Turn Off Ads?
Page 7 of 7 FirstFirst ... 34567
Results 91 to 96 of 96

Thread: Turning down high paying job. Am I crazy?

  1. #91
    Member medford's Avatar
    Join Date
    Mar 2002
    Posts
    2,083

    Re: Turning down high paying job. Am I crazy?

    I don't think the socal thing is an option at this point.

  2. Turn Off Ads?
  3. #92
    Member JaxRed's Avatar
    Join Date
    Apr 2000
    Location
    Jacksonville, FL
    Posts
    9,523

    Re: Turning down high paying job. Am I crazy?

    Quote Originally Posted by medford View Post
    thanks for the update, never saw the original post, but happy to see the outcome some 3 years later.

    If you don't mind me asking, w/ the house paid for (I assume the rental properites as well?) what are your monthly living expenses? What are the things you find yourself paying for in retirement that you didn't think about 20-30 years ago? I've often wondered myself just how much I'll need for retirement.

    I've read alot about something I think is called the theory of 20 or something along those lines, where basically you take your yearly living expenses, multiple it by 20 and that is how much you need in retirement. You take out 5% each year, and even if you started your retirement in the worst time frame for the S&P (It was the early 70s at the time I believe where it took a sharp dive over 2 years) you still ended up growing your portfolio showing that traditional returns, even if you pick the wrong year to start should get you thru assuming you can start limit your self to a 5% withdrawl each year (the historical return would outpace inflation so each year you'd take out a little more money in theory than the year before to overcome the rise in cost)

    I'm currently on "pace" to have a little over 1 mil in my 401(k) when I hit 60. I've got a small personal account outside of that that I hope to continue contributing to again some day, plus we'll have my wife's retirement from STRS (teacher's retirement plan). Throw on Social Security (if its still there) as well. The 5% would be 50k a year, plus 5% of whatever my personal accounts are at the time, plus the SS and my wife's pension plan (there are so many changes I haven't even bothered to begin worrying about what that will be yearly at this point). All told, $75 to $100k a year, I'd hope to have my house paid off at that point, perhaps even a retirement getaway somewhere. Inflation will eat into that number from today; I think that would all be enough, we live fairly simple, probably wouldn't start getting all extravagent in retirement.
    You're going to be far ahead of me if you are going to have a million. I am withdrawing from my retirement accounts, but I am not withdrawing any principal. If you recall from my retirement threads, I am a believer in Dividend Growth Investing. Not just at the end.... the whole way. So right now I am in the distribution (retirement) phase, so I am withdrawing 75% of my dividend income and reinvesting the rest. Only been in that phase for 2 months.

    I am not retired enough to have lowered spending. My wife still works full time and I'm working part time. Nothing has changed. And other than the fact that I have a very big car payment that will someday end, I'm not sure I expect a big reduction.

  4. #93
    Member medford's Avatar
    Join Date
    Mar 2002
    Posts
    2,083

    Re: Turning down high paying job. Am I crazy?

    thanks, I've followed your dividend investing thing closely, you've inspired me that someday, whenever I get back to investing money in my personal accoutns again, not just my 401(k) (we get a very generous offer, 50% matching up to whatever we put in, so my savings is obviously concentrated there, and will eventually increase up to 15% of my paycheck once kids are out of day care, then I'll contribute to my personal accounts again, impossible to beat a 50% automatic retun)

    anyways, most things I've read is not to expect a drop in your spending as you retire (perhaps as you age, but the goal for most people is to retire in relative good health that they can still get out and around) with the possible expection of a mortgage, most places will tell you to aim to have that paid off by retirement. I guess what I was wondering, were there expenses you see now that you never anticipated? Perhaps medical insurance or something? You may get that thru your wife's employer. What I'll equate it to, is people talk about having a baby a few years down the road, talk about the cost of diapers, baby food, etc... but the thing that rarely gets talked about is the cost of daycare. I don't think most people realize they'll be spending 600-1200 a month on their child's day care if they continue working full time. Didn't know if there was something equivalent to that in retirement that I haven't thought about.

    Thanks for everything you share in this regard, its helpful to read about someone else's experience so that I can prepare for my own.

  5. #94
    Playoffs Cyclone792's Avatar
    Join Date
    May 2005
    Location
    Cincinnati, OH
    Posts
    6,271

    Re: Turning down high paying job. Am I crazy?

    Quote Originally Posted by medford View Post
    thanks for the update, never saw the original post, but happy to see the outcome some 3 years later.

    If you don't mind me asking, w/ the house paid for (I assume the rental properites as well?) what are your monthly living expenses? What are the things you find yourself paying for in retirement that you didn't think about 20-30 years ago? I've often wondered myself just how much I'll need for retirement.

