How much income do you need to retire?

[leedavis]

I've been retired for a couple of years and figured out what my income, taxes and such would be before I took the plunge. When my net retirement income equaled my net working income I left. There are many internet resources available for calculating that stuff though it gets complicated. If you don't feel like doing that talk to a professional. Don't guess.

 

[08FJR4ME]

I go through this life putting my trust in someone elses hands. I came into the world with nothing and most likely will leave it with nothing. If genetics has anything to do with it I won't have many years of retirement anyway.

Enjoy the ride today and don't worry about tomorrow.

JMT,

 

[Fred W]

OK, for many of us the big risk in early retirement is in covering the healthcare between retirement and age 65 when the Medicare becomes available.

How many Veterans are using their VA Health and Dental Benefits to fill that gap? Working in a healthcare related industry, I am aware that the VA facilities are not always the nicest in town.

edit - It appears the VA requires you to have some other insurance? (More research required)

I did serve for 6 years of active duty back in the late 70's so, from what I can tell, I am eligible.

 

[Auburn]

OK, for many of us the big risk in early retirement is in covering the healthcare between retirement and age 65 when the Medicare becomes available.
How many Veterans are using their VA Health and Dental Benefits to fill that gap? Working in a healthcare related industry, I am aware that the VA facilities are not always the nicest in town.

edit - It appears the VA requires you to have some other insurance? (More research required)

I did serve for 6 years of active duty back in the late 70's so, from what I can tell, I am eligible.

I think income level and assets come into play for VA benefits unless you retire from the service.

 

[Pterodactyl]

I have insurance thru three sources: VA (due to service related injuries), Tri-Care (military retirees) and State of Alaska (as a retiree). I pay nothing for any of these plans except a $100/month to Alaska Care for dental and eye care.

I live near a regional VA hospital and use that as my "family physician" sort of care. You do not need to have any insurance to use the VA if otherwise entitled, but if you do have insurance the VA will bill them. If your insurance does not pay or there is a co-pay or deductible you still pay nothing to the VA. The care is okay at the VA but waits can be long. My VA doc is a former local physician that quit his practice to wprk for the VA. He was very highly regarded locally when in private practice, but he tired of the insurance racket and unpredictable hours. I was diagnosed with cancer at the VA and they wanted to send me to Salt Lake City for treatment. The cancer center there has a good reputation, but it would have meant a bunch of travel and long absences from home. Alaska Care is a great plan and I elected to stay locally for treatment. I estimate the insurance company paid $5-600K for my care to date. We owe the Cancer Treatment Center a few thousand dollars which they refuse to accept payment for. They say wait until the dust settles because they may still get some of it paid or just forgive the debt.

Some of the comments above about health care being the critical aspect of retirement are right on target. Had I not had coverage, real good coveraage, I would be deep in debt and my wife would be working three jobs just to keep fuel in the FJR.

 

[Fred W]

I think income level and assets come into play for VA benefits unless you retire from the service.

Yeah it does, and probably most of us would exceed the income level (it's pretty low).

But even if you exceed that it only means that you would have a co-pay on services and no monthly premiums.

 

[Pterodactyl]

OK, for many of us the big risk in early retirement is in covering the healthcare between retirement and age 65 when the Medicare becomes available.
How many Veterans are using their VA Health and Dental Benefits to fill that gap? Working in a healthcare related industry, I am aware that the VA facilities are not always the nicest in town.

edit - It appears the VA requires you to have some other insurance? (More research required)

I did serve for 6 years of active duty back in the late 70's so, from what I can tell, I am eligible.

I think income level and assets come into play for VA benefits unless you retire from the service.

I'm no expert so check with the VA. I am a retiree, but my VA eligibility was determined by the percent service related disabilities I am rated as having (40%). The only thing I do not get is dental care which requires a 50% rating. I also think combat related injuries are considered differently at least in how they affect your retiree pay and VA payments. If you are receiving any sort of VA disability payment then you are likely eligible for some level of medical coverage. Call or go online for accurate info.

 

[Auburn]

Yeah it does, and probably most of us would exceed the income level (it's pretty low). But even if you exceed that it only means that you would have a co-pay on services and no monthly premiums.

