I was very surprised when I came across this post from January 2011 because I thought this part of our journey had come much, much later.
Brett and I have long called ourselves “accidental retirees.” We had never thought much about or discussed retirement although we did save, but at the beginning of 2010 we did not believe we would ever be able to retire. We were drowning in debt at that point, had depleted our savings, and we were still raising young children – retirement was nothing more than a pipe dream. While we had committed ourselves to getting out of debt we were unable to see ourselves ever surviving without being employed somewhere. However, it appears that after just one (very difficult) year of debt reduction, we were not only thinking about but apparently actively starting to plan Brett’s retirement!
The game-changer was not only the elimination of over half of our debt, but discovering Brett would qualify for an additional family allowance from Social Security. Before January 2011 we had no idea such a thing even existed, let alone that we would qualify for it. I remember Brett and I talking with a counselor at Social Security, and finding out that because we had three children under age 18 that we would receive the full allowance, at least for a couple of years. With that, and with Brett’s military retirement, a small pension from his employer, his regular Social Security, and our debt eliminated, retirement became an affordable reality.
Brett did not retire in 2012 – that didn’t happen until June 2013 because stuff continued to happen and the rest of our debt did not get paid off as quickly as we hoped. However, at the beginning of 2011, we finally knew where the path we were on was taking us and how we were going to get there, and we had an even bigger motivation for finally getting rid of our debt. That journey never really got much easier, but knowing what awaited us at the end made a huge difference.
No, it’s not Rest, Relaxation, Reuse or Recycle. The R-word here is Retirement.
Brett is eligible to retire (Social Security-type retire) in just a little over a year. This is both exciting and somewhat frightening at the same time. The date is coming fast too, although frankly, not fast enough for Brett. He wants to be done with work yesterday, although he plans to continue working at his current position until the end of 2012. His huge desire to retire is the primary factor behind our urgency to pay off our debt.
The conventional wisdom is that you should work as long as possible, and put off taking your Social Security benefits in order to draw the full benefit upon retirement. We’re in a somewhat unique position though because we have dependents under the age of 18, so Brett will be eligible to receive the full family allowance for a while along with his standard Social Security payment. It makes sense for him to retire earlier rather than later. Social Security, along with his military retirement and pension from his current job, will provide us with an adequate income when he does leave his job. He will probably continue to work part-time somewhere because he’s not a sit-around sort of guy, but that’s an unknown for now. Right around when the time comes for our youngest (YaYu) to age out of eligibility for the allowance, my Social Security and pension will kick in to bring our income back up, although my pension will probably be just enough to buy milk every month. We’re not going to be rich by any stretch of the imagination, but we’ll be OK, especially if we don’t have any debt.
One thing we are talking about now is whether to stay in Portland or move elsewhere and if so, where? Brett and I are both getting tired of the rain and the cold of Portland winters, but the girls love it here. Any move would have to be done after Meiling graduates from high school in 2014 as she does not do particularly well with change, and is the most embedded here. But I’m not sure we will want to stay an additional four years after that for YaYu to graduate. We have long dreamed of moving out to the Oregon coast, but realize we would face the same weather there as we do here. Although I’m originally from California, I have little desire to go back there, and any place on the east coast would be too far away from our son, daughter-in-law, and grandson in Japan. Hawaii is a possibility, although the cost of living is quite high there. We have lots to think about, and thankfully don’t need to make any quick decisions.
We made some not-so-smart financial choices in the past and would be in even better financial shape if we’d done a few things differently, but we also did some things right or smart, like making the commitment for Brett to stick it out with the navy for 22 years, even though it was not an easy life. Adopting three children when we were in our mid- to late-40s was maybe not a smart financial move, but the right thing for us, and the best thing we ever did in every other sense. Going back to school in our 40s and borrowing for that was also not the brightest choice we made, but we’re both glad we have our degrees, and in Brett’s case it has paid off. Sticking with his current employer for all these years has also turned out well, although he could have made more money elsewhere. His Fortune 500 company has provided incredible benefits that no one else could come close to matching, and some of those will continue to be there after retirement.
If I know just one thing now, it’s that time passes way more quickly than you ever think it will and suddenly something like actual retirement looms. When we were young, when Brett was deployed, time seemed to stretch out forever. I never gave much of a thought to retirement or what we’d be doing or how we’d pay for things but all of a sudden . . . here it is. “Old people” were always talking about retirement and saving and investments but we felt like we had forever to get there. How wrong we were! We know that Social Security, in its current form, should be there for us and for that we are immensely grateful. For our son, or our daughters, or others younger than us, maybe not. We’re lucky and we know it.
P.S. I was doubly surprised to see Hawaii mentioned this early as well, as I remembered that as coming much later too.
P.P.S. Neither of us has ever had to (or wanted to) work after retirement – with a changed, more frugal lifestyle, our income, approximately two-thirds of what we earned pre-retirement, has turned out to be enough that we haven’t needed additional employment.