Can I Retire ?

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Topic Author
sunrisered
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Re: Can I Retire ?

Post by sunrisered »

Casper wrote: Tue Jun 21, 2022 12:49 pm If I were in the same position, I'd take the package and retire. Especially if you can cut your costs a bit. $72k per year is a bit high (and not an amount I'd call "conservative").
thank you Casper. I appreciate your comments. - i have to agree maybe the 72k is not so conservative. It is not my bare bones number. I actually started with 50k (that is what we spend now for a number of years ongoing). Added in 10k as a buffer which took it to 60k. Then added another 12k for health insurance prior to Medicare.

So what started out as rather conservative at 50k got ratcheted up to 72k.......... (and i agree that number doesn't feel really conservative). :happy
Topic Author
sunrisered
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Re: Can I Retire ?

Post by sunrisered »

FoolMeOnce wrote: Tue Jun 21, 2022 1:30 pm
happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
4.5% would probably be fine for most people for 30 years, and if it proves not to be, they can cut costs down the line - that possibility is the trade-off for retiring now instead of continuing to work. But that is without even considering SS, which will drastically reduce the withdrawal rate. They should be more than fine.
thank you FoolMeOnce. I appreciate your thoughts.
BernardShakey
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Re: Can I Retire ?

Post by BernardShakey »

sunrisered wrote: Tue Jun 21, 2022 6:06 am
ThankYouJack wrote: Mon Jun 20, 2022 6:58 pm I'd jump on it.

Assuming your combined social security starting at 62 is over $20k and we don't have any black swan events, you should be good to go.

Congrats!
ThankYouJack - thank you for your comments. Our combined SS starting at 62 will be $36k (2,000 a month for me and 1,000 a month for my wife with spousal SS). We will be spending from our after-tax, cash until 59.5 and are planning to continue to be conservative with our spending.
I would not "jump on it" --- I don't think you've done enough homework. Opensocialsecurity recommends you both take at 62 ? My understanding is that you are likely better off waiting until 70 unless you have health issue or short expected longevity (optimum for your wife may be at 62). How confident are you that you can self-insure for LTC insurance ? Have you priced it out ?
Last edited by BernardShakey on Tue Jun 21, 2022 2:43 pm, edited 2 times in total.
An important key to investing is having a well-calibrated sense of your future regret.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

delamer wrote: Tue Jun 21, 2022 1:50 pm I don’t see any reason that you can’t retire now.

As I always recommend in these situations, I’d do a spreadsheet showing income sources and expenses for the next 10 years. That will allow you to see how both will change over time, plus your portfolio balance.

Medicare eligibility and Social Security claiming will both make big differences.

Make sure you include income taxes in your spreadsheet.

And definitely check out a Social Security calculator. In order to optimize your benefits, it will probably recommend that you claim at 70 and your wife at 62. Remember that when the first spouse dies, the survivor will receive the larger of the two benefits. So if you delay, it has significant benefits down the road.
Thank you delamer for all of your thoughts. I do have a pdf output from a Fidelity retirement tool but do like your suggestion about putting it into Excel myself. I agree sometimes that can help to show you things when you create it yourself.

I see a lot of folks tend to lean towards and recommend claiming SS later. My thoughts for claiming earlier was to use the SS money that my wife and I have paid in to so that more of my IRA and 401k is left over since it can be passed on to our kids when we are both gone. (not that the inheritance is my primary consideration, as it is not, but, i do like the idea of our kids getting a little more since they cannot get our 'left over' SS). Maybe that is not the best way to look at it.
BernardShakey
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Re: Can I Retire ?

Post by BernardShakey »

michaeljc70 wrote: Tue Jun 21, 2022 8:37 am Yes, you can retire. You can collect SS in just 3-4 years and that will cover half your expenses. I don't understand the math some people are using. I would throw in the caveat that if you are invested very conservatively (less than 50/50) I'd rethink retiring now. Even if you wait until FRA to collect SS, you have enough money to last until that or age 70. Guessing based on my projected SS benefits, 36k SS at age 62 would be around $60k if you wait until age 70.
Taking SS at 62 is likely not optimum except for the lower earner.
An important key to investing is having a well-calibrated sense of your future regret.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

Fulltimer wrote: Tue Jun 21, 2022 11:34 am Would your wife be eligible for her own benefit at 62 to help with expenses while you possibly wait? Also, verify your $2000 at 62 includes no income after 58.

