Financial Situation When you FIRED.

[chinaco]

This is a poll about your financial situation when you FIRED.

What I would like to know is how many of you retired with less than your original target portfolio amount. For example: you thought you would need $3M but retired with $1.8M instead. I also listed voting options if you were somehow pushed into the situation (e.g., lost job, health issue, etc).

Please comment about the situation. List your age at retirement and how you decided to ER (especially if you were below your target $ or age) and if it has made difference in your lifestyle.

 

[CyclingInvestor]

In 2004 I reached my target amount ahead of schedule - I had expected to reach
it 4 years later when I hit 50. I pre-paid off my mortgage to celebrate.
Work (programming) was going smoothly (as it had most of my career) and was
enjoyable, so I stayed on. 2 years later unpleasant changes occurred in my working
conditions (new rules, no offices for anyone) so I retired at 48 with quite a bit more
than I felt I needed. As a result, my after-tax net income available for spending is
higher than it was while working, and I am spending all of it.

 

[Moemg]

I met my financial goals at 52 but I wasn't ready to retire . I still enjoyed by job. At 59 I finally had enough and I retired . The extra years also gave my portfolio time to recoup the tech drop so it all worked out perfectly .

 

[UncleHoney]

Chinaco

I bailed at 61-1/2. I have a pension that was getting close to maxing out at age 62. (The pension was based on age, up to 62, years of service, up to 35, and last five years average salary. ) When I retired the monthly pension check was still growing at the rate of $1 a day. By leaving 150 days early I left about $158 a month on the table.

The portfolio target was whatever I wanted it to be and I was well into the comfort zone. I did have an artificial target that I missed by a few $k the day I retired, but have since passed.

As for the retirement date, I just decided enough was enough on the finances and wanted to retire while the weather was still nice last fall.

So far things are working out, I'm drawing my pension and DW is drawing her SS and that puts us at about 49% of our potential income with my SS and earnings off the stash growing for the future. Since the pension isn't COLA'd , the stash will start filling the gaps as time goes on.

 

[JohnP]

My plan was to retire once our in-retirement spending (represented by the takehome amount after taxes, retirement savings, health care, etc) equaled our working takehome. In early 2003 DW and I retired after determining that the takehome from our COLA'ed pensions would exceed the takehome from w**king. Like CyclingInvestor, my w**king conditions in the previous two years had become less enjoyable so it was an easy choice. I was a couple months shy of 60 yo at retirement.

We also had a nice chunk of change in our savings, TIRAs, Roths, etc - that has doubled since 2003 - just need to get over the LBYM mentality and find a good reason to tap into the savings.

JohnP

 

[W2R]

ER is pretty much a "done deal" for me, though I have to wait another 523 days for lifetime medical. I will be 61 and already have several times my portfolio target amount (and I have enough in fixed income that even if the market falls through the floor, my portfolio will still substantially exceed its target amount).

Also, at this point I believe there is no way the federal government could "push" me out short of an act of Congress. We have great job security, and the feds move slower than glaciers in making changes.

So, I voted even though I am not technically retired yet. Essentially I am there.

I am happy that you chose 62 as the dividing line, since I felt a retirement age of 61 was pretty old around this forum!

 

[Jake46]

Reached my financial goals at 60 and retired six months later. It's been a year yesterday and a great one at that.

 

[kcowan]

I had completed a 5-years management contract as CEO. Rather than sign on for an extension, I turned the reins over to my COO and retired in 2002. We were short of our goal and I got really serious about portfolio management. By investing in selected growth stocks, we made our goal of 4% SWR by Jan 2007.

We decided to aim for 3.5%. That goal will have to wait a while longer. Got close last November for a month.

 

[happy2bretired]

I retired at 55 (31 years with Fed government) with a pension in 2006. My plan was to retire in Jan 2007 but my husband died early in 2006. I retired soon after his death due to my mental state. I selected retired early after reaching financial goals but "pushed". I was not only pushed by my husband's death but by several years of work related chaos that was way too much for me.

 

[CuppaJoe]

Another poll I can cheat on! That is because I haven't FIREd yet, but close enough. I will retire at age 61 in exactly 59 working days (but who's counting?). I'm pushing myself to get out because of health issues (both physical and mental) and if you look at my most recent post, I've lost my sense of humor; I believe I will have an impressive improvement in health, come September. I didn't have a precise target in mind but have worked with the numbers I have. When I get my Keogh deposit for 2008 next spring, that should bring my nest egg to a comfortable level. I could retire and be OK financially on a lot less.

