Is it possible to retire now (40's)?

[gwraigty]

I know a few stay at home moms who live in our neighborhood. Lately, when I drive by houses each morning on the way to work, I always wonder: Do they worry about money or savings, do they regret not working... I think I envy them more than the other way around (of course, they don't know about our piggy bank either).

I've been a SAHW, then later a SAHM, since my marriage in 1992. No regrets. No worrying about money, even in the days when my husband didn't make much. He handed over the finances to me and I made it my "job" to made sure we had a surplus every month to save and, later on, to invest. It was easy for me, because my identity was never wrapped up in what I ever did for a paycheck. (I had a 4 1/2 year stint in accounting myself.)

We're both 56. The total of our financial accounts is close to yours, even though my husband still doesn't make what yours makes, and I've not brought home a paycheck in our marriage. We don't want for anything financially. It can be done.

 

[AbbA]

I've been a SAHW, then later a SAHM, since my marriage in 1992. No regrets. No worrying about money, even in the days when my husband didn't make much. He handed over the finances to me and I made it my "job" to made sure we had a surplus every month to save and, later on, to invest. It was easy for me, because my identity was never wrapped up in what I ever did for a paycheck. (I had a 4 1/2 year stint in accounting myself.)

We're both 56. The total of our financial accounts is close to yours, even though my husband still doesn't make what yours makes, and I've not brought home a paycheck in our marriage. We don't want for anything financially. It can be done.

Thank you for posting! I think your and FlaGator's comments were the most or even the only encouraging and inspirational on this thread. It doesn't mean I didn't appreciate reading the other views. They were very realistic for sure.
The most unique thing I heard was voices of a potential divorce. I was/am more worried for my spouse not to get sick with some terrible disease. A divorce didn't even cross my mind! I'l probably have to create another thread w/poll to ask how many people save and prepare for retirement while accounting for a potential divorce in their numbers. Yes, divorces are kind of popular in this country . It's probably a good idea to build a cushion into a retirement portfolio for this reason, but then how many years do people delay their retirements to build up this kind of security...Uhh, I didn't consider such an option in my marriage (yet).
Like you, I'm also a CFO and CEO and secretary in my house. My DH has no inclination to learn anything about finances. If you asked him what funds he has in his 401k, he'd say he has Vanguard and it's stocks and bonds. He wouldn't be able to name even one index fund correctly . We do some credit card churning... I have to tell him which CC to use for gas, groceries, etc. so we maximize cash back or point earning. OTOH, he's a great cook and educator for the kids!!

 

[Dtail]

Thank you for posting! I think your and FlaGator's comments were the most or even the only encouraging and inspirational on this thread. It doesn't mean I didn't appreciate reading the other views. They were very realistic for sure.
The most unique thing I heard was voices of a potential divorce. I was/am more worried for my spouse not to get sick with some terrible disease. A divorce didn't even cross my mind! I'l probably have to create another thread w/poll to ask how many people save and prepare for retirement while accounting for a potential divorce in their numbers. Yes, divorces are kind of popular in this country . It's probably a good idea to build a cushion into a retirement portfolio for this reason, but then how many years do people delay their retirements to build up this kind of security...Uhh, I didn't consider such an option in my marriage (yet).
Like you, I'm also a CFO and CEO and secretary in my house. My DH has no inclination to learn anything about finances. If you asked him what funds he has in his 401k, he'd say he has Vanguard and it's stocks and bonds. He wouldn't be able to name even one index fund correctly . We do some credit card churning... I have to tell him which CC to use for gas, groceries, etc. so we maximize cash back or point earning. OTOH, he's a great cook and educator for the kids!!

Everyone has different skills that they bring to the relationship.
My DGF doesn't understand our finances except on a high level review which I go through with her monthly.
I went through a divorce and it cost me plenty, but would not have worked years longer just in case of that possibility. Life happens and we all get through it.

 

[ivinsfan]

Thank you for posting! I think your and FlaGator's comments were the most or even the only encouraging and inspirational on this thread. It doesn't mean I didn't appreciate reading the other views. They were very realistic for sure.
The most unique thing I heard was voices of a potential divorce. I was/am more worried for my spouse not to get sick with some terrible disease. A divorce didn't even cross my mind! I'l probably have to create another thread w/poll to ask how many people save and prepare for retirement while accounting for a potential divorce in their numbers. Yes, divorces are kind of popular in this country . It's probably a good idea to build a cushion into a retirement portfolio for this reason, but then how many years do people delay their retirements to build up this kind of security...Uhh, I didn't consider such an option in my marriage (yet).
Like you, I'm also a CFO and CEO and secretary in my house. My DH has no inclination to learn anything about finances. If you asked him what funds he has in his 401k, he'd say he has Vanguard and it's stocks and bonds. He wouldn't be able to name even one index fund correctly . We do some credit card churning... I have to tell him which CC to use for gas, groceries, etc. so we maximize cash back or point earning. OTOH, he's a great cook and educator for the kids!!

