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Old 01-12-2018, 06:47 PM
 
6,616 posts, read 3,744,488 times
Reputation: 13682

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Quote:
Originally Posted by kelly237 View Post
Considering all the life curve balls I have had thrown at me I am pleased to be where I am financially.
I have been divorced, single parented 2 boys , and widowed.
It has taken a lot of work to get to 60 and be in decent shape financially. My kids are all grown and independent and making me proud.

My financial planner thinks I need to work PT and bring in 2-3K / month until 67, but I am not convinced.
I haven't worked the last few years but could easily find PT work in my field if I need to.


Here are the #'s

60 year old single
Own 230K Home with no Mortgage.
500 K in investments
2000/month budget is enough to include taxes, vacations and extras.
Will draw 1700 SS at 67 (option to draw less earlier)
I may move but that would be same price house & cost of living.
Realistic life expectancy 85 based on family history

All advice welcome.
I'm a single female like you. I retired a little early...maybe around 60. So I can relate to your situation.

I think you would be open to a financial problem, if you ran into a big unexpected expense. I'd like to see you with a bigger retirement account.

What I would recommend is:

1. Work PT for three years (at $36k) and see where you are.

2. What about health insurance? Health ins for seniors can be very expensive. Are you covered for that from your full time work, or do you have to buy it? If not taken care of, plan on working until Medicare age or thereabouts. Health ins. is a big deal, and unfortunately would wreck your retirement, if there isn't a cost effective way to get good ins.

3. I'd like to see you with at least $600k in retirement funds. (This is possible, if you put your earned income into them, and they are invested.) I don't think $500k is enough.

4. Do you have a Roth? Roth is more important than an IRA.

5. One of the most important things about working for a few more years is YOU CAN PUT MORE MONEY INTO YOUR ROTH ACCOUNT, where it can grow and grow, and you will never have to pay taxes on it. You can only used earned income, so if you don't work, you won't be able to add to it.

6. As soon as you stop working, start drawing Social Security. Your SS will probably be more, now, since you worked those 3 years, which probably replaced 3 years of lower earnings in your early years.

7. As a widow, will you be able to draw on HIS Social Security or pension?


I will add that a lot of people think that you need $1M to retire. That is not true. Millions of people do fine, and better than fine, on less than that. It depends on your standard of living, spending habits, cost of living where you live, etc.

BUT since I retired early, I will tell you that you will feel, and be, more secure with more money in your retirement accounts. You don't want to have to pinch pennies or worry about the cost of OTC medications or other basic expenses, when you are older. It would be a constant worry.

BUDGET: Don't forget that besides your regular expenses, you have will have occasional large expenses, like a new a/c, new roof, new car, etc. And if you want to get a pet or two, that could add $2,000 in expenses a year. Or take up a new hobby...hobbies cost.

You are able to work NOW. You may not be able to get good work later. So take advantage of that, and work for maybe three more years, if only part time, to try to get that retirement account up. You'll be happy you did.
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Old 01-12-2018, 07:02 PM
 
8,080 posts, read 13,458,974 times
Reputation: 10322
Quote:
Originally Posted by bpollen View Post
I'm a single female like you. I retired a little early...maybe around 60. So I can relate to your situation.

I think you would be open to a financial problem, if you ran into a big unexpected expense. I'd like to see you with a bigger retirement account.

What I would recommend is:

1. Work PT for three years (at $36k) and see where you are.

2. What about health insurance? Health ins for seniors can be very expensive. Are you covered for that from your full time work, or do you have to buy it?

3. I'd like to see you with at least $600k in retirement funds. (This is possible, if you put your earned income into them, and they are invested.) I don't think $500k is enough.

4. Do you have a Roth? Roth is more important than an IRA.

5. One of the most important things about working for a few more years is YOU CAN PUT MORE MONEY INTO YOUR ROTH ACCOUNT, where it can grow and grow, and you will never have to pay taxes on it. You can only used earned income, so if you don't work, you won't be able to add to it.

