ISO and retirement planning

[cronewitch]

ISO has been saying he would retire next June for his birthday. I ask him to check to see how many years in the pension plan and what day they add a year. Today he tells me he tried to quit his job this week. Someone asked him what he was going to do, quit? and he said yes and asked for the paperwork. They suggested he wait until the new union contract since they are working without a contract the last couple of weeks because he might get more pension. So in a few days or a few weeks he will be on a pension and not allowed in the union hiring hall anymore.

For those of us who micro manage retirement and stress out over it this seems odd. His retirement budget consist of his SS and other pension cover the mortgage and electric bill with a couple of hundred leftover and so his current pension will be his spending money. Seems he will have 2,100 to 2,300 spending money a month. I think he will get a few surprises like having to pay for Medicare. I think he has car payments and supporting a car, truck and boat won't be free.

His plan is to take care of his yard 2 days a week and fish 3 days a week and have weekends off. His yard is 2.3 acres so rider mower and tons of trimming to do so with working 5 days a week he doesn't have enough time for fishing. I have been visiting him some weekends but he spends the whole time mowing the lawn so I skip a lot of weeks. Now I can go midweek for visits on non mowing days and go for boat rides and help him catch fish.

[msventoux]

Hopefully it works out for him.  Maybe if he finds things are getting a bit tight and he can't afford to have all of his toys he can find part-time work as an employee or just doing odd jobs. 

[Bonny]

Weren't you going to pay him rent or vice-versa? Sorry don't remember the arrangement.

It doesn't sound like he thinks things through very well. I agree it's going to be a painful adjustment.

[Gardening Grandma]

Yeah, I've seen more than one person surprised that retirement didn't "work out" the way they (sorta) thought it would....

[cronewitch]

His will work out he has enough wiggle room. He is 67 and really should retire he is driving 100 each way to work. He was going to charge me to live with him but I never moved down there. He was going to pay me back for shelving for his garage and some life jackets but I think he might forget. He owes me money from last year he was going to pay me at Christmas from his Christmas club but I think he might have forgotten and if he retires he won't have enough in. He pays 100 a week to the Christmas club so should have 5K for that. He has an old ROTH but not large. I think he has money in his 457 plan so those can be his emergency funds. I usually take him some food when I visit but he is old fashion thinking he should provide for me. I could bring him more food or fishing tackle if he was really short but he could quit drinking and smoking.

He will be fine, I just couldn't have retired without a single spreadsheet.

[Deleted]

You'd both save a lot of money if you could find a way to live together. Just sayin.

[Deleted]

Crone, do you have any family members who might be happy to rent your house for a while? That way you could move into your ISO's place temporarily (since he bought the place you wanted to buy) and get you guys sorted out there. And you wouldn't have to sell your place.

[cronewitch]

No I want to sell my house anyhow but right now having a man doing work for me to make it nicer. He is sanding the kitchen cupboards painting and going to hang my new chandelier and light fixtures in the entry and kitchen, then new carpet and vinyl. Once my house is nice I will list it and sell it and become homeless. I might rent a storage unit and just store everything except what I need then go stay at his house a while. He promised me my own room but it is full of his stuff now. I was going to put my desk in there and have my own den. I might buy my own home again if I don't feel good living with him. I could stay with him while I look and either find something near him or in the city. He hates cities, I like shopping, I can't buy stuff for his house so nothing to shop for and no place to keep what I buy. I like using his house as my vacation house but having my own home. I like being less than 100 miles from my family even if I don't talk to them often we still are close.

I expect to out live ISO and he doesn't have a will so I would be evicted when he dies and need a new place to live. He claims he will marry me 3 years before he dies so I can collect his pension but I expect he will not know in advance that far and I don't want to get married.

Maybe I will move half way between his house and my family so 50 miles from anything, maybe Olympia, WA instead of Seattle or Toledo. I really should stay in the city so when I am elderly I have transportation.

[msventoux]

Jul 20, 2014 22:21:55 GMT -5 cronewitch said:

No I want to sell my house anyhow but right now having a man doing work for me to make it nicer. He is sanding the kitchen cupboards painting and going to hang my new chandelier and light fixtures in the entry and kitchen, then new carpet and vinyl. Once my house is nice I will list it and sell it and become homeless. I might rent a storage unit and just store everything except what I need then go stay at his house a while. He promised me my own room but it is full of his stuff now. I was going to put my desk in there and have my own den. I might buy my own home again if I don't feel good living with him. I could stay with him while I look and either find something near him or in the city. He hates cities, I like shopping, I can't buy stuff for his house so nothing to shop for and no place to keep what I buy. I like using his house as my vacation house but having my own home. I like being less than 100 miles from my family even if I don't talk to them often we still are close.

I expect to out live ISO and he doesn't have a will so I would be evicted when he dies and need a new place to live. He claims he will marry me 3 years before he dies so I can collect his pension but I expect he will not know in advance that far and I don't want to get married.

Maybe I will move half way between his house and my family so 50 miles from anything, maybe Olympia, WA instead of Seattle or Toledo. I really should stay in the city so when I am elderly I have transportation.

