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Yes -- you're right about the RMDs having to be paid in the year we reach 72.
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Funny timing on this thread. I just informed my employer a few minutes ago that I am retiring effective September 1.

PSU
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Congratulations!!!

(Ever time I see your name I imagine you design power supplies, despite knowing better.)
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Funny timing on this thread. I just informed my employer a few minutes ago that I am retiring effective September 1.

Congrats, PSUEngineer!!! Enjoy, enjoy, enjoy.

I retired 3 years ago and I consider the best career move I’ve made.

Oddly, my boss told me the same thing when I handed her my resignation letter.

AW
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No. of Recommendations: 6
I did part of this with some MYGAs to cover the first 4-5 years. Sure inflation is chewing up some of this right now but at least I'm not losing to inflation and another 20% in the market.

I expect somebody (ahem, intercst) to come along and tell us about the hidden expenses and downsides of MYGAs. I did my usual goggling for "problems with MYGA" and got nothing but pages and pages of ads and insurance barkers cheering for them. google is getting worse and worse about tossing up ads when you are just looking for information.

About "first 4-5 years" ---- is there something special about the first 5 that is not the case for any other 5 year period? Whenever you are, the next 5 years are the first 5 of the rest of your life. Whether you are 50 or 80.


Personally I think the best way to do this would be to buy a house in your 30s and have it paid off by retirement and it greatly reduces your expenses. I was set for that but ended up selling the house and will now have to pay an inflated price (likely) for a place to live.

No, that's called suboptimal (I would say d*mb, but TMF doesn't like that word). You bury a big part of your net worth into an illiquid poorly performing asset instead of keeping it invested to grow with the economy. Sure, you lower your expenses in retirement. Because you gave up the dividends and growth that being invested would have given you. That's a bad tradeoff.

A 30 year fixed rate mortgage is great for retirees. Keep your money out of the house, keep it in investments that grow with inflation while your monthly mortgage payment stays fixed no matter what inflation does.

As you say, "Obviously the cash is losing to inflation ..." so you are paying the mortgage with less and less inflation adjusted money.
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No, that's called suboptimal (I would say d*mb, but TMF doesn't like that word). You bury a big part of your net worth into an illiquid poorly performing asset instead of keeping it invested to grow with the economy. Sure, you lower your expenses in retirement. Because you gave up the dividends and growth that being invested would have given you. That's a bad tradeoff.

Did you do the math? The person said buying a house in your 30s and paid off in retirement. Since many people retire in their 60s, the math is 60s minus 30s or around the length of a 30 year fixed rate mortgage.

PSU
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I'm nearly there with ya, hopefully 1 1/2 to 2 years away from switching from full time to 6-7 mo a year contracting and the rest golfing and traveling for a few more. Fortunately, my project/program management skills are in demand. Unfortunately I have no idea what to do once I retire to stay busy, that doesn't involve IT, and the money is too good to pass up (for the right roles).

And congrats to PSU!
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I'm also slated for early September retirement, at age 62. I have a raft trip down the Grand Canyon booked for Sept. 8 as a means of disengaging from nearly 40 years of office work and sitting at a desk and computer all day. I'd like to retire sooner, but the way things are looking I'll probably be working up to the day before then. They haven't yet started interviewing for my (two) replacement(s), and there is likely a lot of training to be done once they get on board.

On the plus side, with the markets as they've been for the last several years I have more money than I expected to at retirement. The flip side is that with a falling stock market and high inflation, among other various world and domestic problems, it's not hard for me to imagine the current time as ending up being one of the "worst case scenarios" that you find in Firecalc so I'll probably be cautious in spending for the first couple years. (That would also be in keeping with my usual timing for major financial moves.)

I'm looking forward to experiencing and enjoying the great Beyond Work, and am very fortunate to be in a position to do that.
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Regarding real estate. My wife and I are both retired, as of 2020. House that we have been in for 26 years has been paid off for quite a long time now. For a variety of reasons, we're looking at properties today, closer to where I grew up. We've got enough liquid funds available that we can make a down payment without selling our current place, though we will have to finance it, unless we realize a bunch of cap gains or take too much in distributions for the year.

Lots to think about, but leaning towards carrying 2 properties for a few months while we wrap up a few things at the old place and get settled in a new place about 2 hours away, and then selling the old one. Since we're downsizing, we expect to net about 100k after all is said and done. Expecting to buy something for around $200k and selling ours for around $350k.

We will probably finance with a 5/1 ARM or similar and see how things go. So, we'll have some extra funds to invest after the sale, that may throw off enough income to pay the mortgage or a good portion, anyway. Eventually, we may end up with a winter place and a summer place, but that remains to be seen.

Hoping that one of the places we see today is suitable.
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I did my usual goggling for "problems with MYGA" and got nothing but pages and pages of ads and insurance barkers cheering for them. google is getting worse and worse about tossing up ads when you are just looking for information.

I got curious and tried the query at DuckDuckGo. (https://duckduckgo.com/?q=MYGA) The first two entries were ads.
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Expecting to buy something for around $200k and selling ours for around $350k.

Hints as to the part of the country? This is far, far below so many places.

One plus for keeping a place a long time - many locations have tax breaks if you are over a certain age and have owned for a certain period of time.

One data point - owning for a long period of time will usually involve significant maintenance. When selling new owners may have quite a few code upgrades to do if choosing to renovate.

For me, buying the cheapest house in an expensive neighborhood has added considerably to the value. But whatever the home, spending less than the income and grabbing every matching penny also did quite a bit.

There's really no one special sauce and luck is at least a tiny piece.
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A 30 year fixed rate mortgage is great for retirees. Keep your money out of the house, keep it in investments that grow with inflation while your monthly mortgage payment stays fixed no matter what inflation does.

Most retirees can't live with all their money in stocks.

Other than stocks, what do you suggest for investments that grow with inflation?
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"A 30 year fixed rate mortgage is great for retirees. Keep your money out of the house, keep it in investments that grow with inflation while your monthly mortgage payment stays fixed no matter what inflation does."

Most retirees can't live with all their money in stocks.

Other than stocks, what do you suggest for investments that grow with inflation?


What I meant was not 100% stocks but a typical diversified portfolio -- 60% stocks & 40% bonds. Or 80/20 or whatever.

