Newly retired

[astromeria]

I've been hanging out as a guest for a long time, enjoying FIREcalc as well as the board info and entertainment (infotainment?!) and thought I'd introduce myself at last.

We moved out of the fast lane a little over 3 years ago and now live comfortably on 25% of our peak Silicon Valley income. We moved to a lower cost of living area, we're debt free, and the kids are independent <well, there's DD's wedding next spring--eek!>. Anyhow, after working part time for 3 years, I retired--yesterday!  (YESS!!) Meanwhile, my husband went from software engineering/mgt to college teaching. With 3 months off in summer and 1 in winter, he feels semi-retired himself. I'm 55 and he's 56.

I'd like comments on the financial aspects of our retirement plans. (If we're not gonna make it, just break it to me gently!)

-- $60k in gross income, $36k for basics and $24k for extras. This is what we live on now. When DH retires, if he's <62 I plan to take a 4% WR off our portfolio (would be $48k now), then at 62 decrease to 3% and add Social Security ($24k for both, so they say), and at 65, some possible pensions (anywhere from 0 to $15k, so I don't count them).

-- We max our Roths, his pension fund (with 100% match on his 6%), and his TIAA-CREF 403b (no match). In order to afford this, we're essentially "laundering" taxable money into the 403b and Roths. Does that make sense for the 403b? (FYI, 65% of our stash is taxable.)

-- Our portfolio is a conservative 50% stocks and 50% fixed income, and the stocks include 30% foreign and 5% REITs. Kind of a mish-mosh of index funds, managed funds, and individual stocks as well as corporate bonds and CDs.

-- If DH teaches long enough (10 years, which would be age 63), we can continue in the state health insurance plan.

 

[yakers]

Hi Astromeria,

Recognize you as a Favored Fool of mine. I expect Nords and the folks who are good with calculators will have more definitive responses but I would say you have things fairly sorted out as the key is an income flow, medical coverage and appropriate style of living. I think moving out of the fast lane makes sense-after whatever struggle for basic needs and investment resources IMHO its all about enjoying life.
I agree with moving funds into the 403 fund since it is a tax deffered account and you are likely to be in a lower tax bracket later. Also you can roll your 403 into an IRA when you retire and then into a Roth if your income and tax paying funds are avilable. Having Roth funds is my favorite way to have money.
I think you could actually retire earlier than 10 more years if you can figure out necessary medical coverage.

 

[dex]

Do you have debt?
What is your net worth?
Total amount of portfolio?

 

[astromeria]

Hi, Dex.

We have no debt--no mortgage, no car loans, no revolving CC debt, no HEL, nada. My parents always lived at their means, but gave me two excellent pieces of financial advice: avoid paying finance charges, and pay your bills on time. Not that I haven't made my share of financial mistakes--sometimes I think I should sell everything in my portfolio and restart from scratch. Too bad so much of it is taxable.

Net worth = $1.2m portfolio plus a house worth ~$500k (built 3 years ago for a lot less--Charleston County, SC is having its own real estate boom, and we're located 10 minutes from the beach and 20 minutes from downtown Charleston). I can't see selling the house for a while--my mom built next door to us and calls us her "long term care insurance." She's nearly 80, and in excellent health.

Our cars should last a while--a 98 4Runner and an 02 Prius.

 

[astromeria]

Hi there, yakers. The health insurance part is my main concern. My husband's in excellent health, but I have some issues that might make individual insurance difficult or at least really expensive for me. So far my husband is happy teaching, so I won't worry about it yet...but it's out there.

I'm retired now, and I ain't going back to work no-how! We might be OK if DH retired this minute, but I'd love to see the port compounding a little longer, if he doesn't mind. I would never ask him to continue to work--in fact, I frequently ask if he minds working, but he says it's cool with the long summers off.

 

[TromboneAl]

Recognize you as a Favored Fool of mine.

What is a favored fool??

 

[yakers]

What is a favored fool?? 