Grey divorce is one of the fastest growing areas of divorce. I never said you should continue to work for that reason. My comment was if you cut things close without allowing for losing your spouse through either death or divorce you could find yourself in a very challenging position. You can buy term insurance if healthy but you can't buy divorce insurance. You would be most vulnerable here since your DH plans or needs to continue working.

 

[karen1972]

Welcome, this forum has such good advice.

If your child does want to become a doctor the other thing is to talk and look at programs that will forgive debt. googling "Health Professional Shortage Area" should lead you to a host of programs. Hopefully they can get involved in high school medical program to try it out. I know my niece wanted to be a nurse but then couldn't handle sticking a needle in anyone so that ended that without any money spent.

As others said health care obviously is a big deal. Its not just the money though, the ones offered on the exchange often excluded good hospitals and doctors. We had better luck when United offered individual plans, but when it stopped BCBS had almost a monopoly and got super greedy and kicked out the two best health care groups (from my opinion).

Others touched on the other aspects of retiring, its just a lifestyle change which you both need to be comfortable with. My honey said he was fine my becoming a SAHW but when he is stressed about work there are occasional snarky remarks about well one of us has a job... its not been a huge deal, but it is always there at little a little bit especially when their job starts to suck real bad.

 

[gwraigty]

Thank you for posting!

<snip>

Like you, I'm also a CFO and CEO and secretary in my house. My DH has no inclination to learn anything about finances. If you asked him what funds he has in his 401k, he'd say he has Vanguard and it's stocks and bonds. He wouldn't be able to name even one index fund correctly . We do some credit card churning... I have to tell him which CC to use for gas, groceries, etc. so we maximize cash back or point earning. OTOH, he's a great cook and educator for the kids!!

You're quite welcome!

My husband managed his finances fine when he was single. He just doesn't like to do it and was happy to pass it on to me. Have you documented how you do things, just in case? I created a document that I regularly update and save to a flash drive. I prompt my husband to save it to his flash drive.

 

[gwraigty]

My honey said he was fine my becoming a SAHW but when he is stressed about work there are occasional snarky remarks about well one of us has a job... its not been a huge deal, but it is always there at little a little bit especially when their job starts to suck real bad.

Um, please don't present this as something normal with being a SAH spouse. My husband has NEVER made a snarky remark to me about it. In fact, just the opposite. Any remarks have been how he values what I've done, and continue to do.

In your case, it sounds like he's really not fine with it, after all.

 

[ivinsfan]

Um, please don't present this as something normal with being a SAH spouse. My husband has NEVER made a snarky remark to me about it. In fact, just the opposite. Any remarks have been how he values what I've done, and continue to do.

In your case, it sounds like he's really not fine with it, after all.

+1 or as my SonIL likes to say 90% joking, but it's the other 10% that is really what you are thinking.

OP this is an example of things changing, one spouse is OK with bringing home all the bacon but things can change. They have negative changes in their work life or health issues or simply feel pressure and/or burned out.

 

[ncbill]

Welcome, this forum has such good advice.

If your child does want to become a doctor the other thing is to talk and look at programs that will forgive debt. googling "Health Professional Shortage Area" should lead you to a host of programs. Hopefully they can get involved in high school medical program to try it out. I know my niece wanted to be a nurse but then couldn't handle sticking a needle in anyone so that ended that without any money spent.

No need to take on debt at all:

https://en.wikipedia.org/wiki/Health_Professions_Scholarship_Program

 

[AbbA]

If your child does want to become a doctor the other thing is to talk and look at programs that will forgive debt. googling "Health Professional Shortage Area" should lead you to a host of programs. Hopefully they can get involved in high school medical program to try it out. I know my niece wanted to be a nurse but then couldn't handle sticking a needle in anyone so that ended that without any money spent.

Thanks, Karen. This is an interesting alternative I never heard about. I'll have to ask around if the HS my kids will go to offers something similar. If not, it wouldn't be bad to volunteer at a hospital...Of course, it wouldn't be easy to find such a place for a teen to volunteer considering liability and underage things.

 

[AbbA]

Um, please don't present this as something normal with being a SAH spouse. My husband has NEVER made a snarky remark to me about it. In fact, just the opposite. Any remarks have been how he values what I've done, and continue to do.
In your case, it sounds like he's really not fine with it, after all.

