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Some people prefer to retire early even if it means a simpler retirement but I am not one of them. I like to travel, have nicer clothes and car, eat out, etc. so I chose to increase my income in retirement by retiring later and so far have no regrets. I was eligible to retire at 59 ½ from my government job with health insurance but worked to 62 to allow more money for extras and for added protection from a recession or cuts to Social Security. Like the OP’s brother, I was saving a big chunk of my income and increasing my pension while working. I did not hate my job but was tired and burned out so the extra 2 ½ years were not easy. I could have managed on the reduced retirement income but my pension went up significantly at age 62 and I did not want to leave that extra money on the table.
Five more years of working is a long time if you hate your job but retiring at 59 in peak earning years (especially if your company retirement does not include health insurance) seems foolish. I would suggest the brother track his expenses for a couple of years and determine how much additional income he actually needs to enhance his retirement and where he could cut some expenses. I was okay with working to age 62 but if having an enhanced retirement meant working to age 64 or 65, I would have made some compromises or looked hard at reducing expenses versus working longer.
But I tell him that by then his health may be poor and he will have lost the five years of good health and years of leisure gained from early retirement...
Instead of telling him that, I would suggest to him that he start a comprehensive exercise program so that he his health will be better in 5 years when he really wants to retire with more money.
About the nicer house-what's he waiting for? I would think that the upgrade should be done while he's working.
However, that's not the route I've chosen-namely retiring earlier and living with less.
Reasons for quitting your f/t job (or greatly reducing hours) retiring early
1. Risk of serious health issues increases w/ age. Get in great physical shape before it happens Eat right.
2. Majorly in shape people have one thing in common. they are in tuned in with their bodies
When a serious issue hits, your body will even more... tell you early on something is wrong. Saves $ to head off serious issues beforehand
These are important points, and because I've striven to maintain top physical fitness after finishing my military career, I'm also acutely aware of how age has taken its toll.
Even though I'm outwardly quite healthy at 65, and my doctor is happy, I noted years ago such things as a decline in my ability to recover from intense exercise (compared to my early 30s).
In other words, I noted during my 50s that it wasn't so much that I was getting worse but that it took more and more work over time to get any stronger. And now, I can see that I've clearly plateaued and I'll spend the rest of my life trying to hold on to what I have as long as possible.
But even then, I can see that despite everything, by the time a person reaches 65, problems can come out of seeming nowhere. I don't know if it's a matter of deep genetic issues or new environmental problems--or a combination.
Stuff happens, and it happens faster when you're older.
It all amounts to a far greater probability that any given person in his 60s may or may not have a whole lot more good years ahead of him. In the last year I've had both a cancer scare (numbers were suddenly bad, had a negative biopsy, then the numbers settled back down) and a spinal surgery scare (I was scheduled for vertebra fusion last Friday, then what had been months of agonizing pain suddenly just went away a week before surgery).
So I'm retiring in three months. I could make more if I worked longer, but we have planned and I'll actually have as much disposable income after retirement as I have working. And I've got things I want to do for myself and my family.
My brother who is still working in his late 50s is just so tired of the corporate rat race. We have had many interesting discussions about the pros and cons of early retirement. (Before age 60) He keeps telling me that while he hates his job if he can just hold out for 5 more years his assets will increase as he is putting about 50% of his income into the stock market and bond funds, plus get a larger pension. His plan was to put up with the corporate madness for five more years and retire at 64 years old.fi
IF he can hold out five more years, he will be able to live a much better life then with more money allowing him to do more things and move into a nicer home. (Plus go on nicer trips and eat at nicer restaurants, etc.) But I tell him that by then his health may be poor and he will have lost the five years of good health and years of leisure gained from early retirement.
Have you faced this dilemma and what did you do?
In my late 50’s I ran the retirement calculator many times trying to see how early I could stop. If I pushed to full 65 years, I would actually be pulling in more than if I was working but I couldn’t see myself lasting that long. I figured I would shoot for 62, but the company decided for me at 57 with a forced retirement.
Those 5 years less made a big difference in my retirement income stream. There is so much more gain at the end. The pension really ramps up at the end. Each extra year adds a peak salary year to the pension calculation and you grow one year older reducing your life expectancy, both pushing the number up quicker at the end. With my forced early retirement the pension could not be delayed and had to start immediately, also no COLA adjustments till age 62. If I would have made it to 62 the pension would have been about 25% higher to start, and with COLA.
The 5 years also would have allowed the 401 to grow a probable 25% between contributions and investment return, giving a bigger safe withdrawal.