6. As soon as you stop working, start drawing Social Security. Your SS will probably be more, now, since you worked those 3 years, which probably replaced 3 years of lower earnings in your early years.

7. As a widow, will you be able to draw on HIS Social Security or pension?


I will add that a lot of people think that you need $1M to retire. That is not true. Millions of people do fine, and better than fine, on less than that. It depends on your standard of living, spending habits, cost of living where you live, etc.

BUT since I retired early, I will tell you that you will feel, and be, more secure with more money in your retirement accounts. You don't want to have to pinch pennies or worry about the cost of OTC medications or other basic expenses, when you are older. It would be a constant worry.

BUDGET: Don't forget that besides your regular expenses, you have will have occasional large expenses, like a new a/c, new roof, new car, etc. And if you want to get a pet or two, that could add $2,000 in expenses a year. Or take up a new hobby...hobbies cost.

You are able to work NOW. You may not be able to get good work later. So take advantage of that, and work for maybe three more years, if only part time, to try to get that retirement account up. You'll be happy you did.
Great post, appreciate how much thought you put into it.
I buy my own health insurance and plan to until I can get medicare at 65.
But that is included in my monthly budget.
My Soc Sec options are interesting.
I can draw on my own SS acct , on my divorced ex's SS (10 year marriage) or as a widow on my late husband's account. I have researched the options and gotten expert advice on that question.
An interesting side note is that if my ex husband were to die I would get his full SS amount (vs 1/2) and
draw about 3400 per month. But I would certainly never wish for that to happen.
Your overall thinking is similar to mine. A tad extra in the savings is sure better than a tad too little.
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Old 01-12-2018, 07:05 PM
 
Location: Grove City, Ohio
10,133 posts, read 12,381,010 times
Reputation: 13956
Quote:
Originally Posted by kelly237 View Post
Considering all the life curve balls I have had thrown at me I am pleased to be where I am financially.
I have been divorced, single parented 2 boys , and widowed.
It has taken a lot of work to get to 60 and be in decent shape financially. My kids are all grown and independent and making me proud.

My financial planner thinks I need to work PT and bring in 2-3K / month until 67, but I am not convinced.
I haven't worked the last few years but could easily find PT work in my field if I need to.


Here are the #'s

60 year old single
Own 230K Home with no Mortgage.
500 K in investments
2000/month budget is enough to include taxes, vacations and extras.
Will draw 1700 SS at 67 (option to draw less earlier)
I may move but that would be same price house & cost of living.
Realistic life expectancy 85 based on family history

All advice welcome.
No problem but I would wait to 65 for Medicare.
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Old 01-13-2018, 05:31 AM
 
13,891 posts, read 7,395,585 times
Reputation: 25379
Quote:
Originally Posted by bpollen View Post
4. Do you have a Roth? Roth is more important than an IRA.

5. One of the most important things about working for a few more years is YOU CAN PUT MORE MONEY INTO YOUR ROTH ACCOUNT, where it can grow and grow, and you will never have to pay taxes on it. You can only used earned income, so if you don't work, you won't be able to add to it.
I don't see that the OP is going to have any kind of tax liability where a Roth would help. Why would you adopt tax avoidance strategies when you're in the 12% bracket? The top of the 12% bracket is $37,700. There's a $12K standard deduction. Worst case, Social Security is only 85% taxable. The OP isn't going to have more than $50K in income. 2018 tax law makes an awful lot of 2017 tax avoidance strategies pretty useless.

I also haven't read anywhere that leads me to believe that the $500K is 100% tax deferred retirement savings. I saw "not working because I fixed up and sold a house".

I wouldn't try early retiring with those numbers. There's too much risk that ACA will vaporize.
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Old 01-13-2018, 06:43 AM
 
Location: Mount Airy, Maryland
10,460 posts, read 5,924,770 times
Reputation: 16151
Quote:
Originally Posted by BucFan View Post
That $500K could be worth 40% of that with a bear market recession. It seemed like just yesterday that people were complaining here about their portfolio sinking. Would be concerned that it's enough there.

