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I’m 52, won’t live past 80 and have $1.6 million. ‘I am tired of both the rat race and workplace politics.’ Should I re

[italic]Hi,

I started working when I was 19 and have been saving half of my salary since my mid-20s. Now at 52, I am tired of both the rat race and workplace politics. With the virus, it feels even worse. I have saved about $800,000 in trading, $800,000 in my 401(k) and $300,000 in a house. I also have six months worth of emergency funds. I don’t have any debt and I own my vehicles, too.

I can easily live on a $60,000 budget (including taxes) but often it is less than that. No one in my family has ever survived beyond 80 years old. Thinking of the remaining days, I wonder should I just retire, do some one-off gig work or learn a language that I always wanted to learn? I just wonder if it is prudent to do so. Or should I keep on slogging another 10 years?

What do you think?

Wondering in Alamo.[/italic]

Dear Wondering in Alamo,

You bring up a question I think a lot of people have been asking themselves lately. The coronavirus crisis has certainly shaken up the way people live, and some of us have been wondering if this is the time to make a big change. But before you do, it’s important that you think about all of the potential consequences on your finances and lifestyle.

Because there are a few personal details missing from your question, it was hard for financial advisers and I to tailor this answer specifically to you. We’d have to know if you’re married, have any dependents, what your salary is roughly, where about in the country you live (I looked it up and there are a few cities named Alamo in the U.S.!) and if you’d have access to health care if you were to leave the workforce. We also weren’t sure what exactly you had included in your $60,000 budget, except for your taxes. Still, the following may help you — and others who are wondering if now is the time to “get out of the rat race.”

Health insurance is probably one of the most crucial — if not the most crucial — consideration you’ll need to make before you leave your job. You’re 52, which means you have 13 years until you qualify for Medicare. Private health insurance can be quite expensive, so if you don’t have a spouse whose insurance can cover you, the premiums alone could take quite a large chunk of your annual budget.

“He is going to have exorbitant rates until Medicare kicks in,” said Michelle Gessner, founder of Gessner Wealth Strategies. The pandemic may also affect how high those rates go in the foreseeable future, especially as hospitals and other medical institutions try to recover from the crisis, said George Gagliardi, a financial adviser at Coromandel Wealth Management.

Even if rates don’t jump because of COVID-19, health care expenses tend to rise, year after year. A single man retiring at 65 years old in 2019 would need $135,000 to spend on health care alone for the rest of his life, according to Fidelity Investment’s 2019 annual Retiree Health Care Cost estimate. That calculation is based on Medicare coverage and does not include long-term care insurance. Between 2002 and 2018, the estimate for health care costs jumped 75%, according to Fidelity’s analysis.

If you would end up needing private coverage because you left the workforce, do your research so that you get the most for your money. Look at the health insurance marketplace, set a budget for yourself, and use comparison sites — being careful to review what is and is not included in the plan so that you are not without services and prescriptions you will need.

I know you said people in your family tend not to live past 80 years old, but you may still want to consider long-term care insurance, Gessner said. It’s not unheard of for nursing homes to cost somewhere around $90,000 a year (or more), and if toward the end of your life you should need some sort of facility like that, you could wind up dwindling your nest egg down to nothing. “He is thinking, ‘Oh I’ll die by 80,’ but that is not a given,” Gagliardi said. Your estimated budget of $60,000 most likely would not be enough to clear your everyday expenses and medical expenses.

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by Anonymousreply 10308/07/2020

Now on to your savings. Aside from your trading and 401(k) investments, you have an emergency fund — something not everyone has or even thinks about, financial advisers said. Having that account will certainly help, both financially and emotionally, in the future.

Also, having a $1.6 million nest egg, outside of your emergency fund, is of course a wonderful feat. But this is the not-so-great news: you may be surprised at how quickly that could be spent, especially if you find out you need more than $60,000 a year to live.

“He has enough money as long as he lives a frugal life and nothing goes wrong and dies in his 80s,” said Jen Grant, a financial adviser at Perryman Financial Advisory. “That is a lot of assumptions to count on. Medicine has improved and he will very probably outlive his ancestors.”

When you start withdrawing money from your portfolio also matters. With the “sequence of return” risk, an investor who starts taking money from a portfolio during a downward cycle could diminish potential returns of the future (as there is less principal to grow on). “The other problem is we have had an amazing run-up of stocks the last 10 years,” Gagliardi said. “If you look at 10-year projections, we are not going to see the same.” The market is pretty volatile these days, which of course does not mean people can’t retire in the middle of these ups-and-downs — it just means you should think carefully before you start withdrawing money from these accounts, especially if you don’t have to yet.

On top of that, you’ll want to strategize which accounts you withdraw from and when, depending on the types of investment accounts you have (traditional or Roth), your age and your income each year. Typically, 401(k) account holders pay a 10% penalty if they take a distribution prior to 59½ years old, but there is the so-called rule of 55, where employees who have been separated from their jobs during or after their 55th birthday can withdraw money penalty-free.

Beyond the numbers, think about what you want to do with your time. Retiring at 52 is quite young, and even if you do live to your personal life expectancy and not more, that’s 30 years of retirement. What will you do with that time?

“My recommendation would be to spend some time self-reflecting on hobbies and things he feels passionately about,” Grant said. This may be a sport, a new skill — you did mention wanting to learn a new language — or perhaps volunteer work. Or, it could just be a good time to take a breather and make a career switch.

“It might be the perfect time to pivot,” Grant said. “He has done a great job saving. Let that money grow another 10 years before he taps into it. He could get a different job, he could get a part-time job, he could get a lower paying (less mentally stressful) job that has health insurance.” Having another job, if even one that pays a fraction of what you currently earn, or building a gig business for yourself, would bring more money in through the years, offsetting potential pitfalls or gaps in your savings needs.