P.S., I never thought I would be this well off because I goofed off for 20 years in "semi-retirement." That Keogh plan was a "luck out" for me, it's a very strong leg on my six-legged financial retirement stool.

 

[Gotadimple]

I hadn't planned on retirement before age 62, but chose to retire at age 58 after talking classes and getting a 'free consult' with a financial planner. At the time, he said I could probably retire at 60 given how I had constructed my portfolio.

Some good years at work helped to add to the stash, but, changes in the work environment and the affect on my personal life pushed me to consider why I was working. When I discovered I didn't need to work for money, the BS Intolerance Meter went way up and I picked a date a year in advance.

-- Rita

 

[aenlighten]

I retired at 43 without knowing it

and while I expected to retire early, being in a technical profession, I hadn't expected that early and I had to learn all about it afterwards. I certainly have a lot less disposable income than working but it really didn't change my lifestyle any other than giving me much more time. I would still consider returning to work if something exciting came along but I don't waste time looking.

 

[theloneranger]

Now 61.5 YO. The situation when I retire at 63: Reached financial goal a couple of years previous. Work is not really stressful. Stock options received at 63 will be a generous insurance policy.

 

[Khan]

Retired at 54.

Was planning for retirement at 30 years (civ employee of USAF) ( would have been Feb '08 age 57).

I was a programmer for many years, then they made me a manager; health went downhill.

Went to a retirement planning seminar and found a loophole for an ER offer.

They offered, I applied, they agreed.

I retired with less than my target portfolio, but I haven't tapped it yet; it pays to be a cheap bastard(tm).

 

[Dawg52]

I reached my target and was approved for an individual health policy. At that point started the phasing out plan with my company. Retired at 52 1/2 years old.

 

[Goonie]

I originally planned to ER at age 55 from my municipal gov't job, with cola'd pension and lifetime medical/dental insurance. They offered an Early Retirement Incentive (ERI) that allowed me to 'buy' five years of service credit. I jumped on that deal immediately!!! I bailed out @ 50 in April '07.

Whether I retired under the ERI offer at age 50, or passed on the ERI offer and stayed until age 55, the monthly pension check would have been the same. So it was a no-brainer.....why would I want to stay 5 more years and tolerate the BS and stupidity (and politics) for NO apparent reason or benefit?!

My net pension (after fed tax & my 25% share of med/dental ins premiums) is ~89% of my final net pay pre-ER. January 1st I got a 3% 'raise', while my former fellow workers got a 1.5% or 2% raise (I can't remember which off the top of my head). Over the last 10-15 years at work, the annual pay raise was always between 1% to 2.5%. I'm locked in for a 3% increase every year until I push daisies. Plus, I get a 13th 'bonus' check every July (50% to 75% of normal monthly pension check), which is in addition to the 3%.

I didn't have a 'target portfolio amount'. I always just tried to manage things the best as I could and to build up my nest egg, so that someday off yonder, if/when I get a wild hair, I'll have enough built up to really let 'er rip!

 

[chinaco]

It seems there are a number of people who got buyouts (pension and benefits). DW got that type of deal.

I do not see a buyout in my future, but I can take ER at 55 and get my pension and benefits... that is 3 years off.

Our portfolio is a little less than the target I set... but the target I set can produce more money @ 4% than we might actually spend.

I keep thinking about quiting sooner than 55... but there is a financial incentive for me to wait for that pension (plus health benefits). The health benefits would serve as a backup to the health benefits from DW... But it would cost an additional premium every year.

I suppose this recent market set back is coming at a good time for me (assuming it will be on the mend in a couple years)... I will make an exit while things are on an upward trajectory.

 

[Walt34]

Normal retirement for me would have been 25 years of service with a local police department but I stayed 29 because I was enjoying the work so much - doing computer forensics and computer crime investigations. That seemed like a job straight out of science fiction and for a long time I couldn't believe they were actually paying me to do that. Many of the legal issues at the time were brand new and we were in effect "writing the book" as we went. They're still using blocks of search warrant text that I wrote from scratch 15 years ago.

