Tell us about your decision to retire (relocate, 2013, state)
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fed pension left 11 years ago at 55. Had 33 years, 8 months service (CSRS). 2.5 years of it was a part-time job (16 hrs a week) while in high school and college. Apparently there was a big fire where they stored the federal records in St. Louis 30-40 years ago so they just gave everyone full time credit for part time jobs if those years were before 1978? or so.
Left at 79% of high three years salary, by the time you subtract my retirement contribution, SS/Medicare tax, and maxing out my Thrift Savings Plan (TSP), my pension income was actually higher than my salary when I left. A great deal
If you don't mind this question, what percentage of your salary does your pension provide, and about what percentage of your savings is allocated to the stock market? Is your stock market allocation in stock index funds?
My pension provides about 1/3 of my base pay, and 1/4 of my total pay when I was permitted to work a lot of overtime hours. My wife's pension is a little higher than my pension. Both pensions don't provide quite enough income compared to our lifestyle we live, which does not include going to luxury stores and driving luxury cars. We do live in an upscale area though. So, we'll have to take some of our savings to supplement our income for 2 1/2 years until I hit FRA and draw social security. Then our pensions and my social security income will add up to close to six figures, and we could probably live on that amount of income without drawing down our savings. When my wife hit FRA in about 6 1/2 years, we'll have a six figure income without touching our investments. Although, we've been advised that we'll need to spend more money in our retirement years, which is very difficult to do after living well below our means for decades.
For two decades, we lived on part of my income and saved all of my wife's income, living well below our means. We both maxed our work retirement account contributions, plus we invested more money in taxable investment accounts. The pensions allowed us the freedom to invest more aggressively for higher returns. If we didn't have the pensions, we would not have been as aggressive, and our returns would have been much lower. For people that are about 60 years old, when they started their careers, many companies had pensions, and those people could have easily had a pension today. People starting their working years in the late 80's or 90's would have had less employment opportunities to work for a company that offered a pension. My wife's company stopped offering pensions almost two decades ago for new employees, but she started long before the pension option was dropped for new employees. My company still offers pensions for new employees today. It's true what people say about pensions, they are golden handcuffs. You have to put up with a lot of crap sometimes for decades to get your pension payback.
Most of our savings are in the stock market, individual company stocks, mutual funds, managed funds, and index funds. During the Obama years, we lost a lot of money in the downturn, but held, and it recovered and increased some. During the Trump year, we had huge gains, making more than my six figure income working and my wife's six figure income, before she retired. I made money on most stock sales, but not as much as I could have made. I really regret selling Netflix for a few thousand dollars profit, when I could have made more money if I would have held a year after the presidential election. If I did that, I would have made more money on one stock sale than I made working all year, even with a lot of overtime work. I also regret not buying Wayfair stock before the election. I could have tripled my investment in less than a year after the election. I did buy and sell Wayfair stock dozens of times for years, several years ago, making a lot of short term money. I bought and sold dozens of stocks for short term gains. But most of the investments are long term holds, not trading. I did short term trading with a smaller portion of the money, which outperformed the long term gains, but not hugely. Over the past two decades, including the market downturns, our averaged annual return has been about 8%. You can lose a lot in the stock market, but you can gain a lot too. If you're not gaining drastically more than you lose, you shouldn't be doing the investing yourself, and you shouldn't be too aggressive. It's pretty sickening to lose more money than your house is worth on paper, and hold for several years, until the stock recovers. You have to be diversified enough, because some stocks never recover. I used to be very poor growing up and in my 20's and early 30's. I know what it's like to be struggling and being broke all the time from personal experience. You have to be willing to invest in yourself, so you can make yourself valuable to an employer that will pay you well. If you just float through life and work at fast food or some retail store, you'll always be poor. We've been in the top 5% for a long time. One year we hit the top 1%. Money isn't everything, but it's better to have financial freedom than to be poor!
