BajaNomad - When to retire?

Run your numbers and plan through a competent financial advisor

x2.
Plenty of online calculators will give you a ball-park figure. Or hire an advisor.

No offense, but asking at the expat forum, with questions like "when and how to retire" - shows that you didn't do much homework, if any.

Range of Baja lifestyles is wild, as is the range of budgets. Can you live without motocross and aviation? Can you live on SS pension alone, if it comes to that? Do you absolutely require a housing built by US standards and willing to pay for that, and if so, then - where? Etc, etc, ad infinitum.

David K - 9-20-2016 at 01:45 PM

Hi Mike,

I turned 59 on Sunday in Las Pintas, a very spiritual site and home to some of the oldest rock art in Baja California...

I was with new friends in an old land that has been in my heart for over 50 years.

Come south again as soon as your heart tells you because your mind will say stay at work and that may be until your last day on earth.

Don't miss a chance to be back where you feel alive, back in Baja California!

I will "retire" in 3 years unless there is a major change coming for us.

San Quintin (or somewhere else) is waiting for you and you have a friend there now, thinking of you who can help with your decision.

ehall - 9-20-2016 at 01:46 PM

Check the 401k. I might be wrong but I thought you could start drawing it at 57.

SFandH - 9-20-2016 at 01:48 PM

Quote: Originally posted by DENNIS

Quote: Originally posted by taoswheat

but be aware that your monthly social security increases 8% each year beyond 62.

Maybe. Depends on rate of inflation. I recall recently about three years the rate didn't increase for this reason. Goes for disability as well.

He means the amount you get if you keep working, delaying enrolling in SS. Don't know if the number is correct.

Man do I wish my check increased 8% annually

Bob and Susan - 9-20-2016 at 01:52 PM

Quote: Originally posted by willardguy

the old guy on the park bench telling peyton "work as long as you can"......nope, retire as soon as you can!

I agree with this guy : )

retire asap... I retired 10 years ago...fantastic

the body's not keeping up... in 10yrs it'll be even worse

go NOW!!

fishbuck - 9-20-2016 at 01:54 PM

Great points all. Please keep them coming. Be harsh if necessaries. Encouraging if possible. The truth shall set me free (to retire!). :coolup:

bkbend - 9-20-2016 at 01:58 PM

I'm happy I retired as soon as I could. It was pretty much as you think you may be able to. Took a pension at 59 and SS at 62 filling the gap with 401K. I didn't already have the Baja fish camp so I spent more than I should have on that before I started collecting SS but once I did start collecting I'm doing fine on pension and SS. Just make sure the numbers you run are sound. I didn't want to work long enough to maximize pension or SS and then be too old to enjoy it. I lived on the cheap while working and do have some savings and a free and clear house when I'm not in Baja. That helps me sleep at night. Work a year or two more living on what you pension would be and bank the balance.

Bob and Susan - 9-20-2016 at 01:59 PM

Run your numbers and plan through a competent financial advisor

spend it ALL!!!

that's why you worked...enjoy life NOW!!!

in the end YOU WIN if you die BROKE!!!

Bajaboy - 9-20-2016 at 02:06 PM

San Diego is America's Finest City but it's also an expensive place to live. I love what I do and don't regret going to work. But with that said, I'm able to spend about 2 months out of the year in Baja. I'm typing this from Baja. Pay off all of your debt before you consider retiring except possibly a mortgage. I plan on retiring in 12 plus years when my youngest goes off to college or wherever.

Life is good!

Mula - 9-20-2016 at 02:12 PM

Retire as soon as you can.

My husband retired from the union work at 55.
Thank gosh he did.
He passed away this summer. Just short of 61.
You never know. . . .

Jack Swords - 9-20-2016 at 02:12 PM

A wise man told me when I contemplated retirement that life is finite. You can work longer to have more money, but you have less time left in which to spend it. Retire sooner, you have less money, but more time to spend it. I retired at 57 and never regretted it.

bajabuddha - 9-20-2016 at 02:12 PM

It's not as much what you need to have to retire on, but what you can do without. One word of advice; DOWN-SIZE. Then it's easy-peasy, and stick to the 'KISS' technique. You'll be well taken care of, so get to it!

KurtG - 9-20-2016 at 02:14 PM

10 years ago at age 62 I decided to stop working and find a way to live decently on what I had. I have never regretted that decision. I lead a low overhead life on a modest income and couldn't be happier. As we age we lose the physical ability to do what we could at a younger age, it is easy to delude ourselves that we have a long string of physically good years in our future but that is not always the case. If you would rather fish than work then find a way to get out on the water!

fishbuck - 9-20-2016 at 02:52 PM

This is all great. I am very glad I made this post.
I can see that I need to develope a functional mindset about this based on the most accurate prediction of reality (mine) after I jump off of the graveytrain.
Really, not going to work is not something I have ever allowed myself to think about.
It hard undo 30 plus years of " Gung-Ho! " :bounce:

[Edited on 9-20-2016 by fishbuck]

Alm - 9-20-2016 at 03:13 PM

Quote: Originally posted by Bajaboy

San Diego is America's Finest City but it's also an expensive place to live.

I missed this point. Indeed, he wasn't planning to retire in Baja - but "somewhere" in SD, making fishing trips to Baja from there. So the question was about SD.

Quote: Originally posted by Bob and Susan

spend it ALL!!!

Impossible

. Both "full pension" - whatever it is - and SS pension will keep coming.

BigBearRider - 9-20-2016 at 03:20 PM

Yesterday.

danaeb - 9-20-2016 at 03:44 PM

You would get a lot more bang for your buck by reversing your plan. Home base in San Quintin, visits to San Diego. I live here - it's a very expensive place to rent or buy. I wouldn't be able to afford it on my retirement income if I was entering the housing market now.

