Retirement Readiness Check

[steadyeddy]

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

[steadyeddy]

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Surprised there were no comments. What did you all do to make sure you were ready before you retired?

Thanks in advance

[galeno]

IMHO the people that post on this new board are the cream of the Morningstar boards. I trust them over any PAID advisor or money manager. My 2 cents. Hopefully others will chime in.

If you are looking at a 30 year retirement you want about 25 times your annual expenses in some combination of equities and fixed income.

I still think it's a good idea to keep your age in fixed income and the rest in equities. Then KISS (keep it simple) and STC (stay the course).

If you want to keep it simple AND cheap use a two fund USA based portfolio. TSM (total stock market) and TBM (total bond market) funds.

If you want global diversification and don't mind paying a bit more use TWSM (total world stock market) instead of TSM.

Personally I like intermediate US treasuries more than TBM. Why deal with credit risk in the bond markets? If I want more return I'd compensate with more equities.

[anitya]

Jan 8, 2021 22:29:31 GMT steadyeddy said:

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Surprised there were no comments. What did you all do to make sure you were ready before you retired?

Thanks in advance

The things (in order of importance) I would do differently if I could turn back the clock from what I had done to get ready for retirement - 

Know that nobody would take care of your money (or your kids) like you would - refrain from outsourcing as much as possible.

Spend a lot of time doing nothing (embrace silence / boredom) - this helps one to learn about oneself and thus ones’ investing behavior.

Get a mentor in your profession so you are always maximizing your personal output to input ratio and not waste time on work tasks / pursuits that are not rewarded in your profession.

Always know how much money / wealth you have so you are taking right amount of risks (not over or under) to maximize your wealth - easily fixed by using a spreadsheet.

When you buy your principal residence (especially, first home) take max mortgage if you live in a jurisdiction where mortgages are non-recourse loans - best leverage available.

The rest will take care of itself.

[chang]

Jan 8, 2021 22:29:31 GMT steadyeddy said:

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Surprised there were no comments. What did you all do to make sure you were ready before you retired?

Thanks in advance

In all honesty, I didn't plan to retire until the day I retired. Fortunately, I had a more-or-less reasonable idea that I could retire, but I didn't plan on it. I still don't know exactly how much money one should have to retire "safely". I know most of the basic variables and assumptions, but our situation is complex; we are renting a house in a foreign country, but plan to move in X years to country Y and buy a house costing Z, where X, Y and Z are still unknown. You are smart to start thinking about the "readiness" question early. I didn't, and still haven't.

[FD1000]

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Most of the big decisions of my life I planned years in advance. 
I planned my retirement in 2010 to be in 2017 but Obama care premiums got to be 3 times more expensive than before, so I delayed it to 2018.
There is no cheap good advisor because there are very a few expensive good advisors.
Why not buy several books or better, find free books/articles online and learn yourself because you will need it for the next 30 years.
You can also get free advice at Schwab and Fidelity local office.  The more you read and see people the more you learn.
This is what I do when I replace a big item.  When I replace the A/C I got 5 offers and the more I heard the more I learned. Ask open questions and listen, then ask specific ones.
BTW, I went to several free dinners and one of these financial advisor said he would work with anybody for free, so, I called him and he ran all the numbers and worse case scenarios and told me I'm ready. Of course, he tried to sell me an insurance product.

You can definitely start several threads with your questions.

[Norbert]

Jan 8, 2021 22:29:31 GMT steadyeddy said:

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Surprised there were no comments. What did you all do to make sure you were ready before you retired?

Thanks in advance

steadyeddy

My goal before retirement was the have ALL monthly Fixed Costs covered by low or zero risk income like my corporate pension and social security. I also made a point of retiring debt free. I wanted a worry free retirement and to avoid any necessity of achieving arbitrary investment returns.

"Fixed Costs" are things that have to be paid no matter what: food, property taxes, transport, medical, clothes, etc. I make an effort to keep these "fixed Costs" as low as possible.

Therefore 0% investment returns would be required to live a simple, basic life, which would mean no travel, country house, nice restaurants, a nice car, and so forth.

I make discretionary spending dependant on investment returns. I don't spend down my capital, but also don't hesitate to freely spend investment gains to do things that I truly enjoy (foreign travel, my new house on a Greek island, etc).

I do not differentiate between income and cap gains in tax protected accounts.

Hope that helps.

N.

[steadyeddy]

Thanks folks for some good food-for-thought.

