Need a different kind of retirement calculator

[Blue Skies]

I have seen the Retirement Calculator on MSN and other sites, but they don't apply to me, and ask about adding a Social Security Benefit.

What I am trying to figure out is this:

If I quit my job in June of 2008, with $525,000 in cash, all of which will be in CD's, and have no debts, can I live off that money until i am 60, at which time I would probably start withdrawls from a SEP-IRA that currently has $371,000.

I am VERY limited in my knowledge of finances, but I am assuming that the SEP will double about every 8 to 9 years, so I would hope to have about $1,200,000 when I am 60...of course who knows what that will actually be worth by then.

I have lived way below my means for the past 12 years. I have no debt of any kind, and most of my cash came from the sale of my home. I do own another home free and clear in the midwest that I want to move to, but it is only worth about $25,000 (seriously..small town). I have estimated that my health insurance, car and home owner insurance, property taxes, phone, cable, propane, water and electric will be about $850 per month and I assume that it will increase by about 5% a year (is that too low or too high) I have a classic old car I will keep forever, and another 1980 model car.

I won't 'retire' like my Dad did, totally quit working. I would like to work 10 to 15 hours per week, and do a lot of volunteering, mostly in AA and at two senior centers that I like back there.

If walk away from my life in So. Cal it will be very hard to re-enter, but I can say that right now I am miserable about 90% of the time.

I do not think my future thinking will change; I went through my "I want more and better and flashier" phase years ago and am very content with what I have.

Right now my SSI Estimate of Benefits Statement says that if I take SS at age 67 I would have about $1,760 per month; if I wait until 70 it would just over $2,100 per month. Again, that may be worth nothing compared to todays dollars, and my parents told me along time ago to never count on Social Security being around when I retire.

I am single so have no hiers to worry about (other than 3 cats and a dog)

I am 50% terrified and 50% excited.

Any links to some way of figuring out some of these things?

Thanks for your patience.
Blue Skies

[boilerman]

Quote:

Originally Posted by Blue Skies If I quit my job in June of 2008, with $525,000 in cash, all of which will be in CD's, and have no debts, can I live off that money until i am 60, at which time I would probably start withdrawls from a SEP-IRA that currently has $371,000.

Maybe I missed this but how old are you today?

[boilerman]

OK I saw in your other thread that you are currently 43. Retiring in 2008 would make you 44 and you want the $525K to last until you're 60.

If your future expenses are really that low ($850 per month) then you're spending only $10,200 the first year. If you escalate that 5% a year for inflation, you'd be spending about $242K over the time span of 16 years. Even if you left the $525K under your mattress, you'd only spend less than half of your nest-egg. In fact, it would take into your 27th year to spend the whole $525K and that's assuming it never grew at all!

Your SEP must be in stocks for you to assume them to double every 8 or 9 years so the $371K would have 27 years to grow before you starting tapping it for expenses. It could double 3 times which could mean 8 X $371K = almost $3M. You could live to 900 like Moses did on that kind of money!

Is it really possible to live so inexpensively? What about car repairs, new roof, new furnace, medical costs not covered by insurance, etc.? I have not REd yet but I think you need to look again at your expenses. Even so, I suspect you'd be good even if you spent a good bit more.

Hope that helps.

[chinaco]

Take a look at the Kaderli's they get by on $24k/year (two of them).

There is really not enough info listed to give you good advice. I would suggest that you seek council from a Financial Planner (fee based) for consultation.

My opinion (with what you state) is that you could probably make it work if you could manage yourself to the budget. Health Care is on large expense that you will need to figure out. If you are planning to work part-time, that might help a little.

One thought. You are probably in your peak earning years. If you walk-away for nay period of time, you will probably not enter the work force again an reestablish the same earning power. Think carefully about the move. I would not make a knee-jerk decision. Most people plan and prepare for a few years before they actually retire. One of the critical elements is understanding your financial situation.

If you are that disgusted with your current job, can you find another job? Will that make thing more bearable until you can figure things out?