Open Social Security calcs told me (younger and lower income spouse) to take mine at 62. My husband should take his at 70 to provide the highest benefit for our combined lifetimes. Since he retired 68 months before his first SS payment, we took that projected payment, $3,866, times 68 and we are holding that money in a separate safe bucket. We withdraw $3,866 from that bucket each month and at age 70 it will be depleted and SS will kick in. Kind of having our cake and eating it too.

His bucket, my SS bucket(I am not 62 yet so we did the same thing for my benefit) and a small pension cover our normal annual expenses so the remainder of our investments will go to various lump sum expenses, a possible future home purchase, Roth conversion tax payments, and future long term care.

We are doing Roth conversions while tax rates are a bit lower that they are projected to be in 2026 and while both of us are alive. When one of us passes we may be looking at high tax rates, RMDs and IRMAA.
thanks Fulltimer. I will check regarding my $2,000 SS at 62 includes no income after 58. good point. thank you.
delamer
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Re: Can I Retire ?

Post by delamer »

sunrisered wrote: Tue Jun 21, 2022 2:34 pm
delamer wrote: Tue Jun 21, 2022 1:50 pm I don’t see any reason that you can’t retire now.

As I always recommend in these situations, I’d do a spreadsheet showing income sources and expenses for the next 10 years. That will allow you to see how both will change over time, plus your portfolio balance.

Medicare eligibility and Social Security claiming will both make big differences.

Make sure you include income taxes in your spreadsheet.

And definitely check out a Social Security calculator. In order to optimize your benefits, it will probably recommend that you claim at 70 and your wife at 62. Remember that when the first spouse dies, the survivor will receive the larger of the two benefits. So if you delay, it has significant benefits down the road.
Thank you delamer for all of your thoughts. I do have a pdf output from a Fidelity retirement tool but do like your suggestion about putting it into Excel myself. I agree sometimes that can help to show you things when you create it yourself.

I see a lot of folks tend to lean towards and recommend claiming SS later. My thoughts for claiming earlier was to use the SS money that my wife and I have paid in to so that more of my IRA and 401k is left over since it can be passed on to our kids when we are both gone. (not that the inheritance is my primary consideration, as it is not, but, i do like the idea of our kids getting a little more since they cannot get our 'left over' SS). Maybe that is not the best way to look at it.
The document from Fidelity sounds very helpful.

Regarding any inheritance, I’m sure you’d agree that providing a solid income for you both and the surviving spouse has to be the first priority.

Another option as you feel more secure in your retirement finances is to begin gifting money to your children while you are still alive. In general, money gifted to young adults has a bigger impact than money they receive when they are in their 50’s or later.
One thing that humbles me deeply is to see that human genius has its limits while human stupidity does not. - Alexandre Dumas, fils
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

BernardShakey wrote: Tue Jun 21, 2022 2:32 pm
sunrisered wrote: Tue Jun 21, 2022 6:06 am
ThankYouJack wrote: Mon Jun 20, 2022 6:58 pm I'd jump on it.

Assuming your combined social security starting at 62 is over $20k and we don't have any black swan events, you should be good to go.

Congrats!
ThankYouJack - thank you for your comments. Our combined SS starting at 62 will be $36k (2,000 a month for me and 1,000 a month for my wife with spousal SS). We will be spending from our after-tax, cash until 59.5 and are planning to continue to be conservative with our spending.
I would not "jump on it" --- I don't think you've done enough homework. Opensocialsecurity recommends you both take at 62 ? My understanding is that you are likely better off waiting until 70 unless you have health issue or short expected longevity (optimum for your wife may be at 62).
Thank you BernardShakey for your comment. To clarify - I was not saying that Opensocialsecurity recommends we take at 62. That was my desire to do it that way - but, a number of folks here have suggested that I do more digging into that before deciding.
BernardShakey
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Re: Can I Retire ?