AKgringo - 9-20-2016 at 04:00 PM

I have not lived in a motor home full time, but I have spent enough time in them to think that could work for me. I am not planning on spending the rest of my days driving around, but my base of operation would be moveable.

I have land with a good well, and power to it in northern CA, so that is where home would be for much of the year. I look forward to reducing my 'stuff' down to what will fit in a motor home.

Simple is good!

Edit; Ok, I will probably need a small storage unit somewhere. but honestly, no connex container!

[Edited on 9-20-2016 by AKgringo]

sancho - 9-20-2016 at 04:22 PM

Good question, all of us here have a bit in common. I want to
wake up SOB, and know I don't have to pack up the tent and
head home. So Cal is not all that, very expensive, crowded.
I have a few yrs on you, took ss at 62. My lifestyle doesn't
require a whole lot, so it is doable for me, maybe not
enough for some here in coastal So Cal. Wife has a 401 which
I understand should be tapped before taking ss.
SS does
state if one lives to the average life expectancy, one will
collect about the same, regardless when starting ss. Somewhere
around 78 +
or so, is when one pulls ahead in ss $ if one had
waited until a later age. I read that if one is 65, one has 12 yrs
or so left on average. I don't want to come up short on time
spent in Mex

weebray - 9-20-2016 at 04:48 PM

It's never too early to retire. You're gonna die with a bunch of money anyway.

Petey - 9-20-2016 at 04:48 PM

You know, you don't have start taking SS at 62 just b/c you stop working and take your pension before that. If you can afford to put it off til later, you could get bigger monthly payments. Only you know what you can afford and what you project your needs, health & otherwise, will be a few years down the road.

David K - 9-20-2016 at 05:25 PM

Quote: Originally posted by Mula

Retire as soon as you can.

My husband retired from the union work at 55.
Thank gosh he did.
He passed away this summer. Just short of 61.
You never know. . . .

TRUTH

woody with a view - 9-20-2016 at 05:46 PM

If you cant retire on a full pention AND ssnsomething is wrong.

retire

J.P. - 9-20-2016 at 06:02 PM

I was vested in my Union Retirement at 57 but not yet eligible for S.S and had a daughter in still in School. I chose to take my union retirement and look for something else to do. the union retirement gave me a whole lot of flexibility in choosing what I wanted to do. and still live comfortably. I took my S.S. at 62 and continued to work part time. After living in Baja for 15 years I am thinking about moving on to something else at 77 years young.
I may have to leave my body here in Baja its too worn out to move :lol:

[Edited on 9-21-2016 by J.P.]

[Edited on 9-21-2016 by J.P.]

TMW - 9-20-2016 at 06:54 PM

Quote: Originally posted by DENNIS

Quote: Originally posted by taoswheat

but be aware that your monthly social security increases 8% each year beyond 62.

Maybe. Depends on rate of inflation. I recall recently about three years the rate didn't increase for this reason. Goes for disability as well.

I don't think he ment inflation I think he was talking about what you lose in SS when you retire under 66 yrs old. For most you get your full benefit at 66 and if you retire early you lose 6% per year for each year. It also raises until 70 which is the max you can get based on income.

bajatrailrider - 9-20-2016 at 06:56 PM

I retired at 54 moved to baja full time. Too have fun while I still can. The big plus is $20 a year prop tax/water(if they have it) $10 month/power $ 50-65 two months.Buying power with dollars good too.

TMW - 9-20-2016 at 07:15 PM

Retirement can be a double edge sword if you don't plan it out. For me the biggest change was in medical expenses. While working my med. insurance was $119 per month for both my wife and I. After retiring it cost both of us Combined about $800 per month for medical sup insurance and drugs with SS taking out $104 per month each for Medicare (included in the $800).

I retired at 65 with two pensions, SS and a 401K. We did not have any lifestyle changes in the way we lived. We just bought a new house to get out of a two story into a single story. Climbing the steps was getting harder and harder, especially for my wife.

My advice is that if you like the work you are doing and it allows you to do what you want to do then keep at it otherwise retire and have fun.

fishbuck - 9-20-2016 at 07:30 PM

So my only connection left to So Cal is that I my have a few more years of motocross racing and riding in me so I am trying to get as close to Lake Elsenore, Perris, Glen Helen etc. and as close to the border as possible too.
But maybe just a cheap apt. if I can find one. If baja had decent motocross that would be great. It doesn't. It's all Baja 1000 type stuff.
Some great trail riding but no moto.
My goal is to stay in San Quintin starting in July. After fishing there and studying it the bite doesn't turn on until then and goes through Oct. The recent 'cane should push up the fish. Look for wahoo in about a week or 2.
I want to follow the fish so may go south after that. Maybe a camper or something.
San Quintin will be my base camp and home but I won't stay there fulltime there until maybe I'm too old to travel much.
But yeah I am retiring to San Quintin but still want to hang in So Cal motoland for a while.
I see some of my union brothers have already had success with the pension/ss/401k route so that is encouraging.
So I will throw out a number.
Is $3000/month enough spending money for a fairly simple retirement?

[Edited on 9-21-2016 by fishbuck]

Retirement

John M - 9-20-2016 at 07:31 PM

I was able to retire obscenely young with a decent pension. As TW mentioned, medical insurance before age 65 (Medicare) is costly, at least north of the border but we budgeted for that in our retirement planning.

We never lived above our means in Southern California prior to retirement and honestly can't afford to be extravagant now. We enjoy a modest life style, but the real benefit was that we've had an exceptionally long time to enjoy what we enjoy - whether it includes trips to Baja or not.