Agreed, most people can't stomach 100% stocks.
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Did you do the math? The person said buying a house in your 30s and paid off in retirement. Since many people retire in their 60s, the math is 60s minus 30s or around the length of a 30 year fixed rate mortgage.

Well, if you buy the house at 30 and never move, then yes it is paid off by the time you retire at 60+. So the mortgage or not question is moot. But note that even the OP said that was his plan but he (unexpectedly?) sold his house before the 30 years.

Here's some figures for the 15 years from 2007 to 2022. Scale to your liking for your own personal situation.

- A $1000 mortgage payment in 2007 now only costs you $717 in 2022 dollars.

- A $1000 Social Security benefit in 2007 is $1350 in 2022.
If in 2007 you devoted your $1000 SS benefit to pay the $1000 mortgage, you now in 2022 have $350 left over.


- $10,000 in a 60/40 balanced portfolio in 2007 has grown to $33,517 in 2022.

- If in 2007 you had $100,000 in a 60/40 portfolio and withdrew $1000 per month for the mortgage, in 2022 that portfolio would still have $297,010.
(Yes, I know that mortgages were 6.34% in 2007 and the payment on a 30 year $100,000 loan at 6.34% is $622.)

The topic of this board is Retirement Investing, so discussions about having a mortgage or having the house paid off should certainly also consider the alternate (read: invested) location for your money other than have it buried in the house.

As long as there is inflation it is financially better to have a 30 year FRM and keep the money invested.
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Cheers to PSU! Living the dream!

DH and I did indeed buy a house decades ago that’s paid for. $600/year in taxes is all we need to keep it, another $1400 or so for insurance. 4 bedroom 3 bathroom on half an acre.

My son rents. His landlord recently sent out numbers on renewing his lease. His $1350 one bedroom apartment is going up to $1850 on a 12 month lease. $1750 on a 15 month lease. I told him no hecking way, give notice.

At most our costs might go up $200 a year.

I’m happy to have a paid off house.
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What I meant was not 100% stocks but a typical diversified portfolio -- 60% stocks & 40% bonds. Or 80/20 or whatever.

Right, so we've been over this before. Having a mortgage or not is an asset allocation decision.
It's not d*mb to not have one, or to have one. Depends on individual circumstances.
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Congratulations PSU!

Making that decision is a big deal, no matter where you are, or were at the time.. I bailed from LU in '02, had more work than we had talents, so the pressures were on to attempt to bring the newbies up to speed overnight, but without management support as they were thinning the herd, too.. An offer to add to my pension came along, unexpectedly, I didn't think there would be another, and if I didn't go I'd be living on the road out of a suitcase until the end game.. So I jumped at almost 62, working DW, a little tight, but we made it..

Best thing ever, although I miss the techs work, big projects, camaraderie of a lot of great fellow workers as well as customers.. But our guys, my supervisor, his boss, and his boss had been pushed out over really doing too well, making money by playing the game as it ha to be played to survive.. So it was time..

House we'd bought in '74 long since paid off, it all worked pretty well, a few glitches as we remodeled, I did a lot of it myself in the early days, now hiring contractors as needed.. We traveled, mixing RV trailering with overseas wanderings, Viking riverboat cruises, etc... Glad we did, age is sneaking up, faster and faster. so get out ASAP and ENJOY! Grandkids nee a bit more of your time, maybe more of a chance to get to know them better...

weco
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Grandkids nee a bit more of your time, maybe more of a chance to get to know them better...

No grandkids. I do have two granddoggies my daughters want me to entertain while they work.

PSU
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"DH and I did indeed buy a house decades ago that’s paid for. $600/year in taxes is all we need to keep it, another $1400 or so for insurance. 4 bedroom 3 bathroom on half an acre."
----------------------------------------------------------

that is astonishingly low tax/insurance obligations, sounds like you all chose well, wherever
you live !
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We live in Huntsville Alabama.

Now the thing about Alabama is that the state constitution says you can’t raise property taxes unless people vote for it. Guess how often that happens? My brother in Michigan pays over ten times what I do.

Yes I know the rep is that this is a state filled with trailer park dwelling toothless banjo players. There are parts that might resemble that but Huntsville is home to wall to wall engineers. NASA, Boeing, more government contractors than I could list. Huge military base. Space Camp. Very well educated population.

US News and World Report just listed it as the best place to live in America.

https://realestate.usnews.com/places/rankings/best-places-to...

Occasional tornadoes, hot in the summer, but cheap home prices, low taxes, low crime.

The politicians are blithering idiots. What can you do.
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$600/year in taxes is all we need to keep it, another $1400 or so for insurance. 4 bedroom 3 bathroom on half an acre.

Wow, that's great. My similar (sounding) 4 bed / 3 bath house costs me $8k/yr tax and recently leapt up to $12k/yr insurance. Fun stuff, being in a state dealing with an insurance crisis...
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SG: We live in Huntsville Alabama.

Now the thing about Alabama is that the state constitution says you can’t raise property taxes unless people vote for it. Guess how often that happens? My brother in Michigan pays over ten times what I do.

When I was in school at Redstone Arsenal oh so many years ago, we called it Huntspatch. But it was truly different from the rest of Alabama.

One of the students in my class was a young black guy. He was afraid to leave the Arsenal, but he needed to go into town for something - Drivers license? Something else? At any rate, sure enough he got rear ended by a white woman. He was astonished that she apologized and gave her insurance information without a fuss.

CNC
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Would be selling in greater Pittburgh, buying in Lake County, Ohio.
Looked at 5 places today. One had promise. The others flaws that made them impractical for us, though a couple of them were still nice, in a way.
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"We live in Huntsville Alabama"
--------------------------------

I drove down to the Florida Panhandle last September, went thru northern Alabama on I65,
thought it was beautiful. The topography reminded me of northern Michigan, although your
hills are bigger. Lots of water and green as can be. I was impressed with
the parts of Alabama that I went thru, everybody I came in contact with was pleasant.

I still like winter, so no desire to move south, but northern Alabama looks like a good
place to live.
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Would be selling in greater Pittburgh, buying in Lake County, Ohio.

