Humpty Dumpty Approach to Retirement

[SoloTraveler]

I've been researching a lot on planning for retirement and, well, I haven't found anything really useful to my situation. I think I may have enough to retire, and I'm sick to death of my job, so I'm going to jump off the wall and either bounce or splatter; either way should be interesting.

The problem is that everyone agrees you must know your expenses and how much you spend to estimate your retirement. My job,for the past 20+ years, has had me moving from place to place overseas, with variable costs of living, variable salaries, variable needs and variable expenses. I've never lived in Hawaii; have no idea how much I will spend living in the U.S.; no idea how much I'll spend on a lifestyle, or clothes in a single climate, or entertainment in a tourist locale... so my best plan is to guesstimate my basic expenses and use a budget planner to decide how much I have to spend on the rest. And if that doesn't work, sell the condo and my junk and move into an RV, onto a boat, or into a trailer park and go wander around at will... At least my life has left me a little more open-minded to the possibilities!

I have no kids or family to worry about and no major health problems at the moment. I do have a $95k mortgage and a hefty HOA fee, but also a $55k a year pension and one million dollars in IRAs/401k, and a condo that's in a very hot real estate market. I'm 55 and will be 56 when I retire; too old to continue in the tech field (no, no one wants older women in technology. It's just a fact.) so limited, minimum-wage, job possibilities once I retire even though I'll probably look for a job just as something to do. I'll be living in Honolulu but I don't get island fever, don't have anyone to go see, have done PLENTY of traveling already, will shop at farmer's markets and Costco, and already own my own scuba diving gear. I'll pay cash for a car, and think a lot about, maybe, a small sailboat...

My question is: what do other people see as possible stumbling blocks, major considerations, minor 'didn't think of thats', to retiring now? How much do most people in the U.S. spend on things like entertainment, clothing, travel...? What would you spend if you didn't have kids or a SO to think about? Suggestions (polite ones) welcome!

 

[jetpack]

Welcome! Getting a grasp on your cost of living seems like your wild card. People here have some huge differences on that matter.. and Honolulu I would think would complicate it even more.

However, everyone has their own concerns... with mine being actually what to do in the middle of nowhere (where I live).

 

[pb4uski]

Between your pension and a 3.5% WR from your $1 million nestegg, you'll have $90k a year of cashflow.... that should be enough to live quite comfortably in many places in the US.

 

[swakyaby]

There are a number of posters on this forum who live in Hawaii, and at least one of them I believe is an accountant. They can give you a better idea of the cost of living in Oahu.

 

[cooch96]

Welcome indeed! I think you've certainly come to the right place. Congratulations on your nest egg and pension, you've done well for yourself. So is the hot condo and the mortgage with HOA the same property? If not, then that's another revenue stream. You could also rent out the condo and live someplace a little cheaper on the island or elsewhere in Hawaii (I loved the North Shore, but I haven't been there in 15 years). I suppose you'll figure that out after you've lived there a few months or years.

You are very open to living arrangements, have you considered getting a roommate? That could do a lot for stretching your budget, if necessary.

But you seem well setup and flexible. Honolulu is darned expensive, but I think you'll figure it out your best option pretty quick.

 

[walkinwood]

Do a google search on this site for user "nords". He lives near honolulu and wrote often about the cost of living (manageable). He doesn't frequent the forum often these days.

 

[97guns]

I'm in Honolulu right now vacationing and it's really expensive, 6-$7 for a gallon of milk, $5 for a loaf of sandwich bread, $8 for # of bacon, $6 for a box of cherries, forget about fresh veggies. $2 a pound for lettuce, I sure wouldn't want to live here much less retire here. I have lots of family here and they all have college degrees with 6 figure jobs, it is a must to have this kind of income here, working a $20/hr job ain't gonna cut it. I would need double my income just to survive here.

 

[evilanne]

Based on your travels, I'm sure you will be able to figure out how to live within your means. If you never have lived in Hawaii, where is your condo located? Trying to connect the dots.

 

[KmmFIdreamer]

Even in Hawaii I think I could live by myself on 55K a year if my home were paid off, but my needs are simple as far as entertainment. Honolulu housing is probably more expensive than where we went on the big island. Gasoline was not any more expensive than California and the distances on an island are short, so you may not even be driving that much. Electric is higher there though than what it would be most other places in the US, but you also don't have huge heating bills in the winter like you would in a cold climate.