We count ourselves as blessed, as well as most fortunate to retire early, have absolutely no regrets, and look forward to many more years - heck, we have to at least outlive our newly acquired SENTRI pass.

Plan for what you can, hope for the best, stay as active as possible, enjoy life where ever it takes you.

John M

Hook - 9-20-2016 at 07:31 PM

Yeah, the average amount that SS increases from 62 to your full retirement age (this is not really cost of living related; the amount you might get at 62-63-64-65 is also adjusted at whatever rate they decide to increase it) is 8%. That's a pretty risk free way of getting 8% these days. If you can afford to wait on it, do it.

fishbuck - 9-20-2016 at 08:52 PM

Very cool. I had zeroed in on Hemet. Cheap rent, close to moto, cool airport, and a straight shot the the border.

fishbuck - 9-20-2016 at 08:55 PM

Yeah the medical and dental is still an unknown for. I got some homework to do.

bajadock - 9-20-2016 at 10:26 PM

Retire sooner than later. Fun has no price. Working your ass off has a price. Cheers, Mike.

fishbuck - 9-20-2016 at 10:41 PM

Very loose timeline.
58 wishful thinking, very irresponsible... very tempting.
59 Please God,Please God...
62 probable with only moderate brain damage. May be surviveable.
67"whaa-whaa"!!!
70 Someone please shoot me!

[Edited on 9-21-2016 by fishbuck]

David K - 9-21-2016 at 07:01 AM

Mike, make a list... two columns... reasons to retire early on one column and reasons not to on the other column.

CortezBlue - 9-21-2016 at 07:22 AM

Usually when hear folks talk about retiring early it is because they are a cop, fireman or educator. If you fall into this catagory, then retirement is probably more accessible for you. I retired at 57, I am not a public works guy, but a long time business guy who did well and saved my penny's. I will tell you that I retired fully for 2 years and had to go do something. I can't sit still. We own a home on the beach in Mexico and love spending time on the road with our RV, but that still leaves a bunch of free time. Being a entrepreneur, it is difficult not to look at something that needs fixed or a process improved. Since I have invested in Real Estate all of my life, I decided to get my RE Lic, and love it. Not only does it help me with my own rental properties but I have listed and sold many homes her in Phoenix.

I think that retirement today has changed to doing what you want on your own terms. So I only try to do home listings and I take the summer off and travel to the north west and split my RE biz into fall and spring. We travel south to Cabo or PV during the winter. So, I have extra cash to pay for Obama Care with out touching my 401K or my savings and have free time to do my thing throughout the year.

PS Don't mess with your 401K unless you really have to. Just remember, if you need $20K for expenses, you will have to pull out $24K. Also, if you are married I would suggest one of you take SS early and the other wait til' 66 or 67.

Enjoy what ever you decide to do.

Sweetwater - 9-21-2016 at 08:32 AM

Cortez makes some good points. Retirement is relative, just like the timing of stepping away from that long time job/career. I did not think that staying at a job for 32 years would take such a long time. Two sons later and a wife with a good career, I bailed at the tender age of 54 although I was a month shy of 55. Several other salient points. Medical is your biggest challenge, I've never needed anything while employed but my wife got one of those $100k + DVT things and then I rang up some orthopedic expenses to the tune of $300k. Out of pocket wasn't bad and because the ACA makes me still insurable with the same policy and price, I'm not damaged financially. Your activity level after you take your EARNED benefits can also entail making some side money on a business that has been a hobby. Why not?

SlyOnce - 9-21-2016 at 08:53 AM

I'm 59 1/2 I live full time in Baja now, I commute to work in SD every day. I will be retired from Government work in 6 months. My income will be about what you are talking about. It will be tight but we can do it. My apartment in Playas is $350/month so consider that cost of living in Baja will be MUCH LESS. In 2 more years my early SS will start. So income will go up. Pay cash for medical, although my MX wife works for Baja CA Government and technically I could go on her medical - although she is going to "retire" at the same time (she's 35).

Just put together a spreadsheet of costs versus income. I can get by by my figures living full time in Baja on $2600 / month and that includes owning a boat.

Additional costs

bajaguy - 9-21-2016 at 08:56 AM

Don't forget federal income tax, and those of you lucky enough, California personal income tax

TMW - 9-21-2016 at 09:04 AM

A couple of things to remember about a 401K.

Some companies maybe all of them, I'm not sure, make you convert a 401K to an IRA when you retire. At least that is what McGraw-Hill does. Basically it is the same thing but you have more choices to invest in.

Also when you when you reach 70.5 years of age you must start with drawing a minimum amount. It's based on how much you have divided by 26. You can withdraw more if you want and normally who ever you are withdrawing from will keep 25% for federal taxes or more if you have a lot of money in it that puts you in a higher tax bracket. You can elect to take it the following year before April 15 but that means you will be taking out twice as much in that tax year.

TMW - 9-21-2016 at 09:08 AM

The U.S. Feds tax 85% of SS. The state of CA does not tax SS. Both tax any pension you get at 100%. I don't know what the tax rate is on a disability pension, it may not be taxed.

[Edited on 9-21-2016 by TMW]

bajamedic - 9-21-2016 at 09:49 AM

Just do it... as a Paramedic I felt that I had seen more sickness, trauma and death than a human should experience. I was able to retire at 56 and I am now 61. I am glad that I have taken time to live, not work, as so many of my patients never got to see the tomorrow that they were planning. Just do it. JH

ehall - 9-21-2016 at 10:34 AM

Great thread. I just turned 49. Never too early to start planning my escape.

