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I have another friend who once was a millionaire. Armstrong company. Back in 1999.
But he never sold the stock.
Armstrong went bankrupt. When it emerged in 2006 my friend lost all his equity, just like GM stockholders did.
It's a mine field out there.
Actually the friend mentioned above created his own mine field. $1,000,000 in a fairly boring fund like Vanguard Balanced Index would have held up ok since 1999.
Depends on the terms of the plan the individual has. I know a couple of people who started with a utility straight out of high school and retired in their 50s with full pension and health care coverage. One still works part time but entirely by choice.
How many people have opted to take early retirement at 55 and forgo a more beneficial pension? I am contemplating retiring at 55 and have saved well and have a part-time job that I plan to make full-time when I retire from my current job. However, almost everyone I know thinks that it would be unwise and that I should play it safe and stick it out for another 5 years since my pension will be almost double. For those of you who have voluntarily taken the leap, would you do it again if you were given a do-over?
In my career path I could have retired 2 years ago 56 and 30+ (actual 34). I would have had to find something to keep me going for 4 years but anything part time would have worked. As it is I stuck it out in hopes of lasting the 4 years but didnt and will come 18 months short of that goal. So people would think me as an early retirement but no I am right on schedule. Old soldiers rarely make it to be very old. I keep losing friends that are mid 60's to mid 70's. Especially those of us that have deployed to war zones.
As for your circumstances, you are not doing anything that will hurt your retirement. You are finding something that will occupy your time. Your pension will pay you even though you are working at your retirement job (mine will be my golf game). Please enjoy life to its fullest. There are a finite number of breaths we take. Breath them all in.
How many people have opted to take early retirement at 55 and forgo a more beneficial pension? I am contemplating retiring at 55 and have saved well and have a part-time job that I plan to make full-time when I retire from my current job. However, almost everyone I know thinks that it would be unwise and that I should play it safe and stick it out for another 5 years since my pension will be almost double. For those of you who have voluntarily taken the leap, would you do it again if you were given a do-over?
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Originally Posted by DaveinMtAiry
I haven't but if you are not completely miserable and could realize twice the pension I'd surely make that move and stick it out. If you stay for say 3 years will that give you a sizable increase as well? Maybe go in with that plan and re-evaluate after 2-3 years?
Now if you have a very short life expectancy or are completely miserable, well that's another story altogether.
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Originally Posted by Escort Rider
You must be very anxious to get out of your current job, otherwise you wouldn't be planning to continue with another full-time job after "retirement". Financially, your plans make no sense at all, but like DaveinMtAiry wrote, if you are completely miserable, then sometimes mental health is more important than extra money.
Your pension amount may become very important to you when you are 75, 80, or 85. At those ages it is normally impossible to get another job. I say wait as many of those five extra years as you can. Lots of people would kill for a good pension, but you are ready to forego the decent amount of yours for a much lesser amount, which is puzzling.
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Originally Posted by MadManofBethesda
I can understand wanting to retire early (I retired at 54), but what would be the point of "retiring" and then taking another full-time job? If you're going to work full time anyway, it makes much more sense to stay at your current job (even if you like the other one better) and increase your pension.
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Originally Posted by HappyTexan
I retired early on a reduced pension but it wasn't 50% reduction. And my pension is sufficient to pay the bills.
I do not need to work and haven't needed to touch my 401K.
I would suggest you tough it out for 5 years if that means double the pension amount.
Maybe then you wouldn't need to work. But if you leave early and need to work then you will most likely continue to need to work. And then is that really "retirement" ?
What these guys said. This is why so many retirees find themselves in tight economic straits. They jump at the lure of "early retirement" because they fall for the "grass is always greener" syndrome. If you've got to continue working to maintain your lifestyle, it's NOT retirement IMO. The chances of you finding a job that pays as well and has as many benies as your current job are generally between slim and none for an older person. Check out the Personal Finance forum.
If you are in a defined benefit pension plan, you are crazy to take a 50% cut and walk away from that. The monetary value of a defined benefit pension for someone at the average salary for teacher etc retiring after 25-30 years has got to be well north of $1 million. If you're in administration, a high-paying school district (or college) or in a state with a generous pension plan, it could be worth double that. Do you have a retirement nest egg of $1-2 million, and are you comfortable literally throwing away $500k or more?
I understand "burn out" among educators; it's why I no longer teach. Unless you just can't stand it any longer, it makes sense to stay.
What you need to do look is long and hard at the actual numbers, by the year and by the month. How is leaving your current job at your current salary going to impact your SS? SS calculates your benefits based on 35 years of employment (140 quarters). If you're only 54, you probably didn't start working full time until you were 22 or 23, which only gives you 32 or 33 years, which means you would have 3 or 4 years of PT salary or 0. You can go to the SS website and find their calculator where you can figure your potential SS benefits based on various scenarios. You can't assume that you'll get a full time job or a full time job that pays what your current one does.
Think long term, too. What happens you can no longer work or just don't want to work?
You live in a very generous state then. In California there is a substantial penalty for retiring as young as 55 in the state teachers' retirement system. The "full" pension is not available until age 61.5.
Earliest unreduced retirement eligibility comes at age 65 with at least five years of service credit or age 50 with at least thirty years of service. I will be eligible for unreduced from the state at age 52 with 30 years, but will hold out through age 55 to get full benefits from our county system.
The biggest issue I foresee is planning for healthcare costs.
Whosoever has taken retirement at the age of 55 yrs must have taken that decision after full thought. One of my known who also retired at the age of 55 yrs already well planned about his savings with the advice of financial advisers and also thorougly made his own calculations on retirement calculator. Now he is peacefully leading his retirement life.
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This is why so many retirees find themselves in tight economic straits. They jump at the lure of "early retirement" because they fall for the "grass is always greener" syndrome. If you've got to continue working to maintain your lifestyle, it's NOT retirement IMO. The chances of you finding a job that pays as well and has as many benies as your current job are generally between slim and none for an older person. Check out the Personal Finance forum.