When we visited on vacation, I found food a little more expensive than mainland, but I didn't think groceries were too horrible. We stocked up at Costco and Walmart at pretty much the same prices we pay for stuff here in our city. We got our fruits and veggies at the farmers market instead of in the stores. Papayas and mangos were dirt cheap compared to what we would pay here - like 3/$1 instead of $2.99 each at Kroger - and so we gorged on them. We even had some starfruit given to us and picked up guavas by the roadside for free. Bread and some dairy items were the only things that were a little bit higher than I would have liked to be paying.

In general, big cities are more expensive to live in than smaller towns. Housing in places like San Francisco, Seattle, and even here in Denver are into the not affordable range for a lot of people. If you consider living in more outlying areas though then this could be mitigated a bit. You might end up paying more for transportation though depending on where you chose to live and where you want to go during your day to day life.

I really like the tiny house/rv idea if I was single. That is just me though - seeing that I could enjoy the open road and going wherever I felt like. I know it wouldn't be for everyone. My husband would hate that tiny home or full-time RV lifestyle. I would rather be alone in a tiny home that having to resort to room-mates in a big house, but that is just me.

 

[97guns]

I'm in Honolulu right now vacationing and it's really expensive,.

Just found out there's no dollar menu at McDonald's, it's a $2.49 menu

 

[Amethyst]

When I was young and poor, I was pretty content with long walks and library books for entertainment. Now we have the Internet, streaming audio, streaming video, and you live on an island with miles of beach to walk...I don't think entertaining yourself should be among your bigger worries.

 

[marko]

Welcome! Getting a grasp on your cost of living seems like your wild card.

Between your pension and a 3.5% WR from your $1 million nestegg, you'll have $90k a year of cashflow.... that should be enough to live quite comfortably in many places in the US.

If you can't figure out your COL at the moment, I'd start with what you do know: your income.

Like most people (at least those on this forum), figure out how much you can spend and work it backwards from there. Take a stab at what housing will cost you (likely your largest expense and Mr. Google is your friend) and then see if the other expenses will fit within your income.

 

[athena53]

Have you looked into health insurance? I retired at age 61 3 years ago and it's been a major pain. I started out at $450/month and it's now at $775/month. Deductibles have stayed around $6K but the network gets crappier and they keep trying to offer me policies with NO out-of-network coverage. Current policy has no cap on out-of-pocket for out of network. Fortunately, I have very little interaction with the healthcare system other than preventative testing. I'm looking forward to Medicare next year!

You mentioned clothes- I spent a lot on my professional wardrobe but now my laundry basket is full of freebie T-shirts from athletic events. When I need to look respectable, the work wardrobe still fits. So far this year the only purchases I made in that category are 2 pairs of Birkenstock sandals and a backpack. So, you can probably keep your clothing budget to a minimum.

I should also mention that I quit without really having an idea of what my expenses were- I just looked at the amount I could potentially withdraw at a 3% rate and figured I could make that work. So far, other than an expensive downsizing, so good.

Welcome to the group!

 

[2017ish]

This survey of detailed spending of "older americans" has been mentioned quite a few times in the past. https://www.ebri.org/pdf/briefspdf/EBRI_IB_02-2012_No368_ExpPttns.pdf Based on 2001-2009, and you have to adjust somewhat for Honolulu, but it gives you a basis to work from.

Agree with what others have said--you've put yourself in a good financial position for retirement and should be able to swing things without too much trouble.

 

[Fedup]

If I retire in Hawaii, I would eat papaya and pineapple everyday. It was dirt cheap, like 99c for a pineapple when I was there. I had to stop myself from buying it. I might eat fish more than steak because it's probably abundant. Bake my own bread that kind of thing. Vacation is different.

 

[LOL!]

I am told that one can work 20 hours a week at Whole Foods and get health insurance for about $150 a week.

 

[97guns]

If I retire in Hawaii, I would eat papaya and pineapple everyday. It was dirt cheap, like 99c for a pineapple when I was there. I had to stop myself from buying it. I might eat fish more than steak because it's probably abundant. Bake my own bread that kind of thing. Vacation is different.