Sweetwater - 9-21-2016 at 10:37 AM

Here's a link to a good review article. The site should give you plenty of homework to feel confident about your choice.

http://www.investopedia.com/articles/personal-finance/011916...

motoged - 9-21-2016 at 10:51 AM

I retired in May of this year and turned 65 in late August...Old Age Pension stuff (SS)starts at the end of this month....$1300 before taxes....have some RRSP's (401K equivalent) and some money in the corporate account saved from my private counselling practice that I will draw from first...and will draw 75% of preretirement "salary"....which should give me about $2500 a month after taxes and that is the plan for the next several years while I figure out what life holds for this single guy with a penchant for riding my moto in Baja during winter months...while I still can.

Plan may well be to use the next two years to downsize my stuff and get the house ready to sell...and then see what's what.

It's an adventure, for sure.

SFandH - 9-21-2016 at 11:00 AM

Plan may well be to use the next two years to downsize my stuff and get the house ready to sell...and then see what's what.

Sell the house? Are you planning on buying another? Having a paid off house is a great thing to have when retired. I wouldn't want to be at the mercy of a landlord considering how steadily rent increases.

I think having fixed housing costs is key to a successful retirement.

Udo - 9-21-2016 at 11:09 AM

I retired at 67.

When I let the Feds know, they sent me a SSI for thousands of $. Now I get a check every month.

Sweet!

fishbuck - 9-21-2016 at 11:50 AM

These is great wealth of knowledge and experience here on the board. Thank you all.

motoged - 9-21-2016 at 12:03 PM

Quote: Originally posted by SFandH

Plan may well be to use the next two years to downsize my stuff and get the house ready to sell...and then see what's what.

House is paid for....certainly not decided about selling it....but have given lots of thought about trailer life.

No, I would not buy another place if I did sell...as it ties up the equity....renting might be a better option....but need to think on that a lot more....love the house but I don't need all the space...

Martyman - 9-21-2016 at 03:00 PM

I'll turn 60 in 10 months and I will retire then. I'll have a nice county pension and my wife and I plan on travelling a lot. When we go to Australia I imagine we will spent $8k/month. When in Baja we will spend $2500/month.
The time that I travel to more expensive place will be when the stock market is UP. We will hang more in Baja and Thailand when the market is DOWN.
Go Stock Market!

fishbuck - 9-21-2016 at 03:02 PM

Any thoughts on Social Security Breakeven age?
Let's start at 62. Read a article that stated it as 80.
Social Security longivity calculator says I'm done at 83.
62 is sounding real good right about now

fishbuck - 9-21-2016 at 03:06 PM

Quote: Originally posted by Martyman

I'll turn 60 in 10 months and I will retire then. I'll have a nice county pension and my wife and I plan on travelling a lot. When we go to Australia I imagine we will spent $8k/month. When in Baja we will spend $2500/month.
The time that I travel to more expensive place will be when the stock market is UP. We will hang more in Baja and Thailand when the market is DOWN.
Go Stock Market!

You win!

mtgoat666 - 9-21-2016 at 03:25 PM

Quote: Originally posted by fishbuck

Any thoughts on Social Security Breakeven age?
Let's start at 62. Read a article that stated it as 80.
Social Security longivity calculator says I'm done at 83.
62 is sounding real good right about now

Why is SS set up to encourage you to work longer?
People worn out at 62 should be allowed to relax with fair pension. Forcing work to age 70 only benefits the rich/oligarchs whose SS contribution is capped. Tax the rich, not the elderly!

Anywho, re your question, i suggest you independently save for retirement so SS is not critical.

Hook - 9-21-2016 at 03:51 PM

Financial planners, as little as ten years ago. were encouraging people to retire at 62. The thinking was that even the reduced amount you accept between 62 and your full retirement age, will more than equal the amount you collect from your full retirement age till the day you die. Also figuring into this was that today's dollars would be worth more than age 66 dollars and taxation rates would likely increase.

Then, inflation became almost nil (at least according to the gubment's suspicious way of figuring it), income taxes have remained largely the same and people began living longer. The rationale for taking SS early has changed.

Motoged, we Americans don't have TWO forms of retirement income from the gubment, like you Canadians do. At least as it has been explained to me by my Canadian friends, you get one at some age around 60 and then another around 65 or something.

We get one IF we have worked jobs that paid into the system. Those who never payed anything into the system, often don't qualify.

So, the timing of taking it can vary greatly, from individual to individual. I dont recall our gubment officially suggesting going early or later. But independent financial planners have begun recommending taking it as late as you can, unless you have a major financial or medical reason to take it early.

Oh, yeah, one last thing. The rich ARE generally ELDERLY. Last time I looked at demographics in wealth, the elderly are far wealthier that every other age demographic. They worked at times when there were good jobs in America with good benefits. They've had their entire lives to accumulate wealth.

Now, a high percentage of those jobs are overseas where corporations could get away with paying peanuts for usually lesser quality.

And people wonder why our economy cant seem to get going again with all the "free money" (cheap loans) being passed out.............

[Edited on 9-21-2016 by Hook]

Shadowman - 9-21-2016 at 04:00 PM

I have a 1.5 m$ house and .5m$ waterfront home on the Baja. 1.7 million in savings and RSP (401 equivalent). I am 58 with a beautiful wife. I owe nothing.
Why am I still working!

SFandH - 9-21-2016 at 04:03 PM

Quote: Originally posted by SFandH

Plan may well be to use the next two years to downsize my stuff and get the house ready to sell...and then see what's what.

"love the house"

Don't sell it unless you NEED the money. A couple of years (maybe months) in a trailer and you'll be dreaming about the house and all the space you don't need while you're kicking yourself in the butt cuz you sold the house.

You own a piece of the rock that is getting more valuable with each tick of the clock, hang onto it!

Will it to someone, me for instance, it will be dearly appreciated.

