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Old 01-02-2010, 08:41 AM
 
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59 yrs old ,2800.00 pension ,typical cheap coupon cutter, will drive extra mile for a deal .no debt.normal expenses,will it last till i die,with no intrest made on savings.
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Old 01-02-2010, 09:00 AM
 
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You should plan on initially taking no more than $1,000/month (4%) and perhaps as little as $750/month (3%) from your 401(k) if you want it to last 30 years.

When added to your pension, that gives you between $3550 - $3800 to live on.

So I'll repeat your question back to you: Is that enough to live on confortably? Only you can answer that.

Two more questions for you though:

Will you be eligible for Social Security in 3 years?
Is your pension indexed to inflation?

If the answer to both of those questions is "no," then you might run into serious problems later on in retirement.

If the answer to both of those is "yes," then your prospects for a long and happy retirement are much better.
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Old 01-02-2010, 09:09 AM
 
8,188 posts, read 11,905,691 times
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Quote:
Originally Posted by MadManofBethesda View Post
You should plan on initially taking no more than $1,000/month (4%) and perhaps as little as $750/month (3%) from your 401(k) if you want it to last 30 years.
Oops. I just re-read your OP and noticed you asked if the $300k would be enough without earning additional interest. My response was based on the standard formula using a 7% rate of return and then increasing your withdrawal rate each year to keep up with inflation. In the scenario you're asking about, if you took out $1000/month and didn't increase it at all, the money would still run out in 25 years. Moreover, even with a very low inflation rate of 3%/year, that $1000 would only have the buying power of $500 in today's money by year 24. That makes things much more difficult and not something that I would recommend.
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Old 01-02-2010, 10:35 AM
 
Location: High Cotton
6,131 posts, read 6,440,860 times
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Quote:
Originally Posted by dave w View Post
59 yrs old ,2800.00 pension ,typical cheap coupon cutter, will drive extra mile for a deal .no debt.normal expenses,will it last till i die,with no intrest made on savings.
You are no where even close in my opinion....unless you plan on living under a bridge and going dumpster-diving in 5-10 years.

Seriously Dave, even if you live out your days (25+ years is a long time) very frugally in a low-cost area, your chances are close to 100% that you will run out of [enough] money a long, long time before you die.
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Old 01-02-2010, 10:48 AM
 
Location: SoCal desert
8,093 posts, read 13,227,512 times
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I could live on a $2800 pension quite comfortably, and not even touch the $300K!

If your house is paid off, no consumer debt, frugal life-style ... why not?

Whats the CoL in the area? If it's high - move!
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Old 01-02-2010, 11:09 AM
 
Location: At the Lake (in Texas)
2,070 posts, read 2,034,685 times
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Quote:
Originally Posted by Gandalara View Post
I could live on a $2800 pension quite comfortably, and not even touch the $300K!

If your house is paid off, no consumer debt, frugal life-style ... why not?

Whats the CoL in the area? If it's high - move!
I agree! So many people do not even HAVE pensions these days ... $2800 a month, plus the security of knowing the $300K is there, PLUS Social Security in a few years ... for a frugal person, all things being equal, that would be enough to live on comfortably -- unless you live in California or somewhere very expensive and want to keep doing everything you did when you worked.

My mother lived on QUITE a bit less than that and was able to stay in her home, take care of herself and had a good medical plan in addition to Medicare -- I think a lot of people are spoiled and assume that they have to have millions to be able to have a good retirement...while that's great if you have it, you don't have to have it.

Just my opinion, OP -- but you're set a lot better than many people I know, and I hope that encourages you a bit.
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Old 01-02-2010, 11:17 AM
 
8,188 posts, read 11,905,691 times
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Quote:
Originally Posted by MagnoliaThunder View Post
... $2800 a month, plus the security of knowing the $300K is there, PLUS Social Security in a few years ...
That's not necessarily true. That's why the first question I asked the OP was whether he would be eligible for Social Security in 3 years.

I, for instance, have a pension, but will never be eligible for Social Security (unless I go back to work for nine more years.) And even though my wife will receive SS at age 62, I will not be eligible for either spousal benefits or survivor's benefits should I outlive her.

So you can't just assume that the OP will receive SS in a few years.
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Old 01-02-2010, 11:25 AM
 
Location: Finally escaped The People's Republic of California
11,119 posts, read 7,566,642 times
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it's up to you , My MIL lives on $1200.00 a month in California, NO mortgage is the key...
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Old 01-02-2010, 11:54 AM
 
Location: At the Lake (in Texas)
2,070 posts, read 2,034,685 times
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Quote:
Originally Posted by MadManofBethesda View Post
That's not necessarily true. That's why the first question I asked the OP was whether he would be eligible for Social Security in 3 years.

I, for instance, have a pension, but will never be eligible for Social Security (unless I go back to work for nine more years.) And even though my wife will receive SS at age 62, I will not be eligible for either spousal benefits or survivor's benefits should I outlive her.

So you can't just assume that the OP will receive SS in a few years.
Again, all things being equal, he should be okay even without SS. A lot of people live on a lot less than $2800 a month with NOTHING in a 401(k). He said he is a thrifty, frugal person. I don't think people realize just how many people live with quite a bit less than this.
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Old 01-02-2010, 12:05 PM
 
8,188 posts, read 11,905,691 times
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Quote:
Originally Posted by MagnoliaThunder View Post
Again, all things being equal, he should be okay even without SS. A lot of people live on a lot less than $2800 a month with NOTHING in a 401(k). He said he is a thrifty, frugal person. I don't think people realize just how many people live with quite a bit less than this.
Yes, but again, I go back to the other question that I posed to the OP:

Is his pension indexed for inflation? If not, that $2800/month will be down to $1400/month in only 18 years even if inflation only averages 4%/year. And if we have the hyper-inflation that some economists predict will happen once the economy recovers, then that $2800 may be able to buy a doughnut and a cup of coffee. (Yes, that is an exaggeration for effect.)
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