    I've read alot about something I think is called the theory of 20 or something along those lines, where basically you take your yearly living expenses, multiple it by 20 and that is how much you need in retirement. You take out 5% each year, and even if you started your retirement in the worst time frame for the S&P (It was the early 70s at the time I believe where it took a sharp dive over 2 years) you still ended up growing your portfolio showing that traditional returns, even if you pick the wrong year to start should get you thru assuming you can start limit your self to a 5% withdrawl each year (the historical return would outpace inflation so each year you'd take out a little more money in theory than the year before to overcome the rise in cost)

    I'm currently on "pace" to have a little over 1 mil in my 401(k) when I hit 60. I've got a small personal account outside of that that I hope to continue contributing to again some day, plus we'll have my wife's retirement from STRS (teacher's retirement plan). Throw on Social Security (if its still there) as well. The 5% would be 50k a year, plus 5% of whatever my personal accounts are at the time, plus the SS and my wife's pension plan (there are so many changes I haven't even bothered to begin worrying about what that will be yearly at this point). All told, $75 to $100k a year, I'd hope to have my house paid off at that point, perhaps even a retirement getaway somewhere. Inflation will eat into that number from today; I think that would all be enough, we live fairly simple, probably wouldn't start getting all extravagent in retirement.
    I think you're on the right track. Check out FIRECalc: http://www.firecalc.com/

    I've always believed that 20 times annual expenses is a bit low though, and a 5 percent withdrawal might be a bit high. A safer number to use, assuming a retirement around your late 50s, would be 30 times annual expenses. If you want to retire early around 50, you might want to aim for 35 or 40 times annual expenses. For safe withdrawal rates, maybe think about 3 percent.

    That much said, adjust for Social Security, even if it's a conservative adjustment of receiving only 50-70 percent of your projected benefits. It'll be there in some manner, maybe not as much as we're promised now (I'm 31 years old, for example), but some of it will be around. If you project your Social Security to cover 30 percent of your living expenses, for example, then you'll only need retirement funds to cover the remaining 70 percent. Use that remaining annual number to multiply by 30 with.

    I've also used a future inflation calculator to try to adjust today's money ahead 25 years or so. A ballpark calculation I simply use is doubling today's money - in other words, if I want $1 million in today's money then I need to actually save $2 million by 2038.

    By the way, my fiance is in STRS Ohio too. Their recent changes were probably necessary to make sure the fund stays healthy, but for her age group (20 and 30-somethings) they took a haircut if they want to retire early before age 60. My response to that is I've now got her maxing out a Roth IRA in addition to STRS so 1) worst case is she has a safety valve if STRS implodes, and 2) best case is she has an early retirement option if STRS stays healthy.
    Barry Larkin - HOF, 2012

    Put an end to the Lost Decade.

  6. #95
    Playoffs Cyclone792's Avatar
    Join Date
    May 2005
    Location
    Cincinnati, OH
    Posts
    6,271

    Re: Turning down high paying job. Am I crazy?

    Quote Originally Posted by medford View Post
    anyways, most things I've read is not to expect a drop in your spending as you retire (perhaps as you age, but the goal for most people is to retire in relative good health that they can still get out and around) with the possible expection of a mortgage, most places will tell you to aim to have that paid off by retirement. I guess what I was wondering, were there expenses you see now that you never anticipated? Perhaps medical insurance or something? You may get that thru your wife's employer. What I'll equate it to, is people talk about having a baby a few years down the road, talk about the cost of diapers, baby food, etc... but the thing that rarely gets talked about is the cost of daycare. I don't think most people realize they'll be spending 600-1200 a month on their child's day care if they continue working full time. Didn't know if there was something equivalent to that in retirement that I haven't thought about.

    Thanks for everything you share in this regard, its helpful to read about someone else's experience so that I can prepare for my own.
    Health insurance is the major wildcard. My parents have friends who just retired and did some research, and they're estimating $800 per person, per month for health insurance. That might be on the high end, but either way it's expensive. Who knows what it'll be in the future. Trying to project health insurance 20 to 30 years in the future is the most difficult thing I've run into.
    Barry Larkin - HOF, 2012

    Put an end to the Lost Decade.

  7. #96
    Member JaxRed's Avatar
    Join Date
    Apr 2000
    Location
    Jacksonville, FL
    Posts
    9,523

    Re: Turning down high paying job. Am I crazy?

    At this point, nothing has changed between my semi-retirement expenses and my normal expenses. But I am constantly trying to think of ways I can lower my expenses. My phone (cell and home) are minimal ($15 a month combined), but I have not yet "cut cable" but it's crossing my mind.

    By the way, both Arizona home are mortgaged. Pay $500 a month, rent for $950. So paying them off down the road sometime will result in a nice "raise". Both mortgages are just below $70K each.


Turn Off Ads?

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  

Board Moderators may, at their discretion and judgment, delete and/or edit any messages that violate any of the following guidelines: 1. Explicit references to alleged illegal or unlawful acts. 2. Graphic sexual descriptions. 3. Racial or ethnic slurs. 4. Use of edgy language (including masked profanity). 5. Direct personal attacks, flames, fights, trolling, baiting, name-calling, general nuisance, excessive player criticism or anything along those lines. 6. Posting spam. 7. Each person may have only one user account. It is fine to be critical here - that's what this board is for. But let's not beat a subject or a player to death, please.

Thank you, and most importantly, enjoy yourselves!


RedsZone.com is a privately owned website and is not affiliated with the Cincinnati Reds or Major League Baseball


Contact us: Boss | GIK | BCubb2003 | dabvu2498 | Gallen5862 | LexRedsFan | Plus Plus | RedlegJake | redsfan1995 | The Operator | Tommyjohn25