TMW - 9-21-2016 at 04:58 PM

I have a 1.5 m$ house and .5m$ waterfront home on the Baja. 1.7 million in savings and RSP (401 equivalent). I am 58 with a beautiful wife. I owe nothing.
Why am I still working!

Probably because you like what you are doing at work.

I have a friend in LA that owns his own company. He did not take SS until 70. He is now 73 and thinking of selling his company or just going out of business. Him and I have discussed him retiring for several years and we both agreed that as long as he liked what he was doing to keep doing it. Last weekend we went to the Randsburg Old West Days and while having dinner he told me the technology was passing him by and he had no interest in keeping up with it and was seriously thinking of retiring. I think it is his time.

fishbuck - 9-21-2016 at 06:16 PM

I have a 1.5 m$ house and .5m$ waterfront home on the Baja. 1.7 million in savings and RSP (401 equivalent). I am 58 with a beautiful wife. I owe nothing.
Why am I still working!

Those beautiful wives can be expensive is my guess.

msteve1014 - 9-21-2016 at 07:05 PM

I have a 1.5 m$ house and .5m$ waterfront home on the Baja. 1.7 million in savings and RSP (401 equivalent). I am 58 with a beautiful wife. I owe nothing.
Why am I still working!

You are a dumb ass.
I retired at 55 with a good pension and medical. My wife liked her job and made good money so she wanted to work a little longer. She died at 57, 8 months before she was going to quit.

Fishbuck, go as soon as you think you can.

basautter - 9-21-2016 at 08:16 PM

ASAP :bounce:

CatCrazyJulie - 9-21-2016 at 09:36 PM

I haven't seen this suggestion yet, so will put it out there:

Check out the "Retire Early Lifestyle" website: http://retireearlylifestyle.com/

The website creators retired when they were 38, selling a nice house and biz in the SF Bay Area, and investing the money. They've been travelling and living in different countries ever since. They're now about 60. Part of their reason for figuring out a way to retire early was that there were a lot of things they wanted to do that they didn't think their bodies would be up to when they were older.

Sometimes on their website they include a list of their day-to-day spending as they travel around various countries. While traveling in Mexico, they took public buses. They have a cheap (like $15) pdf book available for download with a lot of practical info, and info on how to figure out whether you're ready to take the leap. And every month their website has stories and columns by other people. There's a lot of "retire early" folks out there. It's inspiring to read about how people make it work.

My husband and I are divers, and that's figured into our thinking. You don't see a lot of 75-year-old divers out there:-). So we've taken the leap, even though he's 62 and I'm 59. And it's a good thing, since this year has ended up being a "rebuild" year for me, with 3 surgeries, including neck disk fusion (non-optional), and bicep reattachment and surgery on a torn rotator cuff. Feels like the universe is saying "get healthy and go play!" (Fortunately, Mark retired with great health insurance.)

I may do part-time work from time to time (since I enjoy my work), and if something ideal falls into Mark's lap, he might take it on. But his last 5 years at work were not fun, due to management changes, and he really needed to get out of his job. He's so happy now!

We don't have quite as much $$ for retirement as we'd ideally like, but it looks like we can make it work. Maybe get creative and spend a full year in Baja in our trailer, and rent out our CA house to generate some extra $$$. I use spreadsheets and mint.com to help with tracking spending and planning. It helps me not worry about the money, knowing exactly where we stand.

If you love your work, that's an argument for continuing to work, because you're enjoying life while you're working. Especially if you have ample vacation time to spend in Baja. But if the only reason that you're working is for the money, but otherwise you'd jump ship...figure out a way to make it work financially to have the life you want.

Check out "Retire Early Lifestyle".

DavidT - 9-21-2016 at 11:14 PM

Retire at 30

JoeJustJoe - 9-22-2016 at 02:50 AM

I have a 1.5 m$ house and .5m$ waterfront home on the Baja. 1.7 million in savings and RSP (401 equivalent). I am 58 with a beautiful wife. I owe nothing.
Why am I still working!

Why are you still working?

Probably because you woke from that dream of owning million dollar homes, having a beautiful wife, and being debt free.

BTW what's a RSP? Are you taking about a Canadian RRSP?

ehall - 9-22-2016 at 04:50 AM

I have a 1.5 m$ house and .5m$ waterfront home on the Baja. 1.7 million in savings and RSP (401 equivalent). I am 58 with a beautiful wife. I owe nothing.
Why am I still working!

If that's pesos you better keep working.

pauldavidmena - 9-22-2016 at 06:37 AM

I'm also 57, and have been working in the IT field for 33 years. I still like what I do, but it's definitely a young man's world, and I'm now playing the role of the silver-haired veteran who's seen it all. At this point my nest is empty, I'm debt-free and trying to save every penny possible. So I have the same basic questions you do: when do I hang up my cleats? When do I draw on my social security?

As others have advised, in addition to using an on-line retirement calculator (there are plenty of those) I talked to a financial planner - two of them, actually (our accountant, and an investment adviser). Both agreed on two things: that I could probably afford to retire at 60, and that I should delay drawing on my social security until 67.

I've thought of delaying my retirement to 62, but then I ask myself: why? I'm still in good health, but can no longer take that for granted. I had major back surgery a year ago, and over the weekend I fell down a flight of stairs and banged myself up pretty well. I think my body is trying to tell me something, and it always gets the deciding vote...

DENNIS - 9-22-2016 at 07:16 AM

An important prerequisite to retirement is having your hobbies in order. Dead time will collect you faster than anything else.

ehall - 9-22-2016 at 07:42 AM

Quote: Originally posted by DENNIS

An important prerequisite to retirement is having your hobbies in order. Dead time will collect you faster than anything else.