You both post good examples. One's spouse was ready and welcomed the change of having a SAHW or SAHM while the other might feel some resentment on the bad days.
My DH would be fine I think as long as I don't assign him to do projects after his work. I recall one situation when we bought our house just before I found a job a few months later and this was before children. I had all that bursting energy to look for new furniture, buy paint, paint garage, etc. My DH would come home in the evenings and I would lay all my plans of where we should go shopping, what we would need to plant, what to buy, etc etc. After a few weeks he made a remark "You know, I think it would be good if you found a job soon and then we would see how much energy you would have after 8-9 hours of work in the office"... Boy, was he right!! OTOH, I was glad I had those few months before finding that job. Anyway, those days of carefree energy are over and I realize how one wishes for relaxation after a long workday and crazy traffic.

 

[cbslc]

about the same situation

I'm in a similar situation. DW is 49 and retired 2 yrs ago. I'm 47 and getting more fed up with healthcare IT everyday. We however don't have children. The only reason I keep on, is 1. $$ and 2. I can work from home in current job. But even with that work from home, I'm getting closer to FIRE.
I found firecalc was too simplistic to model what we have. The optimal retirement planner was better at handling more of my stuff: https://www.i-orp.com/Spend/index.html
But neither and for that matter none of our wealth managers can model a good way to spend our money. We have 401k's, 403b's, 457b's, I series, lump sum annuities, lifetime annuity (tort), CD's, Municipal bonds, tiny amts of state retirements...
And nothing can spit out anything close to what assets to tap first, second...
Unfortunately, how you spend your money before 59.5 can have a big impact.
Have you figured out how to attack your retirement savings?

 

[samcat]

Thanks for the reminder. Yes, he's insured. $500k term insurance will expire in 8 years and another $250k will lapse after he turns 65. $160k is through his job while he's employed.

Do you have any life insurance outside of work? I think SAHMs need life insurance also. He would need help paying someone to do the work you would be doing as a SAHM.

 

[samcat]

No, it's not. Yep, I wonder what other people do about it too. What would be good websites to start looking up available plans for individual states? If families don't qualify for ACA plan (which I hear/read is crumbling), how/where to they look for private insurance plans? I know that BCBS is in many states including ours, so I would guess I can visit their website, but aren't there websites that aggregate information of various plans and let you compare?

We have a cost sharing medical plan. Have had it for almost two years and it has worked great. Ours is Christian Healthcare Ministries. There are a few different plans out there.

 

[gwraigty]

Do you have any life insurance outside of work? I think SAHMs need life insurance also. He would need help paying someone to do the work you would be doing as a SAHM.

That depends. We never took out life insurance on me. My husband never paid anyone to do his cooking and cleaning before he met me. He wouldn't have done so if I'd died.

 

[Crewer]

No comment on your finances but I have some experience with getting out and becoming a SAHM when our kids were about the ages of your kids. We had some advantages over you (20 years ago I took a severance package that allowed me to keep the company health insurance - something that would probably be unthinkable these days) and I did work part time at home, which gave me some cover professionally.

I am so, so glad I was there when the kids were young. It added quite a bit of value to the family IMHO. It was a stretch for me as a Ph. D. scientist to take the leap but now I feel I had the best of all worlds. We had a 2.5 lb preemie who was on oxygen at home for over 2 years so early days were different for us but the teen years were a wilder ride. I am grateful I could be there and I think the kids appreciated it, too. They are doing great, especially the one who "grew up in the school of hard knocks."

 

[samcat]

That depends. We never took out life insurance on me. My husband never paid anyone to do his cooking and cleaning before he met me. He wouldn't have done so if I'd died.

The original post says she has kids. I think if a SAHM dies while having kids at home, there might be a need for life insurance.

 

[rpguy4]

DH has term life insurance (see post #17)
Quote:
"Thanks for the reminder. Yes, he's insured. $500k term insurance will expire in 8 years and another $250k will lapse after he turns 65. $160k is through his job while he's employed."

 

[gwraigty]

The original post says she has kids. I think if a SAHM dies while having kids at home, there might be a need for life insurance.

I saw that. It depends on the ages of the kids, the availability of low-cost/no-cost child care, etc. Not at all as simple as saying it's a must-have in all situations. I'm not sure how this relates to the OP retiring or not.

 

[NanaW]

In regards to a PT job, it feels that it's not really worth it unless I *want* to do it instead of *need* to do it. You start as a part-timer and as time goes on you become almost a FT employee at a PT pay. That's what I've heard from other accountants. I don't have CPA licence and I don't aspire to have it .

Ideally, I would like to quit soon and decompress for a while, but that's wishful thinking probably. It will be hard to find a job once there is a gap on the resume. Salary will be low if anyone wants to hire me. What if I lose interest in working professionally after a few years? So, I just keep dreaming while driving to work and back...

That is pretty much what happen to me I quit working for 2 yrs to take care of my FIL thinking I would go back, well now I am finding it hard to go back no one wants to hire someone my age and when I try part time they pay me squat so I know how you feel . It’s harder for a woman I think.