I believe my stepfather gets his medications for free from the VA, and got his cancer treatment there too. He has a small teachers pension and SS. I think the income level may be higher than I think it is. He is over 80, and only served during the Korean war and doesn't have any disability from the war.

It is definitely worth finding out about.

 

[Pterodactyl]

I think income level and assets come into play for VA benefits unless you retire from the service.

Yeah it does, and probably most of us would exceed the income level (it's pretty low).

But even if you exceed that it only means that you would have a co-pay on services and no monthly premiums.

I was eligible for VA care even when I was working and had an income of $200K. Once a year they send a form that asks what your income is. If it is over $16,000 (I think) you can just say you elect not to provide the financial info. All that means in my case is that I pay $8 for every prescription I get thru the VA. Were I under $16,000 the prescriptions would be free.

 

[Auburn]

OK, for many of us the big risk in early retirement is in covering the healthcare between retirement and age 65 when the Medicare becomes available.
How many Veterans are using their VA Health and Dental Benefits to fill that gap? Working in a healthcare related industry, I am aware that the VA facilities are not always the nicest in town.

edit - It appears the VA requires you to have some other insurance? (More research required)

I did serve for 6 years of active duty back in the late 70's so, from what I can tell, I am eligible.

I think income level and assets come into play for VA benefits unless you retire from the service.

I'm no expert so check with the VA. I am a retiree, but my VA eligibility was determined by the percent service related disabilities I am rated as having (40%). The only thing I do not get is dental care which requires a 50% rating. I also think combat related injuries are considered differently at least in how they affect your retiree pay and VA payments. If you are receiving any sort of VA disability payment then you are likely eligible for some level of medical coverage. Call or go online for accurate info.

Yeah, my son just got his VA disability raised to 100% due to illness that occurred while on active duty. He was discharged at 70% disability and had to fight the VA for 3 years to get it raised. But finally the VA agreed. It would have been hard for them not to since the VA's independent doctors that recommend the increase in disability to 100%. SS followed suit a couple of weeks later, but that took an attorney to advocate for him to 100% too. It gives him and his family security, but I would not want to go through the migraines and other issues associated with his illness. Now he has a lifetime pension, medical treatment, and some education benefits for himself and his family - the VA portion is tax free.

It has been tough to see him go through this and even tougher way to live. But at least he doesn't have to worry about income any more.

 

[FJRay]

I use the VA and don't have service related disability. My disability income doesn't count so I'm good for health, vision and travel. Don't need dental cause the teeth come out at night. When I get medicare this year they tap some of that to offset costs. The VA has lots of folks to care for and I think are doing better all the time.

I've been very pleased with the quality of care here in Oregon but have heard is not always the case elswhere. I hope it stays good cause they are getting ready to remove part of my colon

 

[Auburn]

I use the VA and don't have service related disability. My disability income doesn't count so I'm good for health, vision and travel. Don't need dental cause the teeth come out at night. When I get medicare this year they tap some of that to offset costs. The VA has lots of folks to care for and I think are doing better all the time.I've been very pleased with the quality of care here in Oregon but have heard is not always the case elswhere. I hope it stays good cause they are getting ready to remove part of my colon

My son has gotten great care from the VA, it has been the administrative folks that were his frustration. He lives a few miles from Madigan in Tacoma. My stepfather is in southern Oregon and has gotten great care there too. I think the last war really brought the spotlight on the VA and made them improve their care and for congress to increase their funding to follow through with the promises made to those who have served.

 

[snackbauer]

Medicare's not free. They take a chunk out of your SS to pay for it and that chunk keeps getting bigger the older you get. You'll also need to purchase Medicare supplemental insurance (plan F covers just about everything) to cover what Medicare doesn't pay. And, of course, you have those pesky prescriptions, part D Medicare helps, but that stinking donut hole still exists, I believe.

I retired at 63, paid for reasonably priced catastrophic coverage until I reached 65. But now insurance companies can't provide just catastrophic coverage anymore. Now you will be dumped into the exchanges and wait til you see what that costs!

 

[weekend rider]

The standard number for retirement is 70% of your gross wage when you retire anything else is a plus

 

[Fred W]

Well, I think I am past 70% already, so that's good to hear.