Happy hour doesn't count either

DENNIS - 9-22-2016 at 07:49 AM

That seems to be the problem. Without real hobbies, life turns into a happy hour for a while anyway.

rocmoc - 9-22-2016 at 08:22 AM

Loved my career. Retired very early and loved being retired more.

rocmoc n AZ/Fld/Baja

JoeJustJoe - 9-22-2016 at 11:49 AM

I see a lot of personal advice from other members frame of reference, and typical stuff you hear like getting a financial adviser's opinion.

One of the last person's advice I would get is from a financial advisory, who is probably more interested in his retirement plan than yours, although he sure would love you to retire early so he could churn your account or make a fee off your account.

I haven't seen any posts seeking advice from their doctor's about their health.

It would seem to me one of the most important considerations is how is your health?

How long do you expect to live based on your parents longevity and other close family members?

Can you really afford to retire at an early age?

Do you actually love your job or career?

Do you wake up some mornings, especially Monday mornings dreading to go to work, because you hate your job..... you hate your brown nosing, and back stabbing co-workers, and you're ready to go postal on your boss or clients who you really really hate with a passion?

If so, you probably should retire early if you know you could afford to, although your Social Security will be a smaller amount if you retire at 62, and if you still work part-time, you may have to give back part of your social security monies, however if you wait till your 66, you will get your full social security check, and you could still work without the fear of having to give the money back to Uncle Sam.

pauldavidmena - 9-22-2016 at 03:51 PM

Quote: Originally posted by JoeJustJoe

I haven't seen any posts seeking advice from their doctor's about their health.

It would seem to me one of the most important considerations is how is your health?

How long do you expect to live based on your parents longevity and other close family members?

Very good point. I have had this discussion with my doctor, who is definitely on board with my retiring at age 60. Apart from working in a very stressful field (IT), heart issues run in my family. Both of my parents are still alive in their mid-80s, but only one of my grandparents lived that long, with one grandfather dying of a heart attack at age 46. Granted, I live a much healthier life style than he did, but there's no reason to play chicken with the Grim Reaper.

fishbuck - 9-23-2016 at 12:55 AM

Quote: Originally posted by pauldavidmena

I'm also 57, and have been working in the IT field for 33 years. I still like what I do, but it's definitely a young man's world, and I'm now playing the role of the silver-haired veteran who's seen it all. At this point my nest is empty, I'm debt-free and trying to save every penny possible. So I have the same basic questions you do: when do I hang up my cleats? When do I draw on my social security?

As others have advised, in addition to using an on-line retirement calculator (there are plenty of those) I talked to a financial planner - two of them, actually (our accountant, and an investment adviser). Both agreed on two things: that I could probably afford to retire at 60, and that I should delay drawing on my social security until 67.

I've thought of delaying my retirement to 62, but then I ask myself: why? I'm still in good health, but can no longer take that for granted. I had major back surgery a year ago, and over the weekend I fell down a flight of stairs and banged myself up pretty well. I think my body is trying to tell me something, and it always gets the deciding vote...

Wishing you speedy recovery from your stairfall. But yeah we're literally on the same page in regards to when to retire and why.

[Edited on 9-23-2016 by fishbuck]

BajaMama - 9-23-2016 at 05:26 AM

We are same age (57) and also pondering when to retire. One thing to keep in mind regarding SS and a pension - I believe, although I could be wrong, that receiving a pension reduces your social security. For some really stupid reason that is incomprehensible to me, the government sees it as "double dipping." (but hey, didn't you work for it?). Also, depending on how much you draw from your 401K, some of your SS benefits could be taxable (up to 85%).

I am a retired math teacher - I get over involved with numbers...

bajaguy - 9-23-2016 at 06:46 AM

Depends on where your pension is from. It's called a "setback"

Quote: Originally posted by BajaMama

We are same age (57) and also pondering when to retire. One thing to keep in mind regarding SS and a pension - I believe, although I could be wrong, that receiving a pension reduces your social security. For some really stupid reason that is incomprehensible to me, the government sees it as "double dipping." (but hey, didn't you work for it?). Also, depending on how much you draw from your 401K, some of your SS benefits could be taxable (up to 85%).

I am a retired math teacher - I get over involved with numbers...

wilderone - 9-23-2016 at 07:11 AM

"...depending on how much you draw from your 401K, some of your SS benefits could be taxable (up to 85%)"
There is a calculator on an IRS website to see how much of your ss would be taxed if you're deriving income from other sources. You can use the calculator to get an idea of what your bite might be after starting required minimum distributions - an important retirement consideration. Whoever you have holding your 401k funds should be able to help you out with firm numbers.
And if you have enough qualifying SS earning years, you can take both pension and ss.

DENNIS - 9-23-2016 at 07:16 AM

I don't think SS was meant to be a retirement program when introduced. How times have changed.

MitchMan - 9-23-2016 at 08:20 AM

The question of when to retire is an easy one to answer.

The trick is to determine accurately the amount of money that will be required to retire successfully and whether or not you will have that amount of money.

The weird thing about all that is that the amount of money required is so very different from one person to another. I am always amazed to find out the amount of money that other people choose to spend to sustain their lives. From person to person, that required amount of money varies by multiples - amazing.

If you are planning to retire in Baja, you should plan on being debt free and buying and owning your own home their...and here is where the differences between people begins. Some Americans believe that they must live in an all American enclave and surround themselves primarily with Americans. To do that, they will buy a fancy shmancy house or condo in a resort like, non-authentic Mexican environment...and that cost will start at $200,000 and skyrocket from there. But, if you want to live in an authentic and real Mexican environment, that could cost you as little as $50,000 USD to $120,000 USD. My place in La Paz is in that price range: two bedroom house in a 9,300 sq ft lot with high brick walls all the way around with attractive rustic landscaping. Property taxes about $130 USD annually.

