FIRE vs. Semi-Retire

[maddythebeagle]

I am looking at this and am wondering what folks think. I think the biggest reason to semi-retire would be to keep health insurance. Where I work, going down to 60%, you keep health insurance (that is for now).

 

[Jay_Gatsby]

Agreed. If you can stand working after becoming financially independent, doing so will address the critical issue of health insurance. OTOH, some folks here have probably fully-retired, and purchased health insurance with higher deductibles than would be offered to an employee.

 

[Nords]

I am looking at this and am wondering what folks think. I think the biggest reason to semi-retire would be to keep health insurance. Where I work, going down to 60%, you keep health insurance (that is for now).

Sure, health insurance & inflation protection are the two biggest FIRE challenges. There's a good reason that most keep working until Medicare eligibility.

The key would be comparing the "cost" of working for employer's health insurance to the cost of your own high-deductible policy. I wouldn't try to go uninsured.

 

[Calgary_Girl]

I am looking at this and am wondering what folks think. I think the biggest reason to semi-retire would be to keep health insurance. Where I work, going down to 60%, you keep health insurance (that is for now).

If you are in the States, then definitely. This doesn't apply to Canada though since you can get cheap coverage.

 

[uncledrz]

I am looking at this and am wondering what folks think. I think the biggest reason to semi-retire would be to keep health insurance. Where I work, going down to 60%, you keep health insurance (that is for now).

Two different, but related issues. Semi-retired as opposes to RE can have many reasons. Desire to keep contract, enjoy the work, etc, at the same time avoid the absolute nonsense that one encounters when having to work full time is also a reason to "semi retire". Probably are many others as well.
Health insurance, if not provided by the company, must be purchased whether working or not. I agree with Nords that the insurance is necessary, if only to get the discounted rates that the insurance companies negotiate with the health providers.
Question, will the 60% allow enough of a decompression from work such that it will be enjoyable (once again if it ever was?) or will you be doing 100% of the work at 60% of pay?

 

[maddythebeagle]

will you be doing 100% of the work at 60% of pay?

Bingo, I think that is the biggest question. A few in my family have said, why not get 100% of the pay and do 60% of the work

 

[bogart]

The contract between worker and employer has been torn up and thrown away. At least mine was (layoff after 20 years of service, for example -- rehired five years later without reinstatement to the defined-benefit pension). So, that being the case, doing 60% of the work for 100% of the pay seems fair enough, just like being expected to do 150% of the work for 100% of the pay is fair enough from their point of view.

 

[retire@40]

Insurance was a non-issue for me since I was and am paying for 100% of it anyway.

The main reason for my semi-retirement is that I asked myself if working more years to be completely FIREd was justified vs. working part-time and being partly FIREd.  I opted for the latter because I didn't know if tomorrow would ever come, and if it did, I wasn't sure if I could do everything I wanted to do at an older age.

I'm happy with my choice so far, even though I know I would be happier being fully FIREd.  But that day will come in a few years when I'm 40 or slightly thereafter.

 

[TargaDave]

Semi retire for me. ~20 hrs/wk. Maybe consulting in my current field and/or some lifestyle things. Pretty much always self employed and I've mostly enjoyed it. Nothing to do with insurance.

 

[mikew]

Thought about this. For me I want to cut the fetal cord asap. Problem with PT is still have to show up. Can't take off to Thailand for October and maybe November. Also would still emotionally involved with the work place. Problems could still follow you home.

Mike

 

[astromeria]

I spent my last 3 years before FIRE working part time as little as 5-10 hours a week. Didn't work for me. I just couldn't manage to turn off the job. As lead editor, I still had a lot of decisions to make--and it actually took longer because I was less in touch with developments at my company and the industry, and simply less engaged. The harder parts of my job became really difficult and the simpler parts became boring. Maybe I just don't multitask well or maybe it was just time to go, but I couldn't wait to bug out after I went PT.

=astro, finally free to waste, I mean spend as much time as I want to right here

 

[Martha]

In my first year of PT/semi retirement I like:

--to BS with work friends
--getting paid enough to live on and cover health insurance
--having the time to travel and time to do nothing


I don't like:

--the fact that the burntout feeling hasn't disappeared. I either am going to have to leave in the next year or take a leave of absence
--having to be available at all times, whether by email or cell phone

 

[Jay_Gatsby]

In my first year of PT/semi retirement I like:
--the fact that the burntout feeling hasn't disappeared.  I either am going to have to leave in the next year or take a leave of absence
--having to be available at all times, whether by email or cell phone.

Unfortunately, neither colleagues nor clients seem to respect the fact that lawyers go part time. I doubt that your feelings of burnout will ever disappear absent taking an extended period of being entirely away from work.

 

[KB]

Instead of leaving my job, I cut back to 24 hours a week to see how I liked it.

I only lasted 4 weeks before giving my notice to leave. Not working at all is my preference. Cut the ties completely.

 

[Caroline]

I cut back to half time last year. I wanted to quit altogether, but my pension vests next year, which allows an immediate, lump-sum payout, and I don't want to leave that money on the table.

I'm back to full-time now with 8 months to go, but the part-time work did what it was supposed to do -- it pulled be back from the edge of complete burnout.

Part-time work was not ideal for reasons others have mentioned -- my head was still in the game and I was still tethered to the computer! But it served its purpose. I could see doing it to bridge to Social Security, Medicare, etc. also. Not ideal, but better than full time, any day!

Best of luck to you, either way,
Caroline

 

[renferme]

I retired about 16 months ago, then took part-time game day jobs with the Pgh Pirates and Steelers. Love it ! ! !

