What I am overlooking?

[COcheesehead]

Hi, new poster here. Just found this forum today.
I am 53, married no kids and plan to retire at 58. We have about $3 mm in conservative (50/40/10) investments which is about 35x our planned retirement expenses. I have health insurance, long term care insurance, umbrella liability, disability and life policies on both of us. We should be able to put away another $700k easily before 58. We have a long list of things we want to do and places to travel. We will try and defer SS until at least 67. I use the Fidelity Planner and an app called Retire Plan. I have also used Firecalc. Everything points to a positive outcome even with very conservative peremeters. Yet I still feel uneasy. What I am missing, overlooking?

 

[mystang52]

I'd bet most of us here have less than your nest egg, never mind the additional $700,000 you anticipate. And it sure looks like you have all of your bases covered (e.g., insurance). Your anticipated withdrawal rate also seems well in the safe area.
So, for what it's worth, you sure look golden from here.

 

[aja8888]

Yet I still feel uneasy. What I am missing, overlooking?

Welcome to the Forum!

Well, it's certainly not money. Maybe it's lack of confidence?

Lots of folks here retire with way less than you and seem to do OK, even the ones with children that are not in college yet.

 

[rodi]

Welcome to the Forum!

Well, it's certainly not money. Maybe it's lack of confidence?

Lots of folks here retire with way less than you and seem to do OK, even the ones with children that are not in college yet.

That would be me. Retired with less. Kids are teenagers/pre college.

You look pretty good to me. How confident are you on your spending? That's the only gotcha that seems to catch some off-kilter.... wrong assumptions about retirement spending (too high or too low.)

 

[Whisper66]

.....We have a long list of things we want to do and places to travel. We will try and defer SS until at least 67. I use the Fidelity Planner and an app called Retire Plan. I have also used Firecalc. Everything points to a positive outcome even with very conservative peremeters. Yet I still feel uneasy. What I am missing, overlooking?

Maybe you are asking the wrong question? With your assets, expected expenses and a long list of things you wish to do, maybe you should be challenging yourself on why you continue to work and not using these good years doing other things? You seem to have all the bases covered to do that if you wish.


Sent from my iPhone using Early Retirement Forum

 

[Sunset]

Welcome.

You can retire now if you like.
Sure it's common to figure OMY (One More Year) of work, often due to being nervous about retiring.
If you have an accurate tracking of your spending it helps to relieve the mind.
If you currently get health insurance from employer, that is one that that would go up a lot when retired until you get to Medicare (which still costs money).

You don't mention a pension ?
You should be able to delay the higher income earner taking SS until 70 (reason is it makes the survivor payment larger for surviving spouse which is more important if you don't have any pension).

 

[travelover]

Why wait until 58? I'd personally rather enjoy an additional 5 years of retirement.

 

[COcheesehead]

Thanks for the responses. The reason behind 58 is I am in a business and tied to a buyout that ends at 58. So I more or less have to work until then.

 

[Richard4444]

Then I don't think that you overlooked anything !

Nice work

Rich

 

[growerVon]

With the high-level summary OP gave, it does look good. Perhaps your unease would be helped by going over your expected annual spending with a finer-toothed comb? Ex: arrive at a detailed annual & monthly expense list that includes balloon / periodic expenses (cars, roof, major appliances, etc). You may have already done this, as evidenced by your x35 estimate.

Another tickling concern you may have is about a drawdown strategy. Do you know how you're going to execute your withdraws in detail, and with a couple options for boommvs bust years? This may also already be accounted for, as evidenced by your 10% cash allocation.

Hope the feedback you're getting is helpful and welcome to the forum!

 

[MichaelB]

What I am missing, overlooking?

Welcome aboard, COcheesehead. These questions will help you answer that question http://www.early-retirement.org/for...-answer-before-asking-can-i-retire-69999.html

At first glance things look pretty solid. Needs more cowbell.
.

 

[COcheesehead]

With the high-level summary OP gave, it does look good. Perhaps your unease would be helped by going over your expected annual spending with a finer-toothed comb? Ex: arrive at a detailed annual & monthly expense list that includes balloon / periodic expenses (cars, roof, major appliances, etc). You may have already done this, as evidenced by your x35 estimate.

Another tickling concern you may have is about a drawdown strategy. Do you know how you're going to execute your withdraws in detail, and with a couple options for boommvs bust years? This may also already be accounted for, as evidenced by your 10% cash allocation.

Hope the feedback you're getting is helpful and welcome to the forum!

Drawdown strategy is the reason I found this forum. I am enjoying getting into the nitty gritty details, rather than just the 30,000 foot overview. Looking forward to learning more from all the members here. Thank you.

