May be time to go

[Ready2Go]

I was originally going to go to age 60. Then it was 58. Now, I'm a few months shy of 56 and my bullsh*t bucket is full. Wife is same age but not at the same BS level as I am. She says she wants to work until age 60 to maximize pension or until they offer an early retirement incentive...which could be next year....50/50 chance.

I've been crunching the numbers....

Retirement Assets:
$1.6m in 401k's ($160k of this is Roth)
$558k from my DB lumpsum (payable 2-3 months after I retire)
$40k in Roth IRA's
Total: Approx. $2.2 mil

Retirement Income:
Wife pension...ranges from $43k in 2021 up to $66k if she retires at 60 in 2025. First $18k of pension is COLA beginning earlier of 5 years after retirement or age 65.
Social Sec....for now, planning for age 62 and approx $42k total ($24k for me and $18k for her). These are conservative estimates.

Expenses:
Wife's company has free retiree medical (based on service threshold) including spouse to age 65. Also covers dependents to age 26.
Have about $50k left on a mortgage and about $70k on a 0% interest car loan.
Total Annual burn (gross...including taxes): $132k. (Could easily trim $10-$20k off of this, as needed.) This includes car payment but not mortgage as I plan to pay this off as soon as I retire...out of savings.
Oldest child is out of college and working. Will be moving out in 2021. Youngest is sophomore in college. We have remaining 2.5 years in 529.

FireCalc: Using $2.1 mil, assuming $40k pension in 2021, SS of $42k starting in 2027 and a 40 year retirement....I get 100% on an annual burn up to $136.5k.

The plan:
I retire 1Q 2021. Wife takes it a year at a time.

I'd love to get some opinions. Is there anything I am missing? Am I cutting it too close?

Thanks in advance.

 

[pacergal]

Firecalc has you at 100% and free medical from your wife--looks good to me.
Does your wife need to work to a certain age or length of time to get the free retiree medical, and has she met that yet?

If you are sure of your budget, I say look forward to your soon-to-be retirement!

 

[SpinDoctorTX]

I was originally going to go to age 60. Then it was 58. Now, I'm a few months shy of 56 and my bullsh*t bucket is full. Wife is same age but not at the same BS level as I am. She says she wants to work until age 60 to maximize pension or until they offer an early retirement incentive...which could be next year....50/50 chance.

I've been crunching the numbers....

Retirement Assets:
$1.6m in 401k's ($160k of this is Roth)
$558k from my DB lumpsum (payable 2-3 months after I retire)
$40k in Roth IRA's
Total: Approx. $2.2 mil

Retirement Income:
Wife pension...ranges from $43k in 2021 up to $66k if she retires at 60 in 2025. First $18k of pension is COLA beginning earlier of 5 years after retirement or age 65.
Social Sec....for now, planning for age 62 and approx $42k total ($24k for me and $18k for her). These are conservative estimates.

Expenses:
Wife's company has free retiree medical (based on service threshold) including spouse to age 65. Also covers dependents to age 26.
Have about $50k left on a mortgage and about $70k on a 0% interest car loan.
Total Annual burn (gross...including taxes): $132k. (Could easily trim $10-$20k off of this, as needed.) This includes car payment but not mortgage as I plan to pay this off as soon as I retire...out of savings.
Oldest child is out of college and working. Will be moving out in 2021. Youngest is sophomore in college. We have remaining 2.5 years in 529.

FireCalc: Using $2.1 mil, assuming $40k pension in 2021, SS of $42k starting in 2027 and a 40 year retirement....I get 100% on an annual burn up to $136.5k.

The plan:
I retire 1Q 2021. Wife takes it a year at a time.

I'd love to get some opinions. Is there anything I am missing? Am I cutting it too close?

Thanks in advance.

You look good to go unless you are in a HCOL area, or plan a bigger spend rate. We retired on considerably less in Houston, and spend on whatever we want, for the most part. The thing is, we don't want much at all aside from travel! I retired at 56 and it is hands down the best decision I've ever made.