Don't know what Hawaii you were in but there ain't no .99 pineapple/papaya, maybe the last time you were there in 1950

 

[Fedup]

Don't know what Hawaii you were in but there ain't no .99 pineapple/papaya, maybe the last time you were there in 1950

I go to Hawaii yearly, maybe twice in some years. That was the price I got Dec 2015 in Maui. It was either near our luxury hotel or Safeway. I never went to Costco ever. Not in Hawaii.

 

[MichaelB]

How about everyone take a step back, breathe deeply, and smile. We're friends.

 

[Nords]

Do a google search on this site for user "nords". He lives near honolulu and wrote often about the cost of living (manageable). He doesn't frequent the forum often these days.

Thanks, Walkinwood!

I've been researching a lot on planning for retirement and, well, I haven't found anything really useful to my situation. I think I may have enough to retire, and I'm sick to death of my job, so I'm going to jump off the wall and either bounce or splatter; either way should be interesting.

My question is: what do other people see as possible stumbling blocks, major considerations, minor 'didn't think of thats', to retiring now? How much do most people in the U.S. spend on things like entertainment, clothing, travel...? What would you spend if you didn't have kids or a SO to think about? Suggestions (polite ones) welcome!

Welcome to the forum, SoloTraveler. I asked similar questions here back in 2004. The answer was that everything would work out fine, and 13 years later that's still the case.

If you're not already tracking your spending, that will give you a little clarity on your retirement expenses. Hawaii is also one of the more retiree-friendly states in the nation... employment income is taxed much more heavily than retirement income.

I've lived here since 1989. Let me know if I can help with detailed analysis. At this point the biggest issue would be what type of longboard you prefer, and Kimo's Surf Hut can help you with the decision.

I'm in Honolulu right now vacationing and it's really expensive, 6-$7 for a gallon of milk, $5 for a loaf of sandwich bread, $8 for # of bacon, $6 for a box of cherries, forget about fresh veggies. $2 a pound for lettuce, I sure wouldn't want to live here much less retire here. I have lots of family here and they all have college degrees with 6 figure jobs, it is a must to have this kind of income here, working a $20/hr job ain't gonna cut it. I would need double my income just to survive here.

If I retire in Hawaii, I would eat papaya and pineapple everyday. It was dirt cheap, like 99c for a pineapple when I was there. I had to stop myself from buying it. I might eat fish more than steak because it's probably abundant. Bake my own bread that kind of thing. Vacation is different.

In general, 97guns, we see that a lot from replicating a Mainland diet and not being able to shop the bargains.

 

[SoloTraveler]

Thank you!

I've always wanted to learn to surf; just afraid I may be too old at this point...

I'm not too fond of papayas, but mangoes would be good...?

Health insurance will be carried into retirement, courtesy of my employer.

My condo is in Honolulu in the Ala Moana area. It's my only property and a one bedroom, so no roommate.

Other than electricity, gas, food, and HOA fees, I'm adding a monthly scuba dive, and Tai Chi or Qi Gong classes; maybe sailing if the funds are there.

I'm still dithering - going to have to take a deep breath and pull the plug on my paycheck and see how it goes, because as long as I'm not there, I'm here enjoying the somewhat-less-than-garden spots of Africa like Chad, Mauritania and the Central African Republic. It's a no-brainer on where i'd rather be; it's just a matter of letting go ...

 

[Nords]

I've always wanted to learn to surf; just afraid I may be too old at this point...

Heh. I'm living proof that surfing requires neither maturity nor youth. Many of the surfers at White Plains Beach are in their 70s, and I'm pretty sure one is pushing 80.

I'm still dithering - going to have to take a deep breath and pull the plug on my paycheck and see how it goes

It's a no-brainer on where i'd rather be; it's just a matter of letting go ...

Do the math, reach your numbers, and work your plan. The alternative is falling into the trap of "Just One More Year."

 

[brucethebroker]

Between your pension and a 3.5% WR from your $1 million nestegg, you'll have $90k a year of cashflow.... that should be enough to live quite comfortably in many places in the US.

Even live like a prince in the Midwest and parts of the South!

Welcome, BTW.

 

[kcowan]

When we were in Hawaii, Honolulu was much cheaper than Waikiki for nearly everything.

Eating the local produce was the only way to economize!

 

[Fedup]

When we were in Hawaii, Honolulu was much cheaper than Waikiki for nearly everything.

Eating the local produce was the only way to economize!

Funny, I thought it's the same place.