Post by BernardShakey »

sunrisered wrote: Tue Jun 21, 2022 2:41 pm
BernardShakey wrote: Tue Jun 21, 2022 2:32 pm
sunrisered wrote: Tue Jun 21, 2022 6:06 am
ThankYouJack wrote: Mon Jun 20, 2022 6:58 pm I'd jump on it.

Assuming your combined social security starting at 62 is over $20k and we don't have any black swan events, you should be good to go.

Congrats!
ThankYouJack - thank you for your comments. Our combined SS starting at 62 will be $36k (2,000 a month for me and 1,000 a month for my wife with spousal SS). We will be spending from our after-tax, cash until 59.5 and are planning to continue to be conservative with our spending.
I would not "jump on it" --- I don't think you've done enough homework. Opensocialsecurity recommends you both take at 62 ? My understanding is that you are likely better off waiting until 70 unless you have health issue or short expected longevity (optimum for your wife may be at 62).
Thank you BernardShakey for your comment. To clarify - I was not saying that Opensocialsecurity recommends we take at 62. That was my desire to do it that way - but, a number of folks here have suggested that I do more digging into that before deciding.
Gotcha. The tool is easy to use and worth the time. You might compare and see what kind of monthly pension you could get in lieu of the lump sum. @immediateannuities.com

And you might also want to price out LTC insurance to make sure you are confident in your plan to self insure you and your wife. Good luck!
An important key to investing is having a well-calibrated sense of your future regret.
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arcticpineapplecorp.
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Re: Can I Retire ?

Post by arcticpineapplecorp. »

not sure if this helps but have you read Mike Piper's "Can I Retire?"
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
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happysteward
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Re: Can I Retire ?

Post by happysteward »

michaeljc70 wrote: Tue Jun 21, 2022 1:44 pm
happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
Why would you exclude the SS they can take in 3-4 years that will cover half their expenses? They will have a 4.5% WR for only 3 or 4 years.
Delaying the “SS card” covers a lot of unknowns especially for a couple in their late 50s. It’s as simple as that for me. Too conservative, maybe… OP these are tough decisions, I wish you the best!
"How much money is enough?", John Rockefeller responded, "...just a little bit more."
GibsonL6s
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Re: Can I Retire ?

Post by GibsonL6s »

sunrisered wrote: Tue Jun 21, 2022 5:50 am
GibsonL6s wrote: Mon Jun 20, 2022 6:42 pm my two cents.

If you use the 4% rule as a quick estimate of what you can withdraw, you get about $62k a year, which leaves you a bit short. What does you social security look like?

A couple of thoughts, are you sure the pension lump sum is the way to go, is there an income stream quote to compare.

I think you could easily go part time for a bit and then full retirement.

Good luck
GibsonL6s - thank you for your response. For SS, we plan to collect when I turn 62. My SS will be $2,000 a month and my wife's will be $1,000 a month for spousal SS.

For pension lump sum, in some ways, I like the lump sum (as it allows me to get the benefit from my company and manage myself and possibly help with inflation, also our kids can get the proceeds upon the death of my wife and I). But; I do want to try and make a wise/informed decision. If I take the pension as a monthly payout for myself and my wife, (so she will receive if I pre-decease her) the amount is $2,131 per month. How do I properly compare lump sum versus monthly payout to determine which one might be preferred?

My preference is full retirement, but I want to be flexible and thoughtful on my approach.
You could plug the lump sum you are receiving into an annuity site like Blueprint Income or immediate annuities and see how the payment compares.

Additionally, there are several sites, I dont have the links handy which allow you put all of the info in and do a monte carlo simulation to see probability of success.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

arcticpineapplecorp. wrote: Tue Jun 21, 2022 3:02 pm not sure if this helps but have you read Mike Piper's "Can I Retire?"
I have not read it yet but just purchased it and downloaded to my Kindle App. I will start reading this evening. Thanks for the tip.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

happysteward wrote: Tue Jun 21, 2022 3:39 pm
michaeljc70 wrote: Tue Jun 21, 2022 1:44 pm
happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
Why would you exclude the SS they can take in 3-4 years that will cover half their expenses? They will have a 4.5% WR for only 3 or 4 years.
Delaying the “SS card” covers a lot of unknowns especially for a couple in their late 50s. It’s as simple as that for me. Too conservative, maybe… OP these are tough decisions, I wish you the best!
Thank you for your best wishes !
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

GibsonL6s wrote: Tue Jun 21, 2022 4:57 pm
sunrisered wrote: Tue Jun 21, 2022 5:50 am
GibsonL6s wrote: Mon Jun 20, 2022 6:42 pm my two cents.