Things I did to move the $ out of ex-employers hands were:

Take the pension right away moving into another company that buys the book of business (and I got a $300./mo bonus on top due t early retirement) and services an annuity with 100% survivor bene. I saw what happened to my DD's pension when his former company filed bk- payments went down by a third. Nothing went to his widow.

Be aware that my retiree medical- serviced directly by ex- employer as they pay 1/2- sends a letter every years stating they have "chosen to continue offering medical insurance" to retirees. I pray that from now until July 2015 that the insurance will continue. If not, I've budgeted for ACA. Perhaps yours is better.

I privatized my LTC with COL increases and was able to keep the same benes at a the fairly small employee cost.

Good luck with your plans!

 

[MBAustin]

Looks to me like you're ready, Ready. You can double check this list of questions if you haven't already:

Some Important Questions to Answer

The one scenario I might model is what if DW's free healthcare premiums for both of you goes away (for either or both of you). Many megacorps are eliminating these benefits, especially for those who haven't retired yet. For example, mine was supposed to continue paying the same % of premium as when I retired, then they changed it to the same $$ amount so my premiums have more than tripled in the past 9 years.

Other than that, you look pretty solid, congratulations!!

 

[Ready2Go]

Thanks for the quick responses!

@pacergal...DW has met the service requirement for retiree medical.

@SpinDoctorTX...I live in HCOL now. Will likely downsize and move south whenever DW decides to hang it up. Also, wife works for a state government where pension is financially healthy. Also, they would be unlikely to reduce benefit for people that are retired or near retirement. Likely path would be to reduce benefit going forward. This would apply to retiree medical as well as pension benefit payments.

 

[SpinDoctorTX]

It sounds like you are Ready2Go, just as your name implies! Having state funded pension and medical coverage that is solid is great- so have fun & keep us posted!

 

[mckittri2000]

I went at 56 and have never looked back. Your finances seem solid and as long as your health insurance is good through your wife then it's time to pull the plug. It would be a good idea to make sure the wife is in agreement since that tends to throw a monkey wrench into the calculations. Good Luck.

 

[finnski1]

sounds very solid to me.
My only question is what the heck kind of car you have that requires a $70k loan?
But then again I am cheap

 

[street]

I'm far from an expert but I can't see a problem letting go. I like your option that you could trim expenses and that alone, says you would be fine.

 

[Ready2Go]

sounds very solid to me.
My only question is what the heck kind of car you have that requires a $70k loan?
But then again I am cheap

LOL! I'm cheap too! This was 2x as expensive as the priciest car I ever bought previously. It's a loaded 2020 Ford Expedition. Financed the entire thing at 0%. We plan to do some cross-country travelling early in retirement and wanted the extra space. We also own a boat that requires hauling large items back/forth in Winter & Spring. No judgements please.

 

[finnski1]

LOL! I'm cheap too! This was 2x as expensive as the priciest car I ever bought previously. It's a loaded 2020 Ford Expedition. Financed the entire thing at 0%. We plan to do some cross-country travelling early in retirement and wanted the extra space. We also own a boat that requires hauling large items back/forth in Winter & Spring. No judgements please.

No judgement. Hard to spend that much for me but I realize top of the line(platinum?) editions are very pricey in trucks and SUV's.
I have a camper I pull but get away with my Toyota Tacoma.More than 2x my priciest car ever myself. Think the most we ever spent(new) was the Tacoma at only $27,500 but that was 11 years ago.

 

[a60dan]

I'm on the cusp of calling it "time" as well. Turn 61 in March.

With almost 40 years at the same place, my "BS bucket" overfloweth.

Can't find anyone who regrets retiring early in our circle of friends, even the 3 who retired in 2020.....#retirementenvy

I have no logical reason to worry about the finances, but that is a hang-up for me. We've done our homework.

