So.... when to retire?

[shotgunner]

Almost everything I have read in this thread is based on the assumption of how much you will have to spend going forward in your life based on having great longevity.

If you knew that you would be diagnosed with something like a stage 4 cancer 5 or 10 years from now how would that effect your decision? If not cancer, ALS, Parkinsons, crippling stroke or heart attack?

My mother, a school teacher was diagnosed with stage 4 breast cancer at age 61, radical masectormy leaving her right arm crippled, she died at age 63.

An older friend with whom I commuted to work with every day for 3 years who was seemingly in good health, not over weight etc. waiting until he turned 60 in late September to retire on Oct 1st. The following January 15th he went to the ER with a severe headache. While there he had a massive stroke and almost died. He survived but talks with slurred speach, wears an eye patch because of vision problems and walks with a walker and no longer drives. These are two examples of bad things happening to people close to me. I could provide others but don't think I need to.

Think about the chance of being crippled or dying long before reaching 90. It happens to a lot of people and it could happen to any of us including you.

 

[Live And Learn]

Almost everything I have read in this thread is based on the assumption of how much you will have to spend going forward in your life based on having great longevity.....
Think about the chance of being crippled or dying long before reaching 90. It happens to a lot of people and it could happen to any of us including you.

Prepare for the worst, hope for the best !

You can't plan long term with potential short term assumptions. What happens if you end up healthy ? Who want's to be 80 and totally broke, looking for handouts ?

 

[Live And Learn]

I made sure I had 100% with Firecalc (steady spending, not Bernicke), Fidelity RIP, Financial Engines, i-Orp, ********, and every other calculator I could get my hands on.

Same here !

 

[2B]

I spent a few years getting very confident on my budget. My retirement budget is based on my working budget with adjustments - no longer contributing to 401k, SS, or medicare, but now paying full freight on health care. Once I was sure of the budget, I wanted a cushion... Not as big as Live and Learn - I put aside $100k that's not part of the retirement nest egg (vs his/hers $300k). But I made sure I had 100% with Firecalc (steady spending, not Bernicke), Fidelity RIP, Financial Engines, i-Orp, ********, and every other calculator I could get my hands on.

Nothing like having 100% confidence for a situation that has less than a 10% chance of happening but who am I to talk?

Nine "in-office" days left before I resign/retire.

 

[robybuck]

U


Sent from my iPhone using Early Retirement Forum

 

[shotgunner]

What happens if you end up healthy ? Who want's to be 80 and totally broke, looking for handouts ?

If you go back and read the OP's 1st post he stated he has 100% in FIRECALC for 35 years (taking him/her to age 90) starting at $70K a year. Based on that odds of him being broke at 80 are rather slim but odds of him being dead or crippled before then much higher.

I guess the fear of running out of money is greater than the fear of running out of life. In my experience the older you get the more you see your plan working the greater the fear of running out of good health or life becomes.

 

[Options]

Nothing like having 100% confidence for a situation that has less than a 10% chance of happening...?
...

This. Absolutely this.

 

[Car-Guy]

My question: how did you decide "enough is enough" and pulled the trigger? Was there a "sweet spot" where working longer wouldn't really improve your retirement numbers significantly? I'm not asking when you think I should retire, but I'm curious what was the final deciding factor for you? Many thanks in advance!!

I used many of the calculators on-line but never fully trusted them. (although I did like FIRECal) So financially speaking, I decided to retire when my personal spreadsheets indicated that I had enough (plus some) to live in the style I wanted without having to invest in what I considered higher risk investments. (my "main" investments are of very low risks and lower returns.) I've never practiced living below my means but I do try with live within my means (lower 6 figures). I wanted to be able to live/spend in retirement the same way I did in the final ~10 years that I worked. Once I reached that number, I still worked a few more years before "pulling the trigger" (OMY syndrome)

I've been retired almost 3 years now and I'm really surprised at how accurate my financial spreadsheet projections have been "so far". YMMV

 

[kimcdougc]

Nothing is for certain (except taxes and death). Took me awhile to talk my DH into retiring. He is turning in his resignation/retirement paperwork tomorrow. He is a little scared..told him after reading on this website he will feel FREE after he hands it in.

