Is it ever the right time to retire?

cheerful1_gwJune 19, 2012

My husband retired last August at age 58. I'm still working at age 57. Husband's pension is the "meat and potatoes", my salary is the "dessert".

We adopted a dog; husband is home all day with him; retirement's not agreeing with him. Dog may have been a mistake initially, but we love him.

I'm feeling guilty about still working; I can't make up my mind about leaving. I don't like the job any more, but the money is good; once I leave, that "dessert" is gone.

I have a 401k and IRA; we have a cushion in the bank.

Why is this so hard? It should be a no-brainer.

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What are you more "frightened" of - loss of one steady regular income stream or being home all day?

    Bookmark   June 19, 2012 at 5:41PM
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I hope your idea of retirement is not TWO people staying home with the dog all day, LOL.

First: How much 'wiggle room' does your retirement budget have if you stop working? We don't need to know this - YOU need to have figured this out with your spouse. Have you accounted for inflation? Home maintenance? Medical expenses? Medical emergencies? Auto maintenance and eventual new car?

What if one of you becomes disabled? What if your spouse dies?

The Boomers I know who ran into trouble in retirement or trying to retire, had problems because they had never really planned an alternate strategy for WHEN something would go wrong. Because that's what life's not IF something goes wrong, it's WHEN. And trouble seldom happens at a 'convenient time.'

How good is your health and your spouse's? How would you manage in the pre-Medicare years?

Are you planning on taking distributions upon retirement? If you do it before 59-1/2, then you'd have to use the 72T rules, which might not be optimal from a tax standpoint. Have you figured out what your tax bracket will be/could be going forward (taxes will almost certainly go up at some point; they're at historically low levels insufficient to cover government expenditures)?

Are you planning to take SocSec early? Have you figured out the potential tax issues?

Excerpt from the website linked below: "Income Thresholds Used in Social Security Taxation Formula for Married Filers" (formula is complex; the example used is an estimate only)"
"...In general, as your income in addition to Social Security goes up, more and more of your benefits become subject to taxation. If you are married and your combined income exceeds $44,000, then up to 85% of your Social Security benefits may be taxable."

Second: I retired at age 55 in 2006; my DH retired at age 56 in 2010. We've had a lot of fun during that time, but have found that in the "active phase" of retirement, our discretionary expenditures have increased noticeably. It isn't cheap to travel and dine out. Where we live, even going to movie matinees with a couple of sodas hits the $30 mark. But we love being retired, with the freedom to do what we want, when we want to, instead of trying to cram both errands and fun into a packed weekend.

I think you need to sit down with your DH and discuss what your plans are for retirement. It doesn't sound like you two have really thought about what you want to do for the next 30+ years.

Especially for those who take early retirement, social contacts are critical. If, like most Boomers, you have made most of your friends through work, a lot of that social contact goes away. You've got time, but they don't. Old friends and family start to die off, and if you don't make an effort to replace them, life gets lonelier (it's happening to my MIL, who lives with us).

Assuming the finances are in order, then you can fulfill your plans for an active, interesting, happy retirement. But you really do need a plan and some goals. Wonderful things are not going to automatically happen just because one has stopped working.

Here is a link that might be useful:'s Money Over 55: link to SS tips

    Bookmark   June 19, 2012 at 6:39PM
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My DH will be 65 in less than a month. He has no hobbies. He works on the weekends (computer-related and from home, with about 2 hours spent on household/yard ). He will never retire until he figures out what to do with himself first and actually establishes a track record of it longer than a month.

Money isn't the problem.

    Bookmark   June 20, 2012 at 12:08AM
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Lots of good questions here. Hope I can answer them all:

Husband is retired from the Federal government and has a monthly annuity. He has not taken anything from his Thrift Savings Plan yet. My salary gets banked every month.

We had many discussions, and made up a budget before he retired; on paper we can carry the expenses.

I have a 401K and an IRA. We have savings in the bank; two houses (Long Island and Pennsylvania) that are fully paid for. I plan to start taking Social Security at 62.

His health insurance is pretty good. His biggest health problem is chronic Lyme disease with Babesiosis (tick-borne parasite). I'm in decent health (biggest issue is osteoporosis).

On paper, our money situation is fine. The freedom to do whatever we want and not be on a timetable is intoxicating to me.