The Countess was born in Ashtabula. Her family all has bad things to say about the winters there. Something about the Lake Effect making a lot of snow.
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The Countess was born in Ashtabula. Her family all has bad things to say about the winters there. Something about the Lake Effect making a lot of snow.

Yes, lea of the lake effect snow is a problem around the east side of the Great Lakes--western Michigan to South Bend, IN. But also along Lake Erie.

The big problem usually cited for Cleveland is lots of cloudy days that last all winter. No sunshine. That extends all the way to Buffalo.

Minneapolis is usually cited as the most sunshine in winter. Lots of clear days. (But I wonder if Arizona is included in the competition.)

A friend in Winnipeg says the clear cold nights are the coldest. Clouds tend to hold more heat close to the ground.
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low crime.

That rules Houston out.
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"The Countess was born in Ashtabula. Her family all has bad things to say about the winters there. Something about the Lake Effect making a lot of snow.

Yes, lea of the lake effect snow is a problem around the east side of the Great Lakes--western Michigan to South Bend, IN. But also along Lake Erie."
-----------------------------------------------------

I guess it's an acquired taste, but I love winter. Love living in the lake effect snow belt.
But the last 2 winters have been weak,snow wise. In January, I had to drive up to the Lake Superior snowbelt to get winter ( it did not disappoint, lol, it was raging ).

Hopefully it's not a permanent trend. I live near the 45th parallel, and
everybody up here says that there has been noticeable change in the winter temps and snowfall.
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"Would be selling in greater Pittburgh, buying in Lake County, Ohio.

The Countess was born in Ashtabula. Her family all has bad things to say about the winters there. Something about the Lake Effect making a lot of snow. "

*********************************************************

I think the town was "Geneva on the Lake". Seemed to be snowing there
90% of the winter.
Ashtabula was pretty bad as well.
Interstate 90 was the border line between heavy snow to the north
if the lake was frozen or heavy snow to the south if the lake was
not frozen.

Howie52
Or was that the other way around?

Regardless, one December it snowed every single day.
That caused me to buy a snowblower.
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I guess it's an acquired taste, but I love winter. Love living in the lake effect snow belt.

Get help. Joe.

CNC
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"Get help. Joe.

CNC"
----------------------------------

LoL.

I have the same thoughts toward living in sweltering southern climates.
I've been in Moab in June. Yeah, it's a dry heat, LoL.
I've been in sweltering, bug swarming Florida, LoL.

Pick your poison, I guess.
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No. of Recommendations: 8
Get help. Joe.

CNC"
----------------------------------

LoL.

I have the same thoughts toward living in sweltering southern climates.
I've been in Moab in June. Yeah, it's a dry heat, LoL.
I've been in sweltering, bug swarming Florida, LoL.

Pick your poison, I guess.


I'm with you. Loved the 9 years I spent in Syracuse & Upstate NY. Wouldn't want to do it now after the heart attack though. (Omaha is a suitable substitute) I've lived down South. And Utah, and Vegas, and Alaska! You can keep the 80 degree Thanksgivings. I do not understand the "Florida psychosis" most people have. Don't they understand how bad it is down there?
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Hopefully it's not a permanent trend. I live near the 45th parallel, and
everybody up here says that there has been noticeable change in the winter temps and snowfall.


Yep. I'd been X-C skiing up Traverse City way since the 1970s. Done VASA race a number of times. The snowfall has declined a lot over the years. So I run the ski trails in the off season instead. Lovely.

I still remember going into the Big Boy in TC some years ago and asking why the salad bar was closed. "Oh, nobody wants salad during the winter," the waitress answered. :-)
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"A 30 year fixed rate mortgage is great for retirees."

Almost exactly 10 yrs ago, we got a mortgage which was interest only (2.86%) for ten years, then P+I for the remaining twenty years, with a max rate of 4.86%. That's worked out VERY WELL for us in terms of putting money aside for retirement.

When we move to our next home, we might well look for a similar mortgage so that the net profit from the sale of our current home will grow in investments while we pay a (relatively) piddling amount of interest on the new mortgage.
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DW just entered “phased retirement” where (for several years) she will teach one semester a year for half annual pay, but full benefits. I’m already retired. Both of us will be 68 this year and we’re deferring SS until age 70. We both have Roth & traditional IRAs to draw on for luxuries, unexpected expenses, etc. Our sources of income:

DW teaching (DWT): DW phased retirement teaching income
BG pension (BGP): fixed amount (no COLA) w/ survivor benefit goes to a single-life annuity upon either of our deaths
DW pension (DWP): fixed amount (no COLA) for about 5 yrs payable to either/both of us (weird pension plan, to odd to get into details)
BGSS: My social security
DWSS: DW’s social security

So our yearly outlook in terms of income:

2022-4: DWT, BGP, DWP, BGSS (for 6 mo. in 2024)
2025: DWT, BGP, DWP, BGSS, DWSS
2026: BGP, BGSS, DWSS, IRA (as needed)
2027+: BGP, BGSS, DWSS, IRA (RMDs from our accounts)

We count ourselves as exceedingly fortunate given our very modest family backgrounds and the great good fortune of getting educated and parlaying that into a very solid middle class position. I suspect that as we age we’ll spend more and more on luxuries given that we have no children and no real desire to leave some major legacy. The one thing we have talked about is that, as a “thank you” to the country which brought us this prosperity, is to pay off our per capita portion of the national debt.

As an aside, I don't see any of our nieces, nephews, or their offspring doing nearly as well in terms of positioning themselves for retirement.
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"Yep. I'd been X-C skiing up Traverse City way since the 1970s. Done VASA race a number of times. The snowfall has declined a lot over the years. So I run the ski trails in the off season instead. Lovely."
--------------------------------------------

lol, somehow I knew that you were an xc skier !! There is no such thing as a "fountain of youth",
but xc skiing, trail running, and mt biking sure does enhance the quality of the years that we
have. There are some amazing skiers in their 50's,60's, and even 70's up here, and a lot more
from the downstate metro Detroit and GR area, I don't know them personally, but see them pretty much every winter weekend, whether in TC or Forbush Corners in the Grayling/Gaylord area.

