For the better part of this year I've been trying to assess when I'll be able to afford to retire. I've been playing with Boldin, Projection Lab, my own overly complicated spreadsheets, Fidelity's planner, etc. And this weekend I had what I think is an epiphany. I reasoned that if I can simply replace my current employment income with 401k withdrawls plus Social Security, then I'm financially ready.

My current income more than covers all my annual expenses. The 401k withdrawals are based on a 5% withdrawal rate; and that will last into my 90s. I've accounted for healthcare costs, given that I won't be on my employer's plan anymore.

Can it really be as simple as "if I can replace my current income with retirement accounts, I'm good to go"?

I am trying to understand the economics of keeping people economically active after the normal retirement age.

For example, imagine a system where people who have reached retirement age could receive an income from social security while working part-time in childcare, with their work also affecting their eventual pension entitlement.

I am particularly interested in how this should be evaluated economically:

How should the cost of supporting someone through social security be compared with the additional taxes, social contributions and economic output generated by their continued work?

How should the effect on their eventual pension be accounted for?

How significant are labour-market substitution effects when people over 65 remain economically active?

Are there established models for estimating the net fiscal effect of increasing labour-force participation among people aged 65+?

I am mainly looking for empirical research or economic models dealing with these questions, particularly in countries with ageing populations and pay-as-you-go pension systems.

Social Security…

My wife and I recently had a conversation with a retirement planner. It was our first conversation, as we (at least I) will likely be making a transition to retirement in about 5 years, when I turn 59.

Through the conversation, we discovered that when social security and my teacher's pension are factored into the mix paying for 95-100% of our living expenses, we are quite a bit further ahead than even we had thought, so much so that the advisor was encouraging us to "dream bigger" with our nest egg, which will be somewhere north of $2M when I retire (God willing).

Some of our plans include blessing our children and grandchildren, helping them financially. We've thought about funding our grandchildren's 529 plans, and matching our children's retirement account investments (for example, they invest $7000 into an IRA in a year, we gift them $7000).

I think we can learn from each other here. What are some ways you have found to creativity bless your children and grandchildren in retirement?

M(33). Planning to retire by 38. Will pay off home loan in next 2 years and live off doing something on my own.
Current corpus:
Equity: 45 lacs
Gold and silver: 7 lacs
Own house: 1.2 cr (plan to sell and move to tier 2)

Monthly sip of 1 lac. Will continue for next 4 years which will add to my equity.
House proceeds will be reinvested in a new house and still be left with 50 lacs which will be used as swp to fund my retirement until 60 years.
Post 60, my equity at that time will fund the rest of my life.

Monthly expenses: 20k (excluding loan and rent)

Note: No kids and love living frugally

Appreciate feedback or criticism

I have decided to retire when I can pay for my future big item expenses while Im working. I want to put a new roof on my house, solar panels, new furnace, and 3x the size of my deck. While Im working. So another year at least. The only thing I will have to buy after I retire is health ins. I have a few apartment buildings and a healthy 401k, wifey retired in Oct. Im 57

I was hoping to retire by 62, but I don’t think I can. My spendy ways are coming home to roost. I’m 57.

Monthly expenses, about $13K
HCOL area bordering on VHCOL
Two kids through college fully paid for (no loans)
About $250k of equity in my home.

But only:
401k $230k
Trad IRA $660k
Roth IRA $20k
Brokerage $25k
Cash $30k

SS ranges from $2800 (62) to $5200 (70)

I’m a high earner and there might even be an IPO in my future with some good payouts in 2-3 years. So no matter how I crunch the numbers I am still pulling the wagon until 65 if I want to maintain my VHCOL life. Do you agree?

EDIT: I guess I should add I have been divorced since 2008 and did much of everything on my own and as such retirement planning was not considered until recently. Bought this house in 2022 after renting for 12 years after having to short sale my marital home in 2013. So it’s been a journey and thus my attachment to this house.

This is what our finances should look like in three years (assuming continued contributions and modest gains)

Assets:

My Pension - $7,150 a month after taxes

Her Pension - ~ 1,200 a month after taxes, starting in 2033

Social Security - let's leave that out for now, but a small amount.

