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Retirement Plan?

Old 02-23-2018, 06:23 AM
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Default Retirement Plan?

What did you get right and what did you get wrong in your retirement plan?

I don't really know how to start planning. My current plan is to buy a house on the coast of NC cash, have $1.5M in cash, stock IRA, 401. I want to leave the $200K job behind between 55-60 and find something to do that I like whether it's working at a small company for $60K/yr or working at Home Depot. I am looking forward to a major reduction in lifestyle complication which I am starting on now.

What am I missing?
Old 02-23-2018, 06:45 AM
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Originally Posted by Lorne Greene View Post
What did you get right and what did you get wrong in your retirement plan?

I don't really know how to start planning. My current plan is to buy a house on the coast of NC cash, have $1.5M in cash, stock IRA, 401. I want to leave the $200K job behind between 55-60 and find something to do that I like whether it's working at a small company for $60K/yr or working at Home Depot. I am looking forward to a major reduction in lifestyle complication which I am starting on now.

What am I missing?
Is 1.5 million gonna cut it? You potentially have 10 years of health insurance, at some point you will want to stop working all together. Having the house paid off is huge. You can always downsize further when you stop working later.
Old 02-23-2018, 06:50 AM
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I'm 38 and still working. I did that much wrong.
Old 02-23-2018, 06:51 AM
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Originally Posted by BadgerS View Post
Is 1.5 million gonna cut it? You potentially have 10 years of health insurance, at some point you will want to stop working all together. Having the house paid off is huge. You can always downsize further when you stop working later.
I went from 1400 feet to 4000 feet and am looking forward to going back to 1400 feet. Huge house works for now but I hate taking care of something this large.

Good point on the insurance. Hopefully by then, they will have it figured out but if not I would have to pay out of pocket or still keep a job with benefits. I guess the short term end game is to have no debt and move to the coast around the time I am 55. I am OK working I just don't think I want the high-pressure type of work I do now. I would like to be in the position that I can do whatever without worrying about how much it pays.
Old 02-23-2018, 08:49 AM
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Op, single or married?
Old 02-23-2018, 08:57 AM
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Originally Posted by Boataholic View Post
Op, single or married?
Married but Wife won't have much as she is a part-time nurse so I'm not counting on much from her.
Old 02-23-2018, 09:03 AM
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I'd leave right now (58) but health insurance has me locked.

Not even sure where to begin to look how much it would be.
Old 02-23-2018, 09:16 AM
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Originally Posted by Lorne Greene View Post
What did you get right and what did you get wrong in your retirement plan?
I don't really know how to start planning. My current plan is to buy a house on the coast of NC cash, have $1.5M in cash, stock IRA, 401. I want to leave the $200K job behind between 55-60 and find something to do that I like whether it's working at a small company for $60K/yr or working at Home Depot. I am looking forward to a major reduction in lifestyle complication which I am starting on now.
What am I missing?
From a financial planning perspective, there is a huge difference between 50, 55, 60 & 65 - mostly to do with medical insurance and market fluctuations.
At 65 you get Medicare, so that is a big savings - having to pay for medical coverage at $15k/yr for a couple for 5-15 years adds up.
$1.5 million is $60,000/yr in drawdown (4% - and you can't start until 59.5 yrs old) - not a lot for someone used to $200k, and it takes 40 years of work to get full Social Security.
In your financial position it might be best to work your planning around a retirement at age 60 rather than 55. That extra 5 years of income and 5 less years to pay for medical is big.
I still have a little under a decade to retirement, so i can't say how well my plan will work out. The plan involves owning all my houses and boats outright, moving our primary residence to Florida (to avoid state income taxes) and between my wife's pension and 403b and my 401k money having about the same income coming in as we spend on just living expenses - about $20k/month, and then using Social Security as additional fun money; we don't plan on touching our non-retirement savings unless it exceeds the amount exempt from federal estate tax.
Old 02-23-2018, 09:27 AM
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If you don’t mind me asking, what do you do to earn $200k?
Old 02-23-2018, 09:45 AM
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Originally Posted by Lorne Greene View Post
What did you get right and what did you get wrong in your retirement plan?

