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We are planning on retiring in less than 2 years. We have been actively planning for about a year so far, so alltogether we will have about 3 years in the process. My wife would prefer to live in NC, while I would be OK with south central PA. We are researching and visiting areas as time permits and have already eliminated some of our earlier locations. We are not putting any deadlines on our plans, so that if things do change we will be flexible.
It is not necessary that you move unless you cannot afford where you are living.
Maybe you never fit into the community that you have lived in. Maybe you moved to a place which was very very conservative in mostly every way, and though many people really love that, you never developed enough friends to make it feel right. Or maybe your spouse has had a hankering to live near the ocean all her life.
There are lots of reasons to move when you retire that ARE NECESSARY, AND THAT HAVE NOTHING TO DO WITH FINANCIAL ISSUES.
Maybe you can say, "Its a nice place to live, but I sure don't want to die here."
It is not necessary that you move unless you cannot afford where you are living. So you might base your financial plan on staying where you are. Another misconception is people move where buying a house is cheaper and property taxes lower but there are many other little "taxes" that are not as obvious (state tax on SS, retired military pay, personal tax on vehicles, etc.). Plus services including medical in the area may be limited.
We could afford where we lived. We'd done so for years to include a year after retirement. The other cautions you enumerate, and additional ones, would only occur with no or faulty planning and lack of analysis of matters fiscal, social, geological, meteorological, etc.. I'm glad we started planning as early as we did and doing it so well. And actually, the housing bust and bad economy ultimately helped us as we were not really impacted by it having already budgeted and pre-qualified for our home loan and having parked our savings/investments in "safe" funds a year or two before when the market first started looking iffy to us.
I want to thank you all for sharing how you planned for your retirement. It will be helpful info for other readers too. I do wish I had thought more about the specifics of retiring sooner - can't change that now but I do agree I need to pay closer attention to income/savings than I have been. Time just goes by so fast..doesn't it?
I have a sib who planned to retire early and lost a great deal when the market went sour, it was quite a blow for someone who had worked extra hard and now has to not only wait to retire but will have less security when retirement arrives.
It does seem like you need to be flexible - you might change your mind about where to live as you get closer to the time. Things change in your life, what you need might vary. I know I'll need to live somewhat near good medical facilities though I'd love a more remote area. It wouldn't be wise though for my disabled adult who needs to be near programs/facilities. Sometimes I wonder though if you get lucky enough to live in a close-knit community, it might be better in some ways to have a good network of "adopted family" where you all help each other when its needed.
I've seen really good ideas posted, thanks so much.
I feel bad for people whose retirement plans were badly affected by the markets. But before the times of what Greenspan called in 1996 as "irrational exuberance", there was a common understanding that the markets were not someplace for people to invest in when you got close to retirement. Look back in every retirement book on investing in the 80's and low 90's and you'll find one piece of advice that was lost when everyone seemed to think that the markets were just like bank CD's.
That advice was: when you get to within 15 years of retirement, you start increasingly taking your principal out of the markets and putting it into safe investments such as CD's and treasuries. While you could lose to inflation, you could lose even bigger to a market crash. As you get closer to retirement you should have no more than 10% of your funds in the market, so you cannot lose what you cannot recover. When you are only 3 years out most people reduced their involvement in the markets to no more than 5%, and put 5% also into precious metals. In the event of a market crash, the metals would take off and cover any losses in the markets.
It is so sad that people couldn't know about this age old advice and would think that the markets could never collapse.
I feel bad for people whose retirement plans were badly affected by the markets. But before the times of what Greenspan called in 1996 as "irrational exuberance", there was a common understanding that the markets were not someplace for people to invest in when you got close to retirement. Look back in every retirement book on investing in the 80's and low 90's and you'll find one piece of advice that was lost when everyone seemed to think that the markets were just like bank CD's.
That advice was: when you get to within 15 years of retirement, you start increasingly taking your principal out of the markets and putting it into safe investments such as CD's and treasuries. While you could lose to inflation, you could lose even bigger to a market crash. As you get closer to retirement you should have no more than 10% of your funds in the market, so you cannot lose what you cannot recover. When you are only 3 years out most people reduced their involvement in the markets to no more than 5%, and put 5% also into precious metals. In the event of a market crash, the metals would take off and cover any losses in the markets.
It is so sad that people couldn't know about this age old advice and would think that the markets could never collapse.
Maybe you never fit into the community that you have lived in. Maybe you moved to a place which was very very conservative in mostly every way, and though many people really love that, you never developed enough friends to make it feel right. Or maybe your spouse has had a hankering to live near the ocean all her life.
There are lots of reasons to move when you retire that ARE NECESSARY, AND THAT HAVE NOTHING TO DO WITH FINANCIAL ISSUES.
Maybe you can say, "Its a nice place to live, but I sure don't want to die here."
Zarathu
I was pointing out that for her it might not be necessary, if she was happy and could afford where she was currently living.
If I lived in a community where I didn't fit in, was different from me i.e. too liberal or conservative, no friends, or a desire to live somewhere else, I would have moved long before I retired. Necessary reasons, to me, would be financial, family, and medical.
I feel bad for people whose retirement plans were badly affected by the markets. But before the times of what Greenspan called in 1996 as "irrational exuberance", there was a common understanding that the markets were not someplace for people to invest in when you got close to retirement. Look back in every retirement book on investing in the 80's and low 90's and you'll find one piece of advice that was lost when everyone seemed to think that the markets were just like bank CD's.
That advice was: when you get to within 15 years of retirement, you start increasingly taking your principal out of the markets and putting it into safe investments such as CD's and treasuries. While you could lose to inflation, you could lose even bigger to a market crash. As you get closer to retirement you should have no more than 10% of your funds in the market, so you cannot lose what you cannot recover. When you are only 3 years out most people reduced their involvement in the markets to no more than 5%, and put 5% also into precious metals. In the event of a market crash, the metals would take off and cover any losses in the markets.
It is so sad that people couldn't know about this age old advice and would think that the markets could never collapse.
Zarathu
We moved the majority of our investments into "stable" funds five years ahead of retirement. We weren't affected by the market crash, were able to sell our home at a good profit and pay off retirement home. Investments continue at 4%. There are many things to consider when investing in precious metals, i.e. costs that are not obvious (ex: storing) so make sure you do due diligence.
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Location: A Yankee in northeast TN
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Quote:
Originally Posted by Zarathu
I feel bad for people whose retirement plans were badly affected by the markets....
That advice was: when you get to within 15 years of retirement, you start increasingly taking your principal out of the markets and putting it into safe investments such as CD's and treasuries. While you could lose to inflation, you could lose even bigger to a market crash.
I figured I had another year or two to go before I had to start going this route and I got burned. Now I'm trying to figure out if the best thing to do is go ahead and take the safe route anyway and try to conserve what little is left? Or do I delay the retirement and spend the next several years trying to recoup some funds first? Plans never seem to work for me the way they are supposed to.
I'm thankful I still have a fair amount of time left until retirement, so I can try to figure out my best course of action.
Look at the events of the past ten years, the housing bubble, the economic collapse, how can you possibly know what will be in 10 years. It's OK to think about it but serious planning?
Yeah, that's what I was thinking. It's good to keep your eyes and ears open and get a feel for different places. But, serious, detailed planning more than 5 years in advance seems like a gamble.
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