One of the podcasts I regularly listen to is called Money Matters by Hanson and McClain. The financial talk show is based out of California, so they will take many callers from California. It's amazing to hear the stories about the people collecting pensions that are $80K, that used to work for the California State government. Their pension system is very generous, several times higher than our pensions! Those people could move to a lower cost state and live very well off of their high pension, as long as California doesn't go bankrupt! They could also sell their hugely expensive home and live off of part of that income. Although, those people probably didn't save much outside of their pensions, since the cost of living is so high in California.
There's a lot of other good financial advise out there that is free. The book, "The Millionaire Next Door" shows the way you can become a millionaire. You can even read the book for free if you search for the book title and the word "PDF". You usually can't tell someone is a millionaire by looking at the way they dress, the car they drive, or their home. The Dave Ramsey show offers are lot of good financial advise too, although sometimes Dave is pretty harsh by telling them that people that they are being stupid! If you search YouTube for Dave Ramsey, you'll find a lot of video podcasts, which include Dave's facial expressions, which can be very entertaining!
Always was thinking about it! But reality was about 5 years prior.
What was the trigger?
I was off work on an injury that most likely I would not be able to go back to what I was doing.
What criteria did you base your decision on?
With the time on the job I had, my pension is actually more than if I stayed at work. The thought of actually "paying" to go to work was a big factor. Most likely not being able to go back to what I was doing due to a neck surgery. Both of my parents dying in their mid 60's.
What regrets do you have? If any?
I miss the adrenaline rush of the job I had, and some of the people. But not the politics.
When do you start to think about it? I retired from teaching, my third career, at 64. When I started this career, I assumed I would retire at 65 or 66. I taught 9 years.
What was the trigger? My district gave a mid term comprehensive test to allegedly check student progress. At the start of my last year, I went to a teaching method using the interactive notebook. I spent many, many extra hours preparing material for the students’ notebooks, things like partially worked problems, flow charts, all kinds of stuff. I was spending way more time than my students. When we got the mid-year scores back, mine were much lower than I expected. Relatively high, but not enough ROI based on the hours spent preparing material. We got the results early one day in late January, and after a few moments thought, during planning, I wrote out my letter of resignation, and turned it end. I finished out the year, teaching until June.
What factors did you evaluate (in addition to money)? The amount of energy and time I was putting in to my teaching and both the lack of appreciation and the lack of effort/academic success on the part of my students. I had two great pensions, money was not a factor.
What criteria did you base your decision on? Return on the investment I was observing based on my effort.
What regrets do you have? If any? I should not have taught the last two years, in other words, I should have retired earlier.
And if you are willing, what did you do before and after retirement? Before: Taught 8th grade pre-algebra and algebra. Before that, I had been a career naval officer and an executive in a Fortune 100 Company. After retirement I have not done much.
When do you start to think about it?
The same year I was re-hired to a contract position, after being unemployed for a year.
What was the trigger?
The contract position that never got "converted" to full-employee status, and the fact that the job I'd been hired for was changing into a high-paid "do-nothing" position.
What factors did you evaluate (in addition to money)?
1) My age, 2) how-many years I'd been employed (since I was 18), and 3) if I had enough ($$$) to be able to afford to retire.
What criteria did you base your decision on?
How many (more) years could I continue getting out of bed (very early) to go to the workplace? <At 72, there weren't many left!>
How much time would I have, in retirement, if I waited much longer? <There are No Guarantees>
Was what I did for a living still viable, or was it now obsolete? <It's Obsolete>
What regrets do you have? If any?
Not being a better parent to (now-grown) children in another State.
And if you are willing, what did you do before and after retirement?
Before - "Data Processing", "Computer Programming", "Playing Music professionally", and "Technical Training", for 50+ years.
After - Learning to play golf , and "selling" my DW on the idea of relocating out of Cali for a better "retirement" ...
I consider 48% of $45,000 which is $21,600 a decent sum of money per year from one source in retirement.
But you said it will 48% of what you're making after 30 years, so that's even quite a bit more.
Social Security monthly payments are often a lot less than $21,600 per year.....the average monthly Social Security monthly payment is $1342 per month in 2017 which is $16,104 per year.
Will you be receiving any Social Security?
