Going back To Work: How should I Invest Salary and Cash??

[Fleur58]

I'm 61, single, and have been retired for 3 years. Next month I am going back to full time work. The position comes with Health and Retirement Plan benefits. They offer a Roth or Non Roth 403B) (no match). I plan to work for 6 years until I get to FRA of 67.

I'm pretty much set for retirement: I have a 7 figure well diversified IRA which I won't need to tap until RMD time. I have a small Roth IRA account as well with 16K in it. I'll get a pension of $460 month that starts at 65. I'll get near the max social security at 67. Home is paid off. I was turned down for Long Term Care Insurance although I am in excellent health.

I will use my new salary (6K month before taxes) for living expenses of about $1300 month (includes insurances, all bills, food, and all taxes). I plan to save the rest.

1. Should I save in a Roth or Trad 403B Plan? Or save in a non retirement investment account at my age? I'm leaning towards the Roth since my existing Trad IRA is taxable. My free FA at Fidelity said I should save in a traditional IRA because of the tax break.

2. I have 300K in non retirement cash instruments that I am now willing to invest, since I am going back to work. This was my Emergency Fund and Living Expenses money. 100K is at on line bank MM account; and the other 200K is in a Fidelity MM account. I don't want to take to much risk with it in case of upcoming recession. What options would you suggest?

I would appreciate any comments on my new situation; I've received some great advice on this forum in the past.

 

[Sunset]

Invest in the ROTH, your RMD at age 70.5 will mean you are in a high tax bracket.

You will be well in the 24% tax bracket, so more IRA money will be heavily taxed coming out.

pension + RMD (from 1.24MM) + SS
$5,520 + $45,454 + $44,376 = $95,350

If your new job pays over $167,000 then an IRA would be good.

Of interest is why are you going back to work.

 

[Fleur58]

Thanks, Sunset:
I'm bored out of my mind with having no structure to my day. I've traveled extensively, taken courses, took up new hobbies. I need to work and feel I retired too young. I just completed a professional training course for free for people over 60. I lucked up and got a job. I will be making 1/3 of what I made when I retired and I am thrilled.

 

[REWahoo]

Thanks, Sunset:
I'm bored out of my mind with having no structure to my day. I've traveled extensively, taken courses, took up new hobbies. I need to work and feel I retired too young. I just completed a professional training course for free for people over 60. I lucked up and got a job. I will be making 1/3 of what I made when I retired and I am thrilled.

Although I shouldn't be, I'm always saddened when I see posts like this. We aren't all wired the same way and while the thought of going back to work after I retired would be the stuff of nightmares for me, I'm glad you'll get to do what you want.

 

[Fleur58]

ReWahoo
I do realize that what I'm doing is unusual. I was financially prepared for retirement but I had no plan for my time. But I've tried 3 years of retirement and was not happy with it even though I filled it with activities and vacations. I live alone, and I felt I made a big mistake. Some days I have no one to talk to. I had been in the pharmaceutical field for the last 26 years, but I used to be an RN before that. I jumped at the chance to take a 3 month Nursing Refresher course tuition free. I passed and now I have a job doing something really interesting. I was not the oldest person taking the course. Its nothing strenuous, and I only have to work 3 days a week.

 

[RunningBum]

If you'll be in a lower or same tax bracket with this new job as you will be in when you start RMDs (along with pension and SS), put what you can in a Roth, and the rest in taxable. If you're in a higher bracket, defer the taxes with a tIRA.

 

[nancyfrank232]

Thanks, Sunset:

I'm bored out of my mind with having no structure to my day. I've traveled extensively, taken courses, took up new hobbies. I need to work and feel I retired too young. I just completed a professional training course for free for people over 60. I lucked up and got a job. I will be making 1/3 of what I made when I retired and I am thrilled.

You’re not alone

http://www.early-retirement.org/forums/f26/hello-from-canada-99808.html

Congrats on the new hobby that pays you!

 

[Cayman]

Thanks, Sunset:
I'm bored out of my mind with having no structure to my day. I've traveled extensively, taken courses, took up new hobbies. I need to work and feel I retired too young. I just completed a professional training course for free for people over 60. I lucked up and got a job. I will be making 1/3 of what I made when I retired and I am thrilled.

Good for you! Free to do what makes you happy. Best wishes as you embark on this next adventure.