I am a Victorian Soul, live in a small townhouse that was built in the mid 1970's, not a huge Mega Mansion, with my Hubby Joe, who is a Retired Letter Carrier. I worked night shift as an RN on a Hospital based Rehabilitation( Physical Medicine) Unit for 37 years before I had Knee Replacement Surgery and officially Retired in 2019 after 41 years working in Direct Patient Care ... I am LOVING Retirement!!!!


George Eliot
George Eliot was actually a pen name for a woman named Mary Anne Evans......


Friday, September 9, 2016

Having a Plan: Planning for Early Retirement

Welcome to the 3rd Installment in my Series, Planning for Early Retirement!!

In the 1st Installment, I shared, What We Learned About Social Security.....
 Click HERE if you missed that post....

In the 2nd installment, I did a bit of research into What Every Woman Should Know About Social Security, which was prompted by some of the comments on the first post.
 Click HERE if you missed that post......

I want to THANK everyone for the amazing amount of interest in this Series and for those who are sharing what they learned about Retirement when commenting!!

I am also learning from all of you!!

Thanks so much for all your input and encouragement to move on with this Series!!
In this post, I am going to touch on Having a Plan for Retirement, whether you are hoping to retire early or not!!
 I always worked full time because for most of our married life, Joe worked in factories or in retail and we lived through Lay Offs, closings and shut downs.

I felt we needed a stable income which my profession as an RN provided us, along with great benefits and an excellent pay.

So I thought that it would be pretty stupid for me not to work full time.

About 30 years ago, the Health Care System that I still work for made enrollment into a 401K plan available to it's employees.
I immediately started to contribute to it because I knew at that time, when it came to retirement, Joe would only receive Social Security and since I do NOT get a pension, I would only get Social Security and what I invested in this 401K plan.

That was my first plan, when we were very young......take advantage of the availability of a 401K plan to add to our Social Security!
At the time, our sons were young so I tried to contribute into it whatever I could afford to at the time.

18 years ago, by the Grace of God, Joe landed a job as a Letter Carrier for the United States Post Office at the age of 43.

This meant that he would now retire with a pension and a 401K plan plus his social security.
He then started to contribute as much as we could afford at the time to his 401K plan.

Because of my health issues, about 4 years ago, I started thinking about Early Retirement for me.

One of my Co Workers had been working with a Financial Planner for several years.

I was surprised to find out that the Financial Planner she was dealing with was provided through our Credit Union ( Service First) and not through Fidelity Investments ( the company through which Our 401K is offered).
I was even more surprised to find out that this service was FREE!!!!!

My advice to you is find a Credit Union that provides Financial Planning Services for FREE and join that Credit Union!!!
It is well worth it!!!

But before we even started working with a financial planner, Joe and I decided that we needed to pay off all of our debt.

We did this by refinancing our house at a very low interest rate which was being offered by our Credit Union at that time.

We paid off all of our Debt, including high interest Credit Cards and took out a new Mortgage for 5 years.
We set up the payments so we were paying Bi-weekly instead of monthly and we were paying an extra amount each payment so this decreased the amount of time that the mortgage would be paid off to a little over 4 years.

Our original plan for doing this was that Joe would work until he had 20 years with the Post Office and by then the mortgage would be paid off along with all of our debt.

We had to change our plan when Joe was diagnosed with moderate to severe osteoporesis and suffered 2 Compression Fractures in his back.

We realized that it would be best for Joe to retire early at 62 years of age before he sustained serious damage to his back from carrying the satchel full of mail and delivering heavy packages.

We started meeting with the Financial Planner about 2 years ago and he agreed wholeheartedly that paying off debt is the first and most important thing one can do planning for retirement.
The less bills you have, the more money you have!!

For our first meeting, we wanted to know if it was even feasible that we could retire early so we needed to have a list of certain things ready for this initial meeting.

This is what we needed to know:

What each of our Social Security payments would be if we worked until 62 years old

What Joe's monthly Pension payment would be upon retirement

What our normal monthly bills would be at retirement age

What would we have to pay for Health Care

Did we have Life Insurance

What was in our 401 K plans

So we prepared all this information and presented it to the financial planner who then determined that YES, we would be able to retire early!

The amount in my 401K plan and Joe's pension was our saving grace!

Also at this meeting, with our permission, the financial planner looked at our 401k  investments, talked with us about how much we wanted to take a bit of a risk with and then he reallocated our investment funds in the plans.
We have done well with his expertise!

