# Can I retire now or must I endure and find another job in IT?



## RobChi (Dec 8, 2017)

Hi. Great website here with wonderful posts. I just joined and am hoping to get some cogent advice since I just received a lay off notice at work. I am single and will turn 55 in June and wish I could retire now but have doubts. I can share financial details/situation in a subsequent reply - didn't want to assume too much here. My take is that health insurance costs and Uncle Sam make early retirement a non-starter for most everyone. It would be nice to be a snowbird and live in South FL during winter and reside up North otherwise.


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## Ken N Tx (Dec 9, 2017)

RobChi said:


> Hi. Great website here with wonderful posts. I just joined and am hoping to get some cogent advice since I just received a lay off notice at work. I am single and will turn 55 in June and wish I could retire now but have doubts. I can share financial details/situation in a subsequent reply - didn't want to assume too much here. My take is that health insurance costs and Uncle Sam make early retirement a non-starter for most everyone. It would be nice to be a snowbird and live in South FL during winter and reside up North otherwise.


Health insurance will be the killer of your finances!!


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## Aunt Bea (Dec 9, 2017)

Welcome!

I stopped working in a similar situation at age 51 and health insurance is definitely the biggest expense for me.

I was able to get employee HI until my severance ran out then I was able to get HI through COBRA.  When COBRA ran out I could still buy HI through my previous employer but the premium went up dramatically because I was switched to a pool of inactive employees/retirees.  Next came the ACA with various programs at various prices.  My individual ACA premiums for 2018 will be $902.00.  My retirement is largely self funded so I view the ACA premiums as wealth insurance more than health insurance and the cost is worth it to me.  If your retirement will come from a guaranteed pension or a protected asset and if you are in good health then you might get by with a cheaper high deductible catastrophic insurance plan.  We each really need to do our own homework and decide what level of risk we are comfortable with.

Good luck!


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## terry123 (Dec 9, 2017)

You will be able to have Cobra insurance for 18 months after you leave your job but you will have to pay the full cost of it(your part and the employer's part) which can be expensive.  After the 18 months you are on your own in finding healthcare for yourself. If it were me I would find another job that had healthcare.  But that's just me as I would have to because I would not be able to afford to retire.  You may have other assets to rely on.


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## Uptosnuff (Dec 9, 2017)

Hi RobChi
It's a difficult situation you are in and one my husband was in also.  He found that jobs are difficult to find in your 50s.  I am 58 and would love to retire, but I'm waiting until I reach a "rule" at work.  When my age and years of service total 75 (although you have to have 20 years of service) then you reach a rule and can retire with health insurance.  That is the only thing keeping me working right now.  From what I see and read, health insurance seems to be the prime consideration for retirement.  I don't know your situation but if it was me, I would look for another job.   Even if you have a pension, 401k, etc. like me, the heath insurance is the big thing.


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## retiredtraveler (Dec 9, 2017)

DW and I retired early, at ages 56 and 54 respectively. I am ex-IT too and was very happy to get out of the business. Just joining the chorus that healthcare costs will hit you the most.
   We started saving/investing for retirement in our 20's, so we were prepared.  I always give the same advice for people thinking about retirement, but are unsure. You need to track your expenses, try to anticipate what future expenses you may have, and amortize as best as possible.
   We tracked our expenses, literally to the penny, for 3 years on an Excel spreadsheet. We created general categories such as house-related, auto-related, food, entertainment, etc. We then could amortize anticipated expenses (as best we could guess). That is, figure that you will eventually have a car payment. You add that to your anticipated future expenses. If you have a house, you need to add an expense you have not incurred for the $10,000 roof you will eventually need. Same kind of thing on car repairs. You may have a new car now, but three years from now you'll start needing $500+ a year for maintenance costs. Then, do you want to travel, eat out more, some other form of entertainment? You get the idea.

   It's work, but without it, you're making a very uninformed guesstimate and every article I've ever read shows that people don't look at their expenses and vastly underestimate their costs in retirement. Then, as discussed on another thread, you need to be aware of tax ramifications and plan for that. I have no idea how sophisticated you are as far as budgeting, spreadsheet, and tax prowess.

   Your 'financial situation' is really only part of the picture. I'm guessing that you have some pretty good estimates of future cash flow, but probably don't have the expense side of things, as I'm discussing here, thoroughly thought through (too alliterative there).


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## Bullie76 (Dec 9, 2017)

If you have enough investment income to cover all your expenses then yes you can. Need a good pad to account for inflation and emergencies. Perhaps consulting or a part time job could help for a few years.


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## Knight (Dec 9, 2017)

Absolutely you can retire. All you need is good health, a financial setup capable of sustaining you for at least 30 more years. 


BUT to be serious. 


