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Retirement Planning
I've recently come to a conclusion which is worrying both Kent & Michael in a fun way: I could theoretically retire right now.
It would be a thin retirement with little free cash, but it is possible. The easiest path would be to buy Mom's farm and move to Ontario: within months, I'd be eligible for the provincial health plan so my only major expenses would be property taxes, utilities & food, stretching my cash reserves much further than they would in the US. Naturally, the guys are not enthused about living in northern Ontario, and frankly, I'm on that keen on it either. But the idea of retirement has suddenly become very, very real instead of some abstract possibility decades away.
In any case, I'm still planning to keep working until I'm 60 in 2027, which is only six years away. Then things get serious.
Michael goes on Medicare this August as he turns 65, so he'll be off my work-related medical insurance. That's a slight disposable cash bump, and one less worry if I change jobs or leave employment entirely. In a year, he can claim his own Social Security at full value (he's receiving discounted funds from his late wife's account currently).
Kent just turned 60. When I retire, he could take Social Security at a discount, or hold on for just a while longer to get the full benefit at 67. I'd really like him to wait until 67, but he's had enough of working for a living since he was 30 so he may not wait.
In the interim, I'm still working to reduce our recurring living expenses, stuff as much money as I can into retirement accounts, and generally ensure we're ready when the time comes. 2,371 day left.
It would be a thin retirement with little free cash, but it is possible. The easiest path would be to buy Mom's farm and move to Ontario: within months, I'd be eligible for the provincial health plan so my only major expenses would be property taxes, utilities & food, stretching my cash reserves much further than they would in the US. Naturally, the guys are not enthused about living in northern Ontario, and frankly, I'm on that keen on it either. But the idea of retirement has suddenly become very, very real instead of some abstract possibility decades away.
In any case, I'm still planning to keep working until I'm 60 in 2027, which is only six years away. Then things get serious.
Michael goes on Medicare this August as he turns 65, so he'll be off my work-related medical insurance. That's a slight disposable cash bump, and one less worry if I change jobs or leave employment entirely. In a year, he can claim his own Social Security at full value (he's receiving discounted funds from his late wife's account currently).
Kent just turned 60. When I retire, he could take Social Security at a discount, or hold on for just a while longer to get the full benefit at 67. I'd really like him to wait until 67, but he's had enough of working for a living since he was 30 so he may not wait.
In the interim, I'm still working to reduce our recurring living expenses, stuff as much money as I can into retirement accounts, and generally ensure we're ready when the time comes. 2,371 day left.
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He dallied with studying to be a real estate professional. He's now heavily immersed in local politics, and has a 'job' as an advocate for a foster child non-profit.
The biggest deal for him was waiting until I retired June 1, 2016, which was a full six years after he did.
I know you'll make a heavily calculated decision when the time comes, taking the others into account. Oh, and welcome back to this blog.
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Having an older husband who already bought a house certainly helped me reduce living expenses, but maximizing my tax-deferred contributions also reduced my taxable income quite a bit over the 28 years at Stanford. At one point, I checked out Stanford's 403b borrowing rules, not because I needed the money, but because loan interest repayment to yourself is a backdoor extra contribution (but not worth the fees and hassle, since fixed interest rates rarely beat the stock market).
Watching the mis-steps at the start of the pandemic (in workplaces, theatrical groups, and dance or social clubs), I'm so glad that I wasn't in charge. Stanford at first told only those who tested positive to stay home, before the testing debacle. The Bay Area lucked out, with low-ish infection rates until last month, but I still wouldn't want to be responsible for a super-spreading event.
Also, don't forget about Required Minimum Distributions. Paying taxes on withdrawals or Roth conversions in lower-income years can reduce future RMD tax brackets, and withdrawals can be invested rather than spent. Time is money, and low-income years are a use-or-lose resource for deferred taxes.
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