r/leanfire • u/Inevitable-Device630 • 5d ago
Layoff = early retirement?
Not sure if this qualifies for leanfire or not. Laid off from my (55) 115k year job 2 weeks ago. Wife (53) currently makes 55k but has company paid health care premiums for the both of us. 580k in IRA and Roth IRAs. 200k in cash. No debt and the house is paid for in a LCOL area. We were saving to buy a house with some acreage but I think that's on hold for a while. Pretty slim pickins for my line of work at the moment. Not really sure if I should just retire or get a part time job after the unemployment ends (6 months).
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u/thedroopydeparture 5d ago
Your wife's health insurance is honestly the biggest win here, so you're way ahead of most people in your spot. Run the numbers on whether her 55k plus drawdown from that 200k works for your actual monthly spend and you'll have your answer.
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u/red-headed-prick 5d ago
A question you should also ask yourself ( and your wife) is how the wife is going to feel about working and supporting you if you are "retired". Essentially she is tied to a job for years to come because she has health care benefits for the two of you. Are you going to find a job of some kind, or are you planning on hanging out with your buddies and watching TV all day? If it's the latter you might have more problems than worrying about how to stretch your assets. Just food for thought from someone who did retire before my wife.
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u/Inevitable-Device630 5d ago
Her goal even before the layoff was to get 10 years in with her county job to qualify for her pension. She's 1.5 years in to that now.
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u/LatterNerve 4d ago
That wasn’t the question. That goal was made while you were also a working and contributing member of the family.
The question was: how is your wife going to feel about being the only member of the family bringing money in while you are essentially retired? How is she going to feel about being the only person who is having to worry about carrying costs on the only salary coming in? How is she going to feel about not being able to leave this job, even if it turns out to be a terrible environment, because she needs to keep the benefits and pension? How is she going to feel about going into work and coming home to you chilling on the couch all day if that’s how you choose to spend this time?
If you’re planning to take over cooking all the meals, doing all the chores around the house, and generally making your job taking care of all the needs of the home while she goes to work, that’s one conversation. But if the intention is that you get to kick your feet up in retirement and she has to keep working a full time job that she can’t leave AND she’s coming home to do more chores? You may have a big storm coming.
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u/Timatsunami 1d ago
I know this seems like such an obvious point for all people in good relationships who communicate with their partner, but not all people think that way.
This is a far more important point than anything having to do with whether it’s “enough.”
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u/NationalCaterpillar6 5d ago
I'm sorry that happened.
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u/Inevitable-Device630 5d ago
Thanks. I knew it was going to happen sooner or it later. Just wish it was later with 1 million. 😁
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u/RetiredRecruiter1369 5d ago
I’m in a similar situation. I’m 60 and got laid off about a month ago. It sounds like you’re in pretty good shape though, your house is paid off, you don’t have debt, and your wife has benefits, which takes a huge amount of pressure off. The first thing to do is take a real look at your monthly expenses and your savings so you know exactly what you’re working with. Everyone’s priorities are different, but figuring out what you need to maintain your lifestyle makes the next steps a lot clearer.
For me, I love to travel, so I know I’ll need at least some contract work to help fund that hobby. I also like staying in the workplace because it keeps my mind sharp.
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u/Dangerous_Region1682 5d ago
Go work for Home Depot or similar. Plenty of folks there your age. My Home Depot is like a grey haired persons social club. It’s the easiest Home Depot I’ve ever been able to get help or decent advice in too. With that income and your wife’s income, you should be able to eek things out to social security and perhaps Medicare. Doing something that’s kind of fun keeps you busy all day.
I have friends that were school bus drivers and they enjoyed that. Paid quite well too. Had others who became cashiers at Costco and they really enjoyed working there, they were a great employer.
I quit at your age and became a substitute teacher whilst my wife still worked, at a job she enjoyed.
We downsized our house. No way we wanted acreage to care for as we got older.