If you use the 4% rule as a quick estimate of what you can withdraw, you get about $62k a year, which leaves you a bit short. What does you social security look like?

A couple of thoughts, are you sure the pension lump sum is the way to go, is there an income stream quote to compare.

I think you could easily go part time for a bit and then full retirement.

Good luck
GibsonL6s - thank you for your response. For SS, we plan to collect when I turn 62. My SS will be $2,000 a month and my wife's will be $1,000 a month for spousal SS.

For pension lump sum, in some ways, I like the lump sum (as it allows me to get the benefit from my company and manage myself and possibly help with inflation, also our kids can get the proceeds upon the death of my wife and I). But; I do want to try and make a wise/informed decision. If I take the pension as a monthly payout for myself and my wife, (so she will receive if I pre-decease her) the amount is $2,131 per month. How do I properly compare lump sum versus monthly payout to determine which one might be preferred?

My preference is full retirement, but I want to be flexible and thoughtful on my approach.
You could plug the lump sum you are receiving into an annuity site like Blueprint Income or immediate annuities and see how the payment compares.

Additionally, there are several sites, I dont have the links handy which allow you put all of the info in and do a monte carlo simulation to see probability of success.
Thank you. I will check out the 2 annuity sites and also the monte carlo simulation for retirement sites that were mentioned by an earlier post.
twh
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Re: Can I Retire ?

Post by twh »

sunrisered wrote: Tue Jun 21, 2022 5:02 pm Thank you. I will check out the 2 annuity sites and also the monte carlo simulation for retirement sites that were mentioned by an earlier post.
I think I saw someone mention Maxifi Planner. I used the predecessor for more than a decade and use Maxifi Planner now. It is a pretty good tool and has Monte Carlo simulations also. I would recommend this as a good tool.
ThankYouJack
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Re: Can I Retire ?

Post by ThankYouJack »

BernardShakey wrote: Tue Jun 21, 2022 2:32 pm
sunrisered wrote: Tue Jun 21, 2022 6:06 am
ThankYouJack wrote: Mon Jun 20, 2022 6:58 pm I'd jump on it.

Assuming your combined social security starting at 62 is over $20k and we don't have any black swan events, you should be good to go.

Congrats!
ThankYouJack - thank you for your comments. Our combined SS starting at 62 will be $36k (2,000 a month for me and 1,000 a month for my wife with spousal SS). We will be spending from our after-tax, cash until 59.5 and are planning to continue to be conservative with our spending.
I would not "jump on it" --- I don't think you've done enough homework. Opensocialsecurity recommends you both take at 62 ? My understanding is that you are likely better off waiting until 70 unless you have health issue or short expected longevity (optimum for your wife may be at 62). How confident are you that you can self-insure for LTC insurance ? Have you priced it out ?
By "jump on it" I mean I would take the severance package and retire. I didn't mean jump on SS as the OP is still 3-4 years away from SS eligibility and they can cross that bridge when the time comes.

OP, you may find the rich, broke, dead app helpful as well - https://engaging-data.com/will-money-last-retire-early/
Wannaretireearly
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Re: Can I Retire ?

Post by Wannaretireearly »

Do you plan to get any part time income/fun job? That could be a good transition to full retirement. Good luck OP - you seem in good shape overall.
Death and taxes. Only one is under your control!
michaeljc70
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Re: Can I Retire ?

Post by michaeljc70 »

I haven't seen it mentioned in this thread, but I would go to Firecalc.com, and input all your info and see what it says. Here's what you need to input:

-AA
-Investments
-SS (try different ages/amounts... though it won't tell you what you would get at what age and things like that...you need an optimizer for that)
-Expenses
-Expected years retired. I'd use until age 90-95 to be safe.

It will output your chances of succeeding (aka not running short of money) based on historical inflation and investment returns. There are other options too like if you want to leave an inheritance, cut/increase expenses, etc.