I get wrapped around the axle on medical insurance, but have always planned for worst case there as well.

2 weeks with our first grandchild gave me a good taste of retirement, and my resentments about work are festering after returning.

"Changing the things I can" is becoming increasingly clear: change what I do in the morning and step up my volunteer work while I discern what comes next. Plenty of volunteer work to do, and I've been calling long time friends on the phone & catching up while we can't travel.

I'm starting to feel optimistic about taking several months of "sabbatical" for myself.

Happy New Year!

 

[flyingaway]

I see quite a few people recently who are posting retirement expenses somewhere from $130k to $150k, which makes me nervous.

What is a new definition of fatFIRE?

 

[Lewis Clark]

... What is a new definition of fatFIRE?

I have not seen a single, universally accepted definition for fatFIRE, or any of the other flavors of FIRE for that matter.

What difference does it make? The important thing is that you have enough assets for the lifestyle you choose. Why care what name some people give to that lifestyle?

 

[Gumby]

Indeed. Retirement is definitely not one of those areas where one size fits all. Decide what type of life you want to live and work toward that. What other people do is largely irrelevant. So, for example, if your idea of heaven on earth is to work in your garden and never leave home, you'll need less money than the person who wants to jet around the world first class and stay at luxury hotels. And vice versa. Only you can decide that.

 

[G8tr]

Agreed. farFIRE vs skinny fire vs healthyFIRE is a Goldilocks question. That said, it's a good thing to RE with more than you need to support your desired expenses just in case you want to do more than you originally planned. FIRE should not be an emotional decision ("I quit!"), but rather one that is planned carefully and with forethought over a period of years (or even a decade).

Indeed. Retirement is definitely not one of those areas where one size fits all. Decide what type of life you want to live and work toward that. What other people do is largely irrelevant. So, for example, if your idea of heaven on earth is to work in your garden and never leave home, you'll need less money than the person who wants to jet around the world first class and stay at luxury hotels. And vice versa. Only you can decide that.

 

[Bigdawg]

No judgement. Hard to spend that much for me but I realize top of the line(platinum?) editions are very pricey in trucks and SUV's.
I have a camper I pull but get away with my Toyota Tacoma.More than 2x my priciest car ever myself. Think the most we ever spent(new) was the Tacoma at only $27,500 but that was 11 years ago.

Not trying to hijack thread.

7 years ago I paid 5k for my 2000 Chevy Silverado. Last month I paid 10k for my 1983 CJ8 Scrambler. Well aware of the 2X for cars. Suppose my next one will have to be something for 20k to keep up the trend.

 

[Dtail]

I see quite a few people recently who are posting retirement expenses somewhere from $130k to $150k, which makes me nervous.

What is a new definition of fatFIRE?

Look at the 2020 spending thread. There are also some folks spending less than 40k yearly for a single.

 

[finnski1]

Not trying to hijack thread.

7 years ago I paid 5k for my 2000 Chevy Silverado. Last month I paid 10k for my 1983 CJ8 Scrambler. Well aware of the 2X for cars. Suppose my next one will have to be something for 20k to keep up the trend.

Yeah you have to spend at least 20k

 

[Out-to-Lunch]

Not trying to hijack thread.

7 years ago I paid 5k for my 2000 Chevy Silverado. Last month I paid 10k for my 1983 CJ8 Scrambler. Well aware of the 2X for cars. Suppose my next one will have to be something for 20k to keep up the trend.

And, to stay on trend, it will have to be something from the 1960's, too!

 

[G8tr]

Might actually cost (and be worth) that much.

And, to stay on trend, it will have to be something from the 1960's, too!

 

[gamboolman]

R2G,

ms gamboolgal and I just pulled the trigger right before Christmas when we went on vacation to carry us thru to formal retirement date of 1-Feb-21.

I'm age 61 and ms gamboolgal is chasing me at age 59.

I truly get the stress and desire to go. We could have gone at age 57/55 but it would have been abit leaner on the budget.

