Did Anyone Retire with "Only" .75M$ Saved?

[RobbieB]

What's this pension thing I keep hearing mentioned?

 

[RunningBum]

Thanks..so, 70+% have a pension..and 60+% say it has an impact on their ability to retire.

I'd love to know where all of these pensions are coming from. What companies are still doing pensions (and, can I apply )? Or is the 60-70+% all .GOV, Teachers and Auto workers?

You're asking the wrong question. People who are retired aren't starting work now. A pension was fairly standard when I started in '84. I didn't stay around that long to make it big enough to rely on though.

 

[Cessna152]

What's this pension thing I keep hearing mentioned?

I think it means boarding house or small hotel.

 

[flintnational]

The folks with a pension, $2m+ and SS are subject to being banned from the forum! Its clearly stated in the forum rules.

" A forum member may not have more than two of the previously listed assets. An exception will be made if the member is able to demonstrate they have a spendthrift spouse or if the member likes expensive cars, fine wine or routinely participates in the Blow That Dough Thread."

 

[pj.mask]

Did Anyone Retire with "Only" .75M$ Saved?

Not a humble brag. It explains how some of us can retire with less than $2 million+. If we didn't mention the pensions, SoSec and/or real estate property revenue we would be very misleading by saying "Yes you can. I did!". The clarifications about those other revenue streams are critical to making the conversation of any value.

If you have $X and a giant pension immediately upon retiring then you have more than $X

At 50 the value of a non COLA pension is 5% (can you even buy a COLA pension?) - so if you earn $38k/yr there is your $750k.

Not to mention the person who ‘retired on less than that... but with 10 paid off rental properties’ lol

My interpretation was people living on income equivalent to a SWR (2-5%) on 750k = $15-38k/yr

 

[IrishMoss]

No pension for me, just ss when the time comes and investments.

I count everything and did a npv for the ss chunk, added to my investments and that's the total nest egg.

Seriously I don't understand anyone who fails to count their pension and SS in their total and only counts their 401k/IRAs. It all counts!

 

[scrabbler1]

Back in late 2001, my (former) company made some big changes to its pension plan. (1) They grandfathered into the existing plan employees who met certain age and longevity criteria. (2) They froze the pension for all other employees. (3) And they ended the plan going forward for any new hires.


The company already had a 401k plan (75% match up to 6% of employee's salary) and ESOP plan. For employees in (2) and (3), a cash-balance plan was introduced which included pay credits and interest credits. I was in (2).


A few years later, but before I left the company in late 2008, they ended the cash-balance plan for new hires and replaced it with a profit-sharing plan.


So, I have a frozen pension, with no COLA, of course. The cash-balance plan remains but I get only the interest credit every year, a puny amount. I had begun working part-time in late 2001, so my pay credits were not very big.


The cash-balance plan, if converted to an annuity (according to the annual statement), would give me a small amount every month starting at age 65. The frozen pension's value erodes over time.


These and SS are my "reinforcements," along with unfettered access to my much larger rollover IRA, waiting for me in my 60s. For the last 10+ years, and for the next 3 years, I live off my taxable account.

 

[Dtail]

No pension for me, just ss when the time comes and investments.

I count everything and did a npv for the ss chunk, added to my investments and that's the total nest egg.

Seriously I don't understand anyone who fails to count their pension and SS in their total and only counts their 401k/IRAs. It all counts!

+1
So says Firecalc and all the others. We would not live our current lifestyle, if we didn't factor in SS and a minor pension.

 

[Maidensong]

When I said we have a small pension, I meant it. It's $420 a month. No COLA. It pays our utilities and a bit more, but when we figure our assets, we have to count it. Didn't mean to sound like a brag.

About our rentals. After the market tumble in 2008, we got serious about looking for other income sources for retirement and bought our first rental that year, picked up the others by 2010. Then we started whacking away at our real estate debt. When we moved to the LCOL town where our rentals were, we made enough on the sale of our Boston condo to put the last mortgage down. Now the rentals are consistent money-makers with an ROI around 12%.