We had a weak winter this last season, so I went up to Munising and Marquette to get some skiing
in. They actually had too much snow in Munising, the groomers couldn't get the trail packed down
enough for skate skiing. But I brought classic and classic-back country ski's and had a great
time up there. The skiing and snow at the Noque in Marquette was incredible. Less snow than Munising, so they were able to groom the trails to perfection for skating. Considering moving from TC to that area.

I do 3 or 4 races every winter, the Vasa being my main race. I get my butt kicked by a whole lot of people, but getting better every year. Didn't start racing till 2012, so just lately starting to feel like I know what I'm doing a little bit, lol. I trail run and bike on it all thru the no-snow months, was just out there this afternoon.
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wall to wall engineers. NASA, Boeing, more government contractors than I could list. Huge military base. Space Camp. Very well educated population.

See, that’s the thing. Probably only a small number of those people are natives and grew up with the educational system there, so Alabama is relying on others to educate people for them. That may be a decent strategy for Alabama but surely is not for the entire country.

I live in Knoxville. Taxes are low. But then so are government services (including education.) We have no municipal trash pickup. We pay for a private fire company to come out if the house catches on fire. We do not have sewers. There are places where the road falls off 20 feet and there is no guard rail. Roadways could stand to be 2’ wider. There is little to no zoning. Schools, for the most part, suck. And so on…

US News and World Report just listed it as the best place to live in America.

OK. But you probably couldn’t pay me enough to live in Alabama. Or Mississippi. I could barely tolerate Tennessee, but inertia kept us here after we moved for Mrs. Goofy’s job, and I can’t imagine moving again after 25 years and a houseful of crap.
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Almost exactly 10 yrs ago, we got a mortgage which was interest only (2.86%) for ten years, then P+I for the remaining twenty years, with a max rate of 4.86%.

So, for every $100k, your I/O payment at 2.86% is $238.33/month. Assuming that your interest rate will jump to the max of 4.86% when the payment changes (because interest rates are at least 2 points higher now), your amortized payment for every $100k will now be $652.25/month That means your payment will jump to 2.74 times what it originally was.

When we move to our next home, we might well look for a similar mortgage so that the net profit from the sale of our current home will grow in investments while we pay a (relatively) piddling amount of interest on the new mortgage.

Good luck, but I doubt you will find one. The rules on what mortgages Fannie and Freddie will buy have changed significantly in the last 10 years - specifically, 8 years ago (2014), the Dodd-Frank Act rules on qualified mortgages took effect. Lenders who can show that they adhered to the rules for qualified mortgages are protected from being sued over making the loan, and Fannie and Freddie are allowed to buy the loans. Loans that defer any interest and/or principal repayment (like interest-only loans) are non-standard, or non-qualified, loans. Non-qualified loans cannot be sold to Fannie or Freddie, so the lender must keep the loan in their portfolio, or find someone other than Fannie or Freddie to purchase it - probably at a significantly lower price than they could sell a qualified mortgage for. Because of the lower price that these loans can be sold for, lenders will generally charge higher rates when you can find them. Additionally, regulators tend to frown upon lenders keeping a significant number of non-standard loans in their portfolios, so if lenders make these loans at all, they generally reserve them for their premier customers.

AJ
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No. of Recommendations: 4
2026: BGP, BGSS, DWSS, IRA (as needed)
2027+: BGP, BGSS, DWSS, IRA (RMDs from our accounts)


I would point out that if you are both going to be 68 in 2022 (i.e. 'this year'), you will both turn 72 in 2026. That means that, under current law, unless you want to take 2 years worth of RMDs in 2027, you will need to start RMDs in 2026.

AJ
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I've been down the Colorado on a 7-day raft trip. Was worried it might get boring on the 40 foot motorized "aircraft carrier" raft we were on. Was completely, utterly wrong, and by the end of the 2nd day I was very glad for every foot of that big raft. When we got to Lava on day 6... wow.

Hope you enjoy it!
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Considering moving from TC to that area.

A good friend moved to Calumet a couple of years ago. Bought a lovely historic house there for something like $40K. Loves it. 6' of snow on the ground is perfectly normal.

I do 3 or 4 races every winter, the Vasa being my main race.

Terrific! Enjoy!
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I've been down the Colorado on a 7-day raft trip. Was worried it might get boring on the 40 foot motorized "aircraft carrier" raft we were on. Was completely, utterly wrong, and by the end of the 2nd day I was very glad for every foot of that big raft.

We did the lower level of the 14 day trip, hiking in as the first half hiked out and helicoptering out at the end. We chose the non-motorized rafts, with DH and I opting for the 4 person raft as often as possible. On one rapid we hit a wave that was much higher than our boat was long, and we just went up and up and up, with the oarsman screaming "PUNCH THE WAVE!" DH, BIL and I threw our bodies at the front of the boat in an attempt to force the nose through, as the oarsman rowed furiously to keep us straight. Finally we punched through rather than get flipped up into the air. Everyone on the larger boats was expecting to see us flip over, but we made it through. Best trip ever!

Kind of feels like the volatility in todays market, come to think of it.

IP,
suggesting you avoid the chili if they are still stupid enough to serve it, given the limited number of cans you use for toilets. What goes down to the river comes back up
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I could barely tolerate Tennessee...

But at least you've got Dollywood a stone's throw away.

;)

Pete
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AJ:

Yes, you're right with the amounts. We've taken advantage of the lower monthly payments to increase our savings over the past ten years. The idea was that when our ten years is up we'll do one of the following:
- take the new interest rate on the remaining balance;
- use some of our increased savings (and their investment returns) to pay down the balance, then have the loan recast;
- just pay the loan off entirely;
- refi elsewhere for a better rate.

As of *now*, it looks like we'll move in 2025-6 or so and we'll have to figure in that possibility as options are weighted.

I don't like putting a ton of cash into a home so we'll look for similar type financing for our next home. But depending on how market returns and interest rates go, we'll have more than enough cash from the sale of our current home to make a cash offer.

As for RMDs, we'll both reach 72 in 2026. Per the IRS, "If you reach age 70 ½ in 2020 or later you must take your first RMD by April 1 of the year after you reach 72." So we'll be starting our RMD in 2027.

https://www.irs.gov/retirement-plans/retirement-plans-faqs-r...
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Congratulations,PSU! You will totally enjoy retirement.
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I'm in the Phoenix area, but we notice it here, too.

