I have given it a lot of thought and I am going to retire on May 1st at 56 years old. I’d love to hear from others who have done so or are also contemplating it. First I will answer the most common questions I have been asked.
How did you do it?
I didn’t have kids. Friendly divorce. I am naturally frugal. I bought a house 27 years ago. I have a graduate degree in engineering and have had good jobs with only one short bout of unemployment. I maxed out my 401k and put everything in an S&P 500 index fund until I turned 50 at which point I got more conservative.
What about health insurance?
I can get very good coverage in California on the private market for ~$900/month.
What will you do?
I am a live music freak. In 2019, I went to see live music on over 90 different days. That will increase. I’ll have more time to practice ukulele. I’ll start riding my bike again (already purchased a new one). I’ll volunteer a few days a month. I will consult a bit on the side.
Are you afraid that you’ll run out of money?
My financial adviser assures me that given my spending rate and may assets, I will be more than fine. I got a second opinion and they concur. Everything will be invested conservatively.
My job is stressful and I don’t enjoy it overall. I like aspects of it and I love many of my co-workers who I will miss very much. I also very much disapprove of some of the directions that my corporation is taking. I have already informed my management of my decision.
Any of your anecdotes and personal experiences will be appreciated.
I said that I will do some consulting. A friend of mine has a small engineering company and I have consulted for him on the side for years. That said, I think that I will prefer not working at all. I have been working since I was 15. I have had enough and I am privileged not to have to do so.
I retired recently, but at 62. While not exactly early like the FIRE people, it’s earlier than most and earlier than any of my relatives.
My (anecdotal) observations. Like you, fairly frugal, especially on housing. Been contributing to 401Ks whenever available, and the missus and I kept up with our personal retirement savings that we started back in '81. There are a lot of things we could have done smarter about personal investing, but starting ~40 years ago compensates for a lot of amateur mistakes.
After 6 months, I’m not spending what I’d projected. I just don’t have that many expenses, nor that many things I want to buy. As a result, we’ve reduced withdrawal amounts and spent the excess that was piling up on bucket list stuff. I never thought I’d say this, but for the first time in my life I have more money than I need. Any worries about outliving my income have evaporated. Engineers tend to “overdesign” if decisions are left to them. And that’s what I did with retirement savings. I think now I should have retired several years ago. But better to err in this direction.
I also discovered that work, and work related/prep tasks take up far more time than you* realize. I have so much free time now it’s actually difficult some weeks to fill it.
I didn’t consider my job stressful, and it was a lot of fun. But removal of pressures and schedules has been far more relaxing that I expected. If your job is stressful, your life will probably improve more than you expect. It dawned on me after a few weeks, that I had been subject to schedule pressures driving me from my bed in the mornings since I was 5 years old. The grind was so normal I didn’t feel it. Now, I have the freedom you can only have when your income is not based on your behavior. No matter what I do, the checks arrive on schedule. This feeling is hard to describe.
I hope you don’t mind hearing from a not-so-early retiree. Best of luck, and I hope your retirement is as amazing as it’s been for me.
*Well, more than I realized. Maybe you’re aware of it, but it surprised me.
I was laid off in 2010 at 54. Shortly after that, my parents died. They weren’t rich by any definition of the word, but they weren’t poor, either. While they were not part of my retirement plan, what I did inherit, combined with savings and pension, made immediate retirement more than possible.
While I mostly enjoyed work, I did not enjoy the commute, and overall, I don’t really miss it.
I travel a bit, work on perfecting my BBQ, catch up on reading, work on hobbies, and in general live a life of quiet contemplation. I too have no wife or kids to take care of, so I can do what I want, when I want. Chores in town that were a drag on weekends, can be knocked out in short order on a week day afternoon, and theaters and other attractions are also less crowded.
I am 41 and am a Michigan public school teacher. I bought 5 years retirement and can retire at 25 years. That puts me at 52-53 years old when I retire from teaching.
I invested heavily in my 403b(which I can access at 52 or 53). I can access my 457k, which I also invest heavily into at 58. My Michigan teacher pension, which is 1.5% per year for most of my years and 1.25% per year the rest(of my top salary level) will kick in immediately when I retire. Insurance is offered as well, though I forget the cost. This pension goes up per year for cost of living.
I own my home free and clear. I have debt of any kinds(not student loan, no credit card debt, etc.). Neither does my wife. We have two kids and I may actually have to stay in my job and additional couple years to assist with college because of this.
No, I won’t be done working. I will get a part time job that is less stressful.
It is also true that as a teacher, I will no longer be:
investing in retirement(a huge amount of my check each pay)
paying my michigan retirement contribution
paying my union dues
a few other things that no longer happen once out
I definitely see myself grumbling along 2-3 more years to 55 years old, but I am out at that point. Done!