I looked into several articles about financial planning for Retirement and I found some interesting ones that I think you may be interested in.......

 I especially liked this one from US News and World Report

"10 ways to Get Ready For Retirement After 50"

1. Grow Your Savings

This suggests that the decade prior to your retirement is your last chance to try to build a significant nest egg.

2. Become a Super Saver

"An Empty Nest gives you the opportunity to build up your nest egg"

3. Eliminate Your Mortgage

Paying this off will eliminate one of your biggest bills
4. Pay Off Debt

Pay off credit cards, car payments, any type of loans and hopefully, your mortgage

5. Downsize Your Life

Now would be the time to downsize to a smaller residence . Also start living smaller and not spending as much money on things that you do not really need

6. Maximize Your Tax Breaks

Take advantage of as many tax breaks as possible like deductions for health care and for retirement savings

7. Catch Up Contributions

Once you reach 50 years old, the amount of contributions to your 401K and IRA jump up allowing you to contribute more to them

8. Avoid Gaps in Health Care

Look for ways to maintain your health care until your reach 65 years old and qualify for Medicare

9. Make a Social Security Plan

Make a plan on when you will start to take your benefits and how to maximize them over your life time

10. Insulate your Career

Job loss in your 50's can be devastating. Try to keep up on all current issues and technology in your field

I think these 10 steps pretty much outlines what you need to do before you retire...

Click HERE to read this article
 Here are several other articles:

"8 Things you need to do before you Retire"
Click HERE
"Top 10 Ways to Prepare for Retirement"
Click HERE

"The Biggest Mistakes Couples Make Preparing for Retirement"
Click HERE
In our case, once our sons moved out, this gave us the opportunity to invest more in our 401 K plans.

Here is the most valuable piece of advice that we got from our financial planner in regards to our 401 K plans.

Take advantage of the "Free Money"!

What does this mean????

Most employers will match their employee's contributions up to a certain percentage of that employee's pay.

Usually, most employers will match up to 5 % which means that if you contribute up to 5%, your employer will match your contributions up to 5%, Dollar for Dollar, putting all that money into your 401K!!

That 5% that comes from your employer is considered "Free Money"!!

That money is a benefit that you would not receive unless you invest up to 5% in your 401K and most articles on Retirement encourage you to invest at least that 5% to get the most out of your employer. 

In our case, we contributed what we could afford until we gradually got up to that 5% and were getting our "Free Money" out of our employers.

Since I will be working for at least 3 years more than Joe, I am slowly increasing my percentage of what I contribute with each raise I get .

You can contribute up to a max of usually $18,000 a year or in most work places up to 15 % of your pay.
Now there are many other investment  options such as a 403, IRA's, etc.

We went with the 401K plan offered by our employers so we could take advantage of that "Free Money"

The one most important thing that I want you to take away from this post is that it is NEVER too early or too late to start planning for Retirement whether it be Early Retirement or not!!

Well, that is it for this post.....

In my next post in this Series, I will touch more on what you need to do before you retire.....

Like Life Insurance, Health Care and what you can do with your 401K after you retire.....

So I hope you will be back to visit soon!!

And thanks to those who took the time out of their busy day to spend a little bit of time with me!!

If you do not have a blog, PLEASE  give me some way to reply to your comment, maybe by including your email in your comment.  If I can not find a way to reach you, I will reply on the post where you commented so please check back......

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  1. One more question for the list: How long will you be living in retirement? I realize it's speculation, but if nobody in your family history lives to 80, the situation is different than if most of your family lives to late 90s. There is a 15-20 year difference in how long the money needs to last.
    Also, I think legally you can add up to 75% of your income to a 401k - not to exceed $18,000 per year. It might be that certain states or employers add a cap (???) Thank you for the resources and all the info. I have been researching this pretty heavily myself so was thrilled to see this post:)