[HobbyDave]

First you need to figure out your expenses. You already mentioned some of yours, but those were just the straight recurring expenses as far as I could tell. What about food, maintenance/repairs on your home, medical costs, etc. You will need to figure out a budget, and from there you can figure out if you can handle it with your funds.

Lets assume if your recurring expenses are 1k per month (rounding up on your estimate), then your other expenses add up to 1k per month as well. So that is 24k per year. Heck, lets make it 30k to be safe.

You will need to get that 525k invested in something that returns better than CDs. Even if you don't "need" to do it, it seems a horrible shame to keep everything in cash. Please take a look at:

The Four Pillars of Investing

That book explains some good stuff about why you want to invest in the stock market. You can do it easily, and with less risk than a full cash portfolio (since you are then more inflation protected, you are reducing risk)

Assuming you redistribute your funds to be 70% stock or so, you have $896,000 in funds. For these rough calculations, it doesn't matter which bucket you take them out of. Some are in an IRA, some are not, but it is all investments.

Since you'll want to be retired for a long time, and I'm guessing you're interested in being conservative, lets say you take out 3.5% of your total balance per year to start with (the rule of thumb is 4% or less), increasing with inflation every year after that. The initial year you would be able to take out $31,360.

So your new "salary" would be a little over 30k per year, increasing with inflation. Is that enough for you? I made a guess of 30k per year needs, so this would cover that.

Anyway, read the book I pointed out as a starting point.

My most important suggestions:

1. Read more about finances, please ask us if you want more book suggestions.
2. Get your money properly invested, CDs for well over 50% of your money is a poor idea in my opinion.

[haha]

Quote:

Originally Posted by Blue Skies I am single so have no hiers to worry about (other than 3 cats and a dog) Blue Skies

Blue Skies, are you a man or a woman? I would be concerned that a fairly young man with a very constrained budget might find it hard to fund a suitable social life in the US. No matter what people say, the man pays.

Ha

[Moemg]

Quote:

Originally Posted by haha Blue Skies, are you a man or a woman? I would be concerned that a fairly young man with a very constrained budget might find it hard to fund a suitable social life in the US. No matter what people say, the man pays. Ha

Not in liberal areas ,It's maybe not 50/50 but it's at least 70/30 !

[haha]

Quote:

Originally Posted by Moemg Not in liberal areas ,It's maybe not 50/50 but it's at least 70/30 !

I live in the Birkenstock/Volvo homeland, and I have never had a woman pull out her billfold-at least not to take money out. But it does seem like a great idea, right up there with whirled peas.

Ha

[RetireeRobert]

Quote:

Originally Posted by Blue Skies I have seen the Retirement Calculator on MSN and other sites, but they don't apply to me, and ask about adding a Social Security Benefit. What I am trying to figure out is this: If I quit my job in June of 2008, with $525,000 in cash, all of which will be in CD's, and have no debts, can I live off that money until i am 60, at which time I would probably start withdrawls from a SEP-IRA that currently has $371,000. I am VERY limited in my knowledge of finances, but I am assuming that the SEP will double about every 8 to 9 years, so I would hope to have about $1,200,000 when I am 60...of course who knows what that will actually be worth by then. I have lived way below my means for the past 12 years. I have no debt of any kind, and most of my cash came from the sale of my home. I do own another home free and clear in the midwest that I want to move to, but it is only worth about $25,000 (seriously..small town). I have estimated that my health insurance, car and home owner insurance, property taxes, phone, cable, propane, water and electric will be about $850 per month and I assume that it will increase by about 5% a year (is that too low or too high) I have a classic old car I will keep forever, and another 1980 model car. I won't 'retire' like my Dad did, totally quit working. I would like to work 10 to 15 hours per week, and do a lot of volunteering, mostly in AA and at two senior centers that I like back there. If walk away from my life in So. Cal it will be very hard to re-enter, but I can say that right now I am miserable about 90% of the time. I do not think my future thinking will change; I went through my "I want more and better and flashier" phase years ago and am very content with what I have. Right now my SSI Estimate of Benefits Statement says that if I take SS at age 67 I would have about $1,760 per month; if I wait until 70 it would just over $2,100 per month. Again, that may be worth nothing compared to todays dollars, and my parents told me along time ago to never count on Social Security being around when I retire. I am single so have no hiers to worry about (other than 3 cats and a dog) I am 50% terrified and 50% excited. Any links to some way of figuring out some of these things? Thanks for your patience. Blue Skies

Are you today age 43? (Someone else said you stated so in another htread).