Granted, rentals aren't completely passive income, but it sure beats a 9 to 5.

 

[HFWR]

My current income is about 42% SS, 43% IRA, and 15% non-COLA pension.

The IRA was/is less than $750k, and would not support much of a lifestyle on its own.

 

[razztazz]

It's funny to me that these threads are where the "I've got a pension and SS that cover my expenses people chime in". IMHO it kind of misses the point. Humble brag perhaps?

Actually, yes. Sounds humble-braggy unto me. If the question is "Were you able to retire on not more than $750,000-ish" then $750,000+ 5000 a month pension doesn't count. If you retire with 10 million, you are still retiring on $750,000.....you'd have to have that to have 10 mil. It's kind of a word play.

That's why when I posted I delineated the imputed value of my pension + my won money was still less than 750,000. The medical was harder to price.

Get it all on the table.

 

[W2R]

It's funny to me that these threads are where the "I've got a pension and SS that cover my expenses people chime in". IMHO it kind of misses the point. Humble brag perhaps?

Hey, I didn't chime in! I'm very thoughtfully and considerately keeping out of it even though my age 70 SS and mini-pension have both kicked in by now and are pretty terrific to have.

But honestly, anyone retiring on a smaller nest egg is going to find SS and/or a pension to be such a big deal. Even if these two income sources haven't kicked in yet, just knowing they are on the way can allow retirees to withdraw a little extra the first few years. Or, another tactic (which I personally prefer) is to just set aside the amount of cash that would represent an "SS+pension" equivalent for all years until these income sources kick in. So, for example, if you expect a total of $20K/year from SS+pension, and both will kick in five years after retirement, then set aside $100K and consider your retirement WR to be based on 0.65M$ instead of 0.75M$.

 

[Gumby]

Actually, yes. Sounds humble-braggy unto me. If the question is "Were you able to retire on not more than $750,000-ish" then $750,000+ 5000 a month pension doesn't count. If you retire with 10 million, you are still retiring on $750,000.....you'd have to have that to have 10 mil. It's kind of a word play.

That's why when I posted I delineated the imputed value of my pension + my won money was still less than 750,000. The medical was harder to price.

Get it all on the table.

Actually, saying that you could retire on less than $30,000 per year (because either straight up savings <$750K or saving plus imputed pension value <$750K) could be viewed by some as a humblebrag. Aren't you really boasting of your frugality and implicitly criticizing those who are unable to do it?

How about we all do this? Assume that each of us is posting in good faith, providing data points for the OP to consider when pondering his own situation, rather than speculate about some ulterior motive for the post. I think we'll all be happier.

 

[Ed B]

Thanks..so, 70+% have a pension..and 60+% say it has an impact on their ability to retire.

I'd love to know where all of these pensions are coming from. What companies are still doing pensions (and, can I apply )? Or is the 60-70+% all .GOV, Teachers and Auto workers?

My megacorp is private sector and offered pensions when I hired on in 1985. Some time around 2006 they stopped offering pensions to any new hires. The get a defined contribution retirement account instead of a pension.

On Dec 31, 2019 pensions will be frozen and all employees will be in the defined contribution plan in addition to 401k.

As someone else said above pensions were fairly common among larger employers in the '70s and 80's. But not many non-union private sector megacorp's offer them now

 

[razztazz]

Actually, saying that you could retire on less than $30,000 per year (because either straight up savings <$750K or saving plus imputed pension value <$750K) could be viewed by some as a humblebrag. Aren't you really boasting of your frugality and implicitly criticizing those who are unable to do it?

How about we all do this? Assume that each of us is posting in good faith, providing data points for the OP to consider when pondering his own situation, rather than speculate about some ulterior motive for the post. I think we'll all be happier.

