Countdown to retirement

[aprilgail]

DH and I are planning to retire at the end of 2027. Three years that I'm sure will go fast but feels so far away. My job is stressful but I make a good salary. Anyone else counting down the days? What did you do to help pass the time? Not wanting to wish my life away but so tired of the corporate crap. Anyone in the same place as me?

I started counting down when I was in my 30's LOL- the last 2 years seemed to take forever! I retired at 50 with a nice pension.

 

[greeneyedchick]

My husband obsesses about retiring. He's still at least 10 years away but looks at his retirement spreadsheet at least once a week. However, he refuses to talk to a financial planner about retirement. I think he's over estimating how much we need to have saved to retire. For those who are within 10 years of retirement, have you talked to a financial planner? Has he or she given you a ball -park number for saving? My hubby thinks 4.5-5 million is needed. I'm wondering what the general consensus is. He's hoping to retire at age 57. I do realize that that is a long time to live without an income, especially if we don't get social security until we're 70.

 

[princesscinderella]

My husband obsesses about retiring. He's still at least 10 years away but looks at his retirement spreadsheet at least once a week. However, he refuses to talk to a financial planner about retirement. I think he's over estimating how much we need to have saved to retire. For those who are within 10 years of retirement, have you talked to a financial planner? Has he or she given you a ball -park number for saving? My hubby thinks 4.5-5 million is needed. I'm wondering what the general consensus is. He's hoping to retire at age 57. I do realize that that is a long time to live without an income, especially if we don't get social security until we're 70.

At 57 4.5-5 million would be considered a no worries retirement for most everyone with a $200,000 annual budget using the traditional 4% rule. It really all depends on your spending habits and if you live in a high cost of living location if that number works for you. If your house is paid off and all you need to worry about are insurances, property taxes, maintenance, utilities etc, a lot of that pot becomes fun money. However, if you have a large house to maintain those costs can be very expense as a new roof on a 4000K sq ft house is about 100K by us vs $25k for a 1400 sq ft house. I think it's important to sit down together as a couple and map what you see as your wants, needs and goals in retirement and once you have that it's easier to focus in on a number that you need to achieve. With so many financial calculators available on the internet, I don't think it's necessary to sit down with a financial planner if you have been maintaining your assets and investments on your own all along and are financially savvy. Too many just want a cut of off the top of your investments without doing anything different than you can do yourself.

 

[tvguy]

My husband obsesses about retiring. He's still at least 10 years away but looks at his retirement spreadsheet at least once a week. However, he refuses to talk to a financial planner about retirement. I think he's over estimating how much we need to have saved to retire. For those who are within 10 years of retirement, have you talked to a financial planner? Has he or she given you a ball -park number for saving? My hubby thinks 4.5-5 million is needed. I'm wondering what the general consensus is. He's hoping to retire at age 57. I do realize that that is a long time to live without an income, especially if we don't get social security until we're 70.

Oh wow, YES you should be consulting a financial planner. And LONG LONG before you are 10 years from retirement. I've been with my financial planner since 1989, when I left a job and had a 401k plan I had to roll into an IRA. I retired in 2021 so 30+ years before I retired. These days they input what you are actually spending to live right now into software that uses historic data to estimate what you actual costs are going to be in retirement. Then a good financial planner will talk to you, get your priorities, and structure a financial plan that meets your projected expenses and desires. You don't HAVE to follow their advice, but the information they give you can help you make an informed decision.
Not knowing your situation, and the cost of living where you live, I would say that yes, your husband's figures are high. However, you will likely face huge health insurance costs for the 8 years between your husband retires at 57, and age 65 when he qualifies for Medicare.

 

[tvguy]

At 57 4.5-5 million would be considered a no worries retirement for most everyone with a $200,000 annual budget using the traditional 4% rule. It really all depends on your spending habits and if you live in a high cost of living location if that number works for you. If your house is paid off and all you need to worry about are insurances, property taxes, maintenance, utilities etc, a lot of that pot becomes fun money. However, if you have a large house to maintain those costs can be very expense as a new roof on a 4000K sq ft house is about 100K by us vs $25k for a 1400 sq ft house. I think it's important to sit down together as a couple and map what you see as your wants, needs and goals in retirement and once you have that it's easier to focus in on a number that you need to achieve. With so many financial calculators available on the internet, I don't think it's necessary to sit down with a financial planner if you have been maintaining your assets and investments on your own all along and are financially savvy. Too many just want a cut of off the top of your investments without doing anything different than you can do yourself.