 

[wabmester]

I am looking at this and am wondering what folks think. I think the biggest reason to semi-retire would be to keep health insurance. Where I work, going down to 60%, you keep health insurance (that is for now).

What is your fear about health insurance? Have you already priced it out? You're young -- insurance is cheap. Get an HSA policy with a high deductible. Ours is $300/mo for a family of three. We get to invest the deductible tax-free. And since we have a little self-employment income, the cost of health insurance is 100% tax deductible.

 

[maddythebeagle]

What is your fear about health insurance?    Have you already priced it out?   You're young -- insurance is cheap.   Get an HSA policy with a high deductible.   Ours is $300/mo for a family of three.   We get to invest the deductible tax-free.   And since we have a little self-employment income, the cost of health insurance is 100% tax deductible.

I hear you, but if you have an ongoing health condition and eating through that 5000 deductible every year, it might be something to consider. I think that I agree with some of the posts on wanting to have the contacts and work relationships. I was thinking more along the lines also of semi-retire earlier than I could completely FIRE also.
I actually have a much easier time not thinking about work when I have only a 2 day work week and the rest of the week off.

 

[sgeeeee]

I retired completely. Then I let myself be sucked into consulting. That was too demanding. So I stopped. I took a bunch of temporary jobs for awhile -- just for the experience. I worked as a poll worker for elections, security for local events, even did some contract maintenance work for a nearby State Park. Then some ex-colleagues contacted me and asked me to help them get a new start-up going. I said "no" several times but they eventually said they would offer me any deal I wanted. I said I wanted to be able to go away for weeks or months at a time whenever I wanted. I would work no more than 3 days per week when I was in town. I would work no more than 6 hours a day when I worked. (I have compromised only on this last point, and only occasionally). They pay me 1/4 time (Engineering Director salary) which pays for about 2/3 of our total annual expences. I take care of my own medical but have access to their 401K which allows me to launder money from my taxable accounts into a tax deferred account.

So far, this works out nicely for me. DW and I travel 1 or 2 weeks a month. I have 4 day weekends when I'm here. I'm convinced its working out well for the start-up too. In some ways I'm more effective than I would be if I was there every day. I recurited almost everyone in the company (15 people) so I have a lot of influence without being there every day. About once a month the CEO or a Board member trys to convince me to come to work full-time. I decline and that's it till next month.

I know . . . blaspheme to an ER board.

 

[bogart]

SG -- far from blaspheme. I am really envious of your job situation. Sounds ideal to me.

 

[MattInAustin]

There is also the option of going part time, but at something you enjoy much more. You may not be able get the health care benefit (fun things usually don't cover insurance), but you will get money to put towards purchasing insurance on your own. I have been giving a great deal of thought to jobs that may bring in that extra $5-15K a year, but are part time or seasonal and more importantly something that wouldn't be high stress and actually might be pleasurable. It wouldn't be official FIRE, but it's also a far cry from being a wage slave. Especially if you can squeeze by without the extra income if need be.

Looking at it another way, a part time job that brings in $5K a year (disregarding taxes), is equivalent to an investment of $125K returning 4%. Making $10K a year part time is like adding $250K to your funds. Of course it still is work no matter how you slice it. Still, worth considering.

One more perspective that I am thinking about is that it might make the plunge into full blown FIRE a little easier to take. You get to cut the ties with the big official career, but you still have a little bit of a safety net if you need it.

Here are some part time work ideas that SG offered me on another forum (I have added a few of my own as well)...

Work in community service
Run for local election (school board, zoning board, town council, etc.)
Work at the polls as part of the Election Board
Work taking tickets or as part of security at a local event
Work for your local Irrigation Board
Start a small business
Start a community Newsletter
Buy a suitable property and build a hotel/apartment or store
Collect and sell antiques
Head a small non-profit organization
Be an author
Write a book
Write articles for your local newspaper
Be an artist
Learn woodworking or metal working and create sculpture
Play an instrument in a band
Consult/Technical
Invent a device and obtain a patent
Solve a company’s current technical or manufacturing problem
Serve as an interim executive
Teach
Become a substitute teacher in nearby school districts
Teach courses at local colleges or junior colleges
Develop short courses in your field of expertise
Be a Tax Preparer
Be a real estate agent
Be a landlord
Take a job in a local store (plus get the employee discount)
Become a clothing store salesperson
Sell power tools
Sell sporting or recreational goods
Work in a home improvement outlet
Take up a trade skill
Build custom cabinets
Become a handyman

Work at a Tennis Center
Become a tour guide/leader (hiking, cycling, fishing, climbing, etc)
Work at a museum or gallery
Usher at the perfomance center
Home inspector
Fix computer problems in the neighborhood
Web page designer
Seasonal work at a national park

Also from SG:

Another article:
Americans choosing work after retirement
http://www.msnbc.msn.com/id/7140314/

And some more job ideas:
Ten hot jobs for today's retirees
http://tinyurl.com/cqblw

--Biker

 

[mikew]

Thanks for posting the list. Very interesting.

My grandfather retired and worked in a small cemetary attatched to a catholic monastary until he was 75. He worked about 10-20 hours a week. The monks gave him lunch and friendship. He really enjoyed it. I think I might like to do something like this.

 

[dt123]

Here's a link to the "10 Hot Jobs for Retirees" article that does not require signing up for spam.  Scroll down to May, 2004.

http://www.co.yakima.wa.us/e&t/news.htm

 

[Gone4Good]

Sure fire way to lower your SWR . . . Keep working!

 

[Mr._johngalt]

Sure fire way to lower your SWR . . . Keep working!

Sure fire way to make SWR completely irrelevant.......die!

JG