Like I said above, I think the numbers will be very favorable. I view a 95%+ success rate as very good but you need to adjust that based on your feelings/philosophy.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

twh wrote: Tue Jun 21, 2022 5:32 pm
sunrisered wrote: Tue Jun 21, 2022 5:02 pm Thank you. I will check out the 2 annuity sites and also the monte carlo simulation for retirement sites that were mentioned by an earlier post.
I think I saw someone mention Maxifi Planner. I used the predecessor for more than a decade and use Maxifi Planner now. It is a pretty good tool and has Monte Carlo simulations also. I would recommend this as a good tool.
Thank you twh. I will check that one out also.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

ThankYouJack wrote: Tue Jun 21, 2022 5:36 pm
BernardShakey wrote: Tue Jun 21, 2022 2:32 pm
sunrisered wrote: Tue Jun 21, 2022 6:06 am
ThankYouJack wrote: Mon Jun 20, 2022 6:58 pm I'd jump on it.

Assuming your combined social security starting at 62 is over $20k and we don't have any black swan events, you should be good to go.

Congrats!
ThankYouJack - thank you for your comments. Our combined SS starting at 62 will be $36k (2,000 a month for me and 1,000 a month for my wife with spousal SS). We will be spending from our after-tax, cash until 59.5 and are planning to continue to be conservative with our spending.
I would not "jump on it" --- I don't think you've done enough homework. Opensocialsecurity recommends you both take at 62 ? My understanding is that you are likely better off waiting until 70 unless you have health issue or short expected longevity (optimum for your wife may be at 62). How confident are you that you can self-insure for LTC insurance ? Have you priced it out ?
By "jump on it" I mean I would take the severance package and retire. I didn't mean jump on SS as the OP is still 3-4 years away from SS eligibility and they can cross that bridge when the time comes.

OP, you may find the rich, broke, dead app helpful as well - https://engaging-data.com/will-money-last-retire-early/
thanks ThankYouJack. I will check out that site as well.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

Wannaretireearly wrote: Tue Jun 21, 2022 5:42 pm Do you plan to get any part time income/fun job? That could be a good transition to full retirement. Good luck OP - you seem in good shape overall.
Wannaretireearly - I'm open to a part time job - and for sure I want to continue with my vegetable garden and give back/help others as well.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

michaeljc70 wrote: Tue Jun 21, 2022 5:44 pm I haven't seen it mentioned in this thread, but I would go to Firecalc.com, and input all your info and see what it says. Here's what you need to input:

-AA
-Investments
-SS (try different ages/amounts... though it won't tell you what you would get at what age and things like that...you need an optimizer for that)
-Expenses
-Expected years retired. I'd use until age 90-95 to be safe.

It will output your chances of succeeding (aka not running short of money) based on historical inflation and investment returns. There are other options too like if you want to leave an inheritance, cut/increase expenses, etc.

Like I said above, I think the numbers will be very favorable. I view a 95%+ success rate as very good but you need to adjust that based on your feelings/philosophy.
thanks michaeljc70. I will check out that site as well.
Engaging in sloth
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Re: Can I Retire ?

Post by Engaging in sloth »

Take the pension now and retire. SS DW at 62, DH SS 67-70. Good to go
Tdubs
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Re: Can I Retire ?

Post by Tdubs »

happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
He is only "young" for about 4 years. After SS kicks in, the withdrawal rate would be less than 3 percent. This seems quite doable.
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Re: Can I Retire ?

Post by chipperd »

With a withdraw rate of 4.5% for 4 years then a withdraw rate after social security in the 3%s, OP you're good to go.

Note you don't have to decide when to take social security until you are able to decide (which would be every day after you turn 62).

So play with the numbers on the calculators others have suggested and wait and see how your finances look at 62, then you'll have a better sense.

But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.

Congrats!
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happysteward
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Re: Can I Retire ?

Post by happysteward »

chipperd wrote: Wed Jun 22, 2022 6:45 pm
But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.
OP you may find this post interesting, 3% is the new 4%, pretty good discussion on both sides….
https://www.bogleheads.org/forum/viewt ... p?t=271709
"How much money is enough?", John Rockefeller responded, "...just a little bit more."
michaeljc70
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Re: Can I Retire ?

