Attempt at most lopsided poll ever

[Midpack]

Well, the poll was a flop (WRT lopsided). I keep making the mistake of thinking from a FIRE perspective, when the SIRE crowd on this forum outnumbers us about 2:1. One day I'll learn...

 

[ziggy29]

Well, the poll was a flop (WRT lopsided). I keep making the mistake of thinking from a FIRE perspective, when the SIRE crowd on this forum outnumbers us about 2:1. One day I'll learn...

Well, you have to consider the universe of people for whom "early retirement" is a possibility. That includes very few people whose retirement is all in 401Ks and IRAs. I'd say those of us who (even now) have a chance at FIRE with no DB goodies coming our way are in the very small minority -- a considerably smaller minority than 18 months ago.

 

[Helen]

It's still too early for me to know if I can stick with my original date of 4.5 years from now.

It will depend on what the inflation rate is and whether they offer an early out where I work. It will also depend on what my job and health are like. We are also still hoping to sell our house in the country and buy one in the city. A lot is up in the air.

For sanity sake, I'm telling myself 4.5 years till ER.

 

[jdw_fire]

please help me out, what does SIRE stand for?

 

[ziggy29]

please help me out, what does SIRE stand for?

I never knew what it stood for, but I know it refers to people with pensions and/or retiree health insurance, so I'd guess the "S" either refers to "semi" or "subsidized."

 

[FIREd]

If I remember the "S" in SIRE stands for "secure".

SIRE = Secure Income Retired Early... something like that.

 

[ziggy29]

If I remember the "S" in SIRE stands for "secure".

SIRE = Secure Income Retired Early... something like that.

Yeah, that could be, too. Certainly nothing that could be applied to the 401K Generation.

 

[jdw_fire]

so since everyone in the USA who had earned income is either covered by SS or some type of DB plan that excluded SS (now rare), anyone who retires early will have some secure income at some time in their retirement (unless they die before reaching eligability age) and is therefore SIRE, right?

 

[FIREd]

so since everyone in the USA who had earned income is either covered by SS or some type of DB plan that excluded SS (now rare), anyone who retires early will have some secure income at some time in their retirement (unless they die before reaching eligability age) and is therefore SIRE, right?

I do not believe that SIRE covers SS (because so many of us are doubtful about the long term viability of SS). I believe that the acronym was coined to describe people with DB pensions and/or retiree healthcare benefits.

After digging around a bit, I believe this is the thread that gave birth to "SIRE":

http://www.early-retirement.org/forums/f28/retirement-benefits-poll-40830-2.html (see post #35)

 

[jdw_fire]

I do not believe that SIRE covers SS (because so many of us are doubtful about the long term viability of SS). I believe that the acronym was coined to describe people with DB pensions and/or retiree healthcare benefits.

After digging around a bit, I believe this is the thread that gave birth to "SIRE":

http://www.early-retirement.org/forums/f28/retirement-benefits-poll-40830-2.html (see post #35)

thank you for the reference. i do have another question though, do u really think that SS (with the federal government's power to print money) is that much worse off (i.e. more likely to not pay out) then alot of private/local government/state government DB plans?

 

[Alan]

thank you for the reference. i do have another question though, do u really think that SS (with the federal government's power to print money) is that much worse off (i.e. more likely to not pay out) then alot of private/local government/state government DB plans?

Many will disagree but I believe that SS is more secure than a private pension plan. I know several retirees who lost a lot of their pension income when their company's plan went under, I know no one who has lost SS.

I am due a private pension plan but that is very suspect at present even though I am very close to starting it because one of 2 companies that employ me is very close to bankruptcy.

Also, private pension plans fail and until recently their recipients got hit very hard. These days a government backed insurance scheme PBGC will cover part of this. For example if I do start drawing a pension next year and the plan fails the following year I will lose about 25%/year of my income from the pension.

While SS may lose value over time I have a lot more confidence in its long term viability than my private pension.

 

[ziggy29]

Many will disagree but I believe that SS is more secure than a private pension plan. I know several retirees who lost a lot of their pension income when their company's plan went under, I know no one who has lost SS.

IMO, the key word above is company, as in "private employer." They can't just raise taxes on everyone to shore up their pension fund -- and if they have strong competition, they can't shore it up through pricing power, either. They either go under, freeze their pensions, or freeze their pensions and then go under.

As for SS, it will be around, but whether the payouts will decrease or the rules for eligibility change remain to be seen. One side benefit of my 401K's meltdown is that I feel a lot less likely to be means-tested out of SS benefits. Glass half-full.

 

[FIREd]

thank you for the reference. i do have another question though, do u really think that SS (with the federal government's power to print money) is that much worse off (i.e. more likely to not pay out) then alot of private/local government/state government DB plans?

I don't think SS is going anywhere for most people. But as Ziggy said, a lot of us fear that we will be means-tested out of SS. I already hear people on the left say aloud that rich people should not be receiving any SS benefits at all because they don't need it. If you can retire early without a DB pension, I am pretty sure that you'll be considered "rich".

 

[DayDreaming]

I voted that my time horizon has changed. On the other hand,I'm a bit uncertain and my plan might always remain "just one more year" - so in that case, my plans haven't changed at all.

