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some opinions/ guidance?
Old 04-16-2021, 08:39 AM   #1
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some opinions/ guidance?

I am fast in approaching my last day of work, 8 months to go as of today. amazing how quick 35 years goes by.. As I try to prepare, after reading many threads, I'm having more and more questions and concerns...
Our story is....
Happy secure marriage of 36 years, healthy and in shape, Kids grown, no student loans, 1 grandson of 10. We have a side saving account for him with about $5K and adding as we can.
Our lifestyle is simple. Self reliant as we can. Rather camp and explore than fly and go on a cruise. 3.5 week trip to Maine cost us about $1500...

Secured loan debt. Camper $9K/ Tractor/backhoe $11K. Vehicles are paid for, but will need to replace my truck at some point, figuring $20K

Home... paid for, but doing a full rebuild, been living in a camper over 3 years. Doing 95% of the work ourselves, but got a long way to go, figuring at least another $35K.. paying as we go.

Outstanding CC debit $2800 @ 0% ..Should be paid off in the next 6 months but adding to it for the next round of building materials. AKA 0% mortgage

Savings... Cash on hand about $35K and trying to keep it in reserve.
My 401K $150K, DW $25K and adding about $1K a month.
Not a lot of money compared to other stories on here, but it is to us.

I will start drawing my pension of $2600/Mo at 58 in January 2022. DW has about 7 more years till her full pension at 60.
I also have plenty of opportunity for PT work.
My health insurance through her work will be $550 month and may cut into her future 401K contributions. She will have coverage till Medicare.

My 401K.. I can roll it into my pension... (mama always said dont put all your eggs in the same basket.)
I can leave it there as a nest egg but I can't add to it, or roll it some place else. The DW will be the same deal in the future.
I would like to start another account of some kind, IRA or stock investment to play with... but have no clue what im doing.
We would like to add extra money for added investment /savings.
so this would give us...
My pension, 401K as a nest egg and SS when its needed
DW pension, 401K also a nest egg and SS when needed
A separate investment account to try and make money with.

Any opinions or suggestions?
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Old 04-16-2021, 08:55 AM   #2
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You won't like my suggestion which is to work an additional 12 months and pay off all debt and grow the cash portion.



This is because of your wife's younger age and the fact that your HC will come from her job. If something happens you want cash to supplement living expenses tax free for an ACA subsidy.



You don't give numbers and if your pension covers 100% of your projected retirement expenses, ignore what I just said.


I just read your thread about continuing to work and noticed your 98% with FC, but I assume that means your DW stays healthy and employed for the next seven years. What's your % if you take out your DW income. If it was a couple years it would be one thing, but a lot can happen in 7 years.
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Old 04-16-2021, 09:15 AM   #3
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You won't like my suggestion which is to work an additional 12 months
I just read your thread about continuing to work and noticed your 98% with FC.
Thanks... and Yes/No.. I'm done full time... I updated the pension check... And the 98% was without the wifes income included. I realize we may not have a road paved with gold, but confident we can swing it... won't be the 1st bare foot dirt path e we've hiked.
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Old 04-16-2021, 09:27 AM   #4
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I don’t see in your post where you mention what your anticipated annual living expenses are so it’s hard to provide any meaningful suggestions. If your pension covers all of your annual expenses that makes a big difference.
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Old 04-16-2021, 09:28 AM   #5
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Thanks... and Yes/No.. I'm done full time... I updated the pension check... And the 98% was without the wifes income included. I realize we may not have a road paved with gold, but confident we can swing it... won't be the 1st bare foot dirt path e we've hiked.

You're not going to be barefoot and dirty!! I was curious what would happen without your spouse working. I didn't ask your exact number pension I was wondering what % of your budget it covered.



Sadly a close friend and outlaw relative had her DH die recently at 65, he never got one SS check. They both worked at local jobs without high pay and/or pension so about equal SS checks. This means whatever retirement budget they had made is blow to He%%.



Stuff happens and you never think it will happen to you.
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Old 04-16-2021, 09:32 AM   #6
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What do you spend each year with health care and taxes included?

Where will each year income come from and how does it map against spending?

For living simply, you are not too simple. I'd pay off the debts with your cash. Prioritize on the house rebuild. It might feel "thin" to have less cash, but it should.

What will you give up to make it work? Can you have your retirement and spend like not retired? Not sure. We don't really have enough information.

35 years goes fast and money goes fast too. The pensions will be nice as will SS down the road. You just won't have much for lumpy spending so will have to be mindful of that.
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Old 04-16-2021, 09:32 AM   #7
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Caught your comment about rolling funds from a 401(k) into pension system.

Mid-career we had a one-time opportunity to boost our pension and I rolled $50k from 401(k) and 457 plans into my pension system. That was the best investment ever! I retired last May at age 56 and that investment boosted my monthly pension by 15%, $1,300 a month. My buddies at work who were retiring around the same time were kicking themselves for not doing what I did.

If you have that option take a very hard look at the return on that investment and the stability of your pension system.