A bit of specifics about my situation so we can have very specific discussion:
- I am retirement eligible now with the company I work for. They offer retiree health benefits until I become Medicare eligible (and until my spouse becomes Medicare eligible) at a substantial subsidy. They are taking away that subsidy at the end of this year. If I retire next year or later, I would have to pay full price - which would likely be close to $1800 per month at today's rates. With subsidy, the monthly premiums would be $700 a month. Based on our ages, this could translate to $50K to $70K of additional medical insurance costs.

Fully paid house and no other debt. Fidelity planning tool says I am ready. I am super conservative so I am not taking a lot of risk in the market, currently cash heavy.

So, my choices are: 1) Retire this year and preserve the retiree medical benefit, OR 2) Continue to work past this year (and perhaps risk layoffs) and assume additional financial liability for medical insurance for me and spouse. I don't think my job is in an immediate danger but you never know - one of the reasons the company took the subsidy away is to motivate folks like me to leave.

Now, please provide your thoughts on how you would approach this situation.

[Chahta]

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Since you are posting here my assumption is that you are doing your own investing. With tools like Portfolio Visualizer, M* Xray and the information other posters provide I would think you have all you need. What could you really get for $199? A starting point is 4% WDR using a 50/50 portfolio. Look at 3% and other AAs too. One thing I am glad I had was a 2 year cash buffer to start to mitigate Sequence of Return Risk. I now have more years (future cash) in investments. Many folks don't believe in that though. Unless you sit down with an advisor they will not have a picture of how you control expenses and your life in general. For a $199 opinion are you ready to change your investments? You did not say how long before you collect SS and other income until then. Would you be living on portfolio WDs only?

Excellent advice from anitya, galeno, Norbert, FD, Chang above. That's what I am talking about. Do not fear retirement. Be prepared.

[steadyeddy]

Jan 9, 2021 16:03:50 GMT Chahta said:

Jan 8, 2021 0:52:49 GMT steadyeddy said:

I want an honest opinion from a cheap/good advisor on my retirement readiness. Don't want to shell out thousands of dollars.

One name I came across is planvisionmn.com (Mark Zoril). He charges $199 one time fee to deliver a readiness plan using eMoney tool.

Any other thoughts or ideas?

Since you are posting here my assumption is that you are doing your own investing. With tools like Portfolio Visualizer, M* Xray and the information other posters provide I would think you have all you need. What could you really get for $199? A starting point is 4% WDR using a 50/50 portfolio. Look at 3% and other AAs too. One thing I am glad I had was a 2 year cash buffer to start. I now have more years (future cash) invested. Many folks don't believe in that though. Unless you sit down with an advisor they will not have a picture of how you control expenses and your life in general. For a $199 opinion are you ready to change your investments? You did not say how long before you collect SS and other income until then. Would you be living on portfolio WDs only?

Excellent advice from anitya, galeno, Norbert, FD, Chang above. That's what I am talking about. Do not fear retirement. Be prepared.

Thanks Gary for your response. I can collect SS now at a reduced benefit (not FRA), and every year I wait would be better. I have cash reserves to carry me to FRA without any issue. The bolded statement above is key.

[steadyeddy]

I just signed up with planvisionmn.com for $149 to get Mark Zoril tell me if my finances are in good shape to retire this year or next. The big corp I work for could downsize any time. So, just getting a "second" opinion.

Will keep you all posted.

[stats]

Jan 13, 2021 0:19:40 GMT steadyeddy said:

I just signed up with planvisionmn.com for $149 to get Mark Zoril tell me if my finances are in good shape to retire this year or next. The big corp I work for could downsize any time. So, just getting a "second" opinion.

Will keep you all posted.

Steddyeddy,
I think, after listening to their videos, you will find they want you in index funds or ETFs that broadly cover the market.  I suspect they will suggest the 4% withdrawal rate in retirement.   Hopefully I am wrong and the give you more personal advice.

Looking forward to hearing what they provided you. 

stats

[stats]

Jan 9, 2021 15:05:14 GMT steadyeddy said:

Thanks folks for some good food-for-thought.

A bit of specifics about my situation so we can have very specific discussion:
- I am retirement eligible now with the company I work for. They offer retiree health benefits until I become Medicare eligible (and until my spouse becomes Medicare eligible) at a substantial subsidy. They are taking away that subsidy at the end of this year. If I retire next year or later, I would have to pay full price - which would likely be close to $1800 per month at today's rates. With subsidy, the monthly premiums would be $700 a month. Based on our ages, this could translate to $50K to $70K of additional medical insurance costs.

Fully paid house and no other debt. Fidelity planning tool says I am ready. I am super conservative so I am not taking a lot of risk in the market, currently cash heavy.