I have a non-COLAed pension that will cover most of my expenses when I start tapping into it 7 years from now. Even with the recent losses, I think I could still ER now, or very soon, and my saving would safely cover me the next several years. I'm just being a lot more conservative in my thinking, and of course worrying that things might get worse. So, I'm still w*rking, waiting to see what happens, and thinking about ER.

 

[Alan]

IMO, the key word above is company, as in "private employer." They can't just raise taxes on everyone to shore up their pension fund -- and if they have strong competition, they can't shore it up through pricing power, either. They either go under, freeze their pensions, or freeze their pensions and then go under.

As for SS, it will be around, but whether the payouts will decrease or the rules for eligibility change remain to be seen. One side benefit of my 401K's meltdown is that I feel a lot less likely to be means-tested out of SS benefits. Glass half-full.

I agree - I definitely meant to say Company. Our company's pension plan is managed by a well known insurance provider and everyone knows how reliable they are.

Means testing of SS is a definite possibility in the future along with actual across the board erosion of benefits. A few years back while in England on vacation there was an article comparing UK SS with other EU countries, and just for kicks they added in the US SS which dwarfed everyone else's. (At the time DW and I decided that a lot of the difference could be explained by health costs as UK SS recipients (over 65) pay nothing including stuff they used to pay for such as eye exams, prescription co-pays etc.)

 

[Helen]

A few years back while in England on vacation there was an article comparing UK SS with other EU countries, and just for kicks they added in the US SS which dwarfed everyone else's.

Do you mean the payments dwarfed everyone else's?

 

[Alan]

Do you mean the payments dwarfed everyone else's?

Correct - the average SS recipient in the USA received much more than the average SS recipient in an EU country.

 

[hankster]

My hoped for age 59 1/2 retirement is now looking more like age 62. One leg of my "three-legged stool" is a non-COLA pension, so our 401k setback puts the hurt on the inflation protection aspect of our nest egg.

DW and I enjoy traveling around the U.S. so scaling back to a "heat and eat" lifestyle to retire earlier isn't an option. I'm willing to put in a few extra years to help feed our roaming addiction

My pension plan appears to be sound at present, but who knows when a freeze or other change could come to pass?
If that happens, I would have to consider semi ER an option.

 

[SecondCor521]

I'm still on track to hit FI just past age 47, but only because I have been pretty ruthlessly cutting back on my expenses as my portfolio has shrunk.

2Cor521

 

[Medit8]

The original plan was for this June at age 46. I intend to add one more year. I have about 15 years of cash (actual cash, not equivalents), but would like to add a full year of equity investments at these prices.

 

[harley]

I don't think SS is going anywhere for most people. But as Ziggy said, a lot of us fear that we will be means-tested out of SS. I already hear people on the left say aloud that rich people should not be receiving any SS benefits at all because they don't need it. If you can retire early without a DB pension, I am pretty sure that you'll be considered "rich".

I suspect that unless there is a MAJOR overhaul of the tax system, it should remain possible to not be "rich" enough to be means tested out of SS, even if the huddled masses get their wish. It's not too hard to manage income in a way that makes you appear to be one of the great unwashed, even while you live a pretty comfortable life. Now if they do away with the itemized deductions and significantly increase cap gains taxes, it could be a different story. But to those who can do it, I think getting as much of your IRA money into Roths vs. traditional would be helpful in keeping under the "rich" radar. That fully taxable RMD moving forward is really going to bite some of us in the gluteus.

 

[FIREd]

I suspect that unless there is a MAJOR overhaul of the tax system, it should remain possible to not be "rich" enough to be means tested out of SS, even if the huddled masses get their wish. It's not too hard to manage income in a way that makes you appear to be one of the great unwashed, even while you live a pretty comfortable life. Now if they do away with the itemized deductions and significantly increase cap gains taxes, it could be a different story. But to those who can do it, I think getting as much of your IRA money into Roths vs. traditional would be helpful in keeping under the "rich" radar. That fully taxable RMD moving forward is really going to bite some of us in the gluteus.

That would be true if they did means-testing based on income. In that case, even people with DB pensions could be in trouble. But I think that they could start doing means-testing based on assets. They do it already for medicaid, so why not do it for SS too... For example: No SS benefits for people with a net worth exceeding $500K ex-primary residence...

 

[harley]

Well, that would suck. Have to move my assets offshore or something. I WANT MY SS!

 

[jdw_fire]

That would be true if they did means-testing based on income. In that case, even people with DB pensions could be in trouble. But I think that they could start doing means-testing based on assets. They do it already for medicaid, so why not do it for SS too... For example: No SS benefits for people with a net worth exceeding $500K ex-primary residence...

so i guess we shud be buying very expensive houses? doesnt seem fair to us that r living in a place just big enough for us. or us away from the east and west coasts

 

[ratface]

I'm in the SIRE column but have still postponed my target date because of uncertainty and a little greed on my part. The uncertain part was that part-time work was going to be my fall-back in case anything went terribly wrong. Obviously there is much more competition for those jobs now. The greed part is that in August I can add 2.5% to my pension. So I'm treading water for at least another six months and giving the market a chance to make up its mind. Socialized health care is another unknown at this time.