And one other piece of advice, donít make the bonehead mistake I made. This past January I put $7k each for wife and I into our IRAs for 2022. Since neither of us plan to ever work again we have zero earned income and cannot put any additional funds into an IRA. Oops! Had to back that investment out.

And of course Congrats on your upcoming retirement.
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Old 04-16-2021, 09:35 AM   #8
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You're not going to be barefoot and dirty!!
Stuff happens and you never think it will happen to you.
No but we are use to barefoot and dirty LOL...
I am to way familiar with the sudden and unexpected.. as a medic I've seen it almost daily for to many years.
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Old 04-16-2021, 09:38 AM   #9
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I donít see in your post where you mention what your anticipated annual living expenses are so itís hard to provide any meaningful suggestions. If your pension covers all of your annual expenses that makes a big difference.
We used $35K in FC for calculations, and my pension alone will barely let us squeek by
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Old 04-16-2021, 09:42 AM   #10
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That's a very good pension, however are you 100% sure it's going to be that much? Most employers have shied away from defined pensions for many years and brought in 401K programs instead. We now often see bigger 401K's and much smaller pensions.

Living in a camper for 3 years while working on your home? And you're still not nearly finished with the job?

You should borrow the money to hire a professional to complete your home ASAP. Saving money is one thing, but disrupting your family is another.
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Old 04-16-2021, 09:50 AM   #11
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We used $35K in FC for calculations, and my pension alone will barely let us squeek by

Backing this out your number seems low for such an extended retirement.


Did you plug in an annual amount auto replacement?


You have two people working full time and still have consumer debt.

What happens to the two pension numbers when one spouse is gone?


Say you are gone (since you are quite a bit older) and spouse loses one SS check completely, say you have spent a lot of your 401, is she going to be OK or comfortable..if that number looks OK no worries.
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Old 04-16-2021, 09:53 AM   #12
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That's a very good pension, however are you 100% sure it's going to be that much? Most employers have shied away from defined pensions for many years and brought in 401K programs instead. We now often see bigger 401K's and much smaller pensions.

Living in a camper for 3 years while working on your home? And you're still not nearly finished with the job?

You should borrow the money to hire a professional to complete your home ASAP. Saving money is one thing, but disrupting your family is another.



Hey some people like that stuff (ask Hermit), there is just the two of them working together. They are in a nice climate and like to DIY, good for them.
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Old 04-16-2021, 01:33 PM   #13
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I retired with a DBP much less than that in California and I like to fly to cruises. But my fixed expenses (prop tax, insurances, utilities) = 1600 month / pension now at net 2724. So without knowing what your fixed expenses are, I don't know if you're fine. Could be.

Questions: (1) does your pension have a COLA? (2) will you he able to buy health insurance at a reduced rate eventually? (Mine dropped to 1c) (3) are you planning on letting investments compound? (4) is it a federal pension? If so, are you under WEP / WPO / or GPO?
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Old 04-17-2021, 03:33 AM   #14
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Most employers have shied away from defined pensions
We both are in the state retirement system. Both have a 50 or 100% survivor options.
Should something happen before either retire, beneficiary will get the cash value of the retirement account and 401K

Living in a camper for 3 years while working on your home? And you're still not nearly finished with the job.
Well thats another story in itself... https://www.early-retirement.org/for...ds-105022.html
We are quite comfortable in the camper, and RV travel is in the plans.
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Old 04-17-2021, 03:38 AM   #15
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.... state retirement system ...
1. What's your COLA
2. What % of fixed expenses will your DBP cover
You might be perfectly fine despite GPO

If your DBP covers 98% of all expenses you might be perfectly fine despite GPO. And those expenses will go down in the retirement years when she's working. Still might want to check out your COLA just to make sure it'll keep up (mines at 4% max) ....

SO with that, I'd keep the 457 / 403b / 401k separate and roll it into an IRA letting it compound.
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Old 04-17-2021, 03:45 AM   #16
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Did you plug in an annual amount auto replacement?
Put $25K one time expense in FC for a truck. we make our vehicles last...

You have two people working full time and still have consumer debt.
Its 90% building supplies and at 0% As its paid off we get the next round.

What happens to the two pension numbers when one spouse is gone?.....if that number looks OK no worries.
with survivors benefits choices we should be fine.
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Old 04-17-2021, 03:58 AM   #17
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1. What's your COLA
2. What % of fixed expenses will your DBP cover
You might be perfectly fine despite GPO
COLA... up to the governor... historically not much every couple years. But there is a COLA option IF you roll 401K money in on just that portion.

Current fixed expenses + future insurance will take about 80% of my check.
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Old 04-17-2021, 04:00 AM   #18
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You don't have a maximum COLA written into your system??

Im another government retiree
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Old 04-17-2021, 04:04 AM   #19
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One of the things Im trying to figure is what to do with the 401K money. I dont want to roll it into my retirement account. I can leave it in the Prudential account but can't add to it once I retire. Will have a second chance when the wife retires with hers..
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Old 04-17-2021, 04:05 AM   #20
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I'd roll it over to Schwab and put it into 2-3 ETFs.
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