 

[racy]

...My question: how did you decide "enough is enough" and pulled the trigger?...I'm curious what was the final deciding factor for you? Many thanks in advance!!

I remember exactly when & why I decided. I was floating on a lounger in our lake with DW, having a cold brew, and I suddenly realized, "I don't have to work; I've had enough and we have enough".

My work responsibilities were going to be significantly increased (China plant) with no additional compensation. So, it wasn't driven by our financial situation, but by undesirable changes at w*rk.

 

[Sir Waldo]

I


Sent from my iPod touch using Early Retirement Forum

 

[brett]

I was fortunate. I had a great work career and very much enjoyed my job...except for the last three years.

My decision came at the intersection of two axis and one event.

My job satisfaction was going downhill quickly. But our financial situation was going the opposite direction. We no longer were concerned about having enough money to retire.

The event...I was lucky. I was downsized and the golden handshake gave us two years of salary/benefits which translated into four/five years of living and travel expenses. Ran, not walked away and could not even consider working in my previous (IT) industry again. The job satisfaction had been wrung out of me by Megacorp. Besides, we are too busy doing what we want to do.

 

[2B]

I am finding that as my "date" approaches I'm getting more and more ready for it to happen. I was planning to retire in the middle of 2014 until I ran what would happen to my income taxes. A lump sum payment I'll get would have added about $60,000 to my income tax bill in 2014 over what it will do to me in 2015. I decided to hang in there for the principle and principal of the situation. I shudder at the thought of writing a six figure check to the IRS. My job isn't hated. It just seemed like it was time to stop working for the grandkids.

I've got 8 "in-office" days left until 5 Jan 2015 when I'll resign. After that it's whether I agree to two weeks or six weeks to transfer project assignments or finish things up. I don't plan on going past six weeks and would prefer to leave 5 Jan.

 

[W2R]

I am finding that as my "date" approaches I'm getting more and more ready for it to happen. I was planning to retire in the middle of 2014 until I ran what would happen to my income taxes. A lump sum payment I'll get would have added about $60,000 to my income tax bill in 2014 over what it will do to me in 2015. I decided to hang in there for the principle and principal of the situation. I shudder at the thought of writing a six figure check to the IRS. My job isn't hated. It just seemed like it was time to stop working for the grandkids.

I've got 8 "in-office" days left until 5 Jan 2015 when I'll resign. After that it's whether I agree to two weeks or six weeks to transfer project assignments or finish things up. I don't plan on going past six weeks and would prefer to leave 5 Jan.

Congratulations on your upcoming retirement!

 

[RobLJ]

I qualified last May at 55, but waited OMY because the financial slack rapidly improved with one more year of market returns, contributions, and savings. DW is four years younger, wants to move to the West Coast (where the DSs are working), and also wants to work for at least 4 more years; she does not take to idleness well.

I can semi-retire at 40% of salary, so I'm taking the glidepath next July since combinging semiretirement and 5% withdrawals from my retirements funds (3% withdrawal rate from total) substitutes for my current salary.
DW will get a bonus in March to pad taxable account, and we can pay more than all expenses on my income and withdrawals if necessary.
If the retirement funds continue to go up for another year or two, then we'll look at DW moving to part-time consultancy and my retiring full-time, since we're about 15-20% away from either fully retiring at close to current generous expenditures (we've done several expensive trips per year and bought a car in cash this year) or at/over the mark when SS kicks in.

Each situation is different, but as you are contemplating we decided to do a version of OMY or (OM halfyear) given the increase in lifestyle made possible. I also have to figure out what to do when not working at all; working 20 hours/week sounds like a hobby.
Good luck with your decision.

