So, Why Do We Wait?

[Intuit]

I have enjoyed gleaning information from the multitude of posts in this forum and have learned a good bit already. Of course there is still much to learn but so far most of the things I have done (other than accumulate debt - soon to be abolished) has been on target. My question is why should I keep working if at 50 my NW will be (est) 750K? While I know that is not a lot by most people's standards here but I would rather start earlier personally. If the SWR of 4% is true, the $30,000 draw would cover all expenses current and projected. At 55 the pensions can kick in for another $14.4K to provide $44.4K per year and then SS at 62 for an additional $30K. My point is, there is already provision for retirement in the later years, why not use the FI to enjoy the E in ER? When plugged into the FireCalc, it worked, on other retirement calculators it seems to work. Hhhhmmm, are those ocean waves I hear?

 

[brewer12345]

I think you are probably made in the shade by 55. The questions that come to mind are:

- Is there fat in your butget that you could cut if need be before you start drawing pension, etc.?

- How sure are you of the pension?

- Does you budget include health insurance, including the likely high rate of increase in that expense item?

If it all works, then I don't see why you couldn't pull the ripcord.

 

[Intuit]

Brewer, thanks for your input and questions.
- Absolutely, in fact expenses right now are about $18K but I expect to pay a tidy sum for health
insurance. i will have two in college when I reach age 50 but there is affordable insurance for them
through the university.
- The pensions are from stable companies I worked for years ago and where my wife works now. So
yes they are available.
- I expect the added in pensions and SS will cover that extra cost and prescription drugs.

N2

 

[MasterBlaster]

why do we wait ??

Well for one ER is a very personal decision. Not everyone is ready to give it all up just yet. Finances are but one aspect of the decision but not all of it.

Then there is always the option of living larger by working longer. That's a decision that only you can make.

After you have taken a month or three off work, and maybe done some (or alot of) traveling, and after you've gone surfing everyday for a couple months, it's then you really have to decide for yourself what it is that you want to do the rest of your life.

 

[New Thinking]

You need 35 years to maximize your SS benefit. If not, you have zeros in those years. Thanks for your SS as a defined benefit plan and you should seek to maximize it for your sake and your spouse. Remember that those SS benefits are indexed to inflation for life and are not be taxed the same as your other income.

 

[MasterBlaster]

I wouldn't be too concerned about social security before deciding to ER. Go look at the SS calculator at www.ssa.gov. From this calculator you'll see that it really doesn't pay well to keep working. Your SS benefits will be reduced by about 1 percent a year should you decide to ER.

When I looked at my numbers, My benefit was reduced around 12 % retiring at 50 versus working to 62.

 

[retire@40]

Some of us don't wait. Sounds like you are there. The real question is, why are you waiting?

 

[Intuit]

Well Retire@40, at this point I am 48 and fine tuning the portfolio pretty much by saving as much as possible until I reach 50 or there about. I really like the idea of being able to work on projects I deem worthy. As a guy that can build anything from cabinets to muscle car engines and a degreed engineer, I know staying busy would not be a problem and I could even pick up the odd job if I desired a little extra cash. My DW will quit working at the end of the school year, at least I think I have her convinced to do so. I guess just looking at the numbers; it doesn't make since to work until I'm 55 to accumulate more money than I will spend.

 

[73ss454]

Well Retire@40, at this point I am 48 and fine tuning the portfolio pretty much by saving as much as possible until I reach 50 or there about. I really like the idea of being able to work on projects I deem worthy. As a guy that can build anything from cabinets to muscle car engines and a degreed engineer, I know staying busy would not be a problem and I could even pick up the odd job if I desired a little extra cash. My DW will quit working at the end of the school year, at least I think I have her convinced to do so. I guess just looking at the numbers; it doesn't make since to work until I'm 55 to accumulate more money than I will spend.

If you can build muscle car engines your in good shape.

Get out now and lets build some engines.

 

[Gone4Good]

Why do I wait? Still need more cash to live the kind of lifestyle I want to live. Right now it seems as if I'll be there in 5 years. The "hard" part will be to let go and actually do it once the time comes.

 

[setab]

I'm asking myself that right now. I can go with a pension plus COLA of about $56,000, roughly $50,000 in cash, $100,000 in home equity, and only a house payment of about $1,000. My wife has IRA's that total about $30,000 which we don't plan to even think about and in three years she will get SS of about $800 and I will get a reduced amount in the $200-$300 range. We don't plan to take that until we need/have to. That's not exactly flush, but from what I've been reading here and elsewhere, we should get by. And yet, I am still trying to decide whether I should leave a job that bores me to death and explore those things that interest me. Poor toilet training?

setab

 

[ShokWaveRider]

At 55 the pensions can kick in for another $14.4K to provide $44.4K per year and then SS at 62 for an additional $30K.

Am I missing something here? What pensions kick in at 55? Are they private? I thought I could only claim a pension from Uncle Sam or Ma Canada or Cousin UK when I turn 65?

SWR

 

[setab]

At 55 you can retire from the federal government if you have 30 years of service. It's a retirement system, strictly speaking, not a pension, but a rose by any other name....Also, may state retirement programs and some private ones also allow for retirement with what amounts to a pension at 55 if you meet certain length of service requirements.

setab

 

[SteveR]

Am I missing something here? What pensions kick in at 55?  Are they private? I thought I could only claim a pension from Uncle Sam or Ma Canada or Cousin UK when I turn 65?

SWR

My Mega. corp. pension was started when I was 50; the earliest "retirement" age with 24 years of incarceration employment. I am using what little it is to help with the 65% cut in income when we both retired and moved. I thought it better to take the money now and have a cushion rather than wait until 65 when I won't need one.

 

[Intuit]

SWR - These pensions are from private companies that I worked for some years back, one for 12 years, the other for 11. If I had stayed at the first company, I could of retired with full pension at age 48 (gulp, that's now). They had a years of service plus age formula.

Setab - I think depending on other expenses and health retirement, if I were in your shoes, I'd be walking. For me it isn't a dislike for my job or anything like that, I just want to enjoy doing what I want to do while I'm young enough to do so. I've been drawing a pay check since I was 14 and would like to pursue other interests....

 

[setab]

N2,

I keep health insurance. My other expenses are pretty much up to me. My major motivation is to do what you are suggesting...other things that I chose to do. After a while the endless bureacratic regirements of my job have gotten to me and they are starting to chip away at the marrow.

setab

 

[BearlyWorking]

N2FIRE - sounds like you are there. I suggest working through a backup plan before you make the move. I have two. You may not need them, but they can help you sleep better at night.

Bear