401k plan -  $291,728

Wife’s retirement accounts - ~ $92,000

PEHP health care account – $96, 400

Sick time cash out – 78,000

High Yield Savings - ~ $212,642

Cash from recent inheritance - $291,000

So close to a million in cash and retirement accounts

Liabilities

Mortgage @ 3.3 % - $466,000 

Our current bills are about  $5,400 (including mortgage, food, gas, utilities etc.

Pension @ $7,150 should cover that. 

We have 4  years worth of money for health insurance – (assuming $2,000 a month), that gets us to 62.5 years old.   So we will need to bridge the gap there.  (60k?) 

How are we looking?

Also - What should I do with that $ in High Yield Savings  and Inheritance – Combined 500k?

I was thinking about paying off the house , or doing a mortgage recast to get the payment down lower,  but also investing the whole amount and adding the 4% withdrawal per year to our yearly / monthly income.

Seems to me that I’d still be paying my mortgage that way, and still have the $ at the end?

We were also thinking about doing a 300k addition to our house,  Opinions please.

What’s the best approach?

Thanks so much to anyone who reads -  I’ve got a lot to learn!

I (57M) and my wife (58F) have worked hard, lived below our means, got the kids through college, and saved towards retirement from our first paychecks 30+ years ago. My work in corporate America has gotten to a level of stress that I don’t feel like I can, nor want to be a part of it any longer – nothing that millions of others haven’t dealt with over the years. I’m running on empty and I don’t see it changing anytime soon, and I’m ready to be out.

In analyzing our financial situation, I, and our financial advisor have a very high level of confidence that both my wife and I could call it quits right now and be secure. With that said, my wife loves her job and wants to continue working for a few more years. Her willingness to keep working adds to the comfort level since we are under her health insurance, so it’s fine by me.

The problem comes in – that no matter what spreadsheet, cash flow, projection, tool, etc. I or our Financial Advisor show my wife, she is freaked out by my potentially leaving the workforce. This extends to even if I quit, take a few months off to re-charge and find a coast job (I know finding a coast job isn’t guaranteed). Personally, I believe some of this goes back to when she was growing up and her father was constantly in/out of the workforce and it put the family in dire straits.

I’ve gone through this sub-reddit and found a few similar situations that have been helpful, but if anyone has a situation where they were able to get their partner past an emotional block to retirement, I’d love to hear your story. I don’t want my potential quitting to be stress inducing for my partner, but I also am just done. She admitted if this was a different couple and they were in the same situation as us, that she would say “quit right now”. We both laughed at that, knowing that advice is always easier given than taken.

Edit (add): For any of my fellow Gen-Xers that are in a similar position, I've found Mike Uplands podcast "Early Retirement Roadmap" to be a great listen with helpful insights.

For those who have been retired for a while, looking back, when was the hardest period? The first few months, the first year, or does it get harder over time? I've heard some people absolutely love retirement from day one, but then also others that seem to need the structure of work for purpose.

A while back, my nice set of Bose noise-canceling headphones broke, and I have no other over-the-ear headphones. I considered buying a new pair and then decided, nope, I’m simplifying, I have my AirPods, and I can do fine with just them. Yesterday, a friend gifted me a Kindle ebook, and I charged my Kindle and discovered that it has fallen out of support and won’t let me download books to it. But I have an iPad with the Kindle app and can read the ebook that way, so I think I’ve settled on not replacing the Kindle device either. So some niceties I enjoyed for years and years, I’m starting to live without, for the sake of simplification and getting rid of stuff opportunistically.

Are you finding yourself doing this? What kinds of belongings/gadgets/toys/luxuries have you quietly abandoned? What did it feel like to do that? Any regrets?

2 bedroom Condo in Nevada paid for and everything new, no Maint required, from windows to AC been replaced,

Bills HOA $ 300, Elec and WiFi $ 125 a month, taxes $75 a month, ins $40 a month, 1 car paid for 2019 camry just got all maint done, car ins a out $100 a month, right now Healthcare free and my employer will charge me $150 a month once retired to age 65. So all bills run about $900 a month, of course havent eaten or had a beer yet, throw $1000 a month for that to be on safe side, so the expenses about 2g a mo nth!!! Yessss all the pervs heading to SE Asia it can be done just as cheap!!!! If not cheaper.