 

[pb4uski]

....I've been retired almost 3 years now and I'm really surprised at how accurate my financial spreadsheet projections have been "so far". YMMV

Same 3 years here but my nestegg is 20% off from what I projected it would be today when I retired (I saved the spreadsheet).

20% higher that is.....

 

[dunkelblau]

This may not make sense but I did it when the percentage increase in invested assets from after-tax base pay dropped below the percentage decrease in my estimated remaining lifetime. Then management blinked and offered a retention incentive that tipped the scale the other way, so that was my 1MY. Then our company stock price moved up so the options I was ignoring are vesting with significant value. 2MY got me half, and the rest come next year.

For me the decision is easy because my job is fun and nothing attracts me towards retirement at the moment. But the reason my job is fun is purely because of FI, it's in a shaky business and the end can come any time. It would be a lot less fun if I had to be able to replace my job as a middle-aged computer tech engineer. Or if I had less control over what I work on day to day. I know this firsthand through relatives who are similarly situated income-wise but who have much higher expense commitments.

Even though I'm a habitual low spender (for me 70k/yr vs 100k/yr is "no difference"), the extra money might not be useless. Some black swan can happen, like some medical breakthrough that can add 10 or 20 years to our life span. It may be very expensive to start, but if I'm in good health when it happens, that would be something I'd buy into. Granted it's highly unlikely in my lifetime but then hopefully my heirs will be in a better position to take advantage should the opportunity arise in theirs.

 

[MuirWannabe]

I am finding that as my "date" approaches I'm getting more and more ready for it to happen. I was planning to retire in the middle of 2014 until I ran what would happen to my income taxes. A lump sum payment I'll get would have added about $60,000 to my income tax bill in 2014 over what it will do to me in 2015. I decided to hang in there for the principle and principal of the situation. I shudder at the thought of writing a six figure check to the IRS. My job isn't hated. It just seemed like it was time to stop working for the grandkids.

I've got 8 "in-office" days left until 5 Jan 2015 when I'll resign. After that it's whether I agree to two weeks or six weeks to transfer project assignments or finish things up. I don't plan on going past six weeks and would prefer to leave 5 Jan.

Lately 2B, I feel like you post mostly to rub our noses in your impending retirement and so you can do a public countdown. I don't blame you one bit for it either.

Muir

 

[Hamlet]

The thing is, I think most of us could live okay with just a little supplement to SS. The "broke at 80" scenario is really pretty hard to get to if you start with at least enough money to have a decent shot at success.

The real risk for most people is needing to downgrade their lifestyle if they live a long time and their investment returns are subpar.

I think a plan to sell the house and live in a small apartment if you live past 85 probably makes more sense than a plan to work an extra 5 years to make absolutely sure that you can keep spending fairly high into your 80s, but its a personal decision, and it depends a lot on your family situation.

I would be much more willing to take the risk of being low-income in my 80s if I wasn't married with young children. The real likelyhood is not me outliving our money but my wife. I'm less inclined to make her take the risk of reducing her standard of living in her 80s/90s than if it was just me.

Prepare for the worst, hope for the best !

You can't plan long term with potential short term assumptions. What happens if you end up healthy ? Who want's to be 80 and totally broke, looking for handouts ?

 

[2B]

Lately 2B, I feel like you post mostly to rub our noses in your impending retirement and so you can do a public countdown. I don't blame you one bit for it either.

Muir

I'm not intentionally trying to rub anyone's nose in it. I'm just excited about finally doing it. I've been OMY for almost a decade. At 63 I don't consider myself an "early retiree."

 

[MuirWannabe]

I'm not intentionally trying to rub anyone's nose in it. I'm just excited about finally doing it. I've been OMY for almost a decade. At 63 I don't consider myself an "early retiree."

I didn't really mean to imply you were doing anything wrong. You're excited. Understandable! I'm jealous. Congrats to you on your very soon to be retirement.

Muir


Sent from my iPhone using Early Retirement Forum