It used to be we could count on a couple of weeks near freezing at night. Usually January. There would be frost warnings for "delicate plants", and freeze warnings for water pipe protection (though the that was rare, I knew someone whose pipes burst in his attic because they froze). Maybe one or two nights it could even dip below 25F. To us, that was parka weather.

No more. I don't think we have dipped below freezing in at least three years. At least I don't recall it. I haven't had to drag my parka out in the city for several years. A jacket has been enough. My parka now is only for travel to cold places (like Flagstaff).
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I did that trip, but on an oar raft. We had a boatman, but sometimes one of the guests would want to row. It was probably 1/3 the size of one of the big ones. I think we had maybe 8 people in ours. Wonderful trip. You really don't get bored. It's surprising how quickly the days pass, even though you're just floating down a river in the middle of a canyon. For me, I had my camera out, so that helped. Always looking for a shot. Plus there are the stops at side canyons.

I only pitched my tent once the entire trip, because it was drizzly. The other nights I slept out in the open.

Lava Falls was "wow". I think it is one of the top rated rapids in the country. Crystal Falls was only slightly tamer. :-)
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My first TMF screen name was "captain nemo". I picked up that nickname on the lower-half trip. It was an oar trip (no motors, except for the "supply barge" that motored on ahead to setup camp every day). Utter quiet except for the swishing sounds of the oars, the winds, and the river.

I spent my time at the front of the raft, so when rapids came I got really wet. I hung on and spent a lot of time submerged. Hence: captain nemo. I'm not sure most of the people knew my actual name by the end of that trip because they were all calling me "nemo".

1poorguy
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I don't like putting a ton of cash into a home so we'll look for similar type financing for our next home.

As I said, I doubt you will find financing that is similar to your current loan, but I wish you luck.

As for RMDs, we'll both reach 72 in 2026. Per the IRS, "If you reach age 70 ½ in 2020 or later you must take your first RMD by April 1 of the year after you reach 72." So we'll be starting our RMD in 2027.

You don't seem to have understood my comment, with bolding to emphasize my point: That means that, under current law, unless you want to take 2 years worth of RMDs in 2027, you will need to start RMDs in 2026.

Yes, you can defer your first RMD until April 1 of the year after you reach 72. But that doesn't absolve you of having to also take your second RMD by Dec 31 of the year you turn 73. That results in each of you having to take 2 RMDs - the one that was deferred from 2026, plus the one that you are required to take for 2027 - both in 2027. Look, that might work to help minimize taxes for some. But for most taxpayers, having to take 2 years of RMDs in a single year results in paying more in taxes.

AJ
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As for RMDs, we'll both reach 72 in 2026. Per the IRS, "If you reach age 70 ½ in 2020 or later you must take your first RMD by April 1 of the year after you reach 72." So we'll be starting our RMD in 2027.

BlueGrits, you need to read the article more carefully. Yes, you can delay taking your first RMD until 01 April of the following year but will still need to take your second RMD by 31 December.
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"Don't they understand how bad it is down there? "

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

A place is a place - you adapt and find things you enjoy about the area.
There is always something positive about a place if you choose to look.

Howie52
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A place is a place - you adapt and find things you enjoy about the area.
There is always something positive about a place if you choose to look.

Howie52


I know. I moved on average every 2.2 years for 20 years. After about 2 or 3 weeks in a new place, after you gotten an address, had the utilities turned on, and know where you'll be doing 90% of your recurring shopping, every place becomes the same. It's just a place. I was being a nudge vis a vis Florida for a specific audient.
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"After about 2 or 3 weeks in a new place, after you gotten an address, had the utilities turned on, and know where you'll be doing 90% of your recurring shopping, every place becomes the same. It's just a place. "

**************************************************************************

Find the libraries and book stores and "just a place" can be a paradise.

Howie52
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Congratulations,PSU! You will totally enjoy retirement.

I'm sure I will. Time has flown by. We met here on TMF when our kids were young. Now they're adults.

PSU
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Regarding MYGAs -
I'm not a buyer of insurance investments for obvious reasons (usually bad for the investor) and other than the MYGAs the only other product I've had was a term life insurance product years ago. I read up on them and did some reading at Bogleheads which tend to be quite detailed in their critiques of products. I didn't see any red flags.

Fairly similar to CDs but:
1. State insurance and not FDIC
2. Don't plan to withdraw money before term is up (no issue with me)
3. MYGAs - interest is tax deferred until the term is up or you can roll it all into another MYGA and continue delaying the tax.

It seemed to give me the most fixed income with minimal risk. Right now I believe T-bills have risen to 2.6% for 2 yrs (obviously under current inflation rates).

I think going forward I'm going to diversify further into commodities and selected stocks and maintain a ~15% holding in gold. I've yet to figure out if TIPs are worthwhile. Just don't seem like it to me but I'm sure someone will say they are better than gold (maybe).

I just listened to a link posted on another board with an interview with Dalio, Grantham talking. Rather pessimistic (Grantham has been for a while) but talking about diversifying and planning for more inflation and commodity shortages. Both areas of investments I'm underweight in.

BTW, good luck in retirement PSU.
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...every place becomes the same. It's just a place.

Beg to differ. Having lived there for more than 10 years now, Hawaii is definitely not "just a place"--at least not for me and many others. Nor, for that matter, are any number of non-US places in which to retire.
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Yes -- you're right about the RMDs having to be paid in the year we reach 72.
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There is always something positive about a place if you choose to look.

You’ve never been to Mississippi, I take it.
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Doesn't Mississippi have beautiful sandy beaches along the Gulf Shore?
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I have never been to MS. So can't comment specifically about much. But I'm a white guy married to an Asian lady. So I've pretty much written off the deep South, even if there are "good areas" (which I have no doubt there are). Not going to chance it.

I understand parts of PA, OR, and ID also are problematic. So not just the South.

I suspect the large number of Latinos in AZ increase acceptance. Whites are still the majority, but just barely. Just over 50% are white. Latinos are 36%.

