Posted on 09/03/2018 5:55:10 AM PDT by proxy_user
Carl Jensen experienced what he calls “the awakening” sometime around 2012.
He was a software engineer in a suburb of Denver, writing code for a medical device. The job was high-pressure: He had to document every step for the Food and Drug Administration, and a coding error could lead to harm or death for patients.
Mr. Jensen was making about $110,000 a year and had benefits, but the stress hardly seemed worth it. He couldn’t unwind with his family after work; he spent days huddled over the toilet. He lost 10 pounds.
After one especially brutal workday, Mr. Jensen Googled “How do I retire early?” and his eyes were opened. He talked to his wife and came up with a plan: They saved a sizable portion of their income over the next five years and drastically reduced expenses, until their net worth was around $1.2 million.
On Tuesday, March 10, 2017, Mr. Jensen called his boss and gave notice after 15 years at the company. He wasn’t quitting, exactly. He had retired. He was 43.
(Excerpt) Read more at nytimes.com ...
My whole life I got to choose what I wanted to do for work, by being an entrepreneur it was a wonderful choice, hard and stressful, no boss but you! Now I am the boss of our tree farm and probably have not physically worked so hard in my life, loving every minute of our retirement, thank you to my husbands parents that left us a very large inheritance.
If you look closely at Volker's actions then, it was clear that he worked hard to monetize the debt [expanding M1] while, at the same time curtailing growth in credit with very high short term and long term interest rates.
It was almost the opposite of quantitative easing, which we have been on ever since.
It depends on the definition of “nice retirement.”
At 65, Medicare kicks, reducing dramatically the costs associated with healthcare. With the addition of a good Medicare Advantage policy, costs for a married couple in need of health insurance will drop 70% or more.
At 67, everyone is eligible for full Social Security benefits. If you’ve funded a retirement account to $1.2 million, and you’re married, Social Security for both husband and wife could be $36,000, or even significantly more.
Properly invested in a basket of low-volatility, healthy, high-dividend stocks, $1.2 million should yield about 4%, or around $48,000. Some companies have long histories of increasing dividends modestly, but consistently, providing some hedge against inflation.
Based on all that, with health care largely squared away, a married couple at 67 with $1.2 million could easily generate a total income of more than $80,000 annually, pre-tax, with little risk.
Which is what after inflation. 30 years down the road what will $40k / year be worth? It would be like retiring on $4k per year in the 1960's. Doable then, but a joke now.
Actually, the maximum social security a married couple can collect is $88,752, if they both hit the maximum tax for at least 35 years and don’t collect until age 70.
Actually, my financial adviser uses an entity like this for his company. He confirms that I’m ineligible,
Just 15 years of contributions, even at the maximum level, isn't going to give you a maximum payout. Read the fine print on those annual mailers. Something along the lines of 'if you continue your current contributions until your retirement age'. Stop working at 40, and that estimated benefit is going to start dropping.
From the SS:
"Your retirement benefit is based on your highest 35 years of earnings "
Calculate in 20 years of zero and re-run the numbers.
Right, but 1), I specifically said “at 67,” and 2) two spouses maxing out Social Security for 35 years is probably not typical.
From memory, the average benefit is about $1,400 per month. Someone who has done well enough to put away $1.2 million is probably somewhat beyond the median. If the primary income earner gets $2,000 per month, and the secondary earner spent many years with no or suppressed earnings as a result of having a family, the secondary earner will still get a minimum of half the spouse’s benefit.
I was getting some crap at work one day about one of the systems we were using. Other “managers” were trying to send the blame my way.
I wrote a response, drawing on many years of experience (including being the first prototype of the system back in the 1990s.) When I pointed out that I had more experience with the system than anyone else in the company; nationwide, it was met with skepticism. I sent them copies of magazine covers.
I got a couple of responses about why was I working where I was.
I told them that I liked my windowless office behind two locked doors, because most of the time this type of crap never made it through.
My story is similar to yours. Started my own business in my early 30’s. Busted my butt for 20 years growing the business. Sold it to a big corporation when I was 52. I’m almost 80 now and haven’t looked back. Had a wonderful run. My only concern now is that the left may someday be successful in turning us into a European style craphole. I just pray my kids and grandkids never have to live in that kind of country.
Solves two problems. You don’t even need much to retire on. You got your head blown off in your 20’s. Just ask all those dead drug dealers in Chicago (if you can).
In that my example sets retirement at 67, if the individual in question started work at 22, that’d be 45 years.
If the spouse doesn’t have 35 years earnings, and she waits until 67, she’ll receive 50% of her husbands benefit, or the benefit she earned, whichever is higher.
Sounds like you have a good spouse. You’re blessed.
yes it does.
BTW, the “I don’t think so was in response to “Have I lost you there?”
Give it another 15 years and see what you've accumulated.
Besides, having your kids in school while you are retired doesn't set a good example.
The guy in the story didn’t work for 45 years, he worked for 15. That’ll get him close to minimum benefits when he hits 67. (A little better than minimum, since he worked more than 40 quarters, and if he waits past the early retirement point.)
Minimum retirement benefits for 15 years of working are $210.50 a month, or a bit over $2500 a year.
Now, he’d make more than that since it’s calculated on minimum contributions for the 15 years, and he was probably closer than maximum for the 15 years he worked, but it certainly isn’t going to be enough for a comfortable retirement.
And remember, you start making Medicare premium payments at 65 even if you don’t retire until 67 or later.
I agree. And for a family of four, it's poverty.
Especially at 43. His kids are probably in HS or JR. HS.
He’s got lots of expenses in front of him.
Retirement now has to cover for children? Oh, my!
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