Remember that if you decide to retire, you’re essentially putting yourself on a fixed budget. Of course there are opportunities to find part-time or gig work in your retirement — something plenty of Americans do — but that income may not be as steady as the work you have now. “It becomes a whole different mentality,” Gessner said. “It’s very scary for people to put yourself on a budget if you’re not already. Think about how you want to live on that budget. Because that makes all the difference in the world.”

by Anonymousreply 107/31/2020

I want to write a letter to one of these financial shows or whatever this is and basically have them tell me to kill myself while trying to suppress laughter at me and my 6-hour emergency fund.

by Anonymousreply 207/31/2020

Same here, R2.

They would hang up on me, if I told them what my financial position was like.

by Anonymousreply 307/31/2020

How does the writer know that he "won't live past 80?"

Seems presumptuous of him to write that.

by Anonymousreply 407/31/2020

1st world problems

by Anonymousreply 507/31/2020

He should find a more meaningful job, even if it pays a fraction of what he makes now. Someone with as much discipline and savvy as him will be bored in retirement at the tender age of 52. Plus, he'll always be thinking about how much of his hard earned investments he's pissing away on things like health insurance and early distributions and what not.

Of course, when asked during interviews why he want's a downgrade - the response would be: "I'm smart enough to save 1.6 million when most Americans can't save 1600. I have fuck you money and I'm going to use it to find a job that makes me happy."

I'd hire them in a heartbeat.

by Anonymousreply 607/31/2020

Also unanswerable at the moment. Don't go without health insurance, especially now.

But who knows where we'll be a year from now: on the mend or more fucked up?

by Anonymousreply 707/31/2020

If he doesn't want the rat, I'll eat it.

by Anonymousreply 807/31/2020

He just needs to find the easiest, most bullshit part time job that offers health insurance, even if a high deductible plan. Starbucks, receipt checker at Costco, etc.

by Anonymousreply 907/31/2020

R4 his family history. Not presumptuous, but realistic.

A colleague had client who was a physician. Her family all died before 60. All her financial advice was predicated on that fact. The physician retired at 55, she had 6 great of retirement, and she died at age 61.

She would have had those 6 years of retirement if she was not realistic about her life span.

by Anonymousreply 1007/31/2020

Life's too short to spend one more day than you have to in corporate America. The politics and bullshit and younger generations are too challenging for me for sure. If I were in your shoes, I'd quit as soon as this Covid mess is behind us and things are open. Then travel for a bit. Then find something you love and find a way to make a bit of money here and there if you are worried about nothing coming in. I don't want to work one more day than I have too. Over it. Step aside and let someone else earn that money that actually needs it to survive.

by Anonymousreply 1107/31/2020

This is the INSANITY of the self-funded retirement scam. You will NEVER be secure or confident enough to retire (unless you’re the 0.5%) and you end up working a miserable job until you drop. At some point, you have to say fuck it - and try to eke a little enjoyment out of this capitalist treadmill game that the world has set up.

As someone whose genes give me an 80%+ chance of having aggressive cancer before 70, I was in almost the same position and said “fuck it”. Best decision I made. Never realized how good life can be. The 401k treadmill is a BS way to live life.

by Anonymousreply 1207/31/2020

just think about how the world would change if everyone had this option.

why is the workplace so full of bullshit, up and down the payscale?

by Anonymousreply 1307/31/2020

[quote]“He is going to have exorbitant rates until Medicare kicks in,” said Michelle Gessner, founder of Gessner Wealth Strategies.

Not necessarily. I retired at the end of June at age 62 and although I am in good health, my biggest hesitation was indeed health insurance. I live in NYC and got a bronze-level Obamacare policy for $482 a month. My deductible is $4000 and my out of pocket maximum is $7900 (my old policy at work had a $1850 deductible and a $6000 out of pocket maximum, so not a big jump). I have never met my deductible.

I have 30 months until Medicare, so that's $14,460 in premiums. I asked myself: 'Is it worth putting in 40 hours a week at a job I hate, plus another 2 hours a day commuting, just to save $15,000 over 2 1/2 years? (Less actually, since I contributed to my health care at my job). Of course the answer was NO!

(If the Democrats win the Senate and Biden wins, I would expect the eligibility for Medicare to tick down to 60 pretty quickly, and maybe to 55 by the time the guy in the article gets to that age, but that is obviously no guarantee.)

52 is not 62. I claimed early Social Security, but he cannot, so if I were this guy, I'd sit down with a financial adviser and have him run the Monte Carlo Analysis and see if the money makes sense.

Of course, nobody knows when the end will come. I know of two men in my office who dithered about retirement ('What will I dooooo?) and worked past 65. One developed cancer and died before he retired and the other retired, developed cancer within 2 years and died. A third had a heart attack and died at age 63.

As the old saying goes "People plan, God laughs'

by Anonymousreply 1407/31/2020

R14 - your friends dying before 72 is the norm I see. Yes, people live long lives - especially women. But I think it’s crazy for many men to worry about saving until 90. 75% of the men I know died by 70. Numbers are distorted - they say if you make it to 80, there’s a good chance you make it to 85. Averages are deceiving. Family history matters most.

I retired at 52 and get a Gold Obamacare plan. Costs $940 month. Biggest expense I have. Would like a better plan - but not worried about it. If I live to 80, I’ve got a $ problem. But not sacrificing happiness while I KNOW I’m alive for fear of bad things happening when I will likely not be alive.

by Anonymousreply 1507/31/2020

I disagree. I think retiring now is like retiring in September of 1929. We’ve already had evictions and bankruptcies, and the next great depression is coming fast.

by Anonymousreply 1607/31/2020

If you have $1.6 million you are rich - by most every ones standards. It’s insane that the 401k industry makes us think that millionaires are poor. What a sick world.

by Anonymousreply 1707/31/2020

[quote] I retired at 52 and get a Gold Obamacare plan. Costs $940 month.

Omg that is ridiculously expensive.

What in the hell do you get for that $940 a month?

by Anonymousreply 1807/31/2020

[quote]How does the writer know that he "won't live past 80?"