But I was done more than I thought, and I am glad to have stopped working, they did me a favor really. I gave myself some time to decompress, and see how the finances worked out, and now I know I am done and I am very happy to be out of the corporate rat race.
It was a bit shocking to find that salary income stream suddenly turned off after so many years. We are not where we hoped to be but we will be fine. It is also an adjustment to go from an accumulation mindset to a spenddown mindset. I have so far avoided tapping into the 401, I want to wait as long as I can to let that grow more. That seems to be my main hope of increasing steady income in the future, other than turning on SS, or going back out to the workforce.
Overall I am very happy to have stopped working earlier, my time and life are my own now. Even with the lower pension it was very liberating to turn off the alarm clock for good and to get paid to not work!
(edit to add that after age 55 with at least 10 years of service you get company health insurance for life so I did not have to add that expense into my decision, which can be considerable)
I am glad you like your job. My experience is that those who truly are fit and healthy, WHILE working full time, if this is done long term, it can put them at risk for health issues. Or they just keel over one day due to heart attack. I am sure being healthy and fit is more beneficial than not
Are you saying that people working full-time are unable to stay fit and healthy, without risking their health?? Huh??
Perhaps you are referring to people that have very high stress jobs, and as such are more susceptible to stress related health issues. That’s a different thing entirely. And to be perfectly honestly, there are far more people in high stress jobs that cope very well, healthwise, than those who do not. Physical exercise, staying fit, is one of the BEST ways to cope with stress. Any doctor will tell you that.
Last edited by ChessieMom; 04-12-2019 at 12:13 PM..
It’s difficult to imagine working at a job he hates for 5 more years. Why not just plan to work another year, and then reevaluate retirement at that time? At the end of each year he can look at his finances and decide if he should go another year. That way he won’t feel so trapped making a choice to work 5 more years.
I am fine with my job, but I'm working until traditional retirement age (this year). I could have retired sooner, but would have higher health insurance costs, and at best would expect a similar income from investments that I got from salary. By waiting a few years and investing more, I will have at least 1.5x my final salary. That leaves a lot of leeway for higher expenses, unexpected medical costs, and higher inflation. I want security, and the ability to continue my lifestyle and travel even more. I think I'll achieve that goal.
Location: Small community in the California Sierra Mountains
119 posts, read 121,023 times
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Quote:
Originally Posted by Ralph_Kirk
These are important points, and because I've striven to maintain top physical fitness after finishing my military career, I'm also acutely aware of how age has taken its toll.
Even though I'm outwardly quite healthy at 65, and my doctor is happy, I noted years ago such things as a decline in my ability to recover from intense exercise (compared to my early 30s).
In other words, I noted during my 50s that it wasn't so much that I was getting worse but that it took more and more work over time to get any stronger. And now, I can see that I've clearly plateaued and I'll spend the rest of my life trying to hold on to what I have as long as possible.
But even then, I can see that despite everything, by the time a person reaches 65, problems can come out of seeming nowhere. I don't know if it's a matter of deep genetic issues or new environmental problems--or a combination.
Stuff happens, and it happens faster when you're older.
It all amounts to a far greater probability that any given person in his 60s may or may not have a whole lot more good years ahead of him. In the last year I've had both a cancer scare (numbers were suddenly bad, had a negative biopsy, then the numbers settled back down) and a spinal surgery scare (I was scheduled for vertebra fusion last Friday, then what had been months of agonizing pain suddenly just went away a week before surgery).
So I'm retiring in three months. I could make more if I worked longer, but we have planned and I'll actually have as much disposable income after retirement as I have working. And I've got things I want to do for myself and my family.
I totally relate to you, especially the bolded above. Sounds like you're on the right track and will have plenty of time soon to get in even better shape.
Amazing your pain suddenly went away before surgery. Maybe working out did some good.
I retired at 52 with a pension and could have worked for another ten or twelve years and gained a little more money a month. We had an age+tenure retirement formula that I met. But I was constantly angry and stressed out at 52 so I would have ruined my life and marriage in ten years. My wife was older and retired a year before I did. If we were going to be retired together when we were both healthy I needed to retire early. I was retired 13 years before I reached 65. I worked part time for seven years, mostly for pocket money and social contacts. My wife did the same. As things worked out, I was widowed at 58 so we would not have had any retirement together if I waited until 62 or 65. My parents waited until 65 to retire but my dad soon became a caregiver and they both were in a nursing home for several years. My choice was right for me but maybe not for everyone.
I feel like such a freak. I'm now 66 and still working. I can work basically reduced hours at a pretty nice self employed job and have a very good income. I'm in good health, don't take my my SS yet.
I think I'm supposed to feel guilty about working so long. Oh well.
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