I just wish it wasn't so bloody hot for about 6 months out of the year. Otherwise, we have great medical care here, decent infrastructure, good restaurants, a Costco business center, and an international airport. :-)
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I just wish it wasn't so bloody hot for about 6 months out of the year. Otherwise, we have great medical care here, decent infrastructure, good restaurants, a Costco business center, and an international airport. :-)

How is your water supply if Lake Meade goes dry?

Andy
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Georgia and Texas both have a higher % of residents of Asian descent than Arizona does. If your stereotypes were correct, I suspect people would be inclined to move elsewhere.
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They won't let Lake Mead go dry. I read something that they'll shut off the tap, so to speak, to prevent that. Because otherwise the hydroelectric generators would have to shut off.

We also have Lake Roosevelt, and wells. But I am expecting restrictions to be implemented at some point. I just read that NV -I think- has outlawed grass. We may have to follow suit.
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Perhaps Asians specifically, but both GA and TX are whiter than AZ. I just checked the stats. Whites are the largest minority, but they are not a majority as of 2020. About 57% here are non-white. I see miscegenous couples all the time here.

As I said, I'm sure there are great places in all those states. I just don't know where they are, and where the KKK are prevalent (and the tiki-torch marchers, and such). Yes, the KKK is everywhere. But their birthplace is in the deep South.

Plus I understand the humidity sucks.
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We also have Lake Roosevelt, and wells. But I am expecting restrictions to be implemented at some point. I just read that NV -I think- has outlawed grass. We may have to follow suit. - 1pg

---------------

Outlawing grass. LOL. That only kicks the can down the road. If they actually want to solve the problem, they would outlaw population growth. Cancelling grass will be offset by population growth in a month, a year, not sure when but it certainly will before too long. After that what do you cancel?

But population growth is somehow sacred to politicians. We must grow so that we have the tax revenue to build new infrastructure to accommodate all the growth we are experiencing. Circular logic.
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poorguy, you ever looked next door in New Mexico? Some very nice options there, depending on what you're looking for.
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The Count has suggested NM. It's not as hot, for sure. I've only ever been once (to visit the El Morro NP, and check out Ramah which I had heard good things about).

Certainly worth further consideration. We'd have to be nearing a major city for medical, though. In Ramah you're out in the boonies. Lovely, but the nearest hospital is on Native land, I believe. And they'll helicopter you from there to ABQ.
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Yeah...specifically "non-functional grass".

https://www.pbs.org/newshour/nation/drought-stricken-nevada-...

I guess that was primarily to exempt golf courses.

Oregon is one of the few places I know of that limits growth. At least the county where Portland is. But it is a moving cap, not an absolute cap. It moves every so often. Unless they changed it (I read about it several years ago...they issue building permits on one side of a line, but not the other...if no place is available on the one side, you can't build).

Nevada relies on the Colorado River. At least southern NV does. Due to climate change, the snowpack in the Rockies is less and less, so the meltwater that drains into the Colorado is less and less. UT, NV, CA, and AZ all have straws in that river.

Population growth combined with drought (which has been going on for at least 10 years in AZ) isn't a good situation.

1poorguy
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Hawaii is definitely not "just a place." At least it wasn't when I first went there about 10 years after statehood. After six years, I had to move to England, as special opportunities were opening to me there. I keep in touch with friends in Hawaii by email and they say that Oahu has about 10 times the population than it did in the old days. Lots more construction and congestion and traffic and crime and homelessness. The other islands might retain some of the original vibes though. It could well be
true: Maui no ka oi.

culcha
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Hawaii is definitely not "just a place." At least it wasn't when I first went there about 10 years after statehood. After six years, I had to move to England, as special opportunities were opening to me there. I keep in touch with friends in Hawaii by email and they say that Oahu has about 10 times the population than it did in the old days. Lots more construction and congestion and traffic and crime and homelessness. The other islands might retain some of the original vibes though. It could well be
true: Maui no ka oi.


Oahu is my least favorite Hawaiian island.

PSU
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However, I've traveled HI extensively. Oahu is very crowded. There are still wild places, but Honolulu is sprawled.

Kaua'i, Mau'i, and the Big Island are all developed, but they seem less city-like than Oahu. At least to me. My favorite is the Big Island, especially the Kona side.

People are still generally friendly, though there seems to be a push-back against tourism. Probably because tourists show up and think they have the right to trash everything.

I bet it was wonderful after statehood. Alas, before I was born. First time I went was early 2000s when I was nearly 40. At least for me, it was an attitude adjustment. There was something inherently calming about the place. I came back to the mainland, to my job, and was like "yeah, take it easy, I'm doin' it". Approached my job without letting it stress me out. I still find it calming to return.

I still wear aloha shirts a lot. I doubt I'll ever wear a tie again (not that I wore one often anyway).

1poorguy (just happens to be wearing aloha swim shorts at this moment)
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1poorguy: "Perhaps Asians specifically, but both GA and TX are whiter than AZ. I just checked the stats. Whites are the largest minority, but they are not a majority as of 2020. About 57% here are non-white."

What is your data source.

First one I found disagrees - https://worldpopulationreview.com/states/states-by-race

Regards, JAFO
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Good catch. I went back and realized I gave the birth stats. Not the current population stats. My bad.

Though births may foretell the future.
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Honolulu is sprawled.

Honolulu is densely populated, to be sure, but not so much sprawled. I can (and do!) walk from Waikiki to deserted mountain trails that run through the forest and past waterfalls. I routinely bike from "town" to some of the most awe-inspiring spots on earth. Most of the island is wilderness, and the windward side is stunningly beautiful. People visit Waikiki with maybe a quick trip into Chinatown and think they know Oahu.

Even Waikiki, where I live for half the year, has its charms. I hang out at places that people spend thousands of dollars to visit for a few days in their lives. Live music under the stars for the price of a beer, every night. I'm out in the ocean at least four days out of every week when I'm there. The view from my outrigger canoe of Waikiki with the mountains behind it and a rainbow overhead never gets old.
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Boulder City Nv has a cap on growth also.

http://bouldercitycommunityalliance.com/growth-ordinance/

But yes the whole Colorado system is in jeopardy. They really need to build a water pipe from the Mississippi to the Colorado river and this would alleviate floods on the Mississippi and put more water in the Colorado. This could be accomplished by building a catch basin lake and pumping the water out but only during flooding season.