Wow, even in my working years my budget........in reality, my income was about half the $200,000. For most folks that is a generous budget in retirement. Like I said above, we have been living over two years on $48,000 a year, before taxes. With withholding, that in reality, that was $36,000. But we are in such a low tax bracket that we have been refunded most of the withholding every year. Now with two social security checks coming in, a small annuity starting to pay out and savings withdrawals ended we will have about $7,000 available, but our expenses will remain the same. So now we can start traveling, and that travel starts next week!

 

[NH-to-FL]

My husband obsesses about retiring. He's still at least 10 years away but looks at his retirement spreadsheet at least once a week. However, he refuses to talk to a financial planner about retirement. I think he's over estimating how much we need to have saved to retire. For those who are within 10 years of retirement, have you talked to a financial planner? Has he or she given you a ball -park number for saving? My hubby thinks 4.5-5 million is needed. I'm wondering what the general consensus is. He's hoping to retire at age 57. I do realize that that is a long time to live without an income, especially if we don't get social security until we're 70.

I retired about 9 years ago but I'll pass along some thoughts.

You are doing pretty well if you are on track for 4.5-5 million at age 57. That said, the first, and most important, question to ask is how much income you need to support your desired lifestyle.

Once you have that number then you can determine how much you need to have saved. The 4% rule, 25 times your desired annual income, will give you a good savings estimate. You will have to assess your comfort level around the risk of that 4% number. Maybe 3% might make you feel better. Also your confidence in your expense estimates. Since you are planning to delay social security than your saving will have to support you for quite a while. Remember to account for taxes if your savings are in a tax deferred account. Make sure you carefully account for healthcare expenses before becoming eligible for medicare. These days healthcare can be a big and potentially uncertain number.

I did not use a financial planner. The basics of these equations are pretty easy to understand. For the years leading up to retirement I was casually watching our annual expenses and then two years before I retired I carefully tracked expenses, thankfully confirming my "casual" estimates. Overall I did pretty well with my planing. Though looking back I probably would have benefited with some professional help on tax planning.

After 9 years of retirement I am doing well. Some might say I over saved but I am comforted by having the buffer.

 

[disykat]

A financial advisor is good for advice on stock market, what kind of accounts to have, etc. Having some money working in the market to generate income is really important. In general though, the math isn't that hard. Figure out your monthly budget, determine if have loans or other things that may change before retirement. Make yourself 3 budget scenarios - one bare bones, one with fun and travel, one with additional medical and care needs. Do the math.

Since our home is paid off, we have enough with pension money and what we anticipate getting with social security to cover the bare bones. Our investments will provide some income for fun and travel AND a big chunk set we won't touch unless/until we need it for care needs. We plan to draw between 1 and 3 percent of our investments per year as income and leave the rest in our investments for the future. (Because I've had two parents in memory care and don't qualify for long term care insurance due to some what I consider minor health issues, I'm really watching the last category. I've managed their finances, and I know EXACTLY how much it costs! The house sale will cover a chunk of it, but DH is younger than me and realistically could still be living in it when I need care.) We hope to leave some money to heirs, but if we were to spend all our assets then we would qualify for help.

I said this before and I'll say it again - sitting down and figuring out the budget and how much money you will need is the first step. Even if you have or get a financial advisor you need those numbers first.

Don't let scary numbers like the husband's 4 million put you off. We have waaay less then that and are doing fine. Options like downsizing if you have a large home with a mortgage can also help. I have friends that chose to move to a smaller house when they became empty nesters and didn't need 4 bedrooms and extra living spaces that still were mortgaged. It made retirement more possible.

 

[tvguy]

Another thing a Financial Advisor can help you with is determining how much risk you are willing to take, or are comfortable taking. And their advice can include investments that you have that they do not control, like if you have a 401k plan at your employer.
About 10 years before we retired, my wife reached the dollar amount goal our Financial Advisor suggested to maintain a comfortable retirement for the rest of her life. She shifted out of stocks and into low or no risk options in her 401k. She did not want the risk anymore that could jeopardize her retirement. I stayed aggressive in my 401k. In hindsight, she would have made more money staying in risker investments. When we retired out financial advisor ran the numbers. Her peace of mind and moving her money into a conservative track cost her $200,000 because stocks continue to grow. But there NEVER was a guarantee of that.