horfield
Dryer sheet wannabe
After 35 years of working in media and technology I have come to realize I am burnt out. I am 59 later this year and am seriously contemplating semi-retiring. I am in a business where even 40-year olds can encounter subtle age discrimination. I don’t look my age (or act it) but I am getting older and it is getting harder to avoid the reality I have less and less in common with colleagues in their twenties and thirties. I used to be really well known in my business but a whole new generation has crept in that does not know me! I think I have had a good run and its probably time to call it a day.
I have not been working since November 2017. I am really enjoying my own time and don’t have any fear of not having anything to retire to. I am on the Board of Directors of a major non-profit and one business. I am also a public speaker and get periodic requests to deliver talks in my circles. I have many personal interests I would like to focus more time on.
My thinking is that I am now ready to at least semi-retire for say 75% of my time with just smaller part-time jobs, contracts and speaking engagements to bring in extra $$$ until I hit 66 when Social Security delivers bigger returns. I am on Cobra at the moment but would consider less demanding part time jobs to help with future medical expenses until I qualify for medicare. I don't mind still working a bit, just want to avoid working in a full-time pressured work environment again.
My question of course is if I am in a good financial position? Currently I have $1.65M split 50/50 between non-liquid IRA’s and liquid investments. The asset allocation is highly diversified and geared to a higher risk investment tolerance. (Still heavily in Stocks and REITS etc) A *major* additional factor is that living in the San Francisco Bay Area I have an additional $1M of house equity. (Minus sales and moving expenses) So my net worth is around $2.6M plus another $0.25M in sellable assets like collectables etc.
The social security calculator shows that if I no longer work from age 59, I will still be able to access $1,667/month at age 62, $2,706/month if I wait until age 66 and $3,564/month if I wait until age 70. It seems to make sense to try and live on existing investments until 66 or 70 when social security would majorly kick in.
My wife is 57 this year and being deaf, has never been able to work in a capacity that has bought in significant additional income but she also does some part-time work. I believe she will qualify for some social security at 62 or 66 also. Therefore, all the above will need to support both of us until our 90's.
My wife and I are also dual USA and UK citizens and could explore living part-time overseas and qualifying for (free) UK health services though the USA is our permanent home and where our children live.
My sense is that the key to our retirement situation is to downsize our house in the next year, free up $1M in equity and look at purchasing a house outright in a cheaper location and/or state than the SF Bay Area. (which is getting too busy/intense and expensive) For example, $600,000 would purchase a perfectly decent house in a good location most places outside coastal California (we just need to figure out where) and still leave $400,000 that added to our existing $1.65M would take our portfolio to $2M at age 59/60.
I am not that big a spender and without any monthly mortgage expenses or high Bay Area property taxes could live happily on $80,000/year and that’s before any additional part-time income or receiving social security from 66 onwards. I have tried Firecalc and though I find it a bit confusing, if I enter a spending of $80,000/year on a $2M portfolio over 30-years I get a success rate of 94.9%. That amount is also about 4% of a $2M investment portfolio.
My question is, does my understanding of our current situation make sense for a “75% retirement” scenario now? My sense from reading other posts is that it does but I welcome the experienced perspectives of other members of this forum on aspects I am not thinking of. Good to go?
I have not been working since November 2017. I am really enjoying my own time and don’t have any fear of not having anything to retire to. I am on the Board of Directors of a major non-profit and one business. I am also a public speaker and get periodic requests to deliver talks in my circles. I have many personal interests I would like to focus more time on.
My thinking is that I am now ready to at least semi-retire for say 75% of my time with just smaller part-time jobs, contracts and speaking engagements to bring in extra $$$ until I hit 66 when Social Security delivers bigger returns. I am on Cobra at the moment but would consider less demanding part time jobs to help with future medical expenses until I qualify for medicare. I don't mind still working a bit, just want to avoid working in a full-time pressured work environment again.
My question of course is if I am in a good financial position? Currently I have $1.65M split 50/50 between non-liquid IRA’s and liquid investments. The asset allocation is highly diversified and geared to a higher risk investment tolerance. (Still heavily in Stocks and REITS etc) A *major* additional factor is that living in the San Francisco Bay Area I have an additional $1M of house equity. (Minus sales and moving expenses) So my net worth is around $2.6M plus another $0.25M in sellable assets like collectables etc.
The social security calculator shows that if I no longer work from age 59, I will still be able to access $1,667/month at age 62, $2,706/month if I wait until age 66 and $3,564/month if I wait until age 70. It seems to make sense to try and live on existing investments until 66 or 70 when social security would majorly kick in.
My wife is 57 this year and being deaf, has never been able to work in a capacity that has bought in significant additional income but she also does some part-time work. I believe she will qualify for some social security at 62 or 66 also. Therefore, all the above will need to support both of us until our 90's.
My wife and I are also dual USA and UK citizens and could explore living part-time overseas and qualifying for (free) UK health services though the USA is our permanent home and where our children live.
My sense is that the key to our retirement situation is to downsize our house in the next year, free up $1M in equity and look at purchasing a house outright in a cheaper location and/or state than the SF Bay Area. (which is getting too busy/intense and expensive) For example, $600,000 would purchase a perfectly decent house in a good location most places outside coastal California (we just need to figure out where) and still leave $400,000 that added to our existing $1.65M would take our portfolio to $2M at age 59/60.
I am not that big a spender and without any monthly mortgage expenses or high Bay Area property taxes could live happily on $80,000/year and that’s before any additional part-time income or receiving social security from 66 onwards. I have tried Firecalc and though I find it a bit confusing, if I enter a spending of $80,000/year on a $2M portfolio over 30-years I get a success rate of 94.9%. That amount is also about 4% of a $2M investment portfolio.
My question is, does my understanding of our current situation make sense for a “75% retirement” scenario now? My sense from reading other posts is that it does but I welcome the experienced perspectives of other members of this forum on aspects I am not thinking of. Good to go?
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