Nice plan! I think I’m a little younger, but I’ll be 55 when I plan to retire to Thailand. I have military retirement too, so that makes it a little easier. I’m also not married, so even easier still 
Good luck with your retirement, sounds like a good one in the making!
I did this exact thing, starting about that age. Retired at 56 and I am now eligible for SS (Age 62).
Keep on keepin’ on. Time goes by fast.
Same here. Spreadsheets are great because you can try out different scenarios for retirement age and other factors.
One thing I added a few years ago (and you have to be into numbers to do this) is seeing what effect year-to-year variation in the performance of stocks and bonds might have on my portfolio, especially using different mixes of each. This book lists the mean and standard deviation for annualized returns for the S&P500 and for the bond market. For each year over the next X years (until retirement), the spreadsheet provides annual rates of return for stocks and bonds; in any given year, either of those returns might be good or bad, but over the years they match the relevant mean and standard deviation from that book. So you simulate that run-up to retirement, rebalancing the portfolio annually to maintain your target stock/bond fractions. And then you run that simulation another 10,000 times. and now you bin the results, and you end up with a probability distribution function that shows the whole range of what your nest egg could end up being when you retire. Now you can calculate a probability of meeting your retirement goal, which is pretty useful - and you can really see how different mixes of stocks and bonds (together with annual rebalancing) affects the shape of that probability distribution function: adding in bonds reduces the mean of the PDF, and it also pulls in the high-side tail a bit but it really pulls in the low-side tail. IOW, you’re a little less likely to end up filthy rich in the event that the stock market does really well between now and retirement, but you’re a lot less likely to end up dirt-poor if the market performs poorly.
Canada is doing that now, and our CPP is well-funded compared to what it is paying out (especially the recent increase), but the amount taken and the amount paid are quite small compared to Germany and the United States. The expanded CPP is supposed to replace one third of working income (vs one quarter prior to expansion), which is still small if someone hasn’t been able to save.
I’d like to retire as an expatriate (Thailand here as well, lovely country), but the nut I haven’t figured out is healthcare. You can’t use regular Medicare overseas*, and it’s not clear to me that a private plan (from a Thai company or otherwise) would cover me when I’m, say, 70 and have the inevitable health issues. I could maybe retire in Thailand immediately if I had details like that figured out, but I need to work for now both for more money in retirement later and to get to 65 and get Medicare. Not sure how all that maps if I live abroad.
*I understand there are some Medicare Advantage plans that work overseas, but not sure if my meds (and I have a couple important ones now) will be covered.
My retirement math shows me spending more on medical care than all my other bills combined, even with Medicare.
If nothing changes, I’ll be moving too. Probably Latin America, southeast Asia, eastern Europe, etc.
Healthcare definitely is a problem. I’ll be covered by Tricare Overseas until I’m 65, so I’m hoping I figure something out by then.
My planner did this for me, but with my portfolio (defined by the level of risk I’ve been using) and modified to include expect inheritances and when I would retire. That was the most useful retirement planning tool I’ve ever seen. He ran it 5 years ago, and so far, 3 1/2 years into retirement, I’m siting in the 5% range - which means only 5% of the results came out this good.
At this rate we leave money to our kids and grandkids unless we live to 150 or so.
I think the biggest nut to crack re: retirement is the healthcare issue, which, sadly, is a distinctly American problem. Part of me just presumes that by the time I retire (early-2050s) that the US will certainly have enacted some kind of universal healthcare system by then, especially once the millenials start running everything and the selfish Boomers & Gen X’ers aren’t involved anymore.
If that doesn’t happen, basically the alternative is to work until I become eligible for Medicare and then move to someplace cheaper, whether domestically or abroad.
Really, I think the issue that precludes so many people from retiring is that they’re missing one or more of the retirement income trifecta: A defined benefit pension, Social Security, and robust personal investments.