Post by michaeljc70 »

The Trinity Study (aka 4% rule) was a study based on almost 100 years of data (after revisions). It doesn't just change based on someone''s feelings and guesses on the current state of the market/economy and guesses as to the future. Of course, an individual can make adjustments to their retirement plan as they see fit to fit their risk profile (and for whatever other reasons), but the study is the study. I personally am not going to try and outsmart history.
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Re: Can I Retire ?

Post by chipperd »

michaeljc70 wrote: Thu Jun 23, 2022 6:40 am The Trinity Study (aka 4% rule) was a study based on almost 100 years of data (after revisions). It doesn't just change based on someone''s feelings and guesses on the current state of the market/economy and guesses as to the future. Of course, an individual can make adjustments to their retirement plan as they see fit to fit their risk profile (and for whatever other reasons), but the study is the study. I personally am not going to try and outsmart history.
+1
"A portfolio is like a bar of soap, the more it's handled, the less there is." Dr. William Bernstein
chipperd
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Re: Can I Retire ?

Post by chipperd »

happysteward wrote: Thu Jun 23, 2022 6:31 am
chipperd wrote: Wed Jun 22, 2022 6:45 pm
But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.
OP you may find this post interesting, 3% is the new 4%, pretty good discussion on both sides….
https://www.bogleheads.org/forum/viewt ... p?t=271709
Since you quoted me, I'll respond by stating that discussion went on and on and on, with the 3% crowd not offering much support for their position the way of the Trinity study supports the 4% position.

I doubt the OP will find that discussion necessary.

And no, I'm not interested in rehashing that one.
"A portfolio is like a bar of soap, the more it's handled, the less there is." Dr. William Bernstein
michaeljc70
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Re: Can I Retire ?

Post by michaeljc70 »

chipperd wrote: Thu Jun 23, 2022 12:41 pm
happysteward wrote: Thu Jun 23, 2022 6:31 am
chipperd wrote: Wed Jun 22, 2022 6:45 pm
But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.
OP you may find this post interesting, 3% is the new 4%, pretty good discussion on both sides….
https://www.bogleheads.org/forum/viewt ... p?t=271709
Since you quoted me, I'll respond by stating that discussion went on and on and on, with the 3% crowd not offering much support for their position the way of the Trinity study supports the 4% position.

I doubt the OP will find that discussion necessary.

And no, I'm not interested in rehashing that one.
Interestingly, that discussion started more than 3 years ago. I say interestingly because the Fed hadn't started to raise rates, there was low inflation, treasury yields were low and the stock market was in a long bull market that continued almost 3 more years. I think that is the beauty of the Trinity Study/4% rule....it covers just about any scenario that is likely, or even unlikely, to arise. Of course a black swan event like we've never seen before could always happen.
chipperd
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Re: Can I Retire ?

Post by chipperd »

michaeljc70 wrote: Thu Jun 23, 2022 12:54 pm
chipperd wrote: Thu Jun 23, 2022 12:41 pm
happysteward wrote: Thu Jun 23, 2022 6:31 am
chipperd wrote: Wed Jun 22, 2022 6:45 pm
But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.
OP you may find this post interesting, 3% is the new 4%, pretty good discussion on both sides….
https://www.bogleheads.org/forum/viewt ... p?t=271709
Since you quoted me, I'll respond by stating that discussion went on and on and on, with the 3% crowd not offering much support for their position the way of the Trinity study supports the 4% position.

I doubt the OP will find that discussion necessary.

And no, I'm not interested in rehashing that one.
Interestingly, that discussion started more than 3 years ago. I say interestingly because the Fed hadn't started to raise rates, there was low inflation, treasury yields were low and the stock market was in a long bull market that continued almost 3 more years. I think that is the beauty of the Trinity Study/4% rule....it covers just about any scenario that is likely, or even unlikely, to arise. Of course a black swan event like we've never seen before could always happen.
Yeah, as I said, not interested in rehashing and/or throwing off the purpose of the post from the OP.
"A portfolio is like a bar of soap, the more it's handled, the less there is." Dr. William Bernstein
Marseille07
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Re: Can I Retire ?

Post by Marseille07 »

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Last edited by Marseille07 on Thu Jun 23, 2022 10:22 pm, edited 1 time in total.
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HomerJ
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Re: Can I Retire ?