He has an assisted suicide pencilled in on his Google Calendar for 2048.

by Anonymousreply 1907/31/2020

OK -- here's mine. I've always lived below my means. I'm 67, retired, have a six-figure pension, sitting on a bunch of cash and other assets (net worth $2.5 million) and have no idea how to spend it because I am unable to make a decision about what to do. I have no close relatives and I'd like to die broke. But I just shut down whenever I start to think about whether I should move (well, actually, I should -- I don't like where I live and I have stairs). I have a hard time convincing myself to spend money, but as I get older I start to realize that there's no reason for me to keep hanging on to it so tightly. I have done a lot of traveling, but now that seems like it's not going to be possible again for some time to come.

by Anonymousreply 2007/31/2020

My dad ^^^

Why don't you talk to a nice American expat RE agent in Puerto Vallarta about a temporary rental there for the winter and get away for a while. Enjoy some tropical breezes at a fraction (literally) of the cost of anywhere in the US?

The virus is still worse in the US compared to Mexico.

Plenty of Americans and Canadians to help you navigate and celebrate life.

by Anonymousreply 2107/31/2020

He defintely should get a fun job - maybe a tour guide

by Anonymousreply 2207/31/2020

A Gold plan makes sense for me. I’m a numbers guy and I would meet the max deductible under the Bronze Plan. If you spend a decent amount each year, it makes sense to get Gold. The plans are designed to make it confusing - with most people going for the cheapest monthly cost. But the math always works out that if you are a result user of health care, Gold ends up being cheaper.

Colonoscopy, heart checks, skin cancer procedures, prostate checks - and maybe one CT or MRI a year. Plus an ER visit maybe every other year. Getting a Gold plan saves money.

by Anonymousreply 2307/31/2020

My sense from most retired people I’ve known is that 90% are less interested in spending and consuming and impressing than at 50. Like R20, it’s hard to justify all the stupid ways we spend money when we get older and hopefully wiser. Other than health care, I’m fine with planning on reduced seconding in retirement. Even at 55, I’m losing interest in going out, traveling or buying things. By 65, I’ll just want a good cup of coffee, simple food and nature.

by Anonymousreply 2407/31/2020

[quote] 1st world problems

Literally yes. In the developing world, old people live with the extended family. They are provided for. It’d in the “first world” where it’s sink or swim even in your 80s.

There’s so often that time when dad fell and hurt his hip and mom’s been gone for years so he’s on his own — thr agonizing decision, do we really want to bring him into the house and be burdened with him and have to deal with him all the time? In the developing world that conversation doesn’t happen. The family just lives together as a family.

by Anonymousreply 2507/31/2020

[quote] What in the hell do you get for that $940 a month?

1. Free annual exam and lab tests

2. In-network rates at doctors and hospitals

3. (and this is the big one) An out-of-pocket maximum. If you don't have insurance of any kind, you could go broke if you have an illness or injury that lands you in the hospital for an extended period. This caps what you'll pay.

It's a completely fucked-up system, and we are the only industrialized country with such a system. When one of my few remaining Republican friends talk about 'American exceptionalism', I start talking about health care and shut them down.

by Anonymousreply 2607/31/2020

R24 is on to something.

by Anonymousreply 2707/31/2020

[quote] How does the writer know that he "won't live past 80?"

Suicide is painless...or so I've been told.

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by Anonymousreply 2807/31/2020

[quote] If you have $1.6 million you are rich - by most every ones standards. It’s insane that the 401k industry makes us think that millionaires are poor. What a sick world.

Distributions from a 401k are taxable. If you continue to work $1.6 million is great but if you stop working and have no other income it can be spent very quickly.

by Anonymousreply 2907/31/2020

“my few remaining Republican friends“ I don’t know how you can’t stand to be around them anymore. It’s just a sickening cult at this point.

by Anonymousreply 3007/31/2020

To live below one’s means is impossible in 2020. That would mean moving to the slums in most cases. And even there the housing costs are still inflated.

Although I think it is still very respectable and responsible for anyone of any generation to do so.

But to rise up from minimum wage to any kind of prosperity is basically impossible at this point in time. You have to get lucky and get an inheritance or win the lottery if you want to get ahead anymore.

by Anonymousreply 3107/31/2020

[quote]To live below one’s means is impossible in 2020. That would mean moving to the slums in most cases. And even there the housing costs are still inflated.

Really? What about all these people who seem to have money for things like the latest phone, tattoos, liquor, travel, drugs .... People don't seem to understand how to prioritize. Anything you spend on something that's not a necessity (food, shelter, clothing, things needed to earn a living) is money that could be saved.

by Anonymousreply 3207/31/2020

R31 That's BS.

Sure there are many people who have legitimate struggles. But please, Mary. People have been doing it since the beginning of time and still do in most of the world.

People in this country think they deserve better than to sacrifice and make tough choices. They reap what they sow.

by Anonymousreply 3307/31/2020

I’d say he should try to stick it out until 55.

by Anonymousreply 3407/31/2020

Yes, but do not retire in the US. Retire somewhere that has decent health care.

by Anonymousreply 3507/31/2020

[quote]If you have $1.6 million you are rich - by most every ones standards. It’s insane that the 401k industry makes us think that millionaires are poor. What a sick world.

In retirement the safe withdrawal rate is 4%. $1.6 million will only provide $64k per year of gross income. If you use a financial planner you will typically be charged 1% of your assets and that will come out of the $64k as well as taxes. That doesn't really provide for a rich lifestyle.

by Anonymousreply 3607/31/2020

R33, if you earned minimum wage, would you still be able to live below your means?

by Anonymousreply 3708/01/2020

I said something similar in another thread R31 and got practically stalked by some borderline psycho who said I must be buying expensive cars and having plastic surgery to not be able to afford a mortgage, car lease, yearly vacation, etc.

We really do make decent money but we can't afford both a car lease and a mortgage. We chose mortgage because it's cheaper monthly than rent would be, and we earn equity in the home. That means a 20-year-old car that seeps pretty much every fluid a car can have and is at least 5% rust, but to lease a car would mean overextending ourselves. We did that once and learned a hard lesson to never do that again.