Andy
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No. of Recommendations: 7
There is always something positive about a place if you choose to look.

You’ve never been to Mississippi, I take it.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

I've been to Mississippi numerous times, and I have found at least one thing that I really enjoy doing every time I go there. And that would be packing my bags and leaving.
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Outlawing grass. LOL. That only kicks the can down the road. If they actually want to solve the problem, they would outlaw population growth. Cancelling grass will be offset by population growth in a month, a year, not sure when but it certainly will before too long. After that what do you cancel?

Believe it or not, domestic indoor water in Las Vegas is treated and pumped back into Lake Meade. Domestic outdoor water is the single biggest consumer of water in Las Vegas, so it makes sense to target that first.
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No. of Recommendations: 6
I did part of this with some MYGAs to cover the first 4-5 years.

I would point out that an alternative to MYGAs that also covers a several year period by providing specific amounts in each year would be to buy target date corporate bond ETFs, like IBDN - 2022; IBDO - 2023; IBDP - 2024; etc. iShares also has target date ETFs for muni bonds, Treasuries, and high yield corporate bonds, so you can get most any flavor you want. All of the bonds in the ETF are set to mature in the target year, and when all of the bonds have matured, the principal is disbursed to the shareholders. As long as you don't pay above par, and you hold to maturity, you will basically get your principal back (minus any defaults, which are likely going to be mostly in the high yield ETF). In the mean time, you will get cash flow from the interest the bonds pay. Average YTM for the corporate funds varies from 2.14% for the 2022 fund to 4.51% for the 2031 fund, and the expense ratio is 0.10% a year.

If you need to sell before maturity, it's quite easy to sell these - just like any other ETF. Yes, if the rates have gone up, you will probably suffer some principal loss vs. holding to maturity. But if you had to sell MYGAs early, I suspect that the surrender fees would just as bad, if not worse.

AJ
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How have you been preparing to retire? How long has that process been? It sounds like you have not taken the leap yet.

I have been looking into it for a few years have had the idea that I should do it by mid-decade. In the past few years, my stock investments have done well and extremely well the past 2 years or so I thought. A big chunk of the gain from these past 2 years have evaporated. I had some thoughts in early 2021 of changing the composition of my portfolio moving to more income producing and 'stable' stocks from a portfolio that has been mostly growth oriented. Those went up fast but went down even faster over the past 6 months.
I did that but not to any large extent so I still have a portfolio biased towards high growth.
I am wondering how I would manage and react if I were retired in these past 2 years. I suffered a now 50% drop from the Nov 2021 highs, and I don't know how much more drop there will be.
How are you handling such a drop?
How are the retirees handle such a drop?

We don't want to miss the come back but that could happen this year? next year? the year after? and meanwhile it is still dropping.
I have bought a bit but I have very limited funds and I cannot keep on buying. The problem is I think there is a lot of money on the sideline but it is not moving in a this time.
Sure this should be a short time problem. But it could be quite long 1,2 or 3 years?

tj
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I had some thoughts in early 2021 of changing the composition of my portfolio moving to more income producing and 'stable' stocks...

Income is good in that it allows you to ignore down markets, assuming you have enough income to provide for your day to day expenses. However, depending on when you take SS and pensions, early retirement can be a golden time to realize capital gains. We are retired and recently sold a rental property that was taxed at a seriously low capital gains rate. A lack of ordinary income can be wonderful for realizing profits with low taxation. This website allows you to play with the ordinary/CG income to visualize how you get taxed on it. Not all dividends from stocks are taxed as CG.

https://engaging-data.com/tax-brackets/

There can be real tax freedom in avoiding income producing stocks.

IP
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I get what you are saying. I maybe should have realized some of my extreme capital gains in the fall of 2021.I was very reluctant to take capital gain due to the fact that I am still earning a salary and I don't really need that money, and a big chunk of my portfolio is in a taxable account. That is something I have to deal...wished that most of it were in a non-taxable or tax deferred account. I am quite limited by the amount I can put in these latter type of accounts. Any suggestion in that regard? I am already looking into to convert my IRA into Roth. Most moneys are actually in a 401K.
At any rate that capital gain has mostly evaporated. I may have been better off taking the capital gain tax hit or some of it. Thanks for that tool.

I pitched into income generating stocks a bit in early 2021 to prepare my portfolio for retirement and reduce its beta.
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Another Retirement thought. I noticed something while my wife was watching Dr Phil the other day. This guy and his wife were trying to decide if they should sell their house, buy an RV and travel. Dr Phil rolled out a long 30ft strip with numbers from 0 at one end and 90 at the other. He then asked the guy to go stand on his age (seems like he was 72+-). Dr Phil's comment was that the average death age for women is 86yo and men 83yo. Now look back, then ahead of you. What do you think you should do?

We have been doing lots of things and traveling on and off ourselves with usual annual tours since retirement. We are in good health, but it really hit me & I'm surely reviewing our bucket list and undoubtedly will be re-prioritizing.

Russ
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“This guy and his wife were trying to decide if they should sell their house, buy an RV and travel. Dr Phil rolled out a long 30ft strip with numbers from 0 at one end and 90 at the other. He then asked the guy to go stand on his age (seems like he was 72+-). Dr Phil's comment was that the average death age for women is 86yo and men 83yo. Now look back, then ahead of you. What do you think you should do?”

Keep the house, rent it out if need be, and travel. Go where an RV can’t go. If you want the “camping” experience rent a cabin.

That’s what I’m going to do.
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Retirement thoughts....

Ours are not about travel much at all. Wife and I have travelled the world for our jobs and vacations already. The thought of getting on a plane does NOTHING for me at all.

We do have a couple of places that we would like to go that we have never been, but getting on a plane right now, or in the near future is not something that we see as enjoyable. So, we'll probably wait a bit to hit those spots.

In the meantime, we LOVE our place and staycations are OK with us. We live south of Boston and can hit many beautiful tourist spots within 1-2 hours drive. Our home is very relaxed, homey, and we love being here.

DW and I want to chill, enjoy our less stressful life, and look forward to grandkids ;-)

Cheers,
'38Packard
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Ours are not about travel much at all. Wife and I have travelled the world for our jobs and vacations already. The thought of getting on a plane does NOTHING for me at all.

