Semi Early Retirement - Where's Your Dough?

[rodi]

Quote:

Originally Posted by googily I'm actually the wife. For the purposes of this exercise, I'm considering my finances separate.

Gotcha and apologies. You'd think as a woman, I wouldn't have made that assumption. Mea culpa.

My questions for how you intend to use this money still apply. It's not enough to fund the 50's years unless your spending is low enough or your part time income is high enough... But, a combo of those two could work nicely.

I cut my hours to 4/5s after I had kids and it extended my tolerance of the BS of work by many years. I would have loved to drop it to 3 days a week but my boss was pushing for full time, so that wasn't a battle I was going to win. Having the extra day away from work made a huge difference in my stress levels though.

[Ohio Tealady]

Hello everyone - this is my first post but have been lurking for quite some time.

I am 54 and working four days per week. I make a modest salary in health care but live in a low cost area versus your location. Hence the drop in salary probably has affected me less than in your situation. By nature, my husband and I are frugal and live simply. Since we live well below our means the drop in salary was an easy transition. The benefit of having that extra day is priceless.

My goal is to reduce to 20 hrs per week when my husband is Medicare eligible and my daughter is a college graduate in 3 years. I am the insurance carrier for the family and I am fortunate enough to have an employer who will provide health insurance, at a slightly higher rate, for employees working at least 20 hours/wk. My next step would be to retire at age 60/61 using COBRA and later ACA for health insurance for myself.

I choose to spend more time at home with my interests - reading, thinking, gardening - which keep my expenses minimal. It is common for me to have 1 or 2 "no drive days" which equates to not buying stuff, and thus saving money. Although I am fond of Amazon.

Good luck in your semi-retirement. I think the ability to ease out of the work force and into retirement is an ideal transition.

[flyingaway]

I am teaching, so I only work for about 7 to 8 months a year (not working in summer and winter months). During my work weeks, I go to school about 2.5 days per week. So I think I am semi-retired since I was 45. I only get paid about 65% of my peak earnings. The good thing is that I do not pay AMT any more.
My wife still works full-time and really wants to quit in about 4 years (after my son finishes college). We are basically FI at this time, but we want to be comfortably FI when our portfolio reaches $2M (or first class seat FI with $3M). We plan to do extensive travel after my wife retires. I may or may not retire completely when my wife quits.

[cooch96]

I love this thread. I hope to be semi-fired/stage 1 retired in four years, and all your stories of success do my soul well.

I figure there is about a 9% chance my current employer would entertain the idea of a salaried engineer to toil just 30-40 hours a week (even with reduced pay and benefits), so I will likely be getting a different job. It would very likely be menial, but I figure I will only need to make $25k a year to augment DW's salary after the mortgage is paid off.

[Dave J]

Quote:

Originally Posted by cooch96 I figure there is about a 9% chance my current employer would entertain the idea of a salaried engineer to toil just 30-40 hours a week (even with reduced pay and benefits), so I will likely be getting a different job. It would very likely be menial, but I figure I will only need to make $25k a year to augment DW's salary after the mortgage is paid off.

What type of Engineer are you?

[cooch96]

Dave J,
I'm a civil engineer and my education leaned towards structures with a focus on concrete bridge design. However, my job in construction is mostly scheduling; managing crews, material, equipment, and subcontractors; and contract negotiation with the client/owner. And, of course, safety. I also estimate/bid to win new jobs. I used to do quite a bit of temporary design: formwork, false work, earthwork, shoring, etc, but I have spent maybe four days of design during the past two years.

I Like hanging out with the crews (they're real people, not corporate types) and seeing the work actually progress, but I hate all the managing stuff, especially cost tracking.

[Dave J]

cooch96,
I did the same type work as you, without the degree. I worked for a contractor and did part time work(mostly estimating) for about 10 years after retiring from full time. Talk to them, as you never know. Should be more $$$ than menial work. Good luck.
Dave

[dunkelblau]

I guess I semi-retired last year. Dropped to part time by local standards 50hrs/wk (5 x 10) from 80hrs, 12hrs on weekdays and 10hrs/day on weekends. Relocated to a calmer place closer to the water and working remotely now. No more lab work, now it's all analytical and software stuff, helping with customer issues where I can. No change in pay from my old job, not that it matters because I had already fully retired. Management talked me back in after my ER trial run didn't go very well (I ran out of interesting stuff to do after only a few weeks) with several changes to make things easier on me, and my results more valuable to the business.

We've talked about how things are going and it appears we both see this deal as win/win-- I didn't realize how the BS bucket runs both ways. I've flat out told them that I'm not interested in promotions or raises, just lump sum bonuses. In exchange they know how image conscious I am so they carefully prescreen possible assignments for fit, and they always ask before signing me up for anything new. It's kind of ironic how my being FI has reduced the burdens on both sides, so it effectively keeps me out of ER. Of course things can change and I'll just have to try harder to make full retirement stick next time around.

Financial setup is simple, no dependents, no properties, no pension, and not expecting social security. Bank deposits cover next 20 years living expenses until 401k/IRA RMDs kick in (prefer FDIC insurance over a mattress). Current annual living expenses (excluding income taxes) are less than 3% of current value of 401k/IRA. Taxable accounts sitting on some long term gains that need to be spread out before then, either that or nieces and nephews get to sort out the mess when I'm gone.

[googily]

Quote:

Originally Posted by Sunset If you are a couple, how can you plan effectively without considering the spouse assets/spending ?

Because we each figure that if we have our own ducks in a row, that means that combined we REALLY have our ducks in a row.

Our financial setup is also kind of a yours-mine-and-ours configuration. We contribute $x each month to the joint account that pays mortgage and all shared/household expenses (including groceries, dining out, travel, utilities). Then we each have the rest of our paychecks to do with what we wish. So in my pondering of semi-early retirement, I look at it in terms of being able to meet that monthly shared expenses obligation, and then see how much I'd still need.

(No lectures on "marriage means shared accounts," please. This works for us because we are both very conscientious and have similar financial outlooks and goals. And eventually I am sure we will consider it one pool. But for now we each like the challenge of knowing that our own income/spending can reach our own goals.)

I'm very much enjoying this thread, I hope people will keep posting their stories!

[W2R]

Quote:

Originally Posted by cooch96 I love this thread. I hope to be semi-fired/stage 1 retired in four years, and all your stories of success do my soul well. I figure there is about a 9% chance my current employer would entertain the idea of a salaried engineer to toil just 30-40 hours a week (even with reduced pay and benefits), so I will likely be getting a different job. It would very likely be menial, but I figure I will only need to make $25k a year to augment DW's salary after the mortgage is paid off.

When it comes to retirement, there are SO many ways to skin a cat, as the saying goes.

For me, well, I just wanted to put my head down and charge towards that goal like a bull until I could go directly into full retirement. As in your case, there was very little possibility of going part time anyway so I figured why not just GO for it. Those last few years were difficult and exhausting, but I was determined.

But others that I have known have gone part time or have taken a "retirement job" part time, and have been very happy with that solution. They were able to kick back a little more, a little earlier.

I'd probably still do it my way, because for me I don't see the sense in prolonging my time in the workforce, but I can see the merit in both.

[Teacher Terry]

WE semi-retired at ages 53 & 58- 3 years ago. WE both consult p.t. in our fields & really love it. For us it was the best of both worlds. Initially, we both fully retired but despite a move & totally remodeling a home we were sick of it within 6 months.