I also just found out today that last year when they "demoted" us (everyone that has my job) to a non-exempt employee, in addition to now being eligible for OT we picked up retiree health care coverage through age 65.

 

[Chiefblueman]

I "retired" from the the "real" world at 55 after 35 yrs as an electrician and got a job with a local municipality maintaining traffic signals. I call it my "retirement job".Paid vacation, sick leave and holidays - never had any of that before. Flex schedule nets another 26 days a year off. With standby,OT and achieving master level I make more than I ever did. Here's the nuggets that were really attractive regarding retirement - I am exempt from paying into Social Security due to the Municipal Employees Benefit Trust. The amount that would be paid to SS is put into an annuity with a match from the city. Since I have more than enough time in SS to be vested, I will recieve a full benefit with no windfall reduction. The fund is well managed and I am putting my max makeup contributions in it and the city is tossing in another 7k match.

The other benny is my major medical coverage is free, the wife costs $50 per mo. Dental is another $50 or so per mo.

I will also recieve a pension based on my 5 highest grossing years @ 2% per yr. At 66 that will be 22% for life. My previous life in construction has provided me with a small pension of $1000/mo and an annuity currently pushing a million. My wife has 401's and IRA's about equal to mine. Our defined benefits should get us 85-90k per year without dipping into annuities and such.

I plan to work until 65 or 66 and take advantage of the health care. The bonus is I like the job, work with a great bunch of guys and it's not hard to get time off. The downside is, well, having to work that long, even if it is a low stress job. Healthcare after retirement, even though Medicaid is available, casts a shadow on things.

As mentioned at the beginning of this thread, getting a gub'mint job could be a good thing for retirement.

 

[Bounce]

Yeah, my son just got his VA disability raised to 100% due to illness that occurred while on active duty.

Heck! Maybe I can get a claim approved for the 40-year old crotch contracted in Korea while 'Nam was winding down.

 

[Old Guy]

Well, I think I am past 70% already, so that's good to hear.
I also just found out today that last year when they "demoted" us (everyone that has my job) to a non-exempt employee, in addition to now being eligible for OT we picked up retiree health care coverage through age 65.

Well, that was like a gift, wasn't it?

 

[escapefjrtist]

If I had a Million $$$...I wouldn't be worried either.

Too bad a million dollars isn't squat now...keep saving your pennies wheatie!

Health care costs during retirement is the elephant in the room.

--G

As Throat Warbler mentioned in the opening post, the actual dollar amounts needed to retire vary greatly by where you live and your lifestyle. Also, what seems like a lot today can easily become 'barely scraping by' in 10 or 20 years because of the effects of inflation.

That said, there are so many variables and risks that if you worry about everything then you'll never take the plunge.

Emphasis added. Great point Geezer...I've been told that more than a few times, gotta make the decision and do it!

I've been retired for a couple of years and figured out what my income, taxes and such would be before I took the plunge. When my net retirement income equaled my net working income I left. There are many internet resources available for calculating that stuff though it gets complicated. If you don't feel like doing that talk to a professional. Don't guess.

This ^^^^ is what I'm shooting for. When [not if] this happens I'm freaking done assuming we can bridge medical insurance until medicare kicks in.

--G

 

[Fred W]

Understood. So the answer to my question initially asked would be 100% of your pre-retirement income. And that is certainly achievable with enough forethought, planning and saving.

But... I keep coming back to the concept that, assuming you are in a position (age and asset type wise) to be able to access your retirement savings, pension, etc., once you reach the point when you could retire with X% of your income, aren't you then working for 100% - X%?

Yesterday I was playing around with my pension estimator and the social security estimations and determined that I would actually take home more per month initially by retiring at the end of May next year (at 57) than if I waited the 2 1/2 more years until I turn 60 up until I can start drawing SS at age 62, and then the difference is less than $100 a month. Waiting to retire till 62 only provides another $300 a month (in after 62 income) and waiting to 65 would get another $1000 a month (in after 65 income) on top of that.

But at that point I'd have been working for more than seven years for less than half pay since they would have paid me more than half my present income to retire from my present job. I guess it is likely to come down to whenever I get fed up of them or they get fed up with me.