I think my fear is the finality of not bringing in extra money, but we could always sell one of the houses. My work environment is not what it used to be, so I wouldn't miss it.

    Bookmark   June 20, 2012 at 6:55AM
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Sounds good. Here's what I'd do, although it would take research and effort to find someone ETHICAL and COMPETENT - I capitalize those words because when you're talking about your money, they're really crucial - to run some Monte Carlo analyses on your situation and make certain that your assumptions are as low-risk as possible.

You want a fiduciary financial planner, the subject of which has been discussed to death here (mostly by me - search on "fiduciary" or "CFP" for a lot of forum threads). A per-hour, independent planner will need a fair amount of information from you, along with a written outline of your short-, medium- and long-term goals. The last isn't mandatory, but believe me, it helps everybody to see it in writing.

A good Monte Carlos analysis needs to be run through at least 1200 scenarios to be actuarially valid. If the planner can't tell you precisely how many scenarios his software will run, or says something like, "we run 500 different scenarios, which will test your budget thoroughly" - smile politely, gather your notes, and leave to interview the next name on the list.

Now, most people don't do this. It takes time to find a planner who will run a good Monte Carlo analysis - the right software itself can be very expensive - and you want someone experienced, which means you're going to be checking references and interviewing at least two or three planners. This means going through NAPFA and Garrett Planning Network, pulling names in your zip code, and making calls to find out if they're interested in working with you on this project. There actually is a shortage of fiduciary financial advisors in the US, so it isn't easy to find someone.

Certainly on paper it looks like you'll be all right, provided you and your spouse figure out what you want to be doing for the next 30+ years.

Retirement is best looked at in phases. Break it down into 10 yr chunks. When you begin retirement, your health is generally good enough to do all the things you wanted to do but didn't have time for.

But ten years later, you're still active but slowing down. Ten years after that: driving at night is a hassle or even dangerous, traveling is getting to be a lot more tiring.

When you don't work, there's a lot of time to fill up. Some people can't find anything more than TV or computer games (my MIL). Conversely, DH and I can't find enough time in the day to do all the things we enjoy doing - but we always had a lot of hobbies, and still do.

    Bookmark   June 20, 2012 at 1:09PM
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The difficulty is the financial decision. Question is am I going to be satisfied with less. Can I make it? It would help if there were more stability in the market. I felt the same way in the decision. Came down to my desire to retire was greater than my financial worries. Of which I believe I am fairly solid. There will never be enough. There was a day in which I knew it was time. My time to myself and my choices is very valuable. Particulary while I am in fair health.

    Bookmark   August 5, 2012 at 12:49PM
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When my co-worker retired, I asked him how he knew it was the right time. He said, you just know.

I don't think I've had that "aha" moment yet, although my desire to retire is strong.

    Bookmark   August 7, 2012 at 12:28PM
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I was talking to my FIL last week. He retired at 59; he's now 85. He said, "make sure it's your decision alone, and no one talks you into it".

I started thinking about that. While my husband keeps saying it's my decision, he says things sometimes that make me feel like he's nudging me.

Also, I think part of my wanting to retire now is I feel physically exhausted. I love my dog, but because we go to bed early, he wakes me up in the middle of the night to go out. I haven't had a full night's sleep in a year (don't want that to sound like a complaint, but I think it's a factor in my wanting to retire).

Thanks to all for listening.

    Bookmark   August 14, 2012 at 8:48AM
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"When my co-worker retired, I asked him how he knew it was the right time. He said, you just know."

I had that moment several years ago, but market did not get the message. So I hang on.

    Bookmark   August 16, 2012 at 9:52AM
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Cheerful1, sounds like you might be better off giving away the dog. You need your sleep, whether or not you retire. Or you could have the dog trained so he does not wake you up.

Some days I get fed up, but most of the time I love my job. I am 64 and my parents both worked until their mid-70s. I don't expect to work that long!

    Bookmark   August 21, 2012 at 11:32PM
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Consistant lack of sleep could definitely be coloring your view of the entire situation.

What I don't understand, is if your husband is retired, why are YOU the one losing sleep to take care of the dog? It should definitely be your husband's responsibility when you need your rest and have to get up every morning. First thing I'd do would be address that situation. Believe me, for the 30+ years my husband worked and I was a housewife, he never had to do those middle of the night things (walk the dog, pump out the basement, etc) that was MY contribution to our lifestyle.