Everyone around us has new cars (SUVs, usually) and has twice-yearly vacations and 4-bedroom homes when they don't even have kids who live there full-time anymore, and I suspect they're always one paycheck away from utter disaster.

by Anonymousreply 3808/01/2020

A retired person doesn’t need 60k a year to live on. I live on much less than that and that’s with the expenses of working.

by Anonymousreply 3908/01/2020

r39, how do you know what someone needs to live on? Cost of living varies greatly depending on where a person lives.

by Anonymousreply 4008/01/2020

The guy who wrote the letter. The 52 year old with the secure nest egg. How big is his dick? How is his body?

by Anonymousreply 4108/01/2020

Retire outside of the US and you will be fine.

by Anonymousreply 4208/01/2020

r42, retiring to a 3rd world country and learning a new language at retirement age isn't for everyone. Plus, after paying into medicare it would be nice to be able to take advantage of it. It's pretty sad when a person works all their life and they can't afford to live in their own country in retirement.

by Anonymousreply 4308/01/2020

Retire outside of the United States and with few exceptions, you’ll need to learn a new language and the customs of your new country of residence. Unless you have family or friends there, you’ll need new ones. If you don’t learn the language, your contacts will be largely limited to other expats. If you plan to stay there, you’ll need to find new everything from a housekeeper or cleaning person to doctors to lawyers to keep you there legally. Taxes are an issue, as is banking. Depending on the pandemic or political situations, you need to be able to get out in a hurry, too, if the local situation or your own changes quickly.

People talk about moving abroad because it’s cheaper and no doubt some do, but it’s never struck me as terribly practical or even a very realistic proposition.

by Anonymousreply 4408/01/2020

There is no need to,retire outside US. There plenty of places in US you can buy a house or townhouse for $100,000 and get all 5e “benefits” of the US.

$1.6Mm - even with the $800k that is taxable in 401k - is still like $1.4MM net! If you can’t live on $60k/year after taxes - which is over the $75k year salary that social scientists have show is the max required for happiness - then move.

Personally, I found after retiring early that I much prefer the country /exurbs and had no desire to use the bars and restaurants and other expensive things of the city. I visit a gay city for long weekend occasionally - that’s plenty. My non-rent and health care expenses dropped over 50% after I retired and moved to the exurbs. Life is good for the first time since I started the misery of the corporate slog at 22.

by Anonymousreply 4508/01/2020

I find it very amusing that so many people in this thread are picking apart this guys retirement plan because “that one point six is going to go fast at 52.” What about the 90 percent of flyovers who have *no* savings and a mountain of debt?”

by Anonymousreply 4608/01/2020

Exactly R46. That $1.6MM - or God forbid, only $1.4MM after taxes - Isn’t enough to justify leaving a miserable existence to try to find some happiness in life is sad/crazy. The median for most retirees is like $150,000.

by Anonymousreply 4708/01/2020

You don't really know when you will die. You also don't really have enough to insure that you won't be looking for a job in your 70s. Perhaps you should rethink or refine your life to allow more time to enjoy. I work very hard for a month or two and then take a great vacation. I still enjoy a generous income and I get to enjoy my money now and then.

by Anonymousreply 4808/01/2020

R46 I don't believe they're talking about them. They're responding to the man with $1.6 million.

If one has no savings and mountains of debt, what is there to pick apart?

by Anonymousreply 4908/01/2020

[quote]In retirement the safe withdrawal rate is 4%. $1.6 million will only provide $64k per year of gross income. If you use a financial planner you will typically be charged 1% of your assets and that will come out of the $64k as well as taxes. That doesn't really provide for a rich lifestyle.

R36 the safe withdrawal rate of 4% assumed the capital will last 30 years. I've toyed with many retirement calculators from basic to sophisticated inputs; most assume a minimum 30 year post-retirement life expectancy or even a life of 95 or 105 years.

There's a big danger of not allowing the right measure of caution, bit for many people there's also a big danger of allowing too much caution and postponing retirement until all the numbers are in order. It's not an easy thing to figure and it's something you will never be certain of (unless you have absolutely no assets or a great many), but planning for your money to hold out until 95 or 97 or105 is clearly too conservative for a lot of people. For the 52 year, you have a great point: even if all his family died before 80, 82 may be cutting it a bit close -- but he also has the luxury of seeing how his money is holding out for 30 years.

by Anonymousreply 5008/01/2020

Honestly, you rich gays should give some of your wealth to younger gays (could be me), who are struggling due to coronavirus and other things. Even 50 Dollars would help :-)

by Anonymousreply 5108/01/2020

R42 retiring to a 3rd world country and learning a new language at retirement age isn't for everyone. Plus, after paying into medicare it would be nice to be able to take advantage of it. It's pretty sad when a person works all their life and they can't afford to live in their own country in retirement.

R43: It's also sad to think that every country outside the U.S. is a 3rd world country. While you were not looking, the U.S. slipped out of the No. 1 spot years ago in the measures of things that count, particularly for retirees.

Any idea how much100% coverage private health insurance costs non-citizens in many 1st works countries? About the same monthly cost as Verizon FiOS for service for internet, TV, and a landline you don't want. Or that residency in those countries for a period of one or more years often qualifies you for national health coverage at even cheaper (or free) rates.

True, taking advantage of Medicare coverage is difficult at best if living (far) outside the U.S. You would, though, be eligible for any Social Security and other federal benefits.

Many U.S. citizens retire abroad (to countries that outscore the U.S.) because it allows them to live at a comparative cost savings and with access to excellent health care. They don't all retire to third world slums.

by Anonymousreply 5208/01/2020

First paragraph in THE should be in quotes. Sorry

by Anonymousreply 5308/01/2020

R48 great point. It’s ALL about when we will die. Pretty much every calculator wants you to save to live to 90. Which is absolutely ridiculous for most of us - especially those like me who have a family history and genetics that make it likely before 72. I’ve rejected the “retirement calculator” BS. Notice how much of it is run by investment firms and related advisors - who are the beneficiaries of the 401k boondoggle Republicans gave Wall Street in the 1980s.

Everyone has different profiles. Arguably pre-48 is too early. But by 50, I think gay men especially (who are likely to die younger than”average”) should begin to seriously contemplate if there is a way they can better enjoy life and minimize toxicity - as it is a realistic possibility they won’t be able to enjoy the mythical “golden years” we have been sold as the gift of sacrificing our lives to corporate greed and consumerism.

by Anonymousreply 5408/01/2020

Wealthier Americans are more likely to live into their 70s and 80s than people in the middle class and the poor, according to a September report from the U.S. Government Accountability Office. In other words, being poor can be hazardous to your health.