 

[AbbA]

The original post says she has kids. I think if a SAHM dies while having kids at home, there might be a need for life insurance.

I know it was a gamble probably to not insure me outside my employer's life insurance but my thinking was that my DH's salary would allow him to hire some occasional help. Now the kids are tweens so I don't think they will need a babysitter. It's more like a tutor and of course college expenses. My DH is insured. Perhaps not abundantly enough but I think since he crossed the line of 50 of age, it might be expensive to find another temp insurance. I haven't thought that we needed more than we have.

 

[FlaGator]

I saw that. It depends on the ages of the kids, the availability of low-cost/no-cost child care, etc. Not at all as simple as saying it's a must-have in all situations. I'm not sure how this relates to the OP retiring or not.

The original post says she has kids. I think if a SAHM dies while having kids at home, there might be a need for life insurance.

A few thoughts on spouse life insurance with young kids at home....
1. Both of us were insured, me at over 10x what the late DW was. Fortunately, when the late DW got her terminal cancer diagnosis, we were in good enough shape otherwise for me to retire a year after she passed.
2. We had a legacy policy on her that was helpful to get paid on, but was less than 5% of our net worth.
3. Had we not accumulated what we did and I needed to keep working, we were woefully underinsured on her.
4. From my experience, couples with a SAHM need to carefully think through what the needs will be should mom die first while the kids are at home.

My job required a lot of travel, and the only way I could have continued that was with a live-in nanny. Our house wasn't good for that arrangement, so I would have needed to upgrade the house, pay the nanny, and pay the "guilt fee" on extras for the kids so I didn't feel they were missing important activities.

I suggest a situation like that should be considered for any SAHM. Having family nearby to help out would be great, but if you're on your own and the worst happens, the costs rise quickly. Make sure there are sufficient assets to make it work for both widowed dad and widowed mom.

 

[pb4uski]

I agree with others that you are in good shape. I did a quick FIRECalc of $75k a year, $2.5m of assets, 50 years and 70% equities and got 100% success and that ignored pensions and SS and had higher expenses than what you reported. 95% success is $2.2 million which is more realistic allowing $300k for college costs. I think if you go through it in detail then you'll find that you are in good shape... you guys have done a great job saving.

You'll want to make sure that health care is covered... and unfortunately that is a bit of a moving target.

If your DH retires at 55 and can do penalty free withdrawals from his 401k then I would suggest that you live on 401k withdrawals from ER until your FRA (or later) for SS.... you should be in a low tax bracket at that point and could do Roth conversions from your IRAs on top of 401k withdrawals.... reducing the size of the dreaded tax torpedo.

Our "policy" was to pay for undergrad... anything after that was on them.

 

[AbbA]

I agree with others that you are in good shape. I did a quick FIRECalc of $75k a year, $2.5m of assets, 50 years and 70% equities and got 100% success and that ignored pensions and SS and had higher expenses than what you reported. 95% success is $2.2 million which is more realistic allowing $300k for college costs. I think if you go through it in detail then you'll find that you are in good shape... you guys have done a great job saving.

You'll want to make sure that health care is covered... and unfortunately that is a bit of a moving target.

If your DH retires at 55 and can do penalty free withdrawals from his 401k then I would suggest that you live on 401k withdrawals from ER until your FRA (or later) for SS.... you should be in a low tax bracket at that point and could do Roth conversions from your IRAs on top of 401k withdrawals.... reducing the size of the dreaded tax torpedo.

Our "policy" was to pay for undergrad... anything after that was on them.

thank you for your response, pb4uski! Learning how to run FireCalc and other calculators is next on my list. Right now I'm learning about the transition to HS and HS classes, etc. It's darn confusing
Your response encourages me not to be afraid to make my own calculations because the answer will not look depressing

How is it possible to confirm that my DH is allowed to use his 401k if he left his employer in the year he turns 55? His 401k administrator is Fidelity. He could call to ask but we're a bit weary...What if the reps are instructed to notify the employer about employees asking such questions and get a reason to kick them out prematurely? I think I read in some paperwork a long time ago that he would have access to his 401k once he turns 55 and leaves but now I cannot find it to confirm.
I also know that employees leaving the company at a certain age in the past were eligible for health insurance, but this policy might have changed. We could like to learn it either way but again we don't know whom to ask in case such questions are leaked. OTOH, his employer is a huge multi-national company and very well known in the industry, so it probably wouldn't care but in our minds we are very averse raising our questions unless he really wants to retire.

DH doesn't want to retire unless circumstances change (health, layoff, etc.). So far he is (reasonably) content with his work.

 

[joeea]

That depends. We never took out life insurance on me. My husband never paid anyone to do his cooking and cleaning before he met me. He wouldn't have done so if I'd died.

The M in SAHM means that someone might need to be paid to care for the children.