Post by HomerJ »

sunrisered wrote: Tue Jun 21, 2022 1:50 pm
happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
thank you happysteward
The 4% "rule of thumb" is for 30-year retirements.

Since you'll get Social Security in a few years, the math above is incorrect.

Think more of it as two buckets... A bucket of money to get you to Social Security, and THEN a 30-year bucket (4% withdrawals) from SS on.

At $72,000 a year, think of it as $300,000 for the next 4 years to get you to 62.

At that point, you'll get $3000 a month in SS...

So you will only need to pull $36,000 a year from your investments after that...

$300,000 for the next 4 years leaves you with $1.3 million...

$36,000/$1,300,000 = 2.7% withdrawals.

You are in good shape to retire.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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HomerJ
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Re: Can I Retire ?

Post by HomerJ »

Marseille07 wrote: Thu Jun 23, 2022 12:57 pm No retirement for another 30 years. I don't like your plan.
Not funny for someone who is new to the site.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
chipperd
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Re: Can I Retire ?

Post by chipperd »

HomerJ wrote: Thu Jun 23, 2022 1:47 pm
Marseille07 wrote: Thu Jun 23, 2022 12:57 pm No retirement for another 30 years. I don't like your plan.
Not funny for someone who is new to the site.
+1
"A portfolio is like a bar of soap, the more it's handled, the less there is." Dr. William Bernstein
kd2008
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Re: Can I Retire ?

Post by kd2008 »

OP, you are in great shape to retire. The information you provided in initial post was incomplete and inadequate and hence a lot of naysayer and negative responses. Please update the original post with SS amount and age at which you will start them. Also include your withdrawal rate from now till SS starts, and also the withdrawal rate once SS starts. You will see a lot of encouraging responses. Enjoy your retirement.
Hebell
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Re: Can I Retire ?

Post by Hebell »

Those numbers would be too low for me. And it's solely because I would not be able to sleep well at night.
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HomerJ
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Re: Can I Retire ?

Post by HomerJ »

Hebell wrote: Thu Jun 23, 2022 2:05 pm Those numbers would be too low for me. And it's solely because I would not be able to sleep well at night.
Bill Gates couldn't retire with YOUR numbers either... So I guess you're never going to retire?

Try replying to his numbers instead of your own.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
michaeljc70
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Re: Can I Retire ?

Post by michaeljc70 »

Hebell wrote: Thu Jun 23, 2022 2:05 pm Those numbers would be too low for me. And it's solely because I would not be able to sleep well at night.
Fair enough...but some people wouldn't be able to sleep well if they had to work another month...year...or whatever. If I loved my job I would have been more conservative...but I didn't.
makeitcount
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Re: Can I Retire ?

Post by makeitcount »

I vote "yes".
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TeamArgo
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Re: Can I Retire ?

Post by TeamArgo »

I lived a middle-class modest life and then retired at the end of 2012 with investments and ages that were extremely similar to yours. Since then, I had my investments go up as I pulled out money to live on. I enjoyed annual vacations and a nearly annual cruise to various locations, with frequent dining out and local entertainment outings. When the market turned last year and this, my accounts have gone down to almost the same level as I started with, but I have no fear for the future.
I have told many friends that it is possible to retire on less than you think or fear you will need. The ones who take my advice seem to have agreed.
So, I vote "YES".
“Love with your heart; Use your brain for everything else.” -Captain Disillusion
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MrBobcat
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Re: Can I Retire ?

Post by MrBobcat »

TeamArgo wrote: Thu Jun 23, 2022 2:49 pm I lived a middle-class modest life and then retired at the end of 2012 with investments and ages that were extremely similar to yours. Since then, I had my investments go up as I pulled out money to live on. I enjoyed annual vacations and a nearly annual cruise to various locations, with frequent dining out and local entertainment outings. When the market turned last year and this, my accounts have gone down to almost the same level as I started with, but I have no fear for the future.
I have told many friends that it is possible to retire on less than you think or fear you will need. The ones who take my advice seem to have agreed.
So, I vote "YES".
That's good to hear as I'll be in that boat next year and I'm seriously thinking of pulling the plug. Bit nervous about it as it gets closer.
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HomerJ
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Re: Can I Retire ?