Retirees tell me they have lost over 50% of their 401K Balance in the last year!
That was a great read from the heart of the bear market. I loved reading posts like "if you are within 5 years of retirement and had more than 20% in the market you were asking for trouble". LMAO.
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Old 01-13-2018, 07:16 AM
 
71,520 posts, read 71,694,121 times
Reputation: 49105
Quote:
Originally Posted by DaveinMtAiry View Post
That was a great read from the heart of the bear market. I loved reading posts like "if you are within 5 years of retirement and had more than 20% in the market you were asking for trouble". LMAO.

the myths and mis-information people have about investing is just mind blowing
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Old 01-13-2018, 07:43 AM
 
Location: Raleigh
8,047 posts, read 5,890,079 times
Reputation: 9785
Sounds like you are on track. I'd suggest holding off as long as you can on starting SSA. It gets bigger in the long run so unless you need to meet expenses don't tap it yet.
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Old 01-13-2018, 08:33 AM
 
Location: Mount Airy, Maryland
10,460 posts, read 5,924,770 times
Reputation: 16151
Well since Kelly has said repeatedly her $2,000 budget includes medical coverage, which is surprising but she knows, and as long as she has the ability to return to work on demand should it be necessary I'm kind of warming to the idea.

But I do have to ask if your plans include funds for car that will no doubt be needed at some point, perhaps even 2. What happens if she needs a new roof? Are you prepared for that?
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Old 01-13-2018, 10:16 AM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,555 posts, read 39,934,465 times
Reputation: 23688
Quote:
Originally Posted by kelly237 View Post
Is that 5.76 % accounting for 1700/month Social Security income at 67 years old ??
....
LOL
Problem is that I absolutely love living alone.
If I get into a relationship he will need his own house.
I'm with you!, no time / patience / desire to 'train another / or be trained by another' time is short, not planning to add pain (to myself or others) (And I don't need Sub's Neighbor's live-in "filling my house with Pastries!!!" Nice thought... tough on my 'physique'! Back to my HS weight, but the W-I-D-T-H is pretty elusive! (Did we really have 23" waists!)

Quote:
Originally Posted by DaveinMtAiry View Post
Well since Kelly has said repeatedly her $2,000 budget includes medical coverage, which is surprising but she knows, and as long as she has the ability to return to work on demand should it be necessary I'm kind of warming to the idea.

But I do have to ask if your plans include funds for car that will no doubt be needed at some point, perhaps even 2. What happens if she needs a new roof? Are you prepared for that?
Good point... Kelly may need one of my $35 WVO (Free fuel) cars. (I have 33 spares...)

Roof... IIRC, currently renting(?) or in condo. Short term... if home has had regular maint, the need for a new roof SHOULD be covered by HO insurance (Keep that!), Long term... yes... a method to cover 'reserves' (for HC and property deductibles / copays / crisis (those adult kids...) and 'other' unPLANNED expenses (trips to Thailand...))

I'm really warm to her idea.

Enjoy the time / smell the roses / don't fret (plenty of that in the past and future, no need for now)

I consider that I am spending time and money from age 50 - 70 on things I am able and desire to do. I will be content to 'hang around home more' in the future (tomorrow if necessary), but today I am OFF on another adventure! +/- (more expensive than planned) not fretting about it.
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Old 01-13-2018, 10:19 AM
 
8,080 posts, read 13,458,974 times
Reputation: 10322
Quote:
Originally Posted by DaveinMtAiry View Post

But I do have to ask if your plans include funds for car that will no doubt be needed at some point, perhaps even 2. What happens if she needs a new roof? Are you prepared for that?
Good points.

Probably the smart move would be to work a few days a week and try to
pad my savings a bit more. Another option that would work would be to do a full-time 13 week travel therapy job every year somewhere I would enjoy spending time. Good money, get to explore a new town and
they provide housing.

I think if I had to I could squeak by on what I have but a little extra spending money is never a bad thing.
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