Best advice was from retiredtravler, read what he wrote carefully and then assess where you are relative to what he wrote.


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## Manatee (Dec 9, 2017)

Have you considered retiring out of the country?  Health care funding can be very different.


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## RobChi (Dec 10, 2017)

Thank you all for the responses and taking the time.  Yes, good tip on Cobra insurance. I suppose a decision on retirement will become clearer in time, when pressed to a choice. Where the rubber meets the road.

Either way, in future I will have to curb free spending habits. Whole Foods buffet, Boston Market, AMC movie theater visits twice/thrice a week, occasional rendezvous's of a questionable or dubious nature, traveling to the South West and Florida, etc.  If I can set my retirement payout income low enough perhaps I can qualify for a discount. HealthCare.gov link below implies this is possible. Example: when I plug in low income such as $24K/yr. 

https://www.healthcare.gov/blog/preview-2018-plans-prices/


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## Lethe200 (Dec 10, 2017)

The GOP want to destroy the ACA and so they are undermining it as much as possible. I would not base my retirement assumptions that the ACA will continue in its present form. With the removal of the insurance mandate (which will force insurers to raise premiums) and removal of restrictions on limited-benefit/low-cost plans, it is extremely risky to budget for below-market costs. 

You know what your healthcare costs, or should - it's printed every year in your Open Enrollment literature. That's what a reasonable price is for healthcare insurance. Go cheaper, and chances are the policy will cover very little. Catastrophic insurance is fine when you're 30. The odds start going against you at 50 and by 60 you're playing with fire.

The tax bill will increase the deficit. This triggers automatic cuts to a host of government programs, including Medicare (which is fortunately protected against more than a 4% cut, but that will still hurt). The GOP has publicly stated that once the tax bill is signed, they will turn their attention to entitlements: first is welfare cuts, next is Medicare. 

If you are in good health you need to consider the cost of eldercare. The longer you live, the more likely that you will need to fund your own eldercare. Your chances of needing skilled nursing care at some point go up with age; if for nothing else, one can be discharged from a hospital but still need a week or a month in a convalescent facility because (a) you can't manage by yourself yet, or (b) you need skilled assistance to deal with attached medical devices. 

I know Boomers who retired abroad because they couldn't afford to retire in the U.S. but could not find a job in their late 50's. It can work, although doing so has its own set of issues to research and debate.

We live in a high-cost state. Thus, one budgets $14-18K for a roof. $500 for car maintenance might cover 3/4 of a year on my car, but not if I need a new tire ($275 + labor). At 75K to get the recommended new timing belt on our previous car, the quote was $1100.

It's fine to make a budget, but you need to honestly stress-test it. Assume that not just one thing goes wrong at any given time - but that two, or three, or four things go wrong within just a few months. If more of our friends had done their planning this way, they wouldn't have been forced to work three or more years longer when "the perfect storm" hit their planned retirement dates in 2008. 

For retirement, planning is critical because your financial flexibility is constrained. SocSecurity will be less help to you, for example, if only because the eligibility age will almost certainly be increased. Even if the SS fund is stabilized, by not working your payout will suffer with more than a decade of non-employment. If you make it to Medicare age with the program still intact, remember that the premiums change every year. They are set by Congress and currently are $134/mo only for Part B. Part D is extra, and mandatory unless your supplemental plan covers drugs.


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## RobChi (Dec 12, 2017)

Thanks for sharing all this. Lots to think about and figure out. But not exactly fun to contemplate. One of the things I live for tends to be on the more decadent or illicit side. I like the phrase 'Enjoy yourself. It's later than you think."


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## Lethe200 (Dec 13, 2017)

It's always later than you think it is, LOL.

Retiring early takes very careful planning. Talk to as many retired people you can find, preferably in circumstances that look like they resemble yours (and/or your future). I can't think of any retirees who would not be willing to discuss what they did wrong and what came out right.

Part of our intensive retirement planning was lowering our risk profile as much as possible. Everybody has risks in their lives. What most don't realize is that as they go through adult life, they increase their risk profile in varying ways by the decisions they make. 

Then, when it comes to thinking about retirement - for most people they are beginning much too late - they realize they face risk factors so great, their instinctive reaction is, "Well, I have to just hope for the best". 

Sometimes it works. But of course, sometimes it does not. 

Increasing your chances of success is the actual goal, no matter what the goal is. 

Good luck to you!


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## KingsX (Dec 18, 2017)

.

I retired at age 55.  My former employer pays 100% of my health insurance,  part of my vested retirement benefits.

My best advice: 

 Don't retire until you are totally out of debt, including your mortgage. Your lifestyle and spending habits are more important than your income.   If you are naturally thrifty, good at controlling your spending and live in a less expensive part of the country...  you can retire on a lot less than others who don't have those skills.


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