Second, have you considered that this doesn't have to be 'either/or'? Why not leave the job that's stressing you out, take your pension, and get a parttime job doing something that's more fun, more fulfilling. Perhaps something to do with a hobby you enjoy, or helping others in a way you're especially talented. Working parttime, you still get to bring in some money for those extras, but you'll have time to do more things with your husband. We make it a rule to go out at least one day a week and do some stuff just for fun. You may start a whole 'nother career that you carry with you for years to come.

I know a gentleman who's retired from a large (actually HUGE) corporation. Now his wife does crafts, he's doing woodworking--he makes the nicest furniture. And they're cleaning up with their 'hobbies'--they have a shop in the Amish market, and the man has months and months of orders stacked up.

You might even consider chatting about that with your husband. Mine retired about 2 months ago--he was really unsure about it, but you know what? He's busy from sun up to sundown every day, he's loving being out of the rat race, and he was just saying the other day how he thought the days would drag, but they're just flying by and he
can't believe it's been 2 months already. That's because he's busy, doing things he enjoys. Luckily, he knows what they are--if your husband is sitting around the house, bored, you may have to do a little leading to get him enthused about something that would be enjoyable for him.

Take your time, and investigate all your options--including even things like going back to college to take up another career. You can do many (like paralegal or optician) as an apprentice, so you can work and earn while you take your courses to qualify. My dd went to college for opticianry right out of high school. She was the youngest in the course by about 20 years!! Most were older (50's and 60's) folks who were taking up a second career. They were a close knit group, she's still in contact with most and they all got jobs in their field and are making great money.

    Bookmark   August 29, 2012 at 9:20PM
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If you are able to continue working without undue stress, I'd do that. The longer you ca delay dipping into social security, the better. That's not 100% true. If you retire before your full SS retirement age, there is a reduction in SS payout. It amounts to about 5/9 percent for each month early. Three year (36 months early) is a 20% reduction in payout. You full retirement age may be different, but lets examine the case where a person's full retirement age is 65 and he starts taking SS 3years early at age 62. His reduction is 20%. The cross over point is 77 years, the age when 50% of the population has died. Taking SS 3 years early he gets the same total amount of money by age 77 as the person who waited until age 65 because he has been paid 3 more years. If he lives longer than 77, then he takes a hit because the 20% reduction continues for life. If your health is poor and you do not expect to pass age 77, take early payment; but if you expect to live into the 80s and beyond, It pays to wait.

Two other reasona for continuing working as long as practical is inflation and health insurance, By retiring early, you are adding those years of inflation against your retirement kity. By delaying retirement (and assuming your pay keeps up with inflation) you are reducing the number of years of inflation in retirement. If your employer offers a health insurance package, this is a bargain even if you have to pay a considerable amount of the premium. Check what it cost to buy the same amount of insurance privately on your own.

And then there are people who are fairly well off and can afford to retire when they want to. What a great condition.

    Bookmark   March 23, 2013 at 1:08AM
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The "right" time to retire is as soon as remotely possible.

I retired at age 49 my wife retired at age 54, couldn't be better except it would be nice to win the lottery.
Do not work your life away, life is too short

    Bookmark   March 23, 2013 at 12:34PM
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My "unofficial" retirement date will be October. Because of certain circumstances, I have 10 weeks of vacation time coming to me this year. I earn vacation from January to October. I want to take advantage of all this time coming to me.

Also, we have changed our dog's feeding time to right before bedtime. He sleeps through the night now.

It's going to be a very intense year.

We've discovered that my husband has some health issues that have to be dealt with in the near future.

    Bookmark   March 25, 2013 at 7:02AM
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The right time really becomes a question about money specifically savings and investments. Regardless of when you "feel" it, the question of if you can afford it is inescapable. Now no one wants to work beyond a certain age when they can no longer keep up with the job. So setting the right time to retire is an exercise of foresight and planning out finances, so when that time comes, you can afford the retirement you want. Desserts included.

    Bookmark   March 26, 2013 at 11:02PM
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Don't forget to make a substantial allowance for inflation.

