How much to retire in late 50's?

[Anonymous]

Anonymous wrote:Financial planner is right, working a few more years is the best option. OP, do you have any skills or connections through your volunteering to get a side gig part time?

Are you paying for college for your kids? If so, what share of your annual expenditure is college tuition?

What do you spend 100K on, if the house is paid off and there is no health care premiums. 100K is 8.3K per MONTH. Do you travel by private jet several times a year or smth?

If DH wants to retire and you already don't work, the responsible thing would be to cut expenses way, way back, especially since you'll have to buy health insurance.

OP here: College is done. Places where we bleed money are mainly eating out, travel, and gifts. Both DH and I have elderly parents who live out of state and there were some health issues last year, so we spent more on travel than usual, but there may be more of that in the future. (Not private jets though, more like peasant class economy.)

[Anonymous]

Anonymous wrote:Ok, so let's say you have health insurance/expenses costs 50k/year (aiming high here to account for volatility) for the next 6 years until you're 65 and qualify for Medicare. 300k. Set that aside.

If you consider 3,300,000 as the remainder of your portfolio, and your annual spending not including that to be 120K (to account for taxes) firecalc suggests that you have greater than 93% chance of sustaining that until you're 100+ retiring now.
That leaves a 200k emergency fund to cover whatever else.

So it seems to me that you *could* do this--but the numbers are close enough that you want to do a careful analysis and/or be willing to reduce spending if you're off in your accounting. What are your actual taxes? What will the cost of Medicare be when you retire? Also, in the early years of retirement annual spending on travel/eating out etc might increase, but that tends to trickle off in later years. I would say to your financial planner, this is what we want to do--how can we make it work rather than 'can we do this?'. Because the safest answer--and the one that often gives the planner more money--is to wait--but it's not always best for life. Your listing of worries seemed to be pretty fear-filled rather than totally rational.

I do think your husband who has to put in the grueling hours gets to decide that he doesn't want to do it anymore--(I couldn't tell from your post if you're mainly the one with the "security" concerns). Both of you could look for easier work options--even though you've been out of the workforce--you should try in earnest rather than just assuming he's the one to keep working if the numbers don't work. If he needs to stop, and you want more financial security, you can look for work. You just need something that will give you health insurance for another year or so. Also, can he discreetly review phased retirement options at his workplace--or ask directly once he's sure he's going to retire? Some people negotiate staying on the health insurance rolls via consulting or the like and many places have more formal slow reductions.

We are both concerned about financial security. But he's counting on me to confirm we'll be financially ok for a comfortable retirement, and as some of you concurred, we're sort of borderline for such an early retirement right now. And no one really knows how long they will live or what the market will do. I've looked at a lot of financial calculators, including some fairly detailed ones on sites like fidelity.com. Assumed health care costs, life span, and market performance end up driving the results. I assume "significantly below average" for market performance (because retirement portfolios don't usually maximize market returns.) I can make it all look great if I reduce our planning to age 90 instead of age 94. (None of my grandparents lived to 90, let alone 94.) Health care is a crap shoot. When I spoke to the financial planner last year, she agreed $30,000 a year for two would be a conservative estimate; now a year later, it's more like $40,000.

I agree about the theoretical possibility of my working, maybe to supplement his doing something less demanding. Unfortunately, I've got some volunteer commitments for a few more months, but I've told him to cut loose whenever he wants because I want him to get to retirement. Talking to the financial planner again in a week. Thanks for all the suggestions!

[Anonymous]

Should get COBRA for 18 months so that should be better than exchanges.

[Anonymous]

Has your husband asked his firm if he can work part time and keep health care benefits? If he is so close to walking away from the job there is nothing to lose by asking the question

[Anonymous]

1) Your DH should talk to his employer about going part-time. My DH has about 5 older employees who are PT and he is fine with that because it frees up $ and they are more efficient and experienced than younger hires. If yourr DH has enough hours that should cover his health care costs.

2) Many jobs offer HC, even Starbucks, so you should be looking also. It's not fair to just rely on your DH when he is burnt out.

[Anonymous]

Anonymous wrote:Has your husband asked his firm if he can work part time and keep health care benefits? If he is so close to walking away from the job there is nothing to lose by asking the question

This. He can always try it and quit later if it’s not working.

[Anonymous]

Anonymous wrote:1) Your DH should talk to his employer about going part-time. My DH has about 5 older employees who are PT and he is fine with that because it frees up $ and they are more efficient and experienced than younger hires. If yourr DH has enough hours that should cover his health care costs.

2) Many jobs offer HC, even Starbucks, so you should be looking also. It's not fair to just rely on your DH when he is burnt out.

+1

[Anonymous]

You can do it now. You have plenty of money. The 3 million is enough for your income. And use the other 850K for health insurance until you are 65 and can get medicare. Insurance is expensive but it isn't 100K.

[Anonymous]

Move to Panama or Mexico and retire with luxury.

[Anonymous]

If $3m plus isn’t enough then we are all screwed.

[Anonymous]

Anonymous wrote:If $3m plus isn’t enough then we are all screwed.

Exactly

[Anonymous]

Anonymous wrote:

Anonymous wrote:If $3m plus isn’t enough then we are all screwed.

Exactly

My thoughts too!

[Anonymous]

Anonymous wrote:You can do it now. You have plenty of money. The 3 million is enough for your income. And use the other 850K for health insurance until you are 65 and can get medicare. Insurance is expensive but it isn't 100K.

OP are you the same age as your Dh? Do you both qualify for Medicare in 6 years?

[Anonymous]

The republicans want to weaken the preexisting conditions law so anyone who is self insured runs the risk of being put in a bare bones high risk pool type insurance policy if they have or develop any number of health conditions

[Anonymous]

Anonymous wrote:The republicans want to weaken the preexisting conditions law so anyone who is self insured runs the risk of being put in a bare bones high risk pool type insurance policy if they have or develop any number of health conditions

In an ideal world the OP should have a catastrophic insurance policy supplemented by an HSA. (This is not self insurance and the OP is familiar with how these work.) This should cost much less than $30K. Of course, the Democrats view these policies as "junk" and they are not offered because of the ACA. Insurance policies have two purposes: actual insurance and access to the medical buying power of insurance companies. What the OP needs is minimal insurance but health care bought through an insurance company. Unfortunately, the ACA precludes this. OP might want to look at something like Medishare, which seems to be a way to get around the anti-market aspects of the ACA using the religious exception.