Are you absolutey sure you will never get married? Love strikes at the oddest times. I have a friend who was a confirmed bachelor up to age 60. He took a trip to Chile, and came back with a girlfriend who within two years became his bride. I have another friend who was a confirmed bachelor to age 57. He is married now too.

Someone else mentioned financial literacy reading material. I would add to the reading list: "Your money or Your Life" (Rodriguez), and "The Wealthy Barber" (forget the author).

Before doing anything drastic, I would spend a lot of time going over possible annual budgets, padding those budgets to be very conservative, and then projecting likely income.

If you are absolutely miserable at your current job, find another job for a year or even two while you refine your thinking.

From the info so far presented, I think you have enough assets, which if reasonably/conservatively invested can not only provide you adequate income, but can last.

Be interested to hear more details of your situation.

[brewer12345]

Um, maybe I missed this, but have you budgeted for health insurance? That can be a very big ticket item, indeed.

I would also suggest that you think long and hard about whether the root cause of your unhappiness will come with you to the midwest. If so, I would deal that issue before making any big life changes. That said, I can empathise with you if it is a grey area. I am at a loss as to whether I was just born unhappy or whether it is the job/commute that is making me so.

I would also suggest that you build your own spreadsheet to model out your scenario. Its not that complex, and you will be able to play what if a lot more easily. But at a very brief glance, it looks like you should be OK.

[Blue Skies]

Original poster here.

I probably should have mentioned in my first post that the love of my life is now in the midwest and that is the biggest reason for being there. After seeing the much slower pace of life, and the attention to family, country and friends, that really appealed to me.

I think I am 90% convinced I am going to do this, probably next year.

Thank you all for your help.

[RetireeRobert]

Quote:

Originally Posted by Blue Skies Original poster here. I probably should have mentioned in my first post that the love of my life is now in the midwest and that is the biggest reason for being there. After seeing the much slower pace of life, and the attention to family, country and friends, that really appealed to me. I think I am 90% convinced I am going to do this, probably next year. Thank you all for your help.

Well that puts a whole different spin on motivation! I'd still say though do the homework. Get a basic foundation in personal investing/personal finance by reading some of the books suggested and/or any of several other fine titles.

Plot out some fairly detail budgets, and do put lots of padding on the expenses---be conservative, have a safety margin, put more than you really think. Then plot out expected income, again be conservative, put less than you really think. Don't forget income tax bite (state as well as federal).

The $525000 now in CD's----think about some asset allocation, think about laddering what stays in CD's, think about safe withdrawal rates (see this forum "Basics" section thread on 4% Safe Rate). Think about an overall portfolio earnings rate on the $525000 that can be reasonably sustainable for 20 years----time to be conservative again.

For example, if you can get by on $21000 a year, then the $525000 at 4% withdrawals (with annual inflation adjustments) could well last you well past the 20 year mark. If you can supplement that $21000 with earnings of only $10 or $15k a year, giving you $31 to $36k income, and you can get by on $21000, you are ready to FIRE!

Your $371k is still in reserve and will be growing. SS is still in reserve to kick in at 62-66 or so. And that would all be "extra" cushion for you later years.

Good luck. And isn't love grand!!

Be interested to hear updates on your thinking and developments.

[Blue Skies]

Robert,
Thanks for your response.

I should tell you all that 12 years ago I had $33,000 in credit card debt, owed the IRS $17,000 and owed more on my car then it was worth. I did read a book called "Your Money or Your Life" and something inside of me snapped. I did away with every 'luxury' item you could imagine. It took 3 years and I paid off everything, but during that time I think I developed a huge phobia regarding debt. I am scared to every again owe anyone any money. One of the reasons I sold my house was I hated having a mortgage and I was convinced that the So. Cal RE market was due for a correction.