I retired at 57 with 37 years of federal service, most as an engineer. Within a year, I was bored, and over the next 4 years, I had a series of part time or temp jobs, before a took a full-time job as a mechanical drafter. I just retired from that gig last month, and as I turn 66 in a few weeks, I think this one will stick.
There were a lot of things I wanted to do in retirement, but my husband, who is younger than I, was still working, and I think that’s partly why I was bored. This time, I’ve got a toddler granddaughter who will no doubt run me ragged while her parents work. Once she’s off to school, I’m hoping my husband will finally retire himself and we can do all the traveling we’ve discussed over the years.
I just turned 52 and I find myself in the very weird position of wishing I were older. Minimum age of retirement in my plan is 54. I of course would like all aging to immediately halt after that, but we’ll see how that works out ;).
It is entirely likely I will continue on for a year or two past that, but I’ve promised myself I’ll be out by 56 at the latest. Mostly I want to be 54 to enjoy the cool, relaxing, psychological comfort of knowing I can walk whenever I feel like it. I don’t dislike my job and it usually isn’t stressful. But I enjoy not working a heck of a lot more and upper management has been irritating the heck out of me lately with some poorly thought out planning nonsense. It would be nice to be done with it and I’m not one of those people who goes stir-crazy with too much free time.
Financially I should be fine. Mostly. It’s a coin toss on whether I’ll eventually feel “forced” to move out of my very expensive area. Which would be a a pity because I like it here. But I’d be able afford to live well in many parts of the country so I’m hardly in a position to complain. Especially at that age.
I retired at age 61 and have never regretted it for an instant. My wife retired six months later and feels the same. I get a little bored at times, but that’s by choice. I have no obligations; no place I have to be, nothing I have to do, and I like it that way.
I retired for good three times between age 45 and now; never lasted. I get bored too easily. So now I work part-time at jobs folks don’t mind leaving and I’ve been at the current one five years. :smack: I wish you all the luck. I wish I could do it. I fear I’ll be that 75 year old greater at Walmart with no real need to be there.
So I’m assuming your income is more than 400% of the FPL and you are going to pay the full price for health insurance?
I think California is looking into increasing the subsidy so that it applies until you hit 600% of FPL rather than 400%. Not sure if that helps in your situation.
There is a risk the ACA will be overturned on the national level by the courts. However I ‘think’ California would keep their state based system anyway even if that happens.
Anyway, good luck. I think health care is the biggest reason people can’t retire.
Sorry to take on the role of the hershey bar in the swimming pool, but I just have to share -
I would very much like to retire soon. It wouldn’t be early, but early-ish. However, I find that my personal financial approach does not sync up with my spouse’s, and our relationship disfunctions prevent addressing it to my satisfaction. I am frugal and a saver/investor by nature. My spouse is a “live for today” person regarding money.
So, I am in a constant fret about it. I believe I could accomplish it and live well on my 401k/IRA (then roll in Social Security later) individually. But since I am part of a “we” the calculations are more tenuous.
And forgive me for saying so, but all y’all with the public pension monies, well bless your hearts!
I was medically retired from the Navy at 35. With the disability pension and the money I’d saved (I was more than frugal and also single/never married), I was fairly well convinced I would just straight up retire, with the exception of maybe trying to write fiction every now and then.
At 35 and half I took the LSAT and started applying to law schools (should be hearing from the ones I’m really interested in attending here in the next month or two). Not because I needed income, but because I was losing my mind not doing anything.
In short, start thinking about what you might like to do as a second career if your passions prove to be insufficient to see you through the day.
I left the workforce at 56; Mrs R retired shortly afterward. Fortunately, both our jobs had a pension, which is the difference between scraping by and doing all right.
You’ll need a social outlet. I’m trying to become a more active member in a couple clubs I was a half-assed participant in. Ya can’t follow your wife around the house all day; murders have resulted from that.
We don’t drive nearly as much as we used to; between Mrs R and myself, we used to drive maybe 20-25000 miles a year; now it’s more like 10000. We just recently bought what are probably our last cars.
We also have more money to play with since we stopped saving. When we retired, we had plenty of savings, so we don’t set any of our pension(s) aside; we live on the pensions and the money we saved while we were working. Thank heaven for 401ks.
I made my decision in early November. A couple of weeks ago I had a small freak out that I might run out of money too early. I called my financial planner and he talked me down. Poor guy has to be part therapist.
Oh you lucky non-Americans have no idea how horrible and evil our health care system is.
$900 might be the price after subsidies too. Subsidies are for silver plans, but a gold or platinum plan costs more.
I’ve heard of people spending $2500 a month on insurance for a pair of people in their early 60s. And that was for garbage insurance with a $6000 deductible and no out of network coverage. Thats more than many people spend on all their other bills combined.