I don't really know how to start planning. My current plan is to buy a house on the coast of NC cash, have $1.5M in cash, stock IRA, 401. I want to leave the $200K job behind between 55-60 and find something to do that I like whether it's working at a small company for $60K/yr or working at Home Depot. I am looking forward to a major reduction in lifestyle complication which I am starting on now.

What am I missing?
I started in my 20's. Goal was to be debt free when I retired and have money saved. I would put half of my raises into my 401K tax deferred. I figured that I was doing fine without it so I wouldn't miss it. After the kids got gone, I put all of my raise into it.

Continued to remove debt from my life. My retirement age goal was about the same as yours, but I knew insurance would be a big cost. My wife loves her job as a critical care nurse at a hospital, so she agreed to work until I got 65 to provide us with insurance.

All of the above, I feel that I did right.

I'm one of the fortunate ones in that I've got a company funded pension that I'm living on now with no need to touch the 401K. Where I went wrong was waiting until 56 to retire when I could have done it at 55.

As for retirement jobs, I haven't taken one.....yet. But if I do, money won't be a factor. It'll boil down to something that I WANT to do and that could be volunteering somewhere.



.
Old 02-23-2018, 10:15 AM
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Originally Posted by KnottyGirlGrady View Post
If you don’t mind me asking, what do you do to earn $200k?
Consulting Managment

The highest level of education was high school, father was an iron welder, mother answered phones at the IRS during tax season. No many people just make $200K most of the comp plans are based in the low to low-mid $100's then add in 20% bonus and company stock and that is how I go there.

As for doing what I actually do, I don't really do anything special. I'm not the smartest person in the world. I just learned that if you make peoples problems go away it pays 10 fold in return. I'm known as the guy in the company that you can come to with any problem and even if its nowhere near my wheelhouse I can figure it out or get you into the right hands.
Old 02-23-2018, 10:17 AM
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So just to clarify retirement for me is not stopping work all together it's just being able to afford to leave the high paying job and go do something else for 25% or whatever I was making before.
Old 02-23-2018, 11:03 AM
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I would recommend looking into low fee index mutual funds such as Vanguard's S & P 500 fund. Buy them and don't sell them. John Bogle's, "Little Book of Common Sense Investing" helped me a lot to understand the plusses of those mutual funds.
Old 02-23-2018, 12:05 PM
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If I had it to do all over again I would have invested more heavily in ETFs and more individual equities and less in high fee mutual funds. I've transitioned in that direction over the past five years and done well.
Old 02-23-2018, 12:22 PM
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the trick is to start investing early so the money will have a chance to work for you!
Old 02-23-2018, 12:45 PM
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Originally Posted by LI32 View Post

it takes 40 years of work to get full Social Security.
What would stop someone from retiring after 30 years of work but paying into SS for 10 more years saying they are an "artist" or something?

So not earning any money outside of investments/dividends, but paying SS as if you were drawing an income of some sort.
Old 02-23-2018, 01:28 PM
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will be 55 this year plan is for 60 but latest will be 62. been maxing out 401k for awhile and closing in on 1 mill. will have a defined pension also with medical benefits. plan on taking ss at 62. house has been paid for awhile along with property in area i plan to go to. looking forward to making beer and fishing rods
Old 02-23-2018, 01:30 PM
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Originally Posted by YFMF View Post
What would stop someone from retiring after 30 years of work but paying into SS for 10 more years saying they are an "artist" or something?

So not earning any money outside of investments/dividends, but paying SS as if you were drawing an income of some sort.
It's based on reported earnings not what you pay in.

And I believe it's 35 years, not 40.
Old 02-23-2018, 01:40 PM
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Originally Posted by KnottyGirlGrady View Post
If you don’t mind me asking, what do you do to earn $200k?
Bonanza ?
Old 02-23-2018, 01:40 PM
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Retirement plan?

Have you spent any time thinking about money management as it relates to retirement. Or figured out how to get ever increasing income?

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