Of the $525,000 I have right now, it is all in CD's through Merrill Lynch. $120,000 of this came from the sale of my house after paying off the mortgage, commissions, closing costs, etc. The rest was what I have saved in the past 9 years.

My SEP IRA is invested with a company called Pershing. I admit right now that I do not know alot about investing, only how to save. I have a financial adviser who took everything out of Fortis Funds 2 years ago, where it was in 14 funds, and moved it to Pershing, now in 7 funds as follows:
Oppenhiemer Strategic Income Fund
Pimco Emerging Market Funds
SunAmerica High Yield Bond Fund
Capital Income Builder Fund
Davis New York Venture Class A
Franklin Income Fund Class A
Income Fund of America Class A

The statement I just received shows just under $372,000. BUT...on the statement is says my Estimated Annual Income will be $16,176.

My rough calculations, and please anyone correct if I am wrong, is that by age 60, in less than 17 years, that account should have about $1,100,000.

I am VERY nervous about high return = high risk investments. I know this sounds irrational, but when you grow up hearing your parents and grandparents talking about the stock market crash of 1929, the banks closing and the Great Depression, it sinks in.

My SSI statement says that I have earned enough credits to qualify for Social Security - at age 62 it would be $1,475.00. At age 67 it would be $2,143 per month, and if I wait until 70 it would be $2,667.

I have NEVER planned on Social Security being around when I am that old...I don't know alot about politics, but it seems that the fund is being drained. So I am planning on using the SEP money to support myself.

The house I have in the midwest is paid in full, property taxes are $177 per year (Oklahoma). Propane will run about $1,200 a year, electric can be as little as $30 per month to as high as $200 in the summer.

My big concern, as someone else pointed out, is health insurance. I currently pay just about $300 a month to Blue Shield of CA for a PPO. $3,000 deductable. No vision or dental coverage. I have had two back surgeries in the past 12 years, and one knee surgery, so I am concerned about 'pre-existing' conditions and would another company accept me.

I know alot of people dream of simplifying their life and downsizing, but I believe I really could do it. I have two cars, one a 1968 model and one a 1979. No student loans, credit card debt, etc. etc.

The other thing one of my friends pointed out is that I am basing my income solely on interest income, and he said that at some point if I had to I could start to withdrawl some of the principal if needed.

I have a part time job already lined up their working in Head Start with kids, paying $7.25 an hour (don't laugh!) I think it would be amazingly rewarding.

Thank you again, to all of you, for your many kindnesses and help this past week on this forum.

[RetireeRobert]

Quote:

