steady saver
Recycles dryer sheets
- Joined
- Apr 10, 2013
- Messages
- 498
Okay. We've done analysis by paralysis until I'm ready to cry "uncle!"
My DH and I had hoped to retire next summer and "wouldn't a package be great?"...well, that time has come. Packages are being offered so we had to get nitty gritty about the reality of pulling the plug.
Oh my.
We have beat this dead horse to death.
Bottom line. FIRECALC wavers between 95% and 100% but our anxiety was high when new factors came in to play (for example, we forgot to account for income tax in our spending initially). We're past that now. My DH is just completely done with the corporate life. He'll be 55 next year and, of course, if he worked 3 more years then all would be rosier financially. But it makes no sense to either of us to walk away from a generous severance, even if he is walking away from future bonuses and better health insurance benefits, etc. because he is SO READY to do something else, (perhaps even something that earns a bit of money)!
So now the questions are about how to best manage the money we'll have. We have 8 months until he pulls the plug and we need to be clear on our options and decisions.
Background info:
1. Our 401K at work is through Fidelity.
2. DH will turn 55 in the year he retires, but will be 54 on the day he retires.
3. We have money in 401K, individual investments, money market, too much in checking account. That's a dumb reality of just not having used it to work for us.
4. We have a pretty good pension. Still, it provides a little over half of our monthly expenses. That will need to come from withdrawals from our investments.
5. I've ironically started a business this year and it is slowly growing. Not a lot of income yet, but I love what I do and the need is there, along with the clients willing and able to pay for my services. I don't want to plan on having to work all the time, though, while my best friend is retired...
Questions:
1. Does it make sense to roll the 401K into an IRA to prevent a penalty? Will he get the 10% penalty if he's turning 55 the same year he leaves?
2. Should we leave enough money in the 401K for cash withdrawals to supplement the pension until he's 59 1/2 since my (vague) understanding is that those withdrawals don't carry a penalty?
3. Our return on the 401K investments has always irritated me - it's always been ridiculously low. Our personal investments have done way, way better. That's why I'd like to roll them over into an IRA that I can control. Question: now I have to figure out my allocation and I'm so burned out from even deciding to pull the plug that my mind isn't thinking straight or strategically. No question there. Just a whine. That's where I'm going to have more questions as we go.
Okay, I needed to at least get that out there. I know I need to provide more details and I'm painfully aware that my questions may not even be on target. I'm literally brain dead right now, gee. But it's a start for now and I know this forum is a place to go for good ideas and varied advice. Also wanted to share the good news with a group that "gets it". We are SO EXCITED!! We've been so busy belaboring the whole thing, and now it's time to back up and celebrate this long anticipated event!!
Thanks!
My DH and I had hoped to retire next summer and "wouldn't a package be great?"...well, that time has come. Packages are being offered so we had to get nitty gritty about the reality of pulling the plug.
Oh my.
We have beat this dead horse to death.
Bottom line. FIRECALC wavers between 95% and 100% but our anxiety was high when new factors came in to play (for example, we forgot to account for income tax in our spending initially). We're past that now. My DH is just completely done with the corporate life. He'll be 55 next year and, of course, if he worked 3 more years then all would be rosier financially. But it makes no sense to either of us to walk away from a generous severance, even if he is walking away from future bonuses and better health insurance benefits, etc. because he is SO READY to do something else, (perhaps even something that earns a bit of money)!
So now the questions are about how to best manage the money we'll have. We have 8 months until he pulls the plug and we need to be clear on our options and decisions.
Background info:
1. Our 401K at work is through Fidelity.
2. DH will turn 55 in the year he retires, but will be 54 on the day he retires.
3. We have money in 401K, individual investments, money market, too much in checking account. That's a dumb reality of just not having used it to work for us.
4. We have a pretty good pension. Still, it provides a little over half of our monthly expenses. That will need to come from withdrawals from our investments.
5. I've ironically started a business this year and it is slowly growing. Not a lot of income yet, but I love what I do and the need is there, along with the clients willing and able to pay for my services. I don't want to plan on having to work all the time, though, while my best friend is retired...
Questions:
1. Does it make sense to roll the 401K into an IRA to prevent a penalty? Will he get the 10% penalty if he's turning 55 the same year he leaves?
2. Should we leave enough money in the 401K for cash withdrawals to supplement the pension until he's 59 1/2 since my (vague) understanding is that those withdrawals don't carry a penalty?
3. Our return on the 401K investments has always irritated me - it's always been ridiculously low. Our personal investments have done way, way better. That's why I'd like to roll them over into an IRA that I can control. Question: now I have to figure out my allocation and I'm so burned out from even deciding to pull the plug that my mind isn't thinking straight or strategically. No question there. Just a whine. That's where I'm going to have more questions as we go.
Okay, I needed to at least get that out there. I know I need to provide more details and I'm painfully aware that my questions may not even be on target. I'm literally brain dead right now, gee. But it's a start for now and I know this forum is a place to go for good ideas and varied advice. Also wanted to share the good news with a group that "gets it". We are SO EXCITED!! We've been so busy belaboring the whole thing, and now it's time to back up and celebrate this long anticipated event!!
Thanks!