College kids are expensive - we put two thru college and both of them got multiple degrees and took international trips for "school", new vehicles, unexpected uhoh's, e.g. tree jumps out in front of their car(s), etc., all paid for courtesy of the Bank Of Mom and Dad. And we helped out on them getting established. The gifting continues to this day but that is just Mom and Dad being Mom and Dad....point being it is a good sized chunk, albeit discretionary.

Your wife may change her mind and go sooner, especially once you get retired, just sayin....

Our numbers are very similar to yours - and by grinding out the last few OMY's we have for us what we consider our FAT FIRE budget.

I would recommend hang tuff for at least one more year, i.e, OMY and revisit the numbers this time next year.....

But I really understand how tuff it can be to subject yourself to the stress and resultant debilitating effects on health. I get it.

I personally did not manage the stress of the last few years intelligently - I took up drinking the Whiskey and Smoking..... and I was not a real pleasant person to be around the last couple of years.

I say that because, now that I am retired and free from the insanity of megaoil corp - the stress is evaporating and it is a night and day change for the better. The drinking and smoking consumption is going down fast and I am exercising a bit.

Was the extra monies worth it for us? Only time will tell and I am not sure if we did right by staying until I was 61....

It's a dam hard decision to make R2G, it really is....

All the best - and please keep us posted on your decision.

gamboolman.....

Lifes A Dance And You Learn As You Go....

 

[TheWizard]

I see quite a few people recently who are posting retirement expenses somewhere from $130k to $150k, which makes me nervous.

What is a new definition of fatFIRE?

We should distinguish between Basic Expenses and Discretionary ones.
My basic expenses are about one-third of my retirement income which gives me a lot of flexibility in doing stuff, except for the pandemic, of course...

 

[Ready2Go]

R2G,

ms gamboolgal and I just pulled the trigger right before Christmas when we went on vacation to carry us thru to formal retirement date of 1-Feb-21.

I'm age 61 and ms gamboolgal is chasing me at age 59.

I truly get the stress and desire to go. We could have gone at age 57/55 but it would have been abit leaner on the budget.

College kids are expensive - we put two thru college and both of them got multiple degrees and took international trips for "school", new vehicles, unexpected uhoh's, e.g. tree jumps out in front of their car(s), etc., all paid for courtesy of the Bank Of Mom and Dad. And we helped out on them getting established. The gifting continues to this day but that is just Mom and Dad being Mom and Dad....point being it is a good sized chunk, albeit discretionary.

Your wife may change her mind and go sooner, especially once you get retired, just sayin....

Our numbers are very similar to yours - and by grinding out the last few OMY's we have for us what we consider our FAT FIRE budget.

I would recommend hang tuff for at least one more year, i.e, OMY and revisit the numbers this time next year.....

But I really understand how tuff it can be to subject yourself to the stress and resultant debilitating effects on health. I get it.

I personally did not manage the stress of the last few years intelligently - I took up drinking the Whiskey and Smoking..... and I was not a real pleasant person to be around the last couple of years.

I say that because, now that I am retired and free from the insanity of megaoil corp - the stress is evaporating and it is a night and day change for the better. The drinking and smoking consumption is going down fast and I am exercising a bit.

Was the extra monies worth it for us? Only time will tell and I am not sure if we did right by staying until I was 61....

It's a dam hard decision to make R2G, it really is....

All the best - and please keep us posted on your decision.

gamboolman.....

Lifes A Dance And You Learn As You Go....

Thank you for the very thoughtful response, gambool!

I did decide to pack it in. Last day is 2/19/21. I just came to terms with the fact that I'll never be 100% comfortable financially. I'm quite sure I can find work if I wanted to or needed to down the line.

 

[Z3Dreamer]

I retired before Mrs Z3. I cooked and cleaned (still a growth area.) and shopped,etc. Mrs. Z3 was happy. Looks like you are heading down that same road.