Sounds like if you get married he's giving you free rein to take him out if he doesn't meet his maker via natural causes. 

[achelois]

I want to know how the ISO thinks he can plan the three-year mark. He might be on to something. Funny how people sometimes go through life without much prior planning, yet things still work out well for them. It is sweet the way he wants to see Crone taken care of, though. 

I retired  without a spreadsheet, but I do have a budget and a ledger.  

I just  hope my retirement works out the way I hope it will. Who can ever know, though. 


Need coffee! 

[skubikky]

I suspect that it will all work out for him. He has several sources of income and some assets.
Not everyone does things the same way.
It might not seem logical to you and indeed it might not be. 
But he's a 67 year old man......I'm sure he can make it work.

[Deleted]

Lots of retired people make it work on miniscule SS checks and not much else. It isn't a lifestyle anyone on here would enjoy, but I know they have quality of life, too.

The truth is that everyone doesn't live by spreadsheets and IRAs and so on. I tried to get my son, who just turned 35, to talk about these issues. He's a CPA no less. But he's just not that concerned. He says at work where they sell insurance they presented something that said it costs $900,000 to raise a child. He said very frankly, "I have four children. I will not have 3.6 million dollars, and somehow they will get raised."

He has a point. Somehow it usually works.

[Deleted]

Jul 20, 2014 22:21:55 GMT -5 cronewitch said:

I expect to out live ISO and he doesn't have a will so I would be evicted when he dies and need a new place to live. He claims he will marry me 3 years before he dies so I can collect his pension but I expect he will not know in advance that far and I don't want to get married.

I'd be really careful about marrying a guy with a limited income (I know you said you wouldn't).  If he needs LTC or has medical expenses he can't pay, you could have to pay. The state does some pretty nasty stuff to punish people for marrying.

[midjd]

it costs $900,000 to raise a child

LOL! Is that the price tag for the ones who live in your basement for 15 years after graduating? 

I'm not sure how they came to that number, though... if the median HH income is around $45K, that's 20 years of gross income right there. Maybe they were counting all the household expenditures (mortgage, etc.) as "for the child."
I would have loved to be at that sales pitch so I could have asked lots of questions!

It is sweet the way he wants to see Crone taken care of, though.

[Deleted]

Jul 21, 2014 8:23:14 GMT -5 midjd said:

it costs $900,000 to raise a child

LOL! Is that the price tag for the ones who live in your basement for 15 years after graduating? 

I'm not sure how they came to that number, though... if the median HH income is around $45K, that's 20 years of gross income right there. Maybe they were counting all the household expenditures (mortgage, etc.) as "for the child."
I would have loved to be at that sales pitch so I could have asked lots of questions!

It is sweet the way he wants to see Crone taken care of, though.

They always tack a lot on for housing in those calculations, but if you're going to be in the same house no matter what it's kind of irrelevant.  Then they probably have 300K of that 900K for college if we're talking newborn....

[Deleted]

Jul 20, 2014 19:21:24 GMT -5 cronewitch said:

ISO has been saying he would retire next June for his birthday. I ask him to check to see how many years in the pension plan and what day they add a year. Today he tells me he tried to quit his job this week. Someone asked him what he was going to do, quit? and he said yes and asked for the paperwork. They suggested he wait until the new union contract since they are working without a contract the last couple of weeks because he might get more pension. So in a few days or a few weeks he will be on a pension and not allowed in the union hiring hall anymore.

For those of us who micro manage retirement and stress out over it this seems odd. His retirement budget consist of his SS and other pension cover the mortgage and electric bill with a couple of hundred leftover and so his current pension will be his spending money. Seems he will have 2,100 to 2,300 spending money a month. I think he will get a few surprises like having to pay for Medicare. I think he has car payments and supporting a car, truck and boat won't be free.

His plan is to take care of his yard 2 days a week and fish 3 days a week and have weekends off. His yard is 2.3 acres so rider mower and tons of trimming to do so with working 5 days a week he doesn't have enough time for fishing. I have been visiting him some weekends but he spends the whole time mowing the lawn so I skip a lot of weeks. Now I can go midweek for visits on non mowing days and go for boat rides and help him catch fish.

67 with two pensions and $2100-$2300 left over after paying the bills?  He sounds like he'll be fine! 

[cronewitch]

Some children cost more than others and some might make you money. My friends lived before landlords were forced to allow children so when pregnant with 1st got evicted, pregnant with 2nd got evicted so pregnant with third bought a flat they wouldn't have bought if not forced. They sold at a nice profit before the baby was 4 and were able to buy a new construction house around 1980 so probably cost them 70K or less now if they are still there. I lost touch they would have a paid off home worth 300K.

Part of the cost might be daycare or lost wages for staying home so a second or third or more child might be almost free if you are already staying at home or have a free daycare.

Special children can cost a lot more. Special needs might need therapy of several kinds and medical expenses. Gifted/talented might need coaches, tutors, tuition. Imagine what it cost to raise an Olympic athlete.

[Deleted]

Well, to be fair, my son works for an insurance company. I think they were perfecting the pitch by making some of the employees listen to it.

He said he got some glares from the marketing guys when he pointed that out.