I am 60 years old and I recently missed my 20-year job. Given my age and the current economic climate, I am looking at least likely to retire from a full-time job. My wife is 68 years old and is currently earning about $ 50,000 a year and collecting Social Security of $ 1,900 a month. She is retiring in June 2021. I would like to wait at least 65 years of age to collect my social security, which would be around $ 2,300 a month at that time. We have approximately $ 1.4 million in retirement accounts and about $ 400,000 in cash accounts. We have a $ 280,000 mortgage on a $ 1.2 million house and a fresh 30-year loan with a payment of $ 2,300 / month including property tax. We have no other debt.
I have a saving tendency to make mistakes and spending in retirement will be a learning experience for me. My wife thinks that money is for spending. Therefore, we are not just looking at whether retirement is realistic, but if it is, what our spending should look like to allow for a not-so-good but extravagant lifestyle and at all costs “Yes, we can’t Are “stop being made. t ”argument.
Best,
JM
See: I am 52 years old, will not live past 80 and $ 1.6 million. ‘I’m tired of both the rat race and workplace politics.’ Should i retire
Dear JM,
I regret quitting your job, but congratulations on preparing you for retirement – it prepares you for the unpredictable weather, as you are doing right now!
Waiting to claim Social Security greatly boosts your profits, so if you can do that, it’s amazing. It is normal to enter retirement with a mortgage loan, although some people feel uncomfortable doing so. It all comes with that on personal priority, so just make sure that what you and your wife do, you are able to pay those bills and withdraw an emergency fund if needed.
I am going to focus on the spent part of your letter – partly because it appears to be a main concern at the moment, and with good reason. Everyone should have a spending plan, especially when they enter retirement, and even more so when they are in a relationship with different perspectives on how to use the money. Some might call the scheme a budget, which it essentially is, but not everyone likes the term budget – it makes them feel like they are restricted from using their assets. Whatever you want to call it, make sure you and your wife develop one.
Not only can you keep your nest egg from wandering by having a spending plan, but it can prevent “yes we can, no we can’t” arguments.
A financial advisor at Trusttree Financial, Brandon Oprey said that the first thing you can do is to both withdraw from your income and still feel safe. Then, automate the cash flow. This can look like an annuity, which generates “regular and steady cash flow” or monthly withdrawals from your checking or banking accounts. He said, “The happiest couple I’ve seen in retirement agree on a certain amount whether they use it or not.” ”
This is where a meeting with a financial planner would be productive. A professional can help you by creating a financial plan that takes into account all your assets and liabilities, as well as how to raise that money while enjoying your retirement, said Janice Kakowski, co-founder of Sentry Financial Advisors . “This plan, which should be unique to their specific situation, should include a cash flow analysis that can tell them how much they can spend each year and still meet their financial goals and lifetime. Can pay the expenses. ” Keep in mind that these figures will naturally go over time in the form of eBay and flows, considering various factors such as inflation, taxes and market performance, but advisors usually account for all of them when they make a plan .
You can personally benefit from this type of meeting, as it will allow you to provide peace of mind when spending your money. A saver mentality is an asset in managing money, but if you do not ease up in the slightest you can become highly stressed and unhappy as you adjust to retirement.
Joel Kondik, a financial advisor at Savant Capital, said, “One of the most difficult moments for savers is the need to transition to meet obligations by withdrawing small amounts each month to accumulate funds for future needs.” it occurs.” “I would say that six months in retirement is a better place for both because the distributions are reasonable: the saver, in particular, may feel better when they look at the few months of the distribution when there is no negative impact.” On the balance as he may have felt. ”
See more: I am 63, my husband is 70, we will have $ 90,000 a year in retirement – how can we claim our Social Security benefits?
Another benefit of a financial planner: He or she can act as a third party so that you can tell in an objective way how your spending is affecting your retirement security. Alex Corry, a wealth management consultant at Hausler Wealth Management, said, meeting with a professional opens up conversations between you and your spouse to find out what your money habits are and what the two of you are like. There is agreement.
“In many cases, a financial planner can become a ‘carrier of bad news’ and can help decide how much a couple should spend.” “These recommendations can be agreed upon, and they can be read at a later time if the planning derails.”
Don’t be disheartened by your different perspectives on how to spend money, said Nicole Gopian Varick, founder of Prosperity Wealth Strategies. “I have found that a ‘spender’ and a ‘saver’ can complement each other quite well in a wedding,” she said. Saver encourages Saver to live a “full life” while Saver provides checks and balances on cash flow. “When properly managed, this stress can be healthy.”
There are even more serious questions to ask each other, including: Will roles change at home? How do you imagine retirement? What are your expectations and how does the other person fit in? What does the transition mean for both of you as an individual and as a couple?
Remember to keep retirement fun, and engage in activities that cost money or are completely free. Neither of you have officially retired yet, so this would be a good time to consider what you will do after retirement, when both of you are permanently out of the workforce.
In addition, retirement is not all about managing finances and getting older – it’s time for you to expand on your hobbies and interests, strengthen your schedule, and develop important relationships. I have spoken with retirees who have really great suggestions for staying active in this new chapter. Some couples take part in an adventure, such as buying an RV and traveling the country, while others have created an “activity jar” where each spouse wants to do some date or day trip and Then each week picks one or two out. Whatever you do, enjoy this time.
Have a question about your own retirement savings? Email us at [email protected]
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