Happily, the nature of travel can change when you are no longer limited to vacations. Though I have never been a fan of getting on planes, I am looking forward to spending a few months here, a few there to become part of the culture for a brief period of time. I like exploring in depth.

One of our best vacations was a 10 minute drive from home. We were living in St. Croix at the time and not looking forward to getting on a plane with two little kids we got a vacation rental a short drive away. Had a pool and ocean view, with our favorite beach restaurant down the street. Sure beat our refinery view at home. It was a last minute rental and I was able to get it for about what our planes would have cost us to the mainland. Nice upgrade for family that flew in to visit us.

Staycations, or this hybrid version, are wonderful.

IP,
who has gotten stuck at the airport too many times to like flying
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Most folks who sell a house, buy an RV.......wind up doing full time travel for 18 months to a year, then winding up buying a 'home base'. It gets old to be on the road 12 months a year. Either that, or they spend six months south, six months north in the same places to meet and socialize with people each year.

- ----

I bought my house while working here in TX. My mom was alive and lived with me for six months a year - and insisted on 'one story house'. Good for her - she was in her 70s and had bad arthritis and hated steps....especially after my 3 story townhouse in Arlington VA....up/down/up down all the time. Still have it 32 years later.

My taxes are frozen at the age 65 level. Now I'm going on age 76.
tax $4000/yr. Insurance $1700/yr. No state income tax in TX.

Didn't have much of a mortgage when I moved here in 1990 so it was quickly paid off.

Dallas is decent area - and I haven't found any place I'd rather be YEAR ROUND. Oh, I like being up north in summer to escape the 100 deg days here. Winters are mild.....if you snooze too late you'll miss the inch of snow.....six weeks of winter....4 months of summer.

Was good place to hop a plane anywhere in the world. Now, seen enough and no plans to be traveling by air any time soon. Good doctors, hospitals...which become more important as you get older.

Now being single I managed to stash a bunch of cash.....diversified a bit..... about 70% stocks overall now. Half of holdings in index funds.

First 20 years of retirement lots of travel - Europe, Asia, central America...Caribbean. All over the US by car......everywhere.....every county. Now slowing down.

Someday maybe I'll move into a retirement community ...... but that is 'far off' I hope.

Get my grass cut. The cleaning lady comes every two weeks. Pool service takes care of the pool. Life is good.


t.
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The DFW news every morning is weather and the latest killing.

Sounds like the Houston Chronicle. Drive by shootings, road rage, drunks driving the wrong way, etc. Amazing what happens between 10 pm and 3 am. Good time to be home sleeping.
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Collin County - 'school taxes' frozen at age 65 - and that is 90% of the tax bill.

Denton County school taxes are not frozen. Also they are not 90% of the tax bill; closer to 60%.

RE tax laws in Texas are written very vague to give the counties the leeway to do what they want (per Tx Controller office).

When I lived in Round Rock - Williamson County, 65 exemption went with the house. When I moved up here (Prosper) part Collin part Denton county, 65 exemption went with the person, not the house. Since I bought that house with my daughter, only half of the house got the 65 exemption. I am now in Little Elm - Denton and sole owner, but as I mentioned, over 65 not frozen.

(not so) funny story about the Prosper house. We got 4 tax bills, (1) Collin with 65 exemption, (2) Collin no 65 exemption, (3) Denton with 65 exemption, (4) Denton no 65 exemption. Since they continued to make mistakes with this and the house valuation, they were issued 3 separate times, thus getting a total of 12 tax bills before paying!!!!!!
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This is so OT that I'm not going to comment about the politics. This is "retirement investing". However, who knows how many lurkers we have here. Or what their political persuasion may or may not be. And it really doesn't matter, so long as we focus on the subject of this board.

JMHO.
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This is so OT that I'm not going to comment about the politics. This is "retirement investing". However, who knows how many lurkers we have here. Or what their political persuasion may or may not be. And it really doesn't matter, so long as we focus on the subject of this board.

JMHO. - 1pg


---------------

Exactly, I agree with you.

That is why I called out Alphawolfs post, not so much for his words which I had seen earlier, but I was surprised by the 19 recs it had received when I checked in on the board again. Many here apparently like what he posted on this ostensibly investing board.

It had twenty recs by the time it was pulled down. BTW, I didn't FA, I don't FA anything)
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That is why I called out Alphawolfs post, not so much for his words which I had seen earlier, but I was surprised by the 19 recs it had received when I checked in on the board again. Many here apparently like what he posted on this ostensibly investing board.

Didn’t see your call out, Mike. Otherwise I would have responded (nicely, of course).

My post was in response to another poster’s political dig. It appears both our posts were pulled. Fair enough.

If it wasn’t for me, think of all the MF censors who wouldn’t have a job, and therefore, no retirement savings.

How’s that for bringing it back home? :)

AW
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Rich, I'm a little late to the discussion, so at the risk of being somewhat redundant, as other people have mentioned aspects of this:

Your allocation of investments between stocks, bonds, and other things is indeed something to consider. And I won't get into whether a 60-40% stocks vs bonds, or whatever, is the optimal ratio. I aim for 70% stocks, myself but that's just me. And which accounts hold which assets can make a difference tax-wise, whether in IRA, 401(k) and other pre-tax retirement accounts, or in taxable investment accounts, or Roths, can make a difference too.

However your target allocation breaks down, don't wait until the year you retire to get there, and have to diversify and reallocate and sell things you have to sell when the market is bad. Especially if you've got a retirement plan full of your employer company's stock. That's something to plan around and diversify to a reasonable level. If bad events happen to your company, that's a double threat to your job and your investment portfolio.

I specifically worked and made adjustments to make my portfolio look the way I wanted it to look in retirement, 2-5 years ahead of time, doing it gradually. Prior to that time I was more heavily invested in stocks.

This also allows you to have a realistic view of how much current income your portfolio will produce, and how that will affect your retirement budget. Also keep in mind that current income from dividends and interest let you sit through market dips and dives without having to sell when you don't want to.

In any case, good luck. I retired at 62, took Social Security at that time, and have made other decisions that smart people here disagree with, with very few regrets. It has worked out well. Bull markets have a way of paving over imperfections in the path you take.

Bill
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