    1. Hello!!
      I am also going to post this reply on my post.
      My Dad died suddenly of a heart attack at 67 years old. My Mom was collecting Social Security but still worked part time, every morning for 4-5 hours. It was the biggest regret of her life because he last day she worked was the day my Dad died, found by my sister and I , That day I had to go to the place of my Mother's employment to tell her that the love of her life was gone. She never returned to work and was never the same. Her biggest regret was not retiring when my Dad did because they never got to spend any of that time together. She felt robbed of that and always told me to take advantage of retirement as soon as I can because no one knows what the future holds.
      I am a cancer survivor with numerous other health issues and I pray that I make it working to 62 years old. Most of my Dad's family died before they hit 70. My Mom's mother died at 62 years of age of Lupus and Rheumatoid Arthritis and my Mom died at 84 years of age. So I feel that my chances of living a long life are slim and I will take those chances.
      My husband plans on working part time once he retires so he keeps busy. He is fairy healthy but he has a bad back , hence the reason for retiring from the Post Office and delivering heavy mail and packages. He ha already had 2 compression fractures.I work in Rehab as a nurse , taking care of patient's with either permanent or temporary disabilities so I lift people for a living. That is a source of back problems and arthritis and Lupus runs in my family with my sister and niece being diagnosed with it. I am tested yearly.
      If we had desk jobs where we did not do strenuous work for a living that has taken quite a physical toll on our bodies, we would consider working longer but that is not the case.
      I believe that each person has to make the decision when to retire based on their own circumstances and I want to get the most out of all the money we paid into Social Security and other investments before we leave this world.
      Thanks so much for your input and for taking the time to comment!

  2. I think it's wonderful when one can retire early. {50-60} Hubby has to work two more years. Meanwhile, we are planning now to downsize. He is very healthy which is good because I have many health issues. I appreciate all the time and effort you put into this post for your blogger friends. You really shared a lot of helpful information, so thank you!


  3. Thank you for this informative post, Debbie! Alas, I still have a couple of decades to go before I retire. A few years ago, I attended a retirement info session and was the youngest person there. It's never too early to start planning for retirement, right?

  4. I am thoroughly enjoying this series. I am pinning it so that I can go back and read all of the linked articles. There is so much good information packed into this post!
    I might add that all financial planners are not the same. Ask around among your friends and find out who a good one is. We switched financial planners this year and have seen a tremendous difference in our return! Our new financial planner said that we should have fired the old one 20 years ago. I sure wish that we had. We would have a whole lot more money in our retirement account now!

  5. We have about 10 years to go before my hubby retires and so this is great info, tfs!

  6. Hi Debbie! I've really been enjoying your series and the comments too! Pinned them all to share too. Thank you for sharing your knowledge with us at Brag About It!

  7. Hi Debbie, I haven't worked for years, but hubby will be retiring (we think) next year. He has been doing lots of research. I'll have to show him this post. Thanks for sharing it with SYC.

  8. Hi Debbie, thanks for sharing this really useful info on retiring at our Cooking and Crafting with J & J.
    Enjoy the week. :)
    Julie xo

  9. YAY...another post for us to read! I personally am so thankful for these posts. Saving them all. Thanks so much Debbie for the time you have put into this. Hugs and blessings, Cindy

  10. This is such a great post!

    I would love for you to share this with my Facebook Group for recipes, crafts, tips, and tricks: https://www.facebook.com/groups/pluckyrecipescraftstips/

    Thanks for joining Cooking and Crafting with J & J!

  11. Great tips Debbie. People who a re retiring will find these very helpful. Congrats...Thanks for sharing at DI&DI.

  12. Thank you for sharing the things you've learned and your retirement plan. Unfortunately many of us did not start saving nearly early enough. In fact I heard on TV this morning that only 1 in 10 are saving enough for retirement. When you're young you always think you have more time, but I encourage everyone to start their retirement savings as soon as they enter the work force.

  13. Wow, Debbie I am impressed with your research! Thank you for sharing @Vintage Charm!

  14. Great tips! Planning is so important! :) Thank you for sharing with us at the #HomeMattersParty

  15. Debbie - I am so much enjoying this series as I am looking forward to retirement my self!! Thanks for sharing on My 2 Favorite Things on Thursday! Pinned!

  16. Debbie, I just love this series! You are so practical and so kind, and you're giving advice that REAL PEOPLE can follow. I'm proud of you for being so proactive, and now many others can benefit from your wisdom.

    Thank you so much for sharing this post at the Grace at Home party. I'm featuring you this week!

  17. I'd also add to decide on an estate planning strategy, whether that's creating a will or a trust. But great advice!

  18. Wow, this post on planning for early retirement is exactly what I had been looking for. Keep sharing such details here. I am just 25 but I think that it is right time to start planning for the retirement. But can’t make the plan on my own so will definitely consult an expert certified financial planner.


I always love to read your comments and opinions!!
I will try to respond to your comment as quickly as I can either on your Blog, through an email address or here on the posts where you commented if I cannot find any other way to contact you!!
If you are a vendor and insist upon leaving a comment with a link back to a website, it will be deleted immediately as I check my comment several times a day!!

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