Originally Posted by Blue Skies Robert, Thanks for your response. I should tell you all that 12 years ago I had $33,000 in credit card debt, owed the IRS $17,000 and owed more on my car then it was worth. I did read a book called "Your Money or Your Life" and something inside of me snapped. I did away with every 'luxury' item you could imagine. It took 3 years and I paid off everything, but during that time I think I developed a huge phobia regarding debt. I am scared to every again owe anyone any money. One of the reasons I sold my house was I hated having a mortgage and I was convinced that the So. Cal RE market was due for a correction. Of the $525,000 I have right now, it is all in CD's through Merrill Lynch. $120,000 of this came from the sale of my house after paying off the mortgage, commissions, closing costs, etc. The rest was what I have saved in the past 9 years. My SEP IRA is invested with a company called Pershing. I admit right now that I do not know alot about investing, only how to save. I have a financial adviser who took everything out of Fortis Funds 2 years ago, where it was in 14 funds, and moved it to Pershing, now in 7 funds as follows: Oppenhiemer Strategic Income Fund Pimco Emerging Market Funds SunAmerica High Yield Bond Fund Capital Income Builder Fund Davis New York Venture Class A Franklin Income Fund Class A Income Fund of America Class A The statement I just received shows just under $372,000. BUT...on the statement is says my Estimated Annual Income will be $16,176. My rough calculations, and please anyone correct if I am wrong, is that by age 60, in less than 17 years, that account should have about $1,100,000. I am VERY nervous about high return = high risk investments. I know this sounds irrational, but when you grow up hearing your parents and grandparents talking about the stock market crash of 1929, the banks closing and the Great Depression, it sinks in. My SSI statement says that I have earned enough credits to qualify for Social Security - at age 62 it would be $1,475.00. At age 67 it would be $2,143 per month, and if I wait until 70 it would be $2,667. I have NEVER planned on Social Security being around when I am that old...I don't know alot about politics, but it seems that the fund is being drained. So I am planning on using the SEP money to support myself. The house I have in the midwest is paid in full, property taxes are $177 per year (Oklahoma). Propane will run about $1,200 a year, electric can be as little as $30 per month to as high as $200 in the summer. My big concern, as someone else pointed out, is health insurance. I currently pay just about $300 a month to Blue Shield of CA for a PPO. $3,000 deductable. No vision or dental coverage. I have had two back surgeries in the past 12 years, and one knee surgery, so I am concerned about 'pre-existing' conditions and would another company accept me. I know alot of people dream of simplifying their life and downsizing, but I believe I really could do it. I have two cars, one a 1968 model and one a 1979. No student loans, credit card debt, etc. etc. The other thing one of my friends pointed out is that I am basing my income solely on interest income, and he said that at some point if I had to I could start to withdrawl some of the principal if needed. I have a part time job already lined up their working in Head Start with kids, paying $7.25 an hour (don't laugh!) I think it would be amazingly rewarding. Thank you again, to all of you, for your many kindnesses and help this past week on this forum.

Thanks for sharing more of your story. Interesting journey.

Another book you might find interesting is Getting a Life by Jacqueline Blix and another person (I think Blix was Rodrigueze's--Your Money or Your Life-- life partner or somehow connected with him). This one was written later on after Your Money or Your Life as a kind of sequel.

I would check into the expense ratios of the mutual funds your IRA is in and also the sales load fees, if any. And is that advisor getting any annual asset management fee? I recognize Davis New York fund and recall it as a decent fund. The others I am unfamiliar with.

I personally would highly recommend Vanguard as an asset holder. Very low costs. You can be ultra-conservative to mildy daring with the choices of funds you would have available at Vanguard. Also can arrange for personal financial consultations with Vanguard advisors if needed/desired.

I hear your nervousness about "high risk" investments. I would just caution that "stocks" does not necessarily equate to "high risk" and "bonds/CD'" does not necessarily mean low risk----what about longterm inflation?

I do believe there is a happy medium. And you could emphasize a stock portion of your portfolio in large, long-established companies, with long histories of dividends. Or mutual funds of such. Or Index funds.

You can also do CD's, bond funds, fixed income type investment at very low cost via Vanguard.

I would urge continued study of personal portfolio allocation and investing, and not just "leave it all to an advisor to handle" approach. Go hands-on.

Keep reading this forum. Go study Vanguard's website and the ton of education material they have there. It IS your life (financially speaking)---it deserves YOUR attention.

If you can parlay that HeadStart job into just enough hours per week to qualify for some group health insurance, that would remove one large uncertainty. Regardless of that, start right now studying health insurance providers in that area and individual policies offered there. They likely have another Blue Cross entity there too. Blues are usually decent as they are mostly non-profits.

Regards

[RetireeRobert]

Quote:

Originally Posted by Blue Skies Original poster here. I probably should have mentioned in my first post that the love of my life is now in the midwest and that is the biggest reason for being there. After seeing the much slower pace of life, and the attention to family, country and friends, that really appealed to me. I think I am 90% convinced I am going to do this, probably next year. Thank you all for your help.

Here is some info explaining the "4% safe annual portfolio withdrawal" idea. In this article, they go for a 90% chance of success of a portfolio lasting at least 30 years. The yearly withdrawals start of 4% of initial portfolio value. Each subsequent withdrawal is then the prior year amount plus inflation adjustmnt--I.e., it goes up each year (assuming there is inflation each year).