So, my choices are: 1) Retire this year and preserve the retiree medical benefit, OR 2) Continue to work past this year (and perhaps risk layoffs) and assume additional financial liability for medical insurance for me and spouse. I don't think my job is in an immediate danger but you never know - one of the reasons the company took the subsidy away is to motivate folks like me to leave.

Now, please provide your thoughts on how you would approach this situation.

Everything else being equal, I would retire this year and get the health subsidy.  We have a subsidy from my university that covered our health care costs.  That is a big monthly bill you will not have to worry about.

It sounds like you have done a budget and have a good idea of your yearly expenses. You also say you are heavy cash.  I would determine how many years you could live on just your cash and pension.   We try to maintain 5 years, which is fairly conservative.  The idea is that in a bear market you would not want to sell anything at a low price just for income.   Very few bear markets last 5 years.

You do not give your age.  If your pension increases as you age.  I wonder if working a few more years would offset the health subsidy and make it to your social security FRA.  I doubt it would but it is something to think about.

I think it was a good idea to hire an adviser.   I really don’t think he will add a lot of value, but he will give you a second pair of eyes. 

At the least you should wait until full retirement age (FRA) to collect social security.   Taking it earlier effects your spouses spousal benefit.  In most cases, I think it is best to wait until you are 70 to start taking social security.   If your health is not good, you would probably start at your FRA.

Retiring is not as scary as it sounds if you have enough.  We actually spent more in our first years of retirement because we made a lot of travel and vacationing.  We were spending four weeks with grandchildren, spending a week in Europe, and a week in Aruba.  Think about what you want to do in retirement.  

best of luck, I think you are on the right track

Stats

[steadyeddy]

Jan 31, 2021 20:08:59 GMT stats said:

Jan 9, 2021 15:05:14 GMT steadyeddy said:

Thanks folks for some good food-for-thought.

A bit of specifics about my situation so we can have very specific discussion:
- I am retirement eligible now with the company I work for. They offer retiree health benefits until I become Medicare eligible (and until my spouse becomes Medicare eligible) at a substantial subsidy. They are taking away that subsidy at the end of this year. If I retire next year or later, I would have to pay full price - which would likely be close to $1800 per month at today's rates. With subsidy, the monthly premiums would be $700 a month. Based on our ages, this could translate to $50K to $70K of additional medical insurance costs.

Fully paid house and no other debt. Fidelity planning tool says I am ready. I am super conservative so I am not taking a lot of risk in the market, currently cash heavy.

So, my choices are: 1) Retire this year and preserve the retiree medical benefit, OR 2) Continue to work past this year (and perhaps risk layoffs) and assume additional financial liability for medical insurance for me and spouse. I don't think my job is in an immediate danger but you never know - one of the reasons the company took the subsidy away is to motivate folks like me to leave.

Now, please provide your thoughts on how you would approach this situation.

Everything else being equal, I would retire this year and get the health subsidy.  We have a subsidy from my university that covered our health care costs.  That is a big monthly bill you will not have to worry about.

It sounds like you have done a budget and have a good idea of your yearly expenses. You also say you are heavy cash.  I would determine how many years you could live on just your cash and pension.   We try to maintain 5 years, which is fairly conservative.  The idea is that in a bear market you would not want to sell anything at a low price just for income.   Very few bear markets last 5 years.

You do not give your age.  If your pension increases as you age.  I wonder if working a few more years would offset the health subsidy and make it to your social security FRA.  I doubt it would but it is something to think about.

I think it was a good idea to hire an adviser.   I really don’t think he will add a lot of value, but he will give you a second pair of eyes. 

At the least you should wait until full retirement age (FRA) to collect social security.   Taking it earlier effects your spouses spousal benefit.  In most cases, I think it is best to wait until you are 70 to start taking social security.   If your health is not good, you would probably start at your FRA.

Retiring is not as scary as it sounds if you have enough.  We actually spent more in our first years of retirement because we made a lot of travel and vacationing.  We were spending four weeks with grandchildren, spending a week in Europe, and a week in Aruba.  Think about what you want to do in retirement.  

best of luck, I think you are on the right track

Stats

Stats - Thanks for your genuine feedback. I truly appreciate it. I have the whole year 2021 to decide so I will continue to ponder this question.. and will keep you posted.

[yogibearbull]

Explore any conditions attached to tapping low or regular price retiree group healthcare to 65.

In our state plan, tapping into retiree group healthcare to 65 required/requires taking pension/annuity, not lump-sum. And unfortunately, there is no partial pension and partial lump-sum option, but some plans do have that.

