Could Retire, But Doesn't Know It

[UnrealizedPotential]

I gave up talking anybody into taking retirement. The last person I was helping was my secretary, she’s still working today. She is about 67. She has a huge pension, but she is not retirement because she doesn’t know where to go. Having one month vacation a year is pretty darn good.

I gave up too. It seemed I was always trying to help people who deep down really didn't want my help. They want the end result but don't want to do what it takes to make it happen or they just don't care. Some people are like that. So I butt out.

 

[Fedup]

I gave up too. It seemed I was always trying to help people who deep down really didn't want my help. They want the end result but don't want to do what it takes to make it happen or they just don't care. Some people are like that. So I butt out.

I also realized some just like to complain, but I’m no longer there therefore I don’t have to listen. Last time she tried to drag me back to office politics there, I turned her down. I said I’m retired now, I don’t want to get stressed out by hearing any more of stuff related to work. No more gossip for me. I haven’t heard from her since.

 

[Offgrid Organic Farmer]

...
$1.4MM her share of rental properties managed by her brother

The income off those rentals should be more than enough to support her in style.

Unless the partner is scamming.

 

[retired1]

I have a friend that still works. Part-time at Starbucks. Mostly for the health-care but also the money that she earns.

She's 62 and wishes she didn't have to work, being so careful with each dollar.

Here's what I know about her net worth:
$1.4MM her share of rental properties managed by her brother
$875K home that son rents (5 years left on note, don't know balance)
$875K condo she lives in (paid off)
...

Pretty Solid net worth numbers !

$875K home !!! wow. The taxes for such an expensive home must be high that cause her to worry & keep working... maybe ?

 

[sheehs1]

Solid net worth but much is tied up in hard assets. The only liquid asset is the $600K in the Roth. Perhaps that is her worry. Can't really comment much since we don't know how much income she receives from the hard assets or how long that will last.

 

[MrLoco]

Solid net worth but much is tied up in hard assets. The only liquid asset is the $600K in the Roth. Perhaps that is her worry. Can't really comment much since we don't know how much income she receives from the hard assets or how long that will last.

This is what caught my eye as well. I would not feel comfortable having 84% of my assets tied up in real estate entering my retirement years. Needs a little more diversification of assets.

 

[gauss]

I have a friend that still works. Part-time at Starbucks. Mostly for the health-care but also the money that she earns.

....
Has pension coming--I encouraged her to research it and the last I've heard is that she followed up with that recommendation, talked to finance guy at the company and they could not find anything on her about her pension.
SS--is eligible, but delaying.
....

If she has the initiative to get to the bottom of what the status of her pension is, there is free legal assistance available in 30 states (including California) that specializes in exactly this.

The overall site is Counseling Projects | Pension Rights Center

Their California partner is:

WESTERN STATES PENSION ASSISTANCE PROJECT
California Pension Rights Office
https://lsnc.net/pension
(916) 930-4911

Here is a a link to a video that may help stir some motivation on this if she has been frustrated by the pension search so far:

-gauss

 

[Offgrid Organic Farmer]

Has pension coming--I encouraged her to research it and the last I've heard is that she followed up with that recommendation, talked to finance guy at the company and they could not find anything on her about her pension.

My wife worked for a Federal agency, and was tracking when exactly she would become eligible for their pension. But when she asked about it, nobody in-house knew anything about their pensions.

Within 90-days of being eligible for the pension, she had to file a request to begin her pension, before their pension department would speak with her. It took them 3 months to review her work history and flesh out the formula used for calculating her pension.

My wife then delayed taking the pension for another 6 months, but at least then we knew how much it was going to be.

 

[GravitySucks]

Don't tell her.
We need more people making payments to SS!

 

[Red Badger]

My wife worked for a Federal agency, and was tracking when exactly she would become eligible for their pension. But when she asked about it, nobody in-house knew anything about their pensions.

Within 90-days of being eligible for the pension, she had to file a request to begin her pension, before their pension department would speak with her. It took them 3 months to review her work history and flesh out the formula used for calculating her pension.

My wife then delayed taking the pension for another 6 months, but at least then we knew how much it was going to be.

My mega-corp had an on-line pension modeling too. I used it extensively during my last few years there. Of course, there was a disclaimer to the effect of "estimate only" stuff. But I could model six ways to Sunday. It helped my to eventually choose 100% joint/survivor. When did eventually apply, it was spot on accurate.

Glad it was there for my usage.

 

[RenoJay]

I’ll second what others have said about not getting too deep into someone’s finances without being invited. I got too involved with an ex girlfriend’s finances and was labeled “controlling” by her and her friends. Now a few years later, she’s made all the mistakes I predicted (and tried to help her avoid) and now she’s proactively asking me for help. People who don’t live for this stuff often need bite-sized nibbles that they can digest at their own speed. I think pointing her in the right direction on pension stuff would be a great first bite-sized nibble, then step back and wait for additional questions.

