Questions Re Retirement

[Mr._Clark]

I'm tentatively planning to retire within the next 2-3 years. I've saved a fair amount over the years, but I'm somewhat apprehensive about having no real income during retirement.

I had always assumed I'd just "know" when it was time to retire, but I'm finding it more difficult than I expected.

For those who are retired, do you wish you had worked longer? I've heard quite a few people say they wish they'd retired younger, but I rarely hear anyone say that they wish they'd worked longer.

Also, is there anything you wish you had done differently?

 

[ryanosaur]

I'm tentatively planning to retire within the next 2-3 years. I've saved a fair amount over the years, but I'm somewhat apprehensive about having no real income during retirement.

I had always assumed I'd just "know" when it was time to retire, but I'm finding it more difficult than I expected.

For those who are retired, do you wish you had worked longer? I've heard quite a few people say they wish they'd retired younger, but I rarely hear anyone say that they wish they'd worked longer.

Also, is there anything you wish you had done differently?

Ozzy retired. Look what happened to him!

 

[highfigh]

I'm tentatively planning to retire within the next 2-3 years. I've saved a fair amount over the years, but I'm somewhat apprehensive about having no real income during retirement.

I had always assumed I'd just "know" when it was time to retire, but I'm finding it more difficult than I expected.

For those who are retired, do you wish you had worked longer? I've heard quite a few people say they wish they'd retired younger, but I rarely hear anyone say that they wish they'd worked longer.

Also, is there anything you wish you had done differently?

Discuss this with a financial planner.

Someone who retires fully needs to do something other than sit all day. That's a really fast track toward death.

It's less a matter of "I no longer work" and more "I no longer work for someone else". A friend wondered "What are we going to do after we stop working?" and I told him that a couple of hobbies that provide income always seemed like a good idea, to me.

 

[Mikado463]

Discuss this with a financial planner.

I'm assuming this step has been done or is in the works

As someone who is in his 5th year of retirement my adj were a little different(retiring smack dab in the middle of COVID). For me having a Railroad retirement pension, a wife retired as an Educator with a pension and living conservatively comfortable, money worries were not a real concern.

As for the actual decision to retire, for me, after a 47 year career, it was time to turn over the reigns to the next generation of railroaders. I did consult back for 6 months or so which did help in weening myself from the 'work routine'

Most importantly, as @highfigh noted, keep and stay active. I have and now I usher another famous quote......"I don't know when I ever found time to go to work" !

 

[highfigh]

I'm assuming this step has been done or is in the works

As someone who is in his 5th year of retirement my adj were a little different(retiring smack dab in the middle of COVID). For me having a Railroad retirement pension, a wife retired as an Educator with a pension and living conservatively comfortable, money worries were not a real concern.

As for the actual decision to retire, for me, after a 47 year career, it was time to turn over the reigns to the next generation of railroaders. I did consult back for 6 months or so which did help in weening myself from the 'work routine'

Most importantly, as @highfigh noted, keep and stay active. I have and now I usher another famous quote......"I don't know when I ever found time to go to work" !

It's unfortunate that so many people retired during COVID- their employers weren't able to find GOOD, well-qualified replacements. Customer/technical service have become unusable in many cases and in the AV industry, that has become so much of a PITA that I don't even want to be involved anymore. Brands have disappeared, companies have been purchased and failed because someone didn't follow Dirty Harry's advice ("A man has to know his limitations") and people who had absolutely no past experience in the new job replaced competent employees. One glaring example was at an equipment distributor- he was new and didn't know anything about the products, so I asked how long he had been working there as conversation, rather than getting in his face about it. I then asked what he had done before and he told me that he drove a truck delivering beer. Yeah, that was great. Unfortunately, the manager knew about as much and when I asked about products, he would look on the computer or in their paper catalog, tell me the part number and price. When I was asking for specs, that really didn't help.

I have been doing this for decades and the changes in HDMI, equipment reliability and lack of support from manufacturers makes it impossible for me to want to continue in the business. Add the fact that almost no electronics service shops are left and I jus want to do other things.

Because of my education and training (independent and on the job working for others), I had filled a niche in AV installations- I was willing to work on the old homes that are well over 50 years old, often 75-120 years old and the other dealers/installers weren't interested or willing to do the work because finding cable paths and cutting holes aren't the same as working on newer homes. These make cable failures a real problem if some kind of conduit wasn't used (I always did, unless the path was short and easy).

Oh, I forgot to mention- I have a 1980's boat that wasn't well-maintained by a previous owner, so............

 

[ski2xblack]

"You don't stop playing because you get old, you get old because you stop playing."
-a plaque on my elderly mother's wall, which she seems to live by. I swear she keeps busier and is more socially engaged than I am!

As for the income apprehension, that's the situation most find themselves in, rather unfortunately. I hope your savings is enough.

I guess people differ on what a "fair amount" means. To me, a fair amount for retirement would be enough to take a defensive investment posture but have enough still working for me to ensure steady (and steadily increasing) after-tax spending power indefinitely. I suppose wealth is a bit like amplifier power: too much is just enough.

 

[Eppie]

Not retired yet but in a similar situation to you. You need to treat retirement income as "real income". You put the money aside, so you earned it. You should have a long term financial plan, though. It's often a matter of how aggressive you want to be with your investments and will you be able to ride out those years where the returns are not very good, or do you want to invest conservatively? A qualified financial planner can be of help here.

I'm not a CFP but work with an investment firm. I have the software to do some projections and have enough retirement savings to maintain and exceed my current income level with full time employment. Basically, how much income do you want to draw from your retirement plan annually, how long should the plan last and what rate of return can you reasonably expect with that plan? A CFP will have software that can calculate those things and factor in inflation and also look at tax implications to minimize taxes paid.

In Canada all workers pay into the Canada Pension Plan (CPP) so you also get to draw on that plan at retirement (based on what you paid into it). So for my plan I take into account my retirement savings plan, my CPP benefits and maybe some Old Age Security on top. I then projected that out to when I will be in my late 80's. I expect to need more money at first because my wife and I will want to travel more. Those expenses will go down when we get older. If we live into our 90's, our house is paid for and I have not factored that into retirement income. There will be enough equity there to place us both in a nice retirement village should we live that long.

That's roughly how I worked things out. If you think income will be an issue, maybe go from full time to part time work so you draw less from retirement savings at the start. At those levels the savings should still grow. My manager enjoys the work here so he plans to keep working but to keep reducing his hours. I've been taking a similar approach and taking more time off lately, but I'm fortunate to work for a small company that allows flexibility in my hours.

None of my friends who have retired have said that they wished they had worked longer. They have strong family ties and grand children and keep busy. A few that ended up with too much free time eventually took on part time work to fill the day. All I can say to that is if you plan to work more, make it something you really enjoy. If you are enjoying what you do and the people you interact with, no harm in continuing. Keeping busy will keep you young. Some of my friends retired from factory and government jobs, so no surprise that they wanted out. If you are in a private practice, your situation could be very different. I know a few lawyers that worked beyond retirement age simply because they enjoyed going into the office daily.

As to knowing when to retire, if you are financially set then it comes down to your mental state or gut instinct. I was initially ready to work beyond 65 but the last 2 or 3 years ended up being very stressful. My mind set has changed and I am getting things in place so that I can transition out of work. I have a ton of projects on the back burner so no concerns about keeping busy. If you don't know what you will do with your spare time, then work will keep you busy. If you have a growing list of things you want to do, then you will eventually realize that it's time for change. Well, I hope I didn't ramble too much and that there is a pinch of wisdom in there.