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by Anonymousreply 5508/01/2020

I have friends that retired to Belize - they have an incredible house with stunning ocean views that they rent for $600/month. They also having a cleaning lady that comes in three times a week and also cooks for them and she charges $20/visit. They have a garden and fruit trees and basically eat from the garden and also rice and beans. I'm very envious.

by Anonymousreply 5608/01/2020

My grandpa knew that he would die young, as literally every single person in his family died before 60. He took early retirement & wanted to have a few good years left. He lived to 94.

by Anonymousreply 5708/01/2020

U.S.A.! U.S.A.!

No. 46 in life expectancy.

And posters are worried about the sacrifices of leaving the U.S. to retire in "3rd world countries"

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by Anonymousreply 5808/01/2020

r51 And what are you willing to do in return for my largesse?

by Anonymousreply 5908/01/2020

If you are going to "charge" the 1% R36, then you have to also account from some kind of return (even conservatively he should net 2-3% a year) over 20 years. Plus, he isn't going to "need" the full $64K once SS kicks in. For someone who saved that much I bet he will get at least $2-3K a month in SS.

Even if you ignore ALL that, $64K a year is still more than the average American makes.

by Anonymousreply 6008/01/2020

my mom had lived one year older than her mother -- till 87; 5 years older than her siblings when they had died, but the COVID got her in the end; had it not, who knows?

by Anonymousreply 6108/01/2020

R59 I have never heard of the word 'largess'. Without looking it up, it probably means generosity?

Well, I would definitely be willing to give you something in return.

by Anonymousreply 6208/01/2020

[quote] There is no need to,retire outside US. There plenty of places in US you can buy a house or townhouse for $100,000 and get all 5e “benefits” of the US.

Agreed, R45.

For what the guy in the article claims he has, I could live ANYWHERE in the US. Comfortably.

It's funny how people with this much money think that they are so limited. They have no idea how many people are just scraping by in this country with much, much less.

by Anonymousreply 6308/01/2020

I retired 8 years ago at age 51. In hindsight, my only wish is that I had done it sooner.

I can't believe how many years I spent in the rat race. It is just a blur. But I am so, so happy to be away from it.

Your needs become smaller as you age and as you transition away from the corporate world. Sure, health care is a big deal, but clothes are not. Cars are not. Anything purchased to impress others is not. You may find it's more workable than you would have thought.

by Anonymousreply 6408/01/2020

sorry the OG post indicates the guy has 1.6 million to live on for 28 years or 57K a year. Pretty sure you could retire to Mexico or Thailand and live on that.

by Anonymousreply 6508/01/2020

R65, anyone with nearly $60G to spend every year, doesn't have to move to Mexico or Thailand or Belize, to live comfortably.

They can stay right here in the US, and live quite nicely.

I don't understand this mentality, where you have to move to another country when you retire.

It's totally unnecessary.

by Anonymousreply 6608/01/2020

It's hard to take the step of retirement, even when you hate your job (as I VERY much do), because, after growing up fairly poor, it's difficult to accept the reality that you really do have enough saved. I just don't want to end up worrying about money, although I know that I have more saved/invested than my parents would have made in three lifetimes. I think it's also partly about truly accepting that, even if I live to 85, that's still only 26 years away and, even if I didn't make another penny on my money, I'd really have enough.

by Anonymousreply 6708/01/2020

If you need to move to another country, just to live off 64K or even 57k a year, you are just living beyond your means in the first place.

by Anonymousreply 6808/01/2020

r66 no I know they can here but they could love SO much better in Thailand or other places. That and medical costs in Thailand for example are low and the are cutting edge in their medicine.

by Anonymousreply 6908/01/2020

[quote]For what the guy in the article claims he has, I could live ANYWHERE in the US. Comfortably.

R63, it depends on how you want to live, and may depend on your flexibility. It sounds workable for OP's situation as he describes it. The one thing I always over-allow for is housing, the idea of owning a house or apartment outright that has some value [bold]and[/bold] having a decent retirement income is important to me. I always want to own so that the property is mine to improve and finish and do with as I like, and in retirement years it's also important for me to own because it gives a buffer in the event of some unforeseen economic upheaval or series of major expenses, or in case I live to be unexpectedly ancient and somehow hale and hearty and love it. The ability to sell a big asset late in life gives me a sense of security.

Other people want to shed assets at the start of a retirement and use them to fund those years, selling the house and renting a smaller apartment, for example. There's much to be said for that but everyone has their own level of comfort. I'm in a good financial position to retire, I'm fortunate that my income would be the same or somewhat more than I make now but owning real estate in retirement is the thing that will give me some security when I do. I don't have—nor need—the kind of money this crazy bitch Suze Orman is needed (and not a few others if you heed your financial advisor too carefully), but every one has a different comfort level and it's not always based on the best reasoning.

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by Anonymousreply 7008/02/2020

The teeth whitening, skin bronzing, hair dying, designer glasses, and shit brown one-size-too-small leather jackets budget alone would boost anyone's retirement budget substantially.

by Anonymousreply 7108/02/2020

You’ll need at least 1/2 million for the last few years of life to pay the help to wheel you up and down the front steps (among other things)

by Anonymousreply 7208/02/2020

R70 - you make an interesting argument, I’ve planned to use my house value for retirement. But there is something to be said for the security of owning. And the safety net of cash that it would provide if I live longer than expected.

