Delurking

[redmcclain]

Well I've been reading the posts on this site for several months and finally decided to delurk and join in the fun

I'm 39 and work as a school administrator. I've noticed several ex/current military and federal employees on the pages but haven't seen as many school retirees as I expected - perhaps they're all lurking as well. I actually enjoy my job but know from summer breaks that I enjoy my freedom even more. I am fortunate in that I have 11 weeks of vacation each year in addition to the typical holidays so there are frequent breaks - which also serve to whet my appetite for more. At this point I'm positive that keeping myself "busy" or "entertained" during retirement won't be a problem.

I plan to retire at 55 - presently that's the earliest I can receive health care through my retirement as well as a COLA pension. In addition to contributing 10% of my salary to the retirement program I'm contributing 10% to a 403B. I also have a small IRA that I rolled over after leaving the private sector.

My DH (44) is a wonderful, intelligent, humorous man who also happens to be mathematically challenged and as such simply avoids any financial plans. Unfortunately, that means that he had made NO efforts toward retirement until meeting me. Fortunately, he recognizes his strengths and weaknesses and has (for the most part) allowed me to direct his income where I wish.

I'm fairly certain I'll be able to retire in 2023 (health care is the main concern in the event the retirement system removes that benefit) but DH may have to work several years beyond that unless we have some fantastic returns on our investments or he stays at his current place of employment and leaves with a pension. He's aware of this possibility and doesn't seem too concerned - yet. In all seriousness he doesn't appear to experience any difficulty going to work during the summer while I remain snoozing so this may never become an issue.

I'm intrigued by the idea of perpetual travel but don't have enough experience to know if this would be a good fit for us. We've discussed buying an RV and cruising the states but the cost of gas may be prohibitive by the time we're retired. Obviously we have several years ahead to work out these details.

I'm curious for those of you with COLA pensions in your futures how aggressive/conservative are you with your current investments. My perspective (which may be in error) has been that since most of my retirement income is guaranteed (as long as I stay put) then I can assume more risk with my 403b/IRA which are 100% equities - growth funds, foreign markets and some BRK.B.

It's been refreshing finding this website and these forums. It seems that most (although not all) of my friends and co-workers are content to spend, spend, spend and rarely give any consideration to financial independence - or they're trust fund beneficiaries and have never had to be concerned. I'm not FI yet but I know that I will be and listening in on your conversations has been very encouraging. Thank you.

[MooreBonds]

Quote:

Originally Posted by redmcclain Well I've been reading the posts on this site for several months and finally decided to delurk and join in the fun .. I plan to retire at 55 - presently that's the earliest I can receive health care through my retirement as well as a COLA pension. In addition to contributing 10% of my salary to the retirement program I'm contributing 10% to a 403B. I also have a small IRA that I rolled over after leaving the private sector. ... I'm fairly certain I'll be able to retire in 2023 (health care is the main concern in the event the retirement system removes that benefit) but DH may have to work several years beyond that unless we have some fantastic returns on our investments or he stays at his current place of employment and leaves with a pension. He's aware of this possibility and doesn't seem too concerned - yet. In all seriousness he doesn't appear to experience any difficulty going to work during the summer while I remain snoozing so this may never become an issue. ... I'm curious for those of you with COLA pensions in your futures how aggressive/conservative are you with your current investments. My perspective (which may be in error) has been that since most of my retirement income is guaranteed (as long as I stay put) then I can assume more risk with my 403b/IRA which are 100% equities - growth funds, foreign markets and some BRK.B.

Welcome redmcclain:

While I don't have the luxury of a COLAed pension, I would definitely agree with your overall view that, since you have a COLAed pension, you can be much riskier with your equity allocation....however, you'd have to do some comparisons first:

1) What is your anticipated retirement budget (without health insurance)? How much would health insurance add if it were cut from DH's coverage?

2) Are you eligible for SS as a teacher? What portion would your pensions and SS make up of your total budget needs?

3) 100% equities can be aggressive enough - but are you being 'conservatively aggressive' (a la Wellesley), 'moderately aggressive' (a la Wellington), or 'strap down, we're shootin' for the moon' with 90% foreign/emerging markets?

For instance, if your dividend yields from your equities could almost pay the difference between your budget and COLAed pensions/SS, then there's nothing to worry about. However, the more you have to withdraw from your equities, the more you'd want to lean a little more conservative when it gets closer to FIREing off.