 

[Offgrid Organic Farmer]

My mega-corp had an on-line pension modeling too. I used it extensively during my last few years there. Of course, there was a disclaimer to the effect of "estimate only" stuff. But I could model six ways to Sunday. It helped my to eventually choose 100% joint/survivor. When did eventually apply, it was spot on accurate.

Glad it was there for my usage.

The SS website also seems to be very user friendly. They send me an update every year, so I can verify my annual income going back to when I was a teenager. And they project my estimated benefits for each year after I become eligible.

Talking to our frends who are on SS, it sounds like those 'estimates' are pretty much right on accurate.

I have been retired for 17 years so far, and I am nowhere near ready to apply for SS benefits, but it is nice knowing they are available whenever I am ready for them.

 

[Elbata]

Thank you to all for your thoughtful responses.

I'm debating sending her this thread, but fear she'll be upset and possibly not speak to me again.

1. I agree about too much in RE (hard assets).
2. She's a smart girl, I'm sure she'll follow up on her retirement.
3. Her brother is managing the properties and I'm not at all familiar with how things are, but I would greatly doubt any kind of shenanigans.

 

[HI Bill]

I'm debating sending her this thread, but fear she'll be upset and possibly not speak to me again.

My advice is...don't. No good can come of it (most people aren't open to help and change, and aren't willing to work toward a goal like this, even if a little work now, means less working). If you think she's different, go ahead, but at your own peril! I've given up trying to offer advice on cameras, unless asked, computers, unless asked, and even 'how to' for underwater photography, unless asked. Otherwise, it goes in on ear and out the other, and almost without exception, they make up their mind based on their own preconceptions or some impulse decision.

 

[Fedup]

Her retirement is none of your business. But I’m surprised that she has $600K in Roth and no TIRA.

 

[FANOFJESUS]

My guess is she is working for her heirs. I have seen it several times.

 

[deserat]

Interesting thread - in a similar vein, I was talking to a friend last week and she was talking about her retirement and needing to wait. She gave me some rough numbers about a pension, her portfolio amount and what she needed. I did a quick back of the envelope calc and told he she could do it and then some. She then said she was meeting with her financial person - I told her she could simplify and do it herself....or I could teach her. I then afterwards sent her a few spreadsheets, some links to here and other retirement calculators and then just went radio silent...she did send back a thankful email and we'll see if she actually looks at the info...

TLR - you can lead a horse to water but you can't make them drink.....

 

[Housewife]

Unless her situation is iron clad/bulletproof, I would absolutely refrain from telling her she could retire. Otherwise, just like the old saying, no good deed goes unpunished. In her case, her ability to retire is far from certain. Her net worth is real estate heavy, and she seems to be a hands-off owner who does not have direct control. Her son may not be paying her rent for all we know. We have no idea how much cash her RE investment property generates. Judging from the price of condo, the properties might be in an expensive area and may not be generating as much returns regardless. Her pension is in question, she wants to delay SS, so all she can rely on is her Roth account which is decent but not substantial. Without a job at that age, her healthcare will be expensive. If something happens, she may or may not be able to sell her share of RE properties. She will be at others’ mercy and could be caught in a liquidity crunch. Other than encouraging her to sort out the pension situation, I would not mention her ability to retire now.

 

[Rianne]

I would maybe point her to a few things (like this forum, bogles, etc.,) and then butt out. If I assume this friend is at least of average intelligence, then she can figure it out if she really wants to. Not want she says she wants. You can't really know her spending either.

It could very well be far more psychological than it seems on the surface. If she's outwardly asking you "please give me concrete help so I can retire" then...maybe...but lacking that, I'd stay well clear of the topic. You already know more about her finances than I do of anyone in my family - and we're pretty close and talk about money freely.

Maybe she listens to Suzy Orman. I envy anyone who can talk about money freely with their family. It's so taboo in my family it is sad and one big reason I joined this forum. All I know about my family is how they spend and a little about their mortgages. I can only assume why one DB is not retired, he spends more than he has and complains about work a lot.

 

[Mdlerth]

Once you start down the dark path, forever will it dominate your destiny

I envy anyone who can talk about money freely with their family. It's so taboo in my family it is sad and one big reason I joined this forum. All I know about my family is how they spend and a little about their mortgages. I can only assume why one DB is not retired, he spends more than he has and complains about work a lot.

I can talk about money in a non-specific way with DW's family without a problem. Her brother and three sisters (plus spouses) are responsible, disciplined and financially secure. Half already are retired, half will be within the next few years. All made some good decisions early in life which presented opportunities for more good decisions later on. It's almost sickening how competent they are. (Just kidding!)

But don't ever mention money around my siblings unless you want to start a fight. None of them will retire with change for a button. Bad decisions early on led to fewer and worse options as they aged. Errors compounded. Sad, but un-fixable.