I may consider downsizing at 65 to a smaller, community/HOA maintained townhouse. I’ll see how things play out and if I can maintain the nest egg I have and add a little in next 5-10 years. The Dems/Biden lowering Medicare age to 60 would be a major game changer for me. Healthcare is the biggest impediment to early retirement.

by Anonymousreply 7308/02/2020

He should quit his job. Pronto. When Covid is over find something to do that enjoyable and gratifying.

by Anonymousreply 7408/02/2020

I could work as somebody's maid or houseboy?

by Anonymousreply 7508/02/2020

[quote] Other people want to shed assets at the start of a retirement and use them to fund those years, selling the house and renting a smaller apartment, for example

I'm all for downsizing, but I wouldn't recommend renting. With mortgage rates at or below 3%, why wouldn't you buy a condo or co-op instead? You get a mortgage deduction on your taxes, but no tax break if you rent. Unless your apartment is rent-stabilized, you have no control over what the landlord will do once your lease expires.

I grew up in a house and hated all the chores that went with it, so when I moved out at age 20, I vowed never to live in a house, and for 40 years, I haven't. I'm perfectly happy to write a check to the HOA every month for maintenance, etc, and not have to worry about it.

A mortgage will ultimately be retired. Rent is forever. (Well, so are HOA dues, but you get my point)

by Anonymousreply 7608/02/2020

Good point, R76. I'm not in the U.S. and mortgage rates are only 2-2.5%, but the age limit for mortgages is 75 (i.e., a maximum 15 year mortgage at age 60), but all-cash payments are common and high down payments are standard (80% is the highest amount that can be financed, 60% is much more common except for first-time buyers.) There's no tax benefit here. I own now, so it would only make sense if I moved for some reason, but the age 75 limit and timing around that would be a deciding issue as to the benefit of financing.

by Anonymousreply 7708/02/2020

[quote]How does the writer know that he "won't live past 80?"

[quote]Seems presumptuous of him to write that.

As another poster said, it's the family medical history. He may have left out certain details out in his letter.

My paternal grandfather and two of his brothers died in their 60s and many in the family believed that there was some curse in which the men in the next generations would die in their 60s. It was kind of ridiculous to believe there was a curse because my grandfather's brothers died of lung cancer attributed to smoking and my grandfather died of bone cancer. The youngest brother had been a smoker, but stopped many years before and had lived a healthy lifestyle and would jog or bicycle almost daily. He died at 83 due to complications from Alzheimer's.

My wife had a similar situation in which most of her grandmother's siblings died in their 70s. My wife's grandmother is the youngest child and is still alive in her 80s. The second to youngest child really believed she was going to die in her 70s. So when she turned 62 she left Oregon and moved to a low cost of living area in New Mexico. She was hippy type who moved around and bounced from job to job. She never married or had kids. She didn't have a lot of money saved up for her old age. She came to New Mexico thinking she was going to die in her 70s and thought she would have enough to survive on. Well, by the time she was in her late 70s, she was running low on money and was having trouble getting by on what she was getting from SS. Around that time, my wife had just moved to New Mexico for a job was living an hour away from her great aunt. The great aunt started asking my wife for grocery money and was starting to show signs of dementia

. My wife spent a lot of time contacting social services, non-profits, and other government agencies trying to help her aunt. My wife's grandmother also started sending money to cover the great aunt's rent. The great aunt was eventually persuaded to move back to Oregon and various relatives started pooling money together to pay her rent at an assisted living center. She died last year at 85 and my wife's grandmother said that as much she loved her sister, she was always foolish when it came to money and it was a bit crazy of her to think she was going to die her 70s like the older siblings.

by Anonymousreply 7808/02/2020

There's no knowing how long you'll live. The stats are useful but predictive for groups, not individuals. And healthy, vigorous people sometimes get hit by a bus.

The thought of living another 20 years is of far greater concern to me than paying for it. I'm pretty frugal and well-insured but would anyone want to live that long, inevitably losing some degree of cognition and physical ability? Or be "alive" but unable to understand your surroundings?

by Anonymousreply 7908/02/2020

Predicting longevity is a crapshoot for most. Heart issues are no longer the death sentence they were. Lung cancers are less likely. Looking to your parents is helpful - but it really depends on cause of their death.

However, there are situations that provide a little more certainty. Having 7 aunts and uncles and father die before 70 of cancer, I always assumed the same would be the case for me. I’ve lived my life knowing I most likely would not make it past the “retirement” age of 65. Recently got a genetic test which became available that confirmed I have a gene that makes it very likely I will get aggressive cancer young- which was oddly comforting. Now I know I’ve lived my life right - and that nagging worry that I should save millions for “retirement” is gone. (And no, screening isn’t an answer for most cancers despite the myth of “early detection”)

by Anonymousreply 8008/02/2020

[quote]I could work as somebody's maid or houseboy?

Yes-- but would you provide additional "services"?

by Anonymousreply 8108/02/2020

R81 Most certainly!

by Anonymousreply 8208/02/2020

[quote] Honestly, you rich gays should give some of your wealth to younger gays (could be me), who are struggling due to coronavirus and other things. Even 50 Dollars would help :-)

$1.6 million in a retirement account is far from rich. I am not OP but whatever is left of my modest estate is going to my nephews. There is no LGBT cause that deserves my hard-earned money. Gay guys -- and white gay guys in particular -- can thrive in this world and amass wealth unfettered by the socio-economic class stratification that excludes others from opportunity.

Go beat down the doors of the Peter Thiels and other reactionary, self-loathing gay nutjobs who only care about themselves. Do a good turn for your brethren (and sorors) and take their money.

by Anonymousreply 8308/02/2020

Christ if 60-70K isn't enough to retire. That's what I'm aiming for and figured it would be a decent retirement. That number actually factors in some leeway. A year ago I downloaded an app to track my expenses. From August to February I was averaging about 3,600 monthly which would result in about 43-44K annual spend. Well of course things dropped off in March and this Friday was 7/31 and one year of tracking expenses. My grant total was $36, 369. This total doesn't reflect a normal year so I'll go with 44K as the norm. If I can't cover my retirement with 60K--then I may as well not retire.

For context, I live in an affluent, high cost area on the east coast. I rent a one bedroom for 1,500 and do not own a car. I do have pets. Included in my annual spend is helping my mom out with her cable bill, minor household shopping and an international airline ticket. This past year all this cost 2,680.

by Anonymousreply 8408/02/2020

Agree R84. Not sure what these people spend money on. I’m in NYC and spend less than $50k/year - excluding rent. And that includes things like going to restaurants and bars which will be less likely after 65. I haven’t done those things for past 3 months and have spent less than $2,000/month.