From the Motley Fool web site. It means someone you agree with or admire.

 

[Mr._johngalt]

Hi there, yakers. The health insurance part is my main concern. My husband's in excellent health, but I have some issues that might make individual insurance difficult or at least really expensive for me. So far my husband is happy teaching, so I won't worry about it yet...but it's out there.

I'm retired now, and I ain't going back to work no-how! We might be OK if DH retired this minute, but I'd love to see the port compounding a little longer, if he doesn't mind. I would never ask him to continue to work--in fact, I frequently ask if he minds working, but he says it's cool with the long summers off.

One of our "arrangements" is that DW provides our health insurance,
either through her employment, or by paying the premiums. I have used
our current insurance a lot...........she; hardly at all. She was saying
"Look, I paid out all of this money for health insurance and have never
used it." Seems to me that is the best possible outcome.

JG

 

[BUM]

Hi astromeria,

Sounds like you've everything right, esp. escaping from SV! Only 2 things caught my attention. One is getting mom's long term care figured out. If you're going to be responsible, have a plan (will, possible trust, POA, etc.). The other is the port. It will likely need overhaul when you change from accumulation to distribution phase in full retirement. Until then it sounds like a bit of attention may be needed.

You're gonna be fine!


Enjoy!


BUM

 

[astromeria]

One of our "arrangements" is that DW provides our health insurance,
either through her employment, or by paying the premiums.

Hi, JG. That deal makes sense. In our case, our finances are so totally co-mingled that saying one person is paying for something doesn't make sense. Technically, after I get my final paycheck, I guess DH is paying for everything. But I earned 50% of our portfolio, so I don't feel like a slacker. (Although it took me a full year of wanting to retire before I worked through my guilt about being able to run my own life to suit myself while he still has to answer to an employer! Compared to that, playing with financial scenarios was easy )javascript:replaceText('%20',%20document.postmodify.message);

 

[astromeria]

oops--I tried dragging down a smiley, but obviously that's not the right way to do it!

 

[astromeria]

Sounds like you've everything right, esp. escaping from SV! Only 2 things caught my attention. One is getting mom's long term care  figured out. If you're going to be responsible, have a plan (will, possible trust, POA, etc.).  The other is the port. It will likely need overhaul when you change from accumulation to distribution phase in full retirement. Until then it sounds like a bit of attention may be needed.

You're gonna be fine!

Thanks, BUM. I still miss my friends and the weather in NoCAL, but we love the warm, white sand beaches here in the Lowcountry, and people are very nice--and calm!--here.

As for my mom's care, she's adamant about never going into an institution. She also has no debt and owns her home (worth about the same as ours) and has a $500k IRA as well as Social Security, so hopefully we can use her resources to pay for anything she needs that we can't do ourselves. We'll be here for emotional, and as far as we're able, physical support--and I have a brother nearby to help. We had some adaptive features built into her house--grab bars, wide doorways, lots of lighting, large master bedroom. She has a will, but no trust. Her advisors didn;t advise that, and she's of the generation that venerates people in authority, so that's that. She gave my brothers POA for health care decisons. She figures I'd probably have too much hope and drag out her suffering <imagine an interesting smiley here!>

Some day I'll be brave enough to expose my port. As an example, for foreign investments I have EEM, EPP, and EFA as well as EWC (Canada ETF), DODFX, TBGVX, TAVIX, MACSX, and SGOVX, plus a few individual stocks. None of the funds are bad--they're all very good to excellent, but a couple have high-ish expense ratios. I started investing when I had a little knowledge--a dangerous thing!

 

[REWahoo]

oops--I tried dragging down a smiley, but obviously that's not the right way to do it!

Just <click> on the and you can have all the 's you want in your post.

REW

 

[astromeria]

Good heavens--how could I forget that I also have large positons in VINEX and VEIEX! Well, it's easy to forget whn you have several dozen investments  :

Thanks for the smiley help, REW. This software is cool!