Retirement Planning - Lessons Learned

[Dale Binkley]

I was fortunate to be able to retire "early" at age 59. My retirement was by choice. Arthritis in my feet spurred my decision along so I could enjoy they next few years doing what I wanted instead of suffering at work on concrete floors. It helped that I had planned to retire at age 60 and worked toward that goal for 25 years.

The biggest advice I give to pre-retirees is "know how much it costs you to live the way you want to". Most people are concerned with how much income they will have. Knowing your costs first makes more sense.

I had a little money left from my mothers estate, she passed when I was in my early 40's. I saved this money and used it each year to fully fund retirement accounts for my wife and I rather than spend it on things I thought I would need at any particular time. This put us on the path to retire when we did.

 

[Frankenkubota]

That link is dated 1981.
Back about that time the management started a push into contracting everything. By about 1990 the started contracting out research big time.
I worked my 37 years in an Army Research lab.
By 1995 we had our lab "seats" filled with contractors. By 2000 most of what was being done was contracted out. Often to contractors that made promises but not results.
But "government management" success was often judged by the size of the program, not the results.
To truly judge government employment one should include ALL contractors.

and consultants!

good catch on the 1981 reference!

 

[dougtrr2]

The biggest advice I give to pre-retirees is "know how much it costs you to live the way you want to". Most people are concerned with how much income they will have. Knowing your costs first makes more sense.

I think a fallacy is that your living expenses will go down when you retire. About the only expense that went down for us was fuel costs. The wife and I were commuting separately 60 miles round trip each every day. Some expenses can actually go up. We tend to eat out a little more often, utilities are up a little because the A/C and heat are not dialed down during the day since we are home all day.

So I would make the safe assumption that your living expenses will stay the same or maybe go up slightly in retirement.

Doug in SW IA

 

[Paddy]

I think a fallacy is that your living expenses will go down when you retire. About the only expense that went down for us was fuel costs. The wife and I were commuting separately 60 miles round trip each every day. Some expenses can actually go up. We tend to eat out a little more often, utilities are up a little because the A/C and heat are not dialed down during the day since we are home all day.

So I would make the safe assumption that your living expenses will stay the same or maybe go up slightly in retirement.

Doug in SW IA

Doug,

We feel the same. The only thing I see is we will not be contributing 15% of the paycheck to the 401k
Down sizing is the only way we can reduce expenses. Big house = high utility, high taxes and high insurance.

 

[DCGuinn]

We’ve been retired 18 months (at 67) and just completed a move 55 miles north out of the Atlanta suburb. It was rushed because of wanting to capture the current housing market For the old house, which sold this Tuesday. The costs of preparing both houses has been Surprising. Moving costs as well. We are in shape financially to afford it, so considering it an investment. I’d been in the house 25 years and the level of clutter was amazing. We donated seven pickup loads to charity. Organizing the stuff was huge, and I suggest you start soon with what you might need after a move in mind.

A side note, we used the BX and a small trailer to move a 1,100# metal lathe out of the basement around a corner and up to street level. I couldn’t get anyone to bid on it, so used the tractor which only had 12 hours on it.

Good luck, keep focused on the job, it’s hard to be fair to yourself and your employer if you don’t.

 

[newbury]

and consultants!

good catch on the 1981 reference!

Consultants are usually under contract.

I think a fallacy is that your living expenses will go down when you retire. About the only expense that went down for us was fuel costs. The wife and I were commuting separately 60 miles round trip each every day. Some expenses can actually go up. We tend to eat out a little more often, utilities are up a little because the A/C and heat are not dialed down during the day since we are home all day.

So I would make the safe assumption that your living expenses will stay the same or maybe go up slightly in retirement.

Doug in SW IA

Disagree - Our costs dropped greatly. It depends on your lifestyle. I would make a safe assumption that you cannot predict the future.
Plan for the worst, hope for the best.

 

[Paddy]

Consultants are usually under contract.


Disagree - Our costs dropped greatly. It depends on your lifestyle. I would make a safe assumption that you cannot predict the future.
Plan for the worst, hope for the best.

Newbury,

What costs dropped? I read an blog that listed the top 10 items where your retired cost drop, no one applied to me.

 

[lman]

I'm afraid my expenses will go up when I'm fully retired. Too many projects I've been putting off until retirement. And then you've got increasing inflation-decreasing value of the dollar. Haven't figured out how to grow money on trees like the federal government does.

 

[Larry Caldwell]

I'm afraid my expenses will go up when I'm fully retired. Too many projects I've been putting off until retirement. And then you've got increasing inflation-decreasing value of the dollar. Haven't figured out how to grow money on trees like the federal government does.

Work expenses disappear. No more commuting expenses, so vehicle costs go way down. Through the pandemic, I have only gone to town twice a month for supplies, so no eating out. Work clothing switched to durable Carhartt and sweats. I figure I saved over $500/month by not going to work. Entertainment expenses switched to streaming, so that was pretty much a push.

One big driver of inflation is housing costs. If you are a renter you are vulnerable, but if you have locked in your housing, the price won't change. If your housing costs are the average 1/3 of your income, that means you get a 1/3 reduction in the inflation rate. Property taxes are your local problem.

If worst comes to worst, you can always sell a project or two. Build a 3-point trencher that will fit a little Kubota and rake in a few grand.

 

[/pine]

I'm seeking venture capital to develop a new food service...it makes real looking vegetables out of meat...!