 

[Sunset]

OP - Since you plan to retire at 58, just be sure to have 2 years worth of spending outside of any tax sheltered plans.
As you cannot withdraw from IRA without extra penalties until you are 59.5

 

[pb4uski]

Thanks for the responses. The reason behind 58 is I am in a business and tied to a buyout that ends at 58. So I more or less have to work until then.

Are you required to work full-time until then? If not, perhaps going part-time and reducing your involvement over the next 5 years is a win-win for you and the business.... who knows, as you reduce your involvement they may figure out that they can do without you and let you go early or just have you be on-call.

 

[COcheesehead]

Yes, I have to work full time.

 

[Vagabond2020]

I would never chose to work away 5 years of my healthy/physically capable adult life to chase some sort of "safety".....you won the game. Focus on what is important to you and enjoy your relative "youth".

 

[COcheesehead]

I would never chose to work away 5 years of my healthy/physically capable adult life to chase some sort of "safety".....you won the game. Focus on what is important to you and enjoy your relative "youth".

I think everyone is missing the point. I have to work. I have a buy out in process and it requires me to remain a part of the company until 2021. Trust me, if I could bail now, I would.

 

[cathy63]

I think everyone is missing the point. I have to work. I have a buy out in process and it requires me to remain a part of the company until 2021. Trust me, if I could bail now, I would.

So you are engaged for a 5-year period of indentured servitude. You can use those 5 years to get more comfortable with the idea of retirement, practice living on your retirement budget and make sure your expenses stay in line.

One thing I see is that you have disability and life insurance for both you and your spouse. Do you need them? If either of you dies or becomes disabled, you do not need to replace income in order to have a comfortable retirement since you already have enough.

 

[COcheesehead]

So you are engaged for a 5-year period of indentured servitude. You can use those 5 years to get more comfortable with the idea of retirement, practice living on your retirement budget and make sure your expenses stay in line.

One thing I see is that you have disability and life insurance for both you and your spouse. Do you need them? If either of you dies or becomes disabled, you do not need to replace income in order to have a comfortable retirement since you already have enough.

Your point about the disability insurance is a good one. I think about cutting it off from time to time. It costs me less than $1200 a year so its not much. I have it outside of my company insurance to give me one more layer of protection. I have seen first hand friends who have had extended medical issues where they are unable to work for long periods. Having some income in those times just protects having to dip into retirement assets to buy the groceries. I still may cut it off in the next year or so as the assets grow. Thanks for the feedback.

 

[kgtest]

let's call it 4million by the time you hit 58 with a good 40 years of life left putting you out at 98.

That gives you 100k/yr to withdraw even if the money is in savings. If it's in the market you will realize another 40yrs of slightly more conservative gains.

Don't work too hard the next five years.

 

[Aerides]

OP assume you have already done this, but I would be throwing a bit of that money at an excellent attorney right now to see what I could do to reduce that 5 years.

You have some of us curious... what is the worst that happens if you say "FU" and quit? I'd imagine it's punitive/painful, but if you'd care to share I doubt I'd be the only one who would be very interested.

You are definitely all set so assuming you have no option and must work full time for the next five years, hope you can at least work in some virtual time, extra long vacations, leisurely lunch "hours" and no doing emails on eves and weekends!

 

[Sunset]

I have seen something like this before, the company where I worked was sold by the 2 owners, and they had to stay for the next 5 years running the company and meeting certain negotiated goals (profit/income per year) to be fully paid for the sale.

I imagine lots of multi-million dollar sales are structured this way.

 

[COcheesehead]

OP assume you have already done this, but I would be throwing a bit of that money at an excellent attorney right now to see what I could do to reduce that 5 years.

You have some of us curious... what is the worst that happens if you say "FU" and quit? I'd imagine it's punitive/painful, but if you'd care to share I doubt I'd be the only one who would be very interested.

You are definitely all set so assuming you have no option and must work full time for the next five years, hope you can at least work in some virtual time, extra long vacations, leisurely lunch "hours" and no doing emails on eves and weekends!

I won't get the rest of the buy out money. Right now that stands at about $650,000 plus I'll make about $275,000 a year. So saying FU costs me about $2 million gross. I can work 5 more years for that.

 

[Aerides]

Oh well in that case, carry on!

 

[ERD50]

I won't get the rest of the buy out money. Right now that stands at about $650,000 plus I'll make about $275,000 a year. So saying FU costs me about $2 million gross. I can work 5 more years for that.

Sure, those extra $ sound great, but if you are truly at 35x expenses (less than 3% WR), what are they really worth to you and your wife?

At the minimum, I'd be taking some nice vacations each year, or whatever you like to do with your time.

I predict that at age 59, you will look back and wonder what the heck you waited for. But by then, it's too late.

For reflection, you said:

We have a long list of things we want to do and places to travel.

Trust me, if I could bail now, I would.​

-ERD50