My house is 4 miles from downtown La Paz, 2 miles from Walmart, Home Depot, Liverpool department store and malls, big grocery stores, restaurants, Marinas, Movie theaters, and the big new hospital, plus, I can see the ocean from in front of my house. In La Paz, and elsewhere in Baja, there is low cost real estate all over the place.

Now, there are three categories of expenses to deal with: living expenses, healthcare costs, and travel plus recreation costs.

The living cost in my very realistic budget is $550 USD per month for one person, a total of $850 USD per month for a husband and wife. That cost includes food (all home cooked), property taxes, home repairs and maintenance, auto repairs and maintenance, auto insurance, clothing, internet and TV, cell phone, haircuts, all utilities (including the use of air conditioning), fideicomiso annual fee, and annual Visa charges.

What you will spend on medical and prescriptions is unique to each person and can vary substantially. You need to know what those cost will be.

What you will spend on travel and recreation is the real "variable" in the retirement equation...and that depends entirely on your discretion, not necessity. I include eating at restaurants in this category as eating at restaurants is not at all a necessity. If you have decided that you do not like to cook, or you have decided that you don't want to learn how to cook for yourself, even though all your life eating is what you have done 3 times a day, well, that's just plain discretionary.

If you have children and other family in the USA, you will surely want to visit them. That will cost you and that amount of travel is expensive and will vary from person to person by leaps an bounds. You need to know what you will need to spend for that.

If you choose to eat at restaurants and/or frequent cantinas a lot, that will add considerably to monthly expenditures. If you choose to travel within Mexico and stay at the more expensive hotels, that will balloon your expenditures. If you choose expensive hobbies, that can mushroom cloud your expenditures. If you choose to own a gas guzzling large vehicle, that will double or triple your monthly gasoline bill. But overall, it won't be that significant because you won't be traveling very far on a daily basis. La Paz, for example, is only about 7 miles from one end to the other. Just be clear and honest with yourself, and be aware of what is really a necessity rather than what is really a discretionary choice. Many people don't really know what the difference is between the two.

How early you can retire has a lot to do with what you feel are absolute necessities. If you know how to live frugally, as I do, you can eat really well at every single meal, be comfortable and warm in winter and cool in summer, be secure and safe, surround yourself with a beautiful environment, have all the conveniences, and have all your true necessities provided.

What will make the difference is what you need to spend on medical and prescriptions, what you choose to spend on travel and recreation, and whether or not you choose to be reasonably frugal. Outside of these costs, your necessities should be around $550 for one person and $850 for two if you do all your own cooking and are frugal within reason.

[Edited on 9-23-2016 by MitchMan]

[Edited on 9-23-2016 by MitchMan]

JoeJustJoe - 9-23-2016 at 08:28 AM

Quote: Originally posted by BajaMama

A pension doesn't normally reduce your social security, nor does interest, capital gains, annuities, or other types of retirement income.

However, if you work for a government agency or employer that doesn't withhold Social Security from your paycheck, than any pension you get from that work can reduce your SS benefits.

It's called the Windfall Elimination Provision.( WEP)

We non government workers who paid into social security all our lives don't want government workers, like teachers, and especially cops double dipping and getting windfall unearned profits, so the WEP makes sense, although things could get complicated when second jobs are considered, and I understand the WEP provision isn't always fair to all workers, and Congress is looking to change the WEP.

bajaguy - 9-23-2016 at 09:41 AM

And what about those pesky government workers who qualified for their SS benefits before or after their government service???.....Why should the SS Administration "withhold" their money or provide a reduced benefit and why shouldn't they be entitled to full benefits??

Santiago - 9-23-2016 at 10:35 AM

And what about those pesky government workers who qualified for their SS benefits before or after their government service???.....Why should the SS Administration "withhold" their money or provide a reduced benefit and why shouldn't they be entitled to full benefits??

BG:
It's worse than that:
SWMBO worked for 10 years in private thus earing substaintial SS benes. She quit and became a teacher under Cal-Strs. Not only is her SS benefit reduced to less than $300 per month (way less than she earned) under double-dipping rules which do not apply here; but she does not get survivor benefits should I die before her, a very likely outcome. I EARNED those benes for me and family but SS will not give her them. We know this to be true because one of her co-workers recently buried her husband and has been told by SS bugger off. Her survivor SS would have been higher than her CalStrs but she is out.

Skipjack Joe - 9-23-2016 at 10:46 AM

Retirement has been set up so that you retire when you are no longer productive at your job. Unfortunate by then you're incapable of fun either. Retire as soon as you can on the income you feel comfortable with.

mtgoat666 - 9-23-2016 at 10:59 AM

Quote: Originally posted by Skipjack Joe

Retirement has been set up so that you retire when you are no longer productive at your job. Unfortunate by then you're incapable of fun either. Retire as soon as you can on the income you feel comfortable with.

Alternatively, choose a career that's fun so you enjoy your life in the now. Who said fun only comes after retiring?

vandenberg - 9-23-2016 at 11:08 AM

The wife and I live in Nopolo in a large home, on the golf course and the ocean accros the boulevard and we can easily get by on $ 1500 a month if we just stay around Loreto and have no travel or high medical expenses.
We maintain US health insurance with an evacuation policy with SKYMED.
Live couldn't be better.

vandenberg - 9-23-2016 at 11:12 AM

Quote: Originally posted by mtgoat666

Quote: Originally posted by Skipjack Joe

Alternatively, choose a career that's fun so you enjoy your life in the now. Who said fun only comes after retiring?