Three years before I retired they changed the normal retirement age to 20 years from 25, which made the retirement income better than I'd planned on.

But I got frustrated with the bureaucracy because working in that field requires so much ongoing training, new equipment and software. The last upgrade to the computers included two "steps up" from what we'd ordered by the vendor because what we ordered wasn't made anymore. Anyone working at any level of government understands that frustration!

The traffic in the area was approaching near constant gridlock and I have little patience with that, DW's job was making her physically sick, we had zero debt and when I looked at the numbers I realized that net pay would go up if I retired. "So I'm working here why?"

The retirement plan I'm under is a defined benefit plan that they stopped offering in 1978 and has 100% COLAs, medical, prescription, dental and vision coverage for life for 30% of the group premium, becoming secondary to Medicare at 65 (I paid 20% when working).

I just got lucky, I didn't give retirement bennies a thought when I signed up at age 22 and didn't give it much serious thought until my mid-thirties.

 

[Free To Canoe]

I ERed last year at 52. No pension or retirement plan. Just savings.
I was able to get over the top with the gain from the sale of our CA house (sold just in time). My amount for retirement is not conservative by any means. I think I can make it. It is worth the risk for the opportunity to be FIREed and do what ever I want. The worse case is that I would have to get a job. So far so good!

 

[playaman]

July 3 will be my last day of work (though officially on payroll through July 31), and I turn 61 a few days thereafter. I shot well past my FIRE goal three or four years ago but have seen my portfolio tumble considerably since then. Even so, I'm still on the plus side and one month is a deliciously short period of time. Technically, I suppose I should not have participated in the poll but I'm considering myself more and more FIREd each day.

 

[albundyz]

I worked for Megacorp for 34 years. At 56, I had a choice of retiring with a nice lump sum. So, I did calculations from all angles. Could I retire at 56? Well, it basically came down to this......... Do I want to retire early? and buy a new Toyota Corolla every 5 years? Lead a Toyota Corolla lifestyle? Is that enough? or do I want more? Do I want a Lexus/Infiniti lifestyle?

I decided that my wife and I could exist ok on a Toyota Corolla lifestyle. It's been 11 months now. I have no regrets. She's ok with it. I have a guaranteed Corolla lifestyle. At 56, I can still go back to work if I need the Lexus/Infinity.

Geez, it sounds like I've decided to become a slacker. Seriously, I just realized that I've become a slacker. Woo hoo.

 

[W2R]

I worked for Megacorp for 34 years. At 56, I had a choice of retiring with a nice lump sum. So, I did calculations from all angles. Could I retire at 56? Well, it basically came down to this......... Do I want to retire early? and buy a new Toyota Corolla every 5 years? Lead a Toyota Corolla lifestyle? Is that enough? or do I want more? Do I want a Lexus/Infiniti lifestyle?

I decided that my wife and I could exist ok on a Toyota Corolla lifestyle. It's been 11 months now. I have no regrets. She's ok with it. I have a guaranteed Corolla lifestyle. At 56, I can still go back to work if I need the Lexus/Infinity.

Geez, it sounds like I've decided to become a slacker. Seriously, I just realized that I've become a slacker. Woo hoo.

I don't think you're a slacker. Who wants a Lexus anyway? It'll just get all scratched up in parking lots.

 

[walkinwood]

I ER'd last month, but plan to keep the option of returning to work at the back of my mind. I turn 48 later this year and DW will turn 45. We have so many years ahead of us that I don't think it is possible to be certain that we have enough. All the calculators I know about give us the green light, and that was enough to give it a shot.

The quality of work was not the primary reason for this decision - it was the lack of time to do much of anything else that motivated me to take this step.

 

[rs0460a]

"Those who fail to plan, plan to fail"...

Looks like the poll shows this.

- Ron

 

[Gotadimple]

July 3 will be my last day of work (though officially on payroll through July 31), and I turn 61 a few days thereafter. I shot well past my FIRE goal three or four years ago but have seen my portfolio tumble considerably since then. Even so, I'm still on the plus side and one month is a deliciously short period of time. Technically, I suppose I should not have participated in the poll but I'm considering myself more and more FIREd each day.

Playaman,
That's kinda how it goes. My last day was May 9, but I'm on payroll through July 11. And so far it's been great!

-- Rita