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Author: rjm1 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76237  
Subject: Re: Retirement questions... Date: 2/19/2000 8:03 PM
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I posted earlier concerning my father who is retiring in a couple months, and a few helpful people requested more information about my father's finances....

He will be 66 years old and in pretty good health. He owns a $220,000 townhouse in the Chicago area w/ the mortgage paid off. His current salary is $70K/year
and he works as an accountant.

--Property taxes are $4200/year
--he has $125,000 in a 401K plan which he can pull out or receive $900/month
--he will also receive $1800/month pension
--and he will also get $1400/month in social sec. benefits
--he has $45,000 in stocks (NITE,BMCS,WCOM,SBH,SNPS :-( )
He calculates he and my mom can live on $2000/month comfortably.

My mother is also retiring as well when the family business is shut down in a couple months. She is 59 years old and has been under my father's insurance but that
will end when he retires.

I guess my question, in a nutshell is, what should he do? :-)
Should he pull his whole 401K or leave it in (he is inclined to pull it all out).
What type of things should he be investing in, and what should the % breakdown in those investments be?
What type of health insurance should he and my mom get?
What is the air speed velocity of an unladen swallow?

He is also wanting to relocate near relatives in the LA area and selling the townhouse....should he buy or rent in LA for his retirement years (he plans to travel a bit).

Thanks so much for any assistance you can give. It is GREATLY appreciated. AND, is there any good book that you can recommend that goes over retirement
planning and living?

Regards,
Jason


The 2,000 per month budget seems low. Might want to recheck the numbers.

The pension and social security give him ample income vs his need. Therefore he does not need to have several years of living expense in fix income investments. He should have an emergency fund plus a fund for large purchases that will be made in the next year or two and travel.

Take the 401k money. He should be able to do better in the market. Also he does not need the 900/month income.

Invest in stocks or index funds. Probably no load stock index funds from Vanguard.

Get the Medicare supplemental insurance from the goverment and a policy to fill in the gaps. For wife will have to get regular health insurance. Should be able to continue her coverage under his plan as a CORBA plan but this will not last more than 3 years.

I would rent for a year or two so he can see where he really wants to live.
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