Now as far as savings did things a bit difference ppl will have a problem with I know but f em, have about $ 1.70 Million in 401K pre tax, prob $1.85 m at retirement, just last mon th I opened a $ 500, 000 Commodity that, wait for it.....will pay me $ 7160.00 per month for 7 years starting June of 2027! I have small pension from old Airli e about $ 800 a month and $ 200,000 in couple CD's and a nice Savings paying 3.70 I can get to anytime, my emerg fund!

Now , I know I could have taken that 500g and done some good stuff with it, but with all the crap around the world I wanted a secure income, of about 8g a month for 7 years at that point 401k should be back up to about 2 Million then Ill throw in the SS prob at 64 which will give me $4400 a month, so from 60years old to 64 have about $ 8 g a month, 64 to 67 about $12.500 a month, now the reason I chose this is I plan on hitting g every Continent for roughly a year, give or take, after 67 or 68 when my knees and bones are shot, , I will chill, open a small shelter for older abused dogs, maybe 8 or 9 max, and know that I have slow traveled and stayed at nice places ate great food, and if it's somewhere I love Like Greece, Laos, or Cuba, ill possibly move or stay couple years longer! At 68 Ill have my 2Mill in my 401K and my cash should be about 250k, what you folks think, in reality probably 4 Continents, South Amer, Europe, Africa, Asia, if I like it somewhere 2 years there...........yeah Thats what I have had 2 and sometimes 3 jobs for many years for........thoughts??????

We are preparing to retire. We currently live in a LCOL area. Paid off house will probably bring $450,000. We are moving to a HCOL area to be near kids. I have 5 million saved for retirement. How would you advise buying a 1.2-1.4 million dollar home? I plan to roll over the 450,000 but do you borrow or take from retirement savings? Thanks for advice

I know it’s been asked but each one of us is unique. Here’s my breakdown.

52 yo. M. Single. No kids.
$200k/yr salary. No bonus.
$400k - 401k
$550k - House. Paid off.
$50k - HYSA

I plan to work for another 5 yrs. Will sell house then move to SE Asia. Will spend $200k to build a house there. Collect SS at 62.

I’m worried about health insurance.

My other option is to work 10 yrs to qualify for health insurance from work until I croak.

But if I’m really super crazy, I can sell my house and move to SE Asia now. I can live on $3k/month.

I’ll turn 37 at the end of this year and currently have approximately:

$177,500 in taxable brokerage accounts
$258,000 in Roth 401k/IRA accounts
$435,500 total invested in stock market
\~$1,276,000total net worth

I’ve already maxed my Roth 401(k) and Roth IRA for this year. For the next three years, I plan to contribute about $32,000 annually (pending updated limits) to retirement accounts and $12,000 to taxable investments. Starting in 2030, I’ll stop retirement contributions and invest approximately $44,000 annually into taxable accounts until I retire.

My primary residence costs about $7,500 per month, but I currently house-hack it for $3,500 per month, reducing my effective cost to about $4,000. I expect that income to disappear when I have children in 2-3yrs. Separately, I receive approximately $55,000 per year in after-tax/passive income from real estate and other means.

My plan is to retire at 45 and use my taxable investments to bridge the 13 years until my military reserve BRS pension begins at 58/retirement account access at 60. I’d like to withdraw $60,000-$90,000 annually from the taxable accounts, pending market returns or travel. Total of 115-145k annual income taxed at long term capital gains rate. My Roth accounts will be untouched and compounding until age 60 unless I need to pull some of the contributions for emergencies.

My projections assume 9% returns while accumulating and 6% during retirement. I know sequence-of-returns risk makes those averages far from guaranteed. I have an emergency fund and some additional money in startups and crypto that I’m not counting unless it were to take off for some reason.

By my 45th birthday, my taxable brokerage account balance should be:
**$687,000**

By 60, my Roth accounts should be:
**$2.46 million**

Does retiring at 45 seem realistic? What taxable balance would you require before retiring, and what risks or expenses do you think I’m overlooking?

My spouse and I could very easily both retire now (really great pension plus plenty in savings with no debt), but I’ve heard that you need something to retire “to.”