Be prudent - but stop buying into the fear that the 401k industry developed post-80s. More importantly, learn early that spending money is a fools game and doesn’t bring happiness. Live your life now - because you will very possibly die sooner than you think. I know I won’t think “I wish I had spent more time working that job I hated”.

by Anonymousreply 8508/02/2020

100% R84 and R85.

Anyone who can't survive on the guy in op's article, is out of their mind.

Not to mention ridiculous.

by Anonymousreply 8608/02/2020

[quote]Anyone who can't survive on the guy in op's article, is out of their mind. Not to mention ridiculous.

Survive, yes, of course he can survive. He's in a fortunate situation with $1.6M in retirement assets plus $300k in a house, no doubt if his estimated needs are in the low $60,000s per year. But his concern probably is whether he enjoy a reasonable standard of life comparable to what he has now. Some of his expenses will likely drop or disappear, even (commuting to work), but others will not. How much comfort level does he have: to what extent does he have to worry or not about everything going well? how much room is there for unexpected costs?

If he has to cover private health insurance, that can easily be $1000/mo. not allowing for out-of-pocket and deductible and other health services costs not covered, at least until Medicare age. Then there is long-term care insurance which the advisors answering the question seem stuck on—another $2500/year if he wants it. If he takes 4% a year from his retirement fund that's $64,000, but if it performs poorly and he takes 3% that's $48,000. The money will last his desired 28 years, but to make it last he may have to make adjustments in how much he withdraws.

Will his money last 28 years? Of course it should. Is it sufficient to be reasonably worry-free to do all that he wants it to do, and if not, what adjustments can he make to carry out his plan all the same? That's the part of the question that's not ridiculous.

by Anonymousreply 8708/03/2020

True R87. But I hate that ALL advisers will never say you’re good enough financially not to have to stay in a life of misery for fear of being broke in old age. Every adviser will put fear first.

The real question will always be - how much risk am I willing to live with - that I’m going to live to 90+, that I’ll have a major costly health emergency, that I’ll need a FT nurse care round the clock. Just like the rest of life, there is always something to worry about. The challenge and goal is to find the middle ground between prudent planning and present enjoyment of life. The 401k industry is all about encouraging worry that you will run out of money - which will always be a risk for 95% of us. But there need to be voices of “enjoy your life now” - because I’ve seen way too many people die before they get to finally enjoy “the golden years”.

by Anonymousreply 8808/03/2020

[quote] The real question will always be - how much risk am I willing to live with - that I’m going to live to 90+, that I’ll have a major costly health emergency, that I’ll need a FT nurse care round the clock. Just like the rest of life, there is always something to worry about. The challenge and goal is to find the middle ground between prudent planning and present enjoyment of life. The 401k industry is all about encouraging worry that you will run out of money - which will always be a risk for 95% of us. But there need to be voices of “enjoy your life now” - because I’ve seen way too many people die before they get to finally enjoy “the golden years”.

All true, r88. The financial planning industry is about its own profit, the larger your savings the more money for them. However, the other component is intergenerational wealth transfers. Many of my hetero colleagues are purposely working into their "golden years" because their children have lesser prospects. They need enough money to cushion the fall of successive generations that will not finish college, will be unable to buy homes and probably cannot look forward to six figure salaries.

So in reality the industry, and the advice it offers, is not for single, childless investors. The only major expenses we will have are related to housing, health and maintenance, and those could be substantial. However, someone with OP's financial profile should be fine to retire @55.

by Anonymousreply 8908/04/2020

[quote]U.S.A.! U.S.A.! No. 46 in life expectancy. And posters are worried about the sacrifices of leaving the U.S. to retire in "3rd world countries"

All the health care in the world won't help people who aren't willing to live a healthy lifestyle. The obesity rate in the US for people over 20 is 40%! Most chronic diseases that plagues US citizens is a result of poor diets, lack of exercise, not enough sleep and too much stress.

by Anonymousreply 9008/05/2020

[quote]If you are going to "charge" the 1% [R36], then you have to also account from some kind of return (even conservatively he should net 2-3% a year) over 20 years.

More than 95% of mutual fund managers can not beat the return of the indexes over the long haul. So paying a 1% AUM fee is basically throwing money away compared to constructing a simple 3 index fund portfolio.

by Anonymousreply 9108/05/2020

R91 some people just need a set it and forget it method.

I've got a professional job, a partner, and hobbies. While I'd love to pour over all the investment options available to me with a fine tooth comb and make the most prudent investments for the rest of my life, I just can't.

At some point, I'm happy with my returns. Trying to outgame the retirement industry would just leave me frozen with indecision, which a lot of people can relate to on these threads.

by Anonymousreply 9208/05/2020

Well, r92, if you ever want to check it out, here's a link to the Bogleheads forum.

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by Anonymousreply 9308/05/2020

I tried Bogleheads. but too many people sweating every penny. Reminds me of my miserly father and a best friend who are loaded but don't know how to enjoy their money.

by Anonymousreply 9408/06/2020

[quote]I tried Bogleheads. but too many people sweating every penny. Reminds me of my miserly father and a best friend who are loaded but don't know how to enjoy their money.

Same experience.

by Anonymousreply 9508/06/2020

[quote] At some point, I'm happy with my returns. Trying to outgame the retirement industry would just leave me frozen with indecision, which a lot of people can relate to on these threads.

I feel the same way.

I didn't leave a job I hated just to sit at my computer and agonize over every uptick and drop in the market. Even if I were a financial genius (which I most certainly am not), I don't have the software and resources my financial advisor does.

I'm paying him so I can sleep at night and spend my days doing fun things (once we can do fun things again).

When the market plunged in March, he called to reassure me that "we're in this for the long run" and not to worry. Just hearing his calm demeanor made me feel better (who knows if, in reality, he was calling from the ledge outside his office or not). At the end of the call I asked him if they give them training as to how to talk to jittery clients in a calm, reassuring tone, and he just laughed and said no, that's just his normal voice.

