Home > Early retirement fantasies?

Early retirement fantasies?

March 15th, 2016 at 02:23 pm

For as long as I've been blogging here (since 2008), I've talked a lot about early retirement. I reckon I was plotting my early retirement when I was 6 years old.

While I've been fortunate to have many writing jobs that I found interesting and stimulating, many things lose their luster after you've been doing it for 34 years. Especially when you cannot follow the beat of your own drummer but must do things according to the very specific instruction of the company issuing your paychecks.

It's not so much the writing I'm talking about as I am the general hierarchical structure of the workplace, inflexible work hours, the personality conflicts, the efforts one must make to be a "team player," get along or get out.

A sidenote on onerous policies: Last year my employer announced a new policy requiring employees to give 30 days notice if they decide to leave the job. Mind you, if you are terminated, you're out that day, but they now want 4 weeks notice, not 2. Hey, if I found a new job, I doubt most prospective new employers would be crazy about waiting 4 weeks for me to show up.

In any case, I called my state's Dept. of Labor today to find out if this policy is enforceable, as they say in writing you are "required...."

As I suspected, it is NOT enforceable, but as far as whether they could get away with withholding severance, for example, if I failed to give the required 4 weeks notice, the DOL spokesperson said they'd have to look into that after I filed a complaint. Perhaps worth testing just to push back against infringement on employee rights, something I feel very strongly about.

Getting back to my topic.....After my mother passed this past December, I've been struck by a growing certainty that there are more important things to do than helping the bank sell more student loans or money market accounts. Along with that feeling is the sense that my time here on earth is fleeting.

I am wanting to make changes. (They tell us in bereavement support group not to make any major life changes within 6 months of your loved one's passing.)

Now while I failed to meet the 1st year of my Retirement Countdown savings goals through my own efforts (see profile, bottom left), I was able to exceed my 1st year goal in the end after receiving about half of an unexpected inheritance from my mother. The other half is still in probate.

Mom was always most concerned with my happiness in the job, not the paycheck, so it almost feels like this was my mother's final, departing gift to me, the chance for true freedom. (Even when she had progressively worsening dementia, I remember her words to me at the nursing home: "But are you happy?")

If you read my profile at left, you see I've mapped out a path toward early retirement (at age 60) in just 3.5 more years.

However, I often conveniently overlook one obstacle that has always been something of an unknown, otherwise known as healthcare expenses.

Specifically, my MS drug. I think when I started taking it in 2000, its retail cost was about $1200 a month. Bad enough, right? Now the drug company, Teva Neuroscience, has jacked up its prices to make up for everything it spent on R&D, and it recently lost its right to exclusively market it. There's a generic equivalent on the market now, but only for the daily injections. I moved to the 3 times a week injections about a year ago and I REALLY would not want to return to daily injections. Can you blame me?

When it comes to healthcare, there are so many unknowns. If, worst case scenario, there is no Obamacare in 3.5 years when I want to retire, who knows how I will purchase health insurance for 5 years until I'm eligible for Medicare? It could be a very expensive, if impossible, proposition for someone who needs a very expensive medication.

Assuming Obamacare still exists, in some form, I have found the Obamacare plans are still more expensive than what I'm paying now with a private plan offered by my employer. It will probably always be like that.

It occurred to me that perhaps the new generic version of the drug might offer more affordable options for me when I'm ready to retire. I called them this morning to find out if they have plans to develop the 3x a week formulation, and she didn't know. I asked about a price comparison, and she didn't know that either, as it varies depending on the plan.

So while my returns to date from my 401k are something like -4%, due to lousy stock market performance, I am at least now on track to meet my goal of over $1 million by age 60. Whether $1 million is actually enough to live on for 30 years or so, I don't know. I don't want to have to scrimp and go without as a senior, because I've often had to do that as a much younger person! I am hoping that with the addition of Social Security benefits (another big unknown, right?) that will see me through.

Like many new retirees, I think my expenses will be higher in the first 10 years if I indulge a strong desire to travel, while I still can. I could see expenses moderating a lot as I got into my 70s, but they could ramp up again in my 80s, if not sooner, due to healthcare costs should I develop medical issues.

If I, someone closing in on their $1 million in savings goal, am having doubts and worries about their financial future, what must so many others feel who have considerably less in savings? I hate to turn this into a political statement, but all this uncertainty about how I will pay for future healthcare costs with a chronic health condition puts me decisively in the Hillary/Bernie camp. I would vote for either one although I lean more strongly toward Bernie, as he is less establishment.

9 Responses to “Early retirement fantasies?”

  1. CB in the City Says:

    I could not have retired without Medicare. When I was without employment in 2006, my health insurance costs forced me back into the workplace, even though I was in a situation where my housing and even food costs were covered. (Long story, it's all in my blog.) You are in a much better financial situation, but you will have to consider whether it is worth it to you for a disproportionate amount of your income/assets to go to health insurance. Especially with a pre-condition such as MS.

  2. creditcardfree Says:

    Part of the reason you have the large goal for retirement is so you can cover medical expenses right?