Many retiree plans these days also require switching to Medicare at 65+ if that is possible.

[steadyeddy]

Feb 1, 2021 2:01:50 GMT yogibearbull said:

Explore any conditions attached to tapping low or regular price retiree group healthcare to 65.

In our state plan, tapping into retiree group healthcare to 65 required/requires taking pension/annuity, not lump-sum. And unfortunately, there is no partial pension and partial lump-sum option, but some plans do have that.

Many retiree plans these days also require switching to Medicare at 65+ if that is possible.

YBB - Our plan requires us to jump to medicare when hitting 65, but it will continue to cover the spouse who is younger on their plan till their 65. Our plan does not have any option such as annuitized pension versus lump-sum in relation to medical benefits. At the end of the day, this is a math problem - if I work for another year I make more money than what the subsidy represents. So, for now, I will keep thinking about this until the end of the year and then make a decision.

Thanks for suggesting options that could impact my decision.

[stats]

I don’t know anything about this retirement calculator other than it’s free and AAII gave it a high rating. Thought you might want to check it out

www.newretirement.com/

Stats

[steadyeddy]

Feb 2, 2021 17:41:28 GMT stats said:

I don’t know anything about this retirement calculator other than it’s free and AAII gave it a high rating. Thought you might want to check it out

www.newretirement.com/

Stats

Thank you stats - I will explore.

[hondo]

Jan 9, 2021 15:05:14 GMT steadyeddy said:

Thanks folks for some good food-for-thought.

A bit of specifics about my situation so we can have very specific discussion:
- I am retirement eligible now with the company I work for. They offer retiree health benefits until I become Medicare eligible (and until my spouse becomes Medicare eligible) at a substantial subsidy. They are taking away that subsidy at the end of this year. If I retire next year or later, I would have to pay full price - which would likely be close to $1800 per month at today's rates. With subsidy, the monthly premiums would be $700 a month. Based on our ages, this could translate to $50K to $70K of additional medical insurance costs.

Fully paid house and no other debt. Fidelity planning tool says I am ready. I am super conservative so I am not taking a lot of risk in the market, currently cash heavy.

So, my choices are: 1) Retire this year and preserve the retiree medical benefit, OR 2) Continue to work past this year (and perhaps risk layoffs) and assume additional financial liability for medical insurance for me and spouse. I don't think my job is in an immediate danger but you never know - one of the reasons the company took the subsidy away is to motivate folks like me to leave.

Now, please provide your thoughts on how you would approach this situation.

Well steadyeddy, my thoughts are worth about what you paid for them, which is nothing, but for what its worth -- if my company made such an offer, in order to motivate people to leave, I would expect that they are preparing to make cuts somewhere soon if not enough folks leave on their own. You say they are taking the health benefits offer away at the end of the year. In that case, you can continue to work for almost another year, so that gives you some time to better prepare and get a feel on what the company has planned. Best of luck to you.

[steadyeddy]

Feb 7, 2021 22:15:54 GMT hondo said:

Jan 9, 2021 15:05:14 GMT steadyeddy said:

Thanks folks for some good food-for-thought.

A bit of specifics about my situation so we can have very specific discussion:
- I am retirement eligible now with the company I work for. They offer retiree health benefits until I become Medicare eligible (and until my spouse becomes Medicare eligible) at a substantial subsidy. They are taking away that subsidy at the end of this year. If I retire next year or later, I would have to pay full price - which would likely be close to $1800 per month at today's rates. With subsidy, the monthly premiums would be $700 a month. Based on our ages, this could translate to $50K to $70K of additional medical insurance costs.

Fully paid house and no other debt. Fidelity planning tool says I am ready. I am super conservative so I am not taking a lot of risk in the market, currently cash heavy.

So, my choices are: 1) Retire this year and preserve the retiree medical benefit, OR 2) Continue to work past this year (and perhaps risk layoffs) and assume additional financial liability for medical insurance for me and spouse. I don't think my job is in an immediate danger but you never know - one of the reasons the company took the subsidy away is to motivate folks like me to leave.

Now, please provide your thoughts on how you would approach this situation.

Well steadyeddy, my thoughts are worth about what you paid for them, which is nothing, but for what its worth -- if my company made such an offer, in order to motivate people to leave, I would expect that they are preparing to make cuts somewhere soon if not enough folks leave on their own. You say they are taking the health benefits offer away at the end of the year. In that case, you can continue to work for almost another year, so that gives you some time to better prepare and get a feel on what the company has planned. Best of luck to you.

Thanks Hondo... good to see you on this board where the waters are calm... and the breeze is cool as all the noisemakers are left behind