No, You're overdoing it. Nothing I said could be construed as any kind of brag. If you did. Tsk tsk. I made no claims to my super-frugality. That is your inference. I did not imply anything about any body else's truthfulness or frugality. I did want to be sure I wasn't lumped into the basket of people with huge pensions vs pensions like mine. Genetic difference not to be conflated.

The Q was anybody retire on 750 or less?. I took it to be a Q about essentially a bare-bones retirement. Well, no, I didn't have the whole 750 in a bag but a small pension divided by 3.5% + savings coming in under, well under 750 grand is still a relevant ref point for the context of the question.

Aren't you really boasting of your frugality and implicitly criticizing those who are unable to do it?

Sherlock Holmes and Colombo couldn't figure how you came up with this one.

 

[Gumby]

I think you missed the point, but that's fine. I assume you had good intentions.

 

[daylatedollarshort]

I'd love to know where all of these pensions are coming from.

In our case, the 1980s! You can still apply to the same companies but they've all either eliminated the pension plan for new hires or made them less of a good deal.

 

[RobbieB]

That sounds about right. The only Co. I worked for that offered a pension was my first hire after school in 1978. They terminated me 4 years later and sold the division I was employed by. Woo-hoo, megacorp business as usual.

After that I looked for mini and micro corps -

 

[anethum]

I sometimes think that there ought to be two separate "Fire and Money" forums. One for those with a pension, and one for those with no pension. For those of us with no pension (including myself), there's a lot more risk in FIREing. Also, if you're a federal/state/local government employee with a pension, you probably get retiree health insurance and don't have to deal with ACA health insurance (assuming you're American) before you turn 65, which is a major expense in those pre-Medicare years.

I worked for a megacorp beginning in the mid-1980s. A little over 10 years later, they ended the pension plan and retiree health insurance. If you weren't already vested (25 years needed, IIRC), you got an immediate cash value payment which I rolled over into my IRA. It wasn't a huge sum of money, at least in my case.

As for this thread and those like it, it would be immensely helpful if the OPs specified at the beginning of the thread whether or not they have a pension & retiree health insurance.

 

[daylatedollarshort]

Besides pensions and retiree health insurance, there are also pretty big differences in Social Security benefits between the minimum and maximum amounts. Maximum benefits at full retirement age are $2.861K a month. That could be over $64K annually for a retired couple at full retirement age just from SS.

 

[dtbach]

No. That would only bring in $30K with a 4% WR. I'd keep working as I don't like being poor.

 

[IrishMoss]

What someone lives on (income flow in a year) was not the question.

The question seemed straightforward: $750K total nest egg, period, end of total investments, not counting anything else, that is everything included.

Not $750K in my 401K/IRA plus oh yeah, $4K/month in pensions will come in and um, well social security will bring in another $35K/year, but yes I retired on 'only' $750K. Because no you didn't retire on only $750K. You actually retired on something like $2M+ whether you're counting it or not, it's what you're getting or will get in this example.

 

[Tiger8693]

The question seemed straightforward: $750K total nest egg, period, end of total investments, not counting anything else, that is everything included.

I would have assumed almost everyone (US) would have some amount of SS? While you assumed the above, I assumed $750k savings/investment outside of SS... I guess only the OP can answer his/her intent.

 

[Calico]

I would have assumed almost everyone (US) would have some amount of SS? While you assumed the above, I assumed $750k savings/investment outside of SS... I guess only the OP can answer his/her intent.

I assumed the same as you. In another thread the OP actually stated that she and her spouse were both thinking of taking SS at age 62.

 

[GravitySucks]

Honestly, I know no one that had $750k to retire on. Think Mom had about $25k. Dad and his wife had $7k when he passed. Probably had about that much when he retired. Coworker friend got the boot to ER at 55 with almost a half million and thought he'd be fine and actually is. A close relative is retiring at FRA SS this year with a negative networth. Any time I spoke with these people they rarely complained about money. Always complained about health issues. As a group we worry about money on this forum way too much.