I told him he was like an airline pilot who, a fatherly tone, assures everyone that the plane violently pitching from side to side was 'just a little turbulence'. It may not be 100% true, but it feels better to hear someone tell you anyway.

by Anonymousreply 9608/06/2020

The Bogleheads are a pretty strict group, but they know their stuff. My issue is that a lot of them frowned on early retirement. I used the Bogleheads forum to learn how to construct a simple portfolio. Once the portfolio is set up, there isn't much to do with it. I spend most of my time on the early retirement forum.

Both forums have saved me a ton of money and have given me confidence that I know how to manage and invest my money.

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by Anonymousreply 9708/06/2020

Bogleheads' simple 3 fund portfolio is the set it and leave it alone approach AND you don't have to pay an advisor to manage your money. I'm not going to write up the entire spiel but simply Bogleheads advocate picking cheap index funds that cover the market, set your allocations, invest and let it be. You can check your accounts once or twice a year--I usually check every quarter. And don't ever fucking sell when the market dives. That's simple and you're not paying anyone for it.

The classic 3 fund portfolio is US market (All market or 500 S&P), International (all world) and US bond (all bonds). All these funds are available as indexes and their cost is miniscule. I think my Vanguard All US Market is something like 0.04%. Not 1%, but .04%.

Encourage people to read the Boglehead book.

by Anonymousreply 9808/06/2020

I am enjoying this thread, and whenever similar threads appear, I often eagerly read them.

Regarding retirement calculators, before I took and early retirement, I found the AARP site retirement calculator to be simple. It asks a few questions and links you to the Social Security site. Push a few buttons, and the graphics instantly indicate your readiness. I suppose parts of it might be oversimplified, but I found it comforting, especially when measured against most of the others I explored. The other calculators, usually sponsored by a brokerage firm, were very intricate, maybe a little too exacting. I think what one of the posters upthread noted about the 401K industry being vested in your working is true. How many professional roofers will examine your roof and inform you that you don't need a new roof...and how many lawn specialists will tell you that your lawn looks just fine and you don't need their special chemicals? Damned few. I think so too with the brokerage firms.

Now, I wonder about where my expenses will go once I no longer work at all anywhere and maybe live to an old age. The long term care just seems too cost prohibitive. Maintaining a healthy lifestyle seems to be the only strategy that can work.

by Anonymousreply 9908/07/2020

Long-term care costs are a burden for those who require custodial care but a couple of facts are sobering:

About 1.5 million people of all ages are in nursing homes in the US. Perhaps a third of them are there for short-term stays after an injury and/or surgery, like rehab from a hip or knee repair, leaving about a million people over the age of 65 who live in nursing homes. There are an estimated 52 million people over the age of 65 in the US, meaning about 2% of the elderly receive long-term nursing home care.

In 2000, there were 125 insurance companies selling long-term care insurance. Today there are 12. It’s not a growth industry. One in which a lot of policyholders got screwed, paying premiums for services they’ll never get because the carrier went under. Far more are paying for a service they’ll never use.

The average premium cost for long-term care is about $3000 annually. The average benefit is paid at the rate of $161 a day, but the average daily cost of nursing home care is about $300 so a policyholder still needs to pay about half the continuing costs, or about $4200 a month.

But also one where the vast majority of policyholders paid for something they’ll never need. And those who need it will still be on the hook for a big chunk of change - about half the cost - if they ever do. It has never struck me as logical to sacrifice financially today for something you probably (overwhelmingly so) won’t need or use in the future.

by Anonymousreply 10008/07/2020

My plan is to live as long as possible independently, even with some assistance. Then blow the pile of money in nursing care for the final leg which would only be a handful of years or even better, months. I'll do what I can do to stay fit and healthy but beyond that, it's out of my control. My grandmother is 92 and living in a great nursing home (it's not in the US). And she's in the section where she lives in her own room and doesn't need medical care. She moved in at 88 so she held out for a good long time post retirement age.

by Anonymousreply 10108/07/2020

Good points, R100.

I wondered if the insurance companies may be facing difficult times as younger generations are maybe less prone than in the past toward long-term care and other somewhat long-shot forms of insurance.

My parents had insurance policies for everything: long-term care, supplemental Medicare, disability insurance, prescriptions, life insurance, etc. They had a worthless policy on me taken out when I left for college; my mother paid annual installments for years after I had forgotten her one time mention of it ("to pay to bring your body home should you die there") and wanted me to renew the policy as an adult because it had a cash value. She nagged and nagged me, papers had to be signed and notarized and sent around, and in the end I cashed out and took my check for $268 or something ridiculous. My parents parents were more ridiculous and evidently had dozens of little policies that were almost more bother than they were worth. Even my homeowner's insurance was a pain in the ass: they would phone me every year to wish me a happy birthday and as a courtesy call—so many courtesy calls that I called the agent and said, "look, courtesy for me is not hearing from you unless I have to; let's just communicate by email unless I have some complex question."

My point is that older generations had a much greater fear of being under-insured and aspects of the insurance industry itself like long-term client-agent relationships make no sense in the present day. Burial plots and lots of stupid little insurance policies (I say stupid because my parents didn't have a financial need for any sort of insurance other than health insurance; they were just inculcated into the idea that there was at least a kernel of a good idea in any sort of insurance that was proposed to them.)

A quick search shows a lot of insurance industry white papers on Insurance Companies Have a Big Problem with Millennials: "of all the generations, millennials are the least likely to be fully engaged -- and the most likely to be actively disengaged -- with their primary insurer." They're not the easy sell that my parents and grandparents were. I can only hope that contributes to to some positive reforms.

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by Anonymousreply 10208/07/2020

Personally I’ve enjoyed trading since I’ve done early retirement. I’m a finance guy and enjoy analytics. Definitely not a “set it and forget it” guy - though I appreciate why some people would do that. I’ve actually made more money in the turmoil of the last 5 months than I made in the last 3 years. In that way, I feel like I’m actually making money in retirement - much of it tax advantaged.

I dont believe in overworking. Leave as early as possible. Life without work is a revelation.

by Anonymousreply 10308/07/2020
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