My position was eliminated in April and I’m still working on my plan to stay retired. Below are the 2 plans I’m currently working with. The major difference in the plans is the delaying of my non-cola pension for 2 years. For some reason I feel better about option 1 because it seems to have less risk because I’ll be spreading out the severance until SS kicks in.
Would I be better off delaying the pension for 2 years for the additional $5,000 per year? Also if I die before I take the pension my wife would only get $15,000 per year.
Do you think option 1 would be fine or should I take a serious look at option 2? Option 2 includes very little reportable income for 2 years so I would need to sell some investments to generate enough income to qualify for Obamacare.
Any recommendations would be greatly appreciated.
Below is my current status.
Current
$16,000 from severance in checking for expenses from Sep 2013 – Dec 2013.
$96,000 from severance in the bank.
$400,000 – 90% stocks 10% bonds. 50% Taxable.
$75,000 in CD’s
I have a small online business that should generate $5,000 per year after expenses but before taxes. If the business does not generate the $5,000 I’ll take if from the investments.
My expenses should be around $45,000 per year and increase by around 2.5% per year.
Option #1
From Jan 2014 until Sept 2021.
$30,000 per (Joint and Survivor) non-COLA pension starting 1/1/2014.
$15,000 per year from severance fund.
$5,000 per year from small business.
$21,000 one time from investments.
Total = $50,000 annually until 2021
Starting in 2021 I’ll turn 66 and my SS will be $27,000 and my wife will get $13,000. The severance money will be gone and I’m not counting on the small business income.
Total income starting in 2021 = $70,000 without any investment income.
Option #2 - Delay pension until Jan 2016.
From Jan 2014 until Jan 2016
$45,000 per year from the severance account.
$5,000 from small business
Total $50,000
From 2016 – 2021
$35,000 (Joint and Survivor) non-COLA pension starting 1/1/2016.
$10,000 per year from investment account
$5,000 from small business.
Total $50,000
Starting in 2021 I’ll turn 66 and my SS will be $27,000 and my wife will get $13,000.
Starting in 2021
$35,000 non-COLA pension
$40,000 SS including spouse
Total = $75,000 annually without any investment income.
Would I be better off delaying the pension for 2 years for the additional $5,000 per year? Also if I die before I take the pension my wife would only get $15,000 per year.
Do you think option 1 would be fine or should I take a serious look at option 2? Option 2 includes very little reportable income for 2 years so I would need to sell some investments to generate enough income to qualify for Obamacare.
Any recommendations would be greatly appreciated.
Below is my current status.
Current
$16,000 from severance in checking for expenses from Sep 2013 – Dec 2013.
$96,000 from severance in the bank.
$400,000 – 90% stocks 10% bonds. 50% Taxable.
$75,000 in CD’s
I have a small online business that should generate $5,000 per year after expenses but before taxes. If the business does not generate the $5,000 I’ll take if from the investments.
My expenses should be around $45,000 per year and increase by around 2.5% per year.
Option #1
From Jan 2014 until Sept 2021.
$30,000 per (Joint and Survivor) non-COLA pension starting 1/1/2014.
$15,000 per year from severance fund.
$5,000 per year from small business.
$21,000 one time from investments.
Total = $50,000 annually until 2021
Starting in 2021 I’ll turn 66 and my SS will be $27,000 and my wife will get $13,000. The severance money will be gone and I’m not counting on the small business income.
Total income starting in 2021 = $70,000 without any investment income.
Option #2 - Delay pension until Jan 2016.
From Jan 2014 until Jan 2016
$45,000 per year from the severance account.
$5,000 from small business
Total $50,000
From 2016 – 2021
$35,000 (Joint and Survivor) non-COLA pension starting 1/1/2016.
$10,000 per year from investment account
$5,000 from small business.
Total $50,000
Starting in 2021 I’ll turn 66 and my SS will be $27,000 and my wife will get $13,000.
Starting in 2021
$35,000 non-COLA pension
$40,000 SS including spouse
Total = $75,000 annually without any investment income.