Since you only need your $525000 to last 16-17 years, you have lots of safety margin. Note they assume an allocation of 60%stocks (could be mutual funds or ETF's), and 40% fixed income.

Also, see the FIRE calculator here at the forums, and run some scenarios for yourself.

Hope this all helps to further build your "finances" education. Keep studying on your own.






by Rande Spiegelman, CPA, CFP®, Vice President of Financial Planning,
Schwab Center for Financial Research
August 29, 2006


Reprinted from the August 17, 2006 issue of Schwab Investing
Insights®, a monthly publication for Schwab clients.

Younger investors saving for retirement often ask: "How big does my
portfolio have to be before I can retire?" Those nearer to or in the
very early stages of retirement might ask: "How much can I safely
withdraw from my retirement portfolio?" The two questions are really
different ways of approaching the same critical issue.

Based on our research, we believe that if you are a conservative-to-
moderate investor at retirement who wants a very high level of
confidence you can maintain your standard of living and keep pace
with inflation for a retirement lasting 30 years, you can follow a
basic rule of thumb. The rule is this: You should shoot for a
retirement portfolio approximately 25 times as large as your first-
year withdrawal. This roughly translates into a 4% withdrawal rate in
the first year of retirement.




First-year vs. per-year approach
A first-year withdrawal target of 4% doesn't mean you will withdraw
4% of your portfolio's value each year. If you did, your cash flows
would be all over the map, up in some years and down in others, as
your portfolio fluctuated over the short term. The key is to strike a
balance between not running out of money prematurely and maintaining
a reliable standard of living, adjusted for inflation, from one year
to the next. The 4% withdrawal rate applies to the first year only.
Then, grow the first-year dollar amount for inflation each year
throughout your retirement.

Residual wealth
Based on a Monte Carlo analysis that runs thousands of simulations of
market scenarios, we believe that a 4% first-year withdrawal rate
should allow you to grow that dollar amount for inflation each year
with about a 90% probability your money will last 30 years. To put
that in perspective, in 89% of the probable outcomes, there would be
more than $0 at the end of 30 years. In the remaining 10% of probable
outcomes, you would run out of money earlier.

Here's an illustration of what ending wealth might look like at
various confidence levels, using as an example a first-year
withdrawal of $50,000 from a $1,250,000 portfolio1:




As you can see, there's a very slim (one-in-ten) chance the portfolio
might be worth at least $6,445,000, a 50/50 chance of ending up with
$2,340,000, and so on. By the way, at a 95% confidence level, the
portfolio runs out of money at some point during the 27th year. Also,
keep in mind that these are future dollars. Assuming a 2.6% compound
rate of inflation, $1,000,000 30 years from now has a present value
of about $463,000. Of course, the first-year withdrawal amount of
$50,000 would grow to almost $108,000 in terms of future dollars. You
might assume higher inflation, but that would also correspond to
higher expected nominal investment returns.

No magic here
There's nothing magical about a 90% probability, though we think it's
a reasonable goal to shoot for. Anything less than 75% would probably
be undesirable for most, with 50% not much more than a coin flip, but
you may be okay with an 80% or 85% probability. And your retirement
may not last 30 years. If that's the case, maybe you could get by
with a portfolio less than 25 times your first-year withdrawal. Every
situation is different.

As for what constitutes a "safe" withdrawal rate, a lot depends on
the return assumptions, time horizon and probability levels used.
Using realistic assumptions—we estimate a long-term return of 7% for
a moderate portfolio of 60% stocks and 40% bonds and cash—a first-
year withdrawal of 3% to 5% seems reasonable. Anything less than that
would require either an extraordinarily large portfolio or
drastically reduced spending, while anything much over that would
likely result in an unacceptable confidence level.

Stay flexible
Remember, too, that in the real world, future returns and inflation
rates are unknowable in the here and now, at least with absolute
certainty. That's why it's a good idea to stay flexible, and why you
should view retirement planning as an ongoing process and not a one-
time event. A Schwab consultant can help you design your own plan,
using realistic assumptions based on your own unique situation.


Important Disclosures:
The retirement strategies discussed herein are guidelines to consider
but are not intended to be predictive of future results and do not
represent individualized advice.

