h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

I have stopped counting down the days until retirement. I'm not so sure now that I want to retire at the date I selected. Health insurance is so expensive that I figured I'd wait until I am 65 and qualify for Medicare. Between now and then, if I stop wasting money on nonessentials like books, clothes, DVDs, vacations, etc. I can pay off all my credit cards and my car. This will make it easier to live on a reduce income. But I'll still have a mortgage payment practically forever.

A couple of days ago I had one of those moments. I can't collect my library pension and continue working, but I can start collecting social security and keep working. But you have to be full retirement age, which for me is 66, to earn as much as you want without a reduction in benefits. So, if I file at age 66 I can live off of my salary and put the entire SS check every month toward the principal on my mortgage.

It would be wonderful to retire with the house completely paid for. I figure it will take 3-3.5 extra years. Then I can quit work and apply for my library pension and live quite comfortable and debt free. Sounds like a plan. Now I just have to stay healthy and keep my trustees happy enough not to fire me.

Since my mother is now 90 and I have many, many relatives who have lived into their 90s, I am hoping that I've inherited their longevity genes. By Lady C dying so young, it isn't a sure thing, though. I just hope I don't forgo the pleasures of retirement in order to get out of debt and then drop dead the next day. It's really hard to know what to do sometimes.

Whatever you do, Hypatia, do it with confidence, but carefully.

I was in being made redundant, in that it cleared my debts and enabled me to have an 8 month sabbatical. The downside? Not having a driven reason to get up in the morning.

Now I'm back at the coalface, I am happier, have a reason to get up, and take an active interest in life around me.

Here's wishing you the very best for the weekend, and a wonderful New Year.



MMF

Several years ago an old drinking buddy of mine (we hadn't known each other long, he was just old ) told me about one of the "ironies" of social security. In a nutshell, all the money taken out of your paychecks through social security payroll taxes add up until you reach retirement. The more you put in, the larger your benefit checks should be. However, once you retire, your total is set. If you continue to work you'll continue to pay social security payroll taxes but they'll have no effect on your benefit rates.

I think this is one of the contributing factors to the grumpiness of old folks.

This latest upheaval of employment and resulting pension ideas ... I have no idea now when I might call it quits with the work-force.

I had noticed, and I did wonder. Good luck with your new plan.

MMF, I'm glad that your're pleased about being back at work. I'vbe wondered if I'll enjoy being retired as much as I expect to. I guess it depends on the person and their circumstances. For one thing, I'm looking forward to having more time in my garden.

BG, that is a genuine travesty. The SS folks swear that they increase your payments if you pay in after you start collecting benefits. But it never actually happens. At least not to anyone I've ever heard about.

Nick, hang in there. Things will work out.

Candi, in a way I'm pleased with the new plan since it gives me a way to actually pay off my house 15 or 16 years sooner. But I'm so burned out here. Those extra years of working make retirement seem awfully far away now.

Yea, but once those extra years are done, they'll feel like they were worth it. The security of being debt free is pretty nice. But the getting there is worrisome. My dad took his retirement almost as soon as he could. He did put it off one year on the advice of his financial adviser. He was actually advised to put it off for about three years which would have definitely given him a cushy retirement fund, but he just couldn't stay working at the refinery that long. It turned out to be a fortuitous choice as his coworkers who stayed on lost out as Dow bought Union Carbide and took a big chunk of their pension fund as a nice little present to themselves.

I hope it works out, whatever you decide.

With people living longer, waiting until 70 to retire still leaves many years to enjoy. But that is dependent on not worrying every day about money and having enough to survive on. Which is why I want to be debt free before I quit work. Yeah, those few extra years of working will be worth it in the long run.

It certainly sounds like it.

Bel, I feel better, more in control, just having a plan that is actually possible. But I'm a bit upset with myself for leaving it so late. On the other hand, what makes it doable is being able to collect social security and work at the same time. That isn't possible until you reach a certain age, so the past didn't have a whole lot to do with it.

Our national (contributory from wages) pension plan has undergone a few changes in recent years as well. I can now collect at age 60, and continue to work. But the trade-off is that the reduction at 60 has increased from 30% to 37% off the top for early beginnings.

I'm not sure what the actual deduction is for retiring early here, but like in Canada, it is significant. And while we can collect and still work beginning at 62, the limits for how much you can earn without having your benefits reduced make it impractical unless you're working a low-paying job to begin with.

The good news is that if I get sick and can't work, I can start collecting both social security and my pension right now. Neither would be as much as if I wait, but it is nice to know that they are there if worse comes to worse.

Right then, I come down and smack ya with a rubber chicken ... Which knee is already the tired one? For disability, etc.

if you retire at 62, your monthly check will be decreased by about 25%, with the percentage lessening the longer you hang on before 66. If you continue working after full retirement age, and start collecting SS, you will get credit for the work-quarters (3 month periods), but it won't accrue at the same rate as before you began to draw your benefits.

It's true that you won't have any restrictions on how much you can earn after 66, before your benefits are reduced to compensate. Better to delay drawing your benefits for a couple of years, as it will continue to accrue at the <66yo rate.

"if you retire at 62, your monthly check will be decreased by about 25%, with the percentage lessening the longer you hang on before 66. " Should have included the phrase "of decrease" between percentage and lessening...

In the company I was last regularly employed with, a lot of the field ops took early retirement, then continued on as contractors...and that was the way it worked -- that they could work up to about $25K, before they lost a dollar of benefit for every dollar earned over the $25K.

I hadn't planned on retiring before 65 at the earliest, but was just saying that if something un expected happens and I ~can't~ work, it is nice to know that there would be some income. Not really enough, but better than nothing. Which describes social security in general. Thank heavens I'll have my library/city pension to supplement it.

The current benefit scheme is set up so that at age 62 you can only earn $14.4K a year before you start losing benefits at the rate of $1 for every $2 earned. Then at the beginning of the year when hyou reach your full retirement age, the amount jumps to around $36K. Over that you lose $1 flor every $3 earned. I don't know what the figures are in between those ages. The SS Administration really doesn't make it easy to retire early unless you are working at a low-paying job to begin with.

Since my birthday is the first week of May, and since there's no way I would earn $36K in 4 months, I could apply for benefits in January of that year if I want to. Hummmmmmm. Or just wait the extra 4 months. Also, being a widow, I can collect F's SS instead of my own. That will give me an extra $300 a month.

I had noticed...

Good luck whatever you do.

Z

DEFINITELY, compare the two accounts -- particularly for us widows. That goes for the guys, too. You might have less quarters than your spouse, or she may have earned more than you did at a crucial time in her career, you never know.

Hyp, I;d wait the 4 months if you could, just because -- might as well, you've waited that long.

I'm afraid SS is *all* I have -- between my husband's illness and then mine, all our savings (401ki and otherwise) were gone.

The Govt. keep moving my state retirement date backwards. I really want to stop what I'm doing well before then. Maybe at 60. The structure working gives is good, and the brain exercise, and the company and the interest but the 'challenge' of new systems is just hassle now. Things outside work are of much more interest and genuine challenge.

It should be possible, now we need to work longer, for a different career structure to become the norm. One where you reach your personal summit and then start winding back down. You can still contribute from experience, but leave those with enthusiasm for change to lead the changes.

Reading this thread reminds me how fortunate I am with the UK's welfare state to fall back on - at least I don't need to deal with medical insurance.

Very best wishes for tomorrow, the New Year and all your planning Hyp.

Waz