Pensions are almost impossible to get nowadays unless somebody gets a state or government job, and even those are becoming exceedingly difficult to secure precisely because everybody wants an in into those retirement systems. Still, if somebody has a job that pays into SS then they’ll at least be eligible for that after 10 years (I will become eligible myself early next year at age 28), and the lack of a traditional pension can be overcome with judicious retirement investing.
The problem with that is that we as a society don’t do a good enough job of hammering home into 20- and 30-somethings that they need to be stashing away 15-25% of their income into various retirement accounts.
Not quite sure what you mean by Canada being “in the same boat”. The CPP, managed by the Canada Pension Plan Investment Board, has been getting the kinds of return on capital that most of us only wish we could have, and so is sustainable for the long-term foreseeable future. The non-contributory Old Age Security is funded by general tax dollars and is equally secure. I believe both go up annually according to the Consumer Price Index; I know for sure that the CPP does.
Further, the majority of Canada’s immigration initiatives are geared to admitting well-qualified educated young people, and that population growth with well-paid employment will keep the public pension systems robust in the same way that they have kept the urban housing markets robust, to the delight of some and the chagrin of others, to be sure, but property values especially in the Toronto and Vancouver areas where many new arrivals tend to settle have gone up astronomically in recent years, providing in some cases much-needed capital for those bitching about the insufficiency of the CPP and OAS payouts. Some property values have gone up by a factor of five or more (5X) in less than a decade, and some have done even better. And there is also the fact that medical care – potentially one of the greatest expenses for the elderly – is a free public service.
I do agree with you, though, that both contributions and payouts to and by the CPP will have to increase.
I hope you’re right but I’m a pessimist. There are states like California that are deep blue and they’re unwilling to enact health reform either.
And health reform doesn’t need to be Medicare for all. There are other reforms to lower costs, improve quality and expand coverage but even the blue states refuse to enact those. So I’m kind of a pessimist that even after the silent generation and boomers die off and are replaced by millennial and generation Z at the ballot box that we’ll actually get health reform. The only true path to health reform is ballot initiative. Democrats are too cowardly and spineless to pass meaningful reform via legislation. Maybe that’ll change someday but even in blue states democrats are pretty cowardly and spineless on the issue of health reform.
Moving to a middle income nation may be the retirement strategy a lot of us end up taking.
Medical costs not covered by Medicare are predicted to be 800 month inflation adjusted per retired person by 2030. That excludes long term care. If nothing changes it’ll be 1000/month by the 2040s and keep growing.
How is a twitted couple in 2040 supposed to afford 2k a month for health care not covered by Medicare (which again excludes long term care costs which are even higher).
Culture shock is one thing to take into account. I’ve never lived in a huge city, but I’ve known some guys who’ve lived in NYC their whole lives. Some have never owned a vehicle or even driven (which is not really feasible anywhere I have lived), and when they describe other things about their childhood, upbringing, etc just the whole lifestyle is completely different than I’ve ever lived. I’ve lived on the east Coast and Midwest, in rural and suburban and beach resort areas. If I lived in NYC my whole life I don’t know that i’d want to retire somewhere else. Just as if I lived the first 60-70 years of my life not in a huge city, I don’t know how I’d handle retiring to a NYC apartment. Some place cheaper likely means learning and entirely new lifestyle in a foreign land. I think most people are a little more inhibited, especially as seniors.
Well, I am from Norway. Government finances seem solid and the pension system was just changed to what the politicians say are self-sustaining. I think they may overestimate the stock market over time. Change does not apply to people who have paid into the current system for a certain number of years.
Basically, you end up with a pension pool. You decide when you want to retire, and your pot is divided by the number of years left until the average lifespan. There is a minimum.
So it penalizes early retirement, and heavily rewards staying in work for a long time. I’ve got investments that I hope will see me able to retire early.
The culture shock aspect is definitely a major aspect.