She loves her job and isn’t ready to retire, and I have what I call a retirement job already-100% remote, low stress, intellectually challenging. Both of our jobs are service oriented so we feel like we’re making the world a better place. We’re both fit, involved in community groups, and have a good circle of friends. We could certainly finish up projects around our house and do some traveling, but what would fill that feeling of purpose that we currently get from our work?

How do you figure that out?

Hi - I’m a married 53m and could retire based on our financial situation (high 7 figure net worth). Our kids are in high school so I feel like I should keep working since I can’t do what I really want to in retirement yet.

My retirement plan is to relocate out of suburbia to a city; travel the world; and enjoy more of my two hobbies, one of which I can do as part-time work as I already have that “business” up and running. I need more hobbies before retiring, but the real point of retirement for me is to live overseas and travel more. I can’t do that while the kids are in school. So I plan to work 4 more years until everyone is in college, bank more retirement funds and then stop. Give me some perspective please - thanks!

55% VTI | 30% VXUS | 15% QQQM. Good enough. I don’t like dividends and bonds in Roth. Comments or suggestions. Total $2M. Right now 95% in 401k and traditional.
Roth Conversion starts in 5 yrs.

Interested to hear from you, especially if you have 100% stopped working completely.

What have been the positives and negatives?

Have you taken on another job/part time etc?

Do you have a DB Scheme?

UK England

Since some people choose not to retire. Retirement is not for everyone. Edit I know there are plenty of old people who still choose to work at their age, this post is about examples of that. Edit for context purposes I’ll be specific and say old as in being in their 70+ old.

I know that most people know this, but I think it’s generalized too much. Unless you are retiring in your 30s, you will most likely receive significant social security, even if reduced due to funding concerns. For example, current projections show us receiving about $75k/year in social security and our expenses are about $100k.

If we ignored this, we would probably work an extra 5-10 years to get the “25-30x expenses” that is often cited as the goal. I know there is some risk with social security, but there is also some risk (IMO, likely higher) that your last 5-10 years will be much less valuable than those years in your 50s.

Anyone else focused more on withdrawal rate rather than some generalized expenses multiplier?

I know that most people know this, but I think it’s generalized too much. Unless you are retiring in your 30s, you will most likely receive significant social security, even if reduced due to funding concerns. For example, current projections show us receiving about $75k/year in social security and our expenses are about $100k.

If we ignored this, we would probably work an extra 5-10 years to get the “25-30x expenses” that is often cited as the goal. I know there is some risk with social security, but there is also some risk (IMO, likely higher) that your last 5-10 years will be much less valuable than those years in your 50s.

Anyone else focused more on withdrawal rate rather than some generalized expenses multiplier?

ready for semi retirement.
Married 53 YO spouse 64. Kids college covered without touching these numbers.

25k checking account
400k investment account
500k IRA
100k Roth.
FMV house 440k & 136K mort bal @3.5%.
Mort is only debt. No credit cards, newer cars and no car loans.
Massachusetts COL.
Sell house and use equity for South Carolina retirement home?
Plan is 40k semi ret wages and spouse 20k SS. W/D as little as possible to keep portfolio invested.

Spouse on Medicare. Marketplace ins for me with lower annual income.

Buy retirement home for 350-400k cash w/no mortgage. Only dip a little into investment account.

Future inheritance 1.5-2mil from real estate protected by Trust in 10-15y. If parents avoid health issues, double that with inherited IRA. (Not using any of this in calculation if this is possible)

Plan is go semi in 2 years or sooner. Full time income until then 110k wages and 12k int/div that get reinvested.

So ready to make this happen. Are we crazy?

I'm flirting with early retirement at 55 and working through numbers. I have this thought that I'll be spending far less the older I get. I currently have two kids in their 20's, one at home and in college, my wife and I are quite active as far as spending money goes. My thought is expenses will go down as the kids eventually leave and our lifestyle slows down. Of course, inflation is in my calculations.

Is that a realistic expectation? The last thing I want to do it short myself down the road.

How have your finances changed (if at all) over the years compared to pre-retirement finances?

Has anyone retired at age 64 and obtained ACA or similar medical insurance UNTIL their Medicare kicked in at age 65 AND severely regretted it? Trying to do a pros and cons for my future plans. THANK YOU.