Plus ... in the light of the huge debts that your government has run up, plus their printing money so fast, that's making people in other parts of the world pretty skittish about using the U.S. Dollar, and when that dollar ceases being the world's standard of currency, there'll almost certainly be some major tremors in the U.S. economy.

ole joyful

    Bookmark   March 28, 2013 at 3:38PM
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>>that's making people in other parts of the world pretty skittish about using the U.S. Dollar, and when that dollar ceases being the world's standard of currency,>>

I think it will be decades before that happens. The euro is finished, and with the recent BOJ move to combat deflation, the yen carry trade is over. The yuan stands no chance of being accepted as the sole major exchange currency until the Chinese clean up their political corruption and establish some serious financial regulation to provide needed transparency into their financial markets.

Hedge funds are already beginning to shy away from Chinese IPOs due to the lack of solid audited financials; big article on the Assoc.Press wires today. As Jim Jubak, an analyst I highly respect on Asian economies, said, "A lot of China's GDP recently consists of digging holes and filling them back up again."

    Bookmark   April 14, 2013 at 6:13PM
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I retired at age 70, two years ago. My husband has prostate cancer that has mestacicized to his bones, so I kept working in order to provide good insurance as the bills are astronomical. Once we got that worked out, I was like many of you; just knew it was time, my job was no longer challenging or satisfying, and haven't looked back! I am into gardening big time, so have plenty to keep me busy; we don't travel, my DH just can't handle it, and that's okay. (However, when we go to the casino once in a while he walks pretty good) Also, I love to read; it doesn't take much to keep me entertained.

I had a 401K, got a financial advisor to handle that; no, we're not rich, but this is so worth it to me!

    Bookmark   April 14, 2013 at 8:27PM
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ogrose, when people ask my DH if he enjoys retirement after being 42 yrs on the job, he laughs and says, "I should have done it thirty years earlier!"

Which of course, we couldn't afford to do...but he is having a lot of fun in retirement. It's great to see him so happy.

    Bookmark   April 20, 2013 at 6:49PM
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I discovered I made an error in the monthly calculations.

When I made a preliminary budget using my husband's annuity (without the Thrift Savings Plan annuity), it all looked ok on paper.

Over the past two years, we haven't completely stuck to it, but we were never in the red at year's end.

I'd tell my husband he didn't need to add the TSP annuity to the budget. It hadn't dawned on me that after putting money into savings, $600 of my salary was in checking every month. I was afraid of bringing it up, but I also thought I had told him about this.

We were discussing finances this morning and I brought that up to him; he was furious that I never told him. We always talk about money, so it surprises me that I never said anything.

I can make cuts to the budget to recoup that $600, but I really messed up.

    Bookmark   May 7, 2013 at 11:48AM
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Retirement for some people can be very difficult. It is a change of life stile to make it easier would be start doing the things you plan on doing when you retire now. I bought a boat a few years before I retired and when I did retire I sailed around the Caribbean for six years finally ending on a island I call home now. As far as finances but as much money in tangibles and not in paper as paper could end up being not worth the paper it is written on. Health check all sources and not just the orthodox medical system who have everything to gain by having you sick and nothing to gain by curing you.

    Bookmark   June 2, 2013 at 12:58PM
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I agree with Nunyabiz1 "Do not work your life away, life is too short" And I'm getting out very soon! I'm 61 and ready looks like next Spring! Been there too long!

    Bookmark   July 2, 2013 at 8:28AM
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Don't forget the ravages that inflation wreaks on our assets.

There are two rats that eat our cheese.

There's an agency that comes to almost all of us with a question ... and a statement ... annually.

The question: "How much did you make?"

The statement (for all but *very* low income people), "We want part of it!"!

Income tax affects our income.

For the parts of our asset base that we choose to invest where we have a guarantee that at the end of the period, we'll get back every dollar of the money that we invested there, along with the rent on the money ...

... there's another problem.

Another rat comes along and nibbles a little piece off of one corner of every five dollar bill that's included in that investment ... and off of the corner of every other bill in it, as well.

That rat is called "inflation" - $10,000.00 won't buy now what it would ten years ago ... and certainly nothing like what it would have, 30 years ago.

Income tax hits our income ...

... inflation hits our guaranteed-dollar investments ...

... (the other investments, as well, really ... but a number of them carry the possibility of a net long-term increase in numbers, to offset the ravages of inflation).

ole joyful

    Bookmark   December 5, 2013 at 4:19PM
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