ikubak
Recycles dryer sheets
- Joined
- Dec 2, 2007
- Messages
- 482
Pulling the trigger and leaving work to retire full-time is a big decision most of you Young Dreamers forum readers will have to face. DW and I eased into it by her going part-time for a couple of years and I took a less stressful and more fun job for 5 years before leaving the work force. It was a smooth transition for us but being a planner and worrier, I had to run the numbers over and over to see if it would work the way we wanted. Jan. 2021 marks 3 years fully retired and here is what has happened:
rate of return
2018 -5.7%
2019 22.52%
2020 13.55%
spending
2018 62,655
2019 60,677
2020 58,007
We spend a little more than when we worked. I thought we might spend a little less but we travel more (not in 2020 thanks to covid) and have more time to spend $ than we did while working. I used to be a saver and wanted to see my balances increase each month, quarter, year. Now I don't really check my balances very often. I give a lot more gifts than I used to. I buy more beers for people than I used to. If you like gifts and free beer, you would like hanging out with me.
We retired with no pension income or SS income. We just live off our investments which have outpaced our spending by about 100K per year so far. DW is now eligible for SS but we haven't taken it yet. I'll have a small pension start paying in the summer of 2021. I keep about a years worth of cash on hand so I don't worry about market ups and downs too much. The retirement funds I draw from have a conservative asset allocation of 50/50. We get a little dividend income and I mow a few yards in the summer for some of our older neighbors that can't do it anymore...it's my pocket change for gifts and beer.
Health insurance was a concern since we had that through my work. We get that through the Affordable Care Act and we manage our income ($ from tIRAs and Roth conversions) to qualify for free insurance from uncle Sam. For us, it means keeping modified adjusted gross income below ~68k. We get a bronze plan that has a high deductible and we pay out of pocket for stuff. It seemed scary at first but as an example, we spent $1,145 on medical costs for 2020 and that includes dental cleanings. We are pretty healthy right now so we picked our bronze plan and took our chances. It works for us and the ACA will probably be where we buy insurance until we go on medicare.
Summary: stepping out of the matrix was not as hard as I thought it was going to be. My conservative projections were just that, conservative. We spent more and investments returned more than I thought they would. I probably gave it way more thought than it warranted but that was my style.
Have a good 2021!
rate of return
2018 -5.7%
2019 22.52%
2020 13.55%
spending
2018 62,655
2019 60,677
2020 58,007
We spend a little more than when we worked. I thought we might spend a little less but we travel more (not in 2020 thanks to covid) and have more time to spend $ than we did while working. I used to be a saver and wanted to see my balances increase each month, quarter, year. Now I don't really check my balances very often. I give a lot more gifts than I used to. I buy more beers for people than I used to. If you like gifts and free beer, you would like hanging out with me.
We retired with no pension income or SS income. We just live off our investments which have outpaced our spending by about 100K per year so far. DW is now eligible for SS but we haven't taken it yet. I'll have a small pension start paying in the summer of 2021. I keep about a years worth of cash on hand so I don't worry about market ups and downs too much. The retirement funds I draw from have a conservative asset allocation of 50/50. We get a little dividend income and I mow a few yards in the summer for some of our older neighbors that can't do it anymore...it's my pocket change for gifts and beer.
Health insurance was a concern since we had that through my work. We get that through the Affordable Care Act and we manage our income ($ from tIRAs and Roth conversions) to qualify for free insurance from uncle Sam. For us, it means keeping modified adjusted gross income below ~68k. We get a bronze plan that has a high deductible and we pay out of pocket for stuff. It seemed scary at first but as an example, we spent $1,145 on medical costs for 2020 and that includes dental cleanings. We are pretty healthy right now so we picked our bronze plan and took our chances. It works for us and the ACA will probably be where we buy insurance until we go on medicare.
Summary: stepping out of the matrix was not as hard as I thought it was going to be. My conservative projections were just that, conservative. We spent more and investments returned more than I thought they would. I probably gave it way more thought than it warranted but that was my style.
Have a good 2021!