Yes I paid into social security during my 36 year career so I will get that. And I wasn’t knocking pensions, it’s great to have one but my point was that many of my graduate friends who stayed in private made a higher salary than I did during those years and though they didn’t have a pension, their companies matched their 401k contributions to a higher level. My pension is also based on me putting 3% of my salary for the career, so it’s also not just a free gift that I didn’t put anything into.
For current teachers if they stay in system for 30 years that might get to 52k so not much more.
When do you start to think about it? I retired from teaching, my third career, at 64. When I started this career, I assumed I would retire at 65 or 66. I taught 9 years.
What was the trigger? My district gave a mid term comprehensive test to allegedly check student progress. At the start of my last year, I went to a teaching method using the interactive notebook. I spent many, many extra hours preparing material for the students’ notebooks, things like partially worked problems, flow charts, all kinds of stuff. I was spending way more time than my students. When we got the mid-year scores back, mine were much lower than I expected. Relatively high, but not enough ROI based on the hours spent preparing material. We got the results early one day in late January, and after a few moments thought, during planning, I wrote out my letter of resignation, and turned it end. I finished out the year, teaching until June.
What factors did you evaluate (in addition to money)? The amount of energy and time I was putting in to my teaching and both the lack of appreciation and the lack of effort/academic success on the part of my students. I had two great pensions, money was not a factor.
What criteria did you base your decision on? Return on the investment I was observing based on my effort.
What regrets do you have? If any? I should not have taught the last two years, in other words, I should have retired earlier.
And if you are willing, what did you do before and after retirement? Before: Taught 8th grade pre-algebra and algebra. Before that, I had been a career naval officer and an executive in a Fortune 100 Company. After retirement I have not done much.
Close to what led me to my decision. I will retire in two years after 36 years in teaching and 4 prior to that in private chemical engineering firm. I was hoping to get to 65, but as you clearly stated the return on investment for the time, effort,appreciation and how it all is affecting my health has pushed my decision. June 2020.
This is an older crowd. Lots of posters here likely had their pensions grandfathered in.
My father worked in a manufacturing plant earning a salary sufficient to provide us with a middle class lifestyle and retired with a pension after 30 years. You won’t find many laborers with that perk today. Outside of government, most private employees are forced to rely solely on their 401(k)s and SS benefits to fund their retirements. These are some of the consequences of “right to work” economies.
Doesn't change the stats that show only 32% of today's retirees, and that includes older retirees, had pensions in 2017.
Here is why I decided to leave.
Fifty mile commute each way.
Prostate problems after 60 waking me up once or twice a night.
The company moved out of the range of the express bus.
I started fearing that I would fall asleep at the wheel.
One icy morning I was on my way to the express bus. The guy in the Jeep coming the other way didn't realize four wheel drive doesn't mean that he could drive as fast as he wanted. He hits the ice and starts coming at me side ways. If there was a guard rail on my right I would have hit him. I kept two wheels on the road and two wheels on the roadside ice. I went to the nearest diner, had breakfast and called in sick. I resolved that morning that I would retire as soon as we could afford it.
As the guy who started this whole pension side bar this is what I was talking about. Only 32% of today's retirees have pensions. But you would never know if from this thread where the vast majority of respondents referenced their pensions. That was my point.
What percentage of US workers are covered by a pension plan?
The BLS overview shows that pension coverage is much higher in the public sector (78 percent) and among unionized workers (67 percent) in the private sector. In contrast, only 13 percent of non-union private-sector workers are covered. Jan 11, 2013
Quoting from the 2013 AARP Public Policy Institute analysis of Census Bureau data,
just under a third (30 percent) of current retirees in 2013 receive income from either a traditional pension or take withdrawals from a retirement savings account such as a 401(k) or an IRA (individual retirement account).
So that study found that just under 30% of current retirees in 2013 take withdrawals from a retirement savings account such as a 401(k) or an IRA (individual retirement account) or from a traditional pension.
DaveInMrAiry, if you're not quoting from the 2013 AARP study, where are you quoting from?
Last edited by matisse12; 05-07-2018 at 06:07 PM..
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, and "selling" my DW on the idea of relocating out of Cali for a better "retirement" ... 