    As more conservative leaning, I still see the value in some government oversight into medical costs. The costs are outlandish!! However, as a military healthcare recipient, I don't like the lack of choice that I'm provided either. So many doctor's won't take our insurance because they can't cover their costs. So less choice. It seems the doctor's with the least experience are the ones willing to work for the government. The bureaucracy of government is the reason it is hard to make any changes with any degree of efficiency.

    I'm not one of those asking for repeal of Obamacare. I think they way in which it was passed was terrible. There is need for changes. I also think it will still exist. I don't think politically it would be a good move for Republicans to actual repeal it in full. The best part is that everyone now has access to healthcare without going to the emergency room to get it, or needing to stay with an employer. So while the cost may be higher for you without an employer, is that increase in cost worth the time you might have to enjoy an earlier retirement.

    And know, that I'm not trying to change your opinion...just stating how I see it.

  3. PatientSaver Says:

    Creditcardfree, the $1 million goal is what I thought I needed to retire comfortably,but I had always read that due to high cost of healthcare, you should tack on another $250K, so my real goal should be $1.25 million. However, I don't think I'm willing to work that long!

    The Republican establishment is fully intent on completely dismantling Obamacare. They SAY they would replace it with something else, but I have heard of no concrete plans. There are now nearly 13 million Americans enrolled in Obamacare. Seems stupid to completely undo it and recreate something else but they seem to be motivated by revenge.

  4. Joan.of.the.Arch Says:

    We found that there was an Obamacare plan that was pretty close to our private plan (through DH's retired from job) and would have saved us a little bit. However, I was too afraid that the ACA plans would be shut down and that we would not be allowed back onto the private plan, leaving us no options. As much as we pay monthly, I'd be willing to pay even more to a universal plan that covered every single citizen. I'd rather see all our $1600/month applied to actual healthcare instead of awarded to salaries and shareholders in the vampiric insurance industry.

  5. ceejay74 Says:

    Your support group is probably right that you shouldn't do anything rash while you're grieving; plus, I can see your point about Obamacare. That Kentucky governor who ran on getting rid of Obamacare is now working on doing just that, with no replacement or alternative. I'd wait until after the election, although I find it hard to believe that we won't have a Democratic president. I'm like you; I'm all about Bernie, but if I have to I'll place a firm, proud vote for Hillary as a vote against hatred and lack of any qualifications (Donald Drumpf) or hatred and chaotic quasi-libertarianism (Cruz).

    As for your severance musings, I've never heard of places being required to give severance if you quit a job. I've only ever gotten it for being laid off. If your company is offering severance for people who quit, it's probably to incentivize following their policy of 4 weeks' notice.

  6. Carol Says:

    I think you are coming to a time in your life when you are getting ready to set new goals for yourself--at least , that's what it sounds like. That's a good thing.
    However, I want to echo the bereavement group not to be too hasty. We made a big financial commitment a year after my mother's death and even then it was too soon,in some ways. I just know it was longer than one year before I felt like my old self in my thinking.
    Wishing you the best!

  7. PatientSaver Says:

    Ceejay, you're right, i don't think severance is an option if you quit to take another job, only if you're laid off. So the whole severance question I raised is an entire non-issue. I had just been thinking of what possible ways could the company retaliate if you chose not to give them 4 weeks notice. I know they couldn't get away with not giving you your final paycheck, or compensation for any unused vacation days.

  8. snafu Says:

    Would the 4 weeks notice rule possibly affect 'vesting' and earned holiday time not yet taken, by those who haven't carefully examined requirements? With retirement as your goal, I doubt the new rule would cause you problems. I understand it from the employer's point of view. They have treated staff so abysmally, for so long, with only the executive team garnering much in the way of benefits, the working staff who get the the job done, no longer gets enough money or praise to consider words like loyalty or job satisfaction.

    Everyone who understands the changes and the need for flexibility in employment will jump ship, taking their precious skills for modest benefit. According to the research, it takes an employer a year to have a new employee fully engaged and 'competent.' It's very costly to lose skilled workers but retention breakeven dates vary significantly.

    If you want to travel for significant periods of time during the 1st ten years, I suggest you carefully consider how the house, yard and insurance requirements would be managed in your absence. Would it be practical to sell the house ? Would you prefer a condo or apartment, free to lock the door and leave a key with a pleasant neighbour who drives you to the airport? Since travel as a single costs more and it's fun to plan itineraries and adventures with someone like-mined, would you consider joining a group whose interest is focused on travel? I ask because it's such fun to talk over all the new to you, sights, sounds and stuff. It also helps when things go off track.

    I don't see earlier retirement as a fantasy. If you were to leave the bank after your mom's estate settles, would you consider seeking freelance jobs such as planned travel or financial planning for seniors? Seniors are becoming a significant factor in the economy and the 'flower babies 'of the 60's - 70's don't seem to understand the rules. Would the bank like to capture this growing segment for trusts accounts and products of interest to the mature group?

    The current President repeatedly demonstrates he must have approval by Congress and Senate for most decisions or they go awry.

    [The rest of the world is horrified by racial remarks, contract uncertainties, treaty value and outstanding American debt should DJT and his lack of knowledge and probity be the choice of the majority of Americans]

  9. FrugalTexan75 Says:

    That's pretty bizarre asking for a 4 week notice. The 2 week notice is just mainly a courtesy thing ... useful mainly if you are planning on seeking further employment and want a positive reference later on.

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