1. Based on 1,000 Monte Carlo simulations assuming a moderately
conservative asset allocation (25% large-cap stocks, 5% small-cap
stocks, 10% international stocks, 50% bonds, 10% cash) using the
following capital market expectations: large-cap stocks 8.6%, small-
cap stocks 10.3%, international stocks 8.6%, bonds 4.4%, cash 2.9%,
inflation 2.6%.

Although the information contained herein is obtained from sources
believed to be reliable, its accuracy or completeness is not
guaranteed. This report is for informational purposes only and is not
an offer, solicitation or recommendation that any particular investor
should purchase or sell any particular security. Schwab does not
assess the suitability or the potential value of any particular
investment. All expressions of opinion are subject to change without
notice. No portion of this report may be copied in any manner or
form, nor redistributed, without the prior written consent of Schwab.
All charts and research have been compiled from publicly available,
proprietary and/or licensed data. Past results are not indicative of
future performance. Diversification and asset allocation do not
eliminate the risk of investment losses.

This report contains viewpoints and opinions on the economy, the
markets, and specific companies and securities. From time to time,
certain of them may differ from each other. Additionally, Schwab or
its affiliates may publish or otherwise express other viewpoints or
opinions that may be different from certain of the viewpoints or
opinions expressed in these materials. Investment funds and/or
separate accounts managed by Schwab or its affiliates may take
positions contrary to the information contained in these materials.

This information is not intended to be a substitute for specific
individualized tax, legal or investment planning advice. Where
specific advice is necessary or appropriate, Schwab recommends
consultation with a qualified tax advisor, CPA, Financial Planner or
Investment Manager.

[TromboneAl]

Blue,

It's great to hear about the successful conversion of a big spender. You're obviously an intelligent guy, so it's time to immerse yourself in information about investing. Read the books recommended on this forum, read a lot of stuff on the forum, track your expenses well, and you'll be all set. I suspect you can do a lot better in your investing, but you need to educate yourself before making changes. It's not difficult.

We also escaped the megalopolis and moved to a small town. Once we decided we were going to move, the traffic and crowding became intolerable, so I understand how you feel now.

[Rich_by_the_Bay]

Health insurance is gonna get you.

If you can even find an individual policy, it will likely be underwritten for your back pain or other medical issues we don't need to know about, and will be much more than $300 per month I'd guess, more likely around $500/month or more.

If you cannot get a policy, you'll want to see if your destination state has a high risk pool, and how much that is. If your employer offers a "continuation" policy on your own nickel after you leave, it would be wise to take it until a suitable replacement is found.

Not meaning to pour ice water on your ideas, but it's such an important part of planning for retirement that you'd be better off knowing in advance.

[RetireeRobert]

Quote:

Originally Posted by Rich_in_Tampa Health insurance is gonna get you. If you can even find an individual policy, it will likely be underwritten for your back pain or other medical issues we don't need to know about, and will be much more than $300 per month I'd guess, more likely around $500/month or more. If you cannot get a policy, you'll want to see if your destination state has a high risk pool, and how much that is. If your employer offers a "continuation" policy on your own nickel after you leave, it would be wise to take it until a suitable replacement is found. Not meaning to pour ice water on your ideas, but it's such an important part of planning for retirement that you'd be better off knowing in advance.

And look into new employer group insurance availability. You mention possibly working part-time for HeadStart. Often times, those part-timers working over a certain minimum of hours still qualify for the employer group insurance. With group insurance, the policy is the policy and is not underwritten to individual pre-existing coniditions.

So, please check out new employer group health insurance options, and qualifying requirements to get it.

[Blue Skies]

Just came to find out that last night somene 'tagged' the side of my garage (it fronts on a alley) with some sort of gang graffiti that I don't even understand, and then noticed that the garage door lock and catch are damaged, I think someone was trying to break into the garage...there is nothing in there but old tools, about 200 bottles of water and my old car.

I am now going to seriously take to heart all of your suggstions and see if I can get out of here by April 30, 2008.