True Goat.
I have been most of my life in the booze business and enjoyed pretty much every minute of it.
However it didn't hold me back from retiring at 55 and I have enjoyed that life as well.

SFandH - 9-23-2016 at 11:45 AM

Nobody has mentioned transportation costs. I'm 66, retired for 6 years, and planning on buying at least two more cars and I like new cars, but I may buy my first used cars from here on out.

No need to explain that new cars are an expensive way to go, I know.

Also expect unexpected expensive car repairs in addition to the usual maintenance.

And then there was the $9000 kitchen remodel last year............happy wife, happy life

It's the recurring non-recurring, unexpected expensive costs that you need to plan for.

[Edited on 9-23-2016 by SFandH]

philodog - 9-23-2016 at 12:04 PM

Besides figuring out what you need to retire comfortably you also need to put a price on what the extra years of freedom are worth. I retired two years early and figure it cost me over 100k in lost wages and retirement benefits. Worth every darn penny!

JoeJustJoe - 9-23-2016 at 12:38 PM

You have to understanding that Social Security, is a great democrat basically socialist plan that was provided to serve as a safety net when we workers in America get old.

Social security also uses a progressive formula that delivers a higher replacement income to lower income earners, and a lower replacement rate for higher income earners, which pretty much protects us all from eating Alpo dog food in the golden years.

The problem or fear, was you were also getting these now highly paid union teachers, cops, firemen, and other government workers not paying into the Social security system, and then retiring on a fat government pension, or other workers retirement programs, and then if these workers who had previous regular jobs would double-dip in the regular social security program. These double-dippers would make out like bandits because social security is skewed favorably towards the low income earners.

In other words don't ask me to feel sorry for government workers drawing income from multiple pensions, and from a fat social security check, that is skewed favorable to them, because they look like low income earners, because they didn't contribute to Social Security for 40 years like the rest of us.

Today, most average workers do not have a pension, like most government workers, nor do they fully invest in their 401K program at work, and now most non government employees are forced to live off mostly their social security check, and other meager incomes or under funded personal retirement plans. ( damn you Ronald Reagan)

But like I said, in my earlier, there are some cases where Windfall Elimination Provision does hurt some workers, and I understand there is support from both the democrats, and republicans to change WEP, and the formula to make it more fair and proportional to all.

[Edited on 9-23-2016 by JoeJustJoe]

pauldavidmena - 9-23-2016 at 01:32 PM

Quote: Originally posted by philodog

Besides figuring out what you need to retire comfortably you also need to put a price on what the extra years of freedom are worth. I retired two years early and figure it cost me over 100k in lost wages and retirement benefits. Worth every darn penny!

You hit the nail on the head. As a veteran non-management IT drone, I'm probably at my peak earning potential right now; but why tempt Fate, who already has me on speed dial? Provided that my employer doesn't sacrifice me to the layoff gods, I should be able to retire early enough to enjoy my salad days. No need to get greedy.

bajaguy - 9-23-2016 at 01:50 PM

Paul.......see if you can make a deal your employer can't refuse and possibly buy you out with benefits

Quote: Originally posted by pauldavidmena

Quote: Originally posted by philodog

fishbuck - 9-23-2016 at 02:17 PM

Yeah the peak earning power thing is a dirty trick.
I made the most money ever in the last few years. But lots of OT.
I have been home sick for a week so have had lots of time to think about this. I am back to work but found out yesterday I have pneumonia... again.
4 of the days were a near coma interupted by coughing fits.
Needed a nebulizer yesterday cause my asthma is in overdrive now.
Sure I like my work.
I am an Aircraft Airworthiness Inspector for the Boeing Company. Top scale.
Stressful, complicated and physically difficult.
I'm bathed in carcinogens constantly. I now need a resparator just to survive in the factory.
I wear double hearing protection, a bump cap, and safety glasses.
It's always hot in there due to giant "hothouses" that we use to accelerate cure time on all the varies paints, sealant, epoxy, and who know what the heck else is in that place.
But I will work today and collapse tomorrow... again.
This is now a litterally a game of survival for me now.
But a top scale Boeing employee makes about 100000/year.
And a real go getter pulls about 150000.
So that is very hard to walk away from.
When I was back in Long Beach our sick joke was that when we saw the abulance inside the building someone would proclaim "Looks like someone retired"!

[Edited on 9-23-2016 by fishbuck]

David K - 9-23-2016 at 02:23 PM

Mike... run away, run away!!!

Skipjack Joe - 9-23-2016 at 02:52 PM

Quote: Originally posted by mtgoat666

Quote: Originally posted by Skipjack Joe

Alternatively, choose a career that's fun so you enjoy your life in the now. Who said fun only comes after retiring?

Oh, I enjoyed my work. Never said I didn't. But retirement gives you much more freedom. You can do this today or that tomorrow, and nothing the following day. You are a free man to live and choose as you wish. Money is no longer a goal either.

Whale-ista - 9-23-2016 at 11:04 PM

Good discussion- it's been on my mind recently.

As for "double dipping"- that's describing my situation: I worked enough and paid enough into SS to earn a modest check, but I've also worked as a teacher- and so my SS will be reduced as a result of earning a pension. Not sure how those calculations are made by the SSA.

And I'm still not sure where all those hi-paying teaching jobs are- because of budget cuts the last 10 years, I've taught mostly part time. My teacher's pension reflects that, and won't be a whole lot of money when I choose to take it.

FInally- I come from a family with pretty good longevity (parents lived into their 80s, grandmother made it to 97). Add the fact we all are living longer than imagined back in the 30's when this system was devised, and the problem becomes clear: how do I, and others like me, avoid outliving my savings?

I'm pulling out the calculator, excel spreadsheets and abacus....