Post by HomerJ »

TeamArgo wrote: Thu Jun 23, 2022 2:49 pm I lived a middle-class modest life and then retired at the end of 2012 with investments and ages that were extremely similar to yours. Since then, I had my investments go up as I pulled out money to live on. I enjoyed annual vacations and a nearly annual cruise to various locations, with frequent dining out and local entertainment outings. When the market turned last year and this, my accounts have gone down to almost the same level as I started with, but I have no fear for the future.
I have told many friends that it is possible to retire on less than you think or fear you will need. The ones who take my advice seem to have agreed.
So, I vote "YES".
Well, you retired into a 10-year bull market, so that's not quite the same.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

Engaging in sloth wrote: Wed Jun 22, 2022 4:39 pm Take the pension now and retire. SS DW at 62, DH SS 67-70. Good to go
Thank you "Engaging in sloth" for your thoughts. I also received this direction from the Fidelity retirement planner tool and another tool from an hourly financial planner. But I do appreciate the different thoughts and important things to think through.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

Tdubs wrote: Wed Jun 22, 2022 6:09 pm
happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
He is only "young" for about 4 years. After SS kicks in, the withdrawal rate would be less than 3 percent. This seems quite doable.
Thank you Tdubs for your thoughts.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

chipperd wrote: Wed Jun 22, 2022 6:45 pm With a withdraw rate of 4.5% for 4 years then a withdraw rate after social security in the 3%s, OP you're good to go.

Note you don't have to decide when to take social security until you are able to decide (which would be every day after you turn 62).

So play with the numbers on the calculators others have suggested and wait and see how your finances look at 62, then you'll have a better sense.

But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.

Congrats!
Thank you chipperd for your thoughts. I can relate to your thoughts - I do want to be careful and am not sure when I will ultimately take SS. But the way you worded your response was helpful and I will give it thoughtful consideration. Thanks.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

happysteward wrote: Thu Jun 23, 2022 6:31 am
chipperd wrote: Wed Jun 22, 2022 6:45 pm
But rest assured knowing that the "worst" social security scenario for you in many eyes, (taking at 62) still means your withdraw rate is under 4%, which is what many consider to be the gold standard at age 62, to be fully and comfortably retired.
OP you may find this post interesting, 3% is the new 4%, pretty good discussion on both sides….
https://www.bogleheads.org/forum/viewt ... p?t=271709
Thank you happysteward. I will take a look at this post and give things careful consideration.
Topic Author
sunrisered
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Re: Can I Retire ?

Post by sunrisered »

Marseille07 wrote: Thu Jun 23, 2022 12:57 pm No retirement for another 30 years. I don't like your plan.
Will have to give things some careful consideration so not quite sure. But will need to go much sooner than 30 years. Been doing this gig for a while and feel its time to move on.
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sunrisered
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Re: Can I Retire ?

Post by sunrisered »

HomerJ wrote: Thu Jun 23, 2022 1:19 pm
sunrisered wrote: Tue Jun 21, 2022 1:50 pm
happysteward wrote: Tue Jun 21, 2022 6:24 am Looks like you have all the basic numbers accounted for, I.e. estimated….I am seeing a 4.5% withdrawal rate ** required not including social security as you are so young…that withdrawal rate is too high for my liking and based on your conservative nature I am guessing it is too high for you too…I wouldn’t do it yet (I.e. retire)…consider part time in another line for a while?

** $72,000/$1,600,000= 4.5%
thank you happysteward
The 4% "rule of thumb" is for 30-year retirements.

Since you'll get Social Security in a few years, the math above is incorrect.

Think more of it as two buckets... A bucket of money to get you to Social Security, and THEN a 30-year bucket (4% withdrawals) from SS on.

At $72,000 a year, think of it as $300,000 for the next 4 years to get you to 62.

At that point, you'll get $3000 a month in SS...

So you will only need to pull $36,000 a year from your investments after that...

$300,000 for the next 4 years leaves you with $1.3 million...

$36,000/$1,300,000 = 2.7% withdrawals.

You are in good shape to retire.
Thank you HomerJ for your comments. The way you worded it and the demeanor that it conveyed is helpful.
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