestions would b most welcomed. Thank you!!
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Old 03-06-2015, 07:14 AM   #5
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So basically you are saying you only spend about $10,000/year in expenses?

Certainly there are some people like Jacob on Early Retirement Extreme that are living off of that but I'd go through your expenses over the past 2-3 years in detail. Things like -

- Food & Liquor
- Dining out & Entertainment
- Medical Insurance (Premium might be $800/yr but deductibles/copays along with dental/vision)
- Car & Home Insurance
- Travel
- Gifts/Charity
- Utilities (Gas, Elect, Water, Garbage, Cable, Cell, Internet) - Heck I spend $6700/yr alone in this
- Auto Expenses
- Major repairs (car replace, appliances, HVAC, paint house, shingles ...)
- Clothing
- Misc (haircuts, pets, parking, .....)

Go through your checkbook and credit cards and really find out how much you're spending to verify.
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