I have done the major city, tiny farm town, mildly large sprawl [Tidewater Virginia - Virginia Beach, Norfolk, Portsmouth, Suffolk, Newport News etc] and I will say that going from small rural to major city with mass transit is definitely easier than going from mass transit equipped, no food desert, entertainment available shopping available metropolitan area.
See - it is also somewhat transportation linked as well - I get people who don’t understand why mrAru and I have 2 vehicles when I am not working until I explain that if there is no medvan available, I have to figure out how to get myself 15 miles into festive downtown Willimantic CT where a bus [Peter Pan or Bluebird] would take me into Hartford, then I would have to catch a downtown bus to whichever outlying area of Hartford I need to get to - roughly 3 to 5 hours transit depending on overall bus schedule. Then I would have to get back. Or I could pray there was a lyft or uber driver somewhere near me willing to do a 30 to 75 mile trip [Yale New Haven Hospital is 75 miles away, Hartford Hospital, St Francis and I can’t remember the rehab facility name is 50 miles away, Backus hospital is 20 miles, New London is 30 miles] AND I have the money to pay for the ride. If I own my own vehicle, I can get to appointments as I need to, and the cost spreads out over the whole year and I can use it to go shopping, out for entertainment and anything else I can think of [including transporting him when his car is in garage for maintenance]
People in areas with mass transportation don’t understand not having it available … just like people with no grocery store nearby don’t understand living in a food desert where one either grazes convenience stores, does a combo of Swann/delivery/mail order or has transportation to go the 10 or so miles to a real grocery. [I live 5 miles from the crossroad that is the town of Canterbury - I don’t just casually walk to the corner for a gallon of milk, well I don’t walk actually bbut you get the drift]
I would much easier settle for a single room studio in a large city with mass transit as a retirement location than a tiny crossroads with a single gas station, a single grocery store, a post office and a dunkin donut shop … and live 5 miles outside town with no transport other than the kindness of my neighbors to drive me to th estore once a week, and a medvan to get to appointments.
In addition to things like culture shock and public transportation, I think a lot of people want to stay close to their family–their kids and grandkids are in the city.
Past that, access to quality medical care is a big deal. Small cities can’t support any sort of selection in specialists–you go see The Cardiologist. And anything more exotic than that, you may have to travel for. And the cancer treatment you get at a small city hospital is not the same as what is available in a large urban center. There’s also a huge difference in quality of life treatment like joint surgery. Whatever you need done, it’s better to go to someone who does that surgery all day long than a generalist.
Why does everyone keep saying that life is impossible or health care is dangerously inadequate unless you live in N ew York or LA?
I mentioned above cities like Indianapolis, Louisville etc. Or how about Little Rock Arkansas? It was good enough for Bill and Hillary. Or how about the city most people had never heard of until Mayor Pete decided to run for president (South Bend).
In all these cities there are five or six hospitals with plenty of good doctors of all specialties,and plenty of good housing at crazy-cheap prices compared to NY or San Francisco. 100,000 dollars buys a nice place. $650 a month pays your rent.
If you want to stay in NY all your life, then plan your finances for it. But if you can’t afford it, then stop complaining and move someplace where you can. You have plenty of options.
Nobody is saying it’s impossible to live anywhere other than New York/LA or that health care is inadequate anywhere else. All of those posts were in response to this :
It wasn’t about why people should move to NY or San Francisco from elsewhere when they retire. And there are lots of reasons people stay in expensive cities - some of them are why people might stay anywhere. I mean, if you lived your entire life in South Bend and your whole family lived there, you might want to stay there rather than moving somewhere less expensive.
Fine. But you will get a :dubious: :rolleyes: from me if you’re retired, on a fixed income, and complaining you’re “barely getting by” while living in NYC, San Francisco, LA, etc.
Speaking of Indianapolis. I happen to be in a ritzy suburb just north of it at the moment. Plenty of health care options, Hamilton is even here.
On the other hand, my daughter asked about lox in the grocery store, and was directed to hardware.