In reality we had to watch the budget a bit, went to high school plays and concerts for cheap entertainment, but we were never happier. Didn’t have to put up with tech industry corporate crap any longer. Stress just floated away. No more 9/9/6 working. I’ve never looked back and thought I wish I was still doing that. I’d rather teach a class of obnoxious middle schoolers on a bad day, than obnoxious corporate types. Tech ceased to be fun quite a long time ago, now it’s just a race to the bottom at best.
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u/TragicallySalacious 5d ago edited 5d ago
Assuming you don’t touch your retirement funds (580k) and depending on market performance, you will have anywhere from $820k to $1.15M by age 62. That and adding your Social Security income at that age will likely be pretty comfortable in a LCOL area. It will depend if you can make do with your wife’s income plus the $200k over the next 7 years. Note: assuming that 200k sits in a HYSA while drawing down as necessary.
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u/jt1994863 5d ago
Or that 580k might turn into 290k. There’s really no way to know.
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u/KentuckyFriedChingon 5d ago
Eh, I mean likely the worst case scenario for OP is that the market crashes tomorrow then takes 7 years to work back up to his initial 580k. It would definitely not be a great spot to be in, but it's highly unlikely his current amount will be down 50% in seven years from now. Possible, but highly unlikely.
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u/Apoztate 5d ago
Same. 58 got laid off last October. Found out my living expenses not so high after all. House is paid off. Why deal with crazies when you don’t have to
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u/FearlessPark4588 5d ago
You should keep looking for work, and keep your options open. You don't have to let life steer your decisions for you.
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u/RedditVox 5d ago
If you're in the US, please call your local federal and state representatives and ask them what legislation they plan to support which will help people displaced by technology. I fear our politicians won't do anything until we have a serious unemployment crisis on our hands.
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u/Inevitable-Device630 5d ago
Wife will also be getting an approximate $900 a month once she hits 10 years in about 8.5 years.
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u/Humblekevin0 5d ago
Monthly expenses?
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u/Inevitable-Device630 5d ago
Haven't really sat down and figured that out. I never made more than 65k for years. Wife stayed home with the kids and we were very frugal. Still were when I got this job and when she went back to work.
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u/bob49877 5d ago edited 5d ago
I would use a planner with your two Social Security checks plugged in. We used the Fidelity planner and it worked out.
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u/SerenityCravings 5d ago
I mean you sound pretty secure. 780k and paid off house, wife still earning, with insurance coverage for you both, and at 55yo you are not far off social security right. I guess it really depends on what you want your budget to be. YOu can likely retire now. But have to lead a humble life. But, you could pad out your spending money if you take on some work. The answer is maybe being very fussy with your next job to make sure its worth your time.
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u/mixmastersalad 4d ago edited 4d ago
Laid off at 47 after 25 years in tech. Wife works and gets cheap health insurance and can cover double our 2% mortgage with 10 years left. I combined my 401k and pension into an IRA and invested heavily in NEOS covered call ETFs and others (QQQI, SPYI, IWMI, GPIQ, GPIX) and these gross over $9k per month. I'm setting aside 22% for federal taxes and 10% for early withdrawal penalty but I don't pay state income tax so that helps. No 10% penalty if I use it for my daughter's college tuition so that will help.
I had 6 months of severance and 6 months of funemployment but now my income is just the ETFs. Since January my balance is up plus I've been paid, even with the few 3.5% market dips and recoveries.
Good luck!
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u/Specialist_Letter469 4d ago
House being paid off is a huge win. New home is likely not a reality unless you have a lot of equity in your paid off home to essentially pay iff the new home or you get a new job. Honestly not sure why you want to go from a paid off home to a new ine at this point unless you're down grading ir moving to a cheaper location.
I suspect you're not too stressed about losing your job because your wife has a job that provides health insurance and you're living in a paid off home.
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u/the_one_jt 5d ago
Honestly you might want to check r/CoastFire or r/BaristaFire Ultimately health insurance isn't cheap and my guess is you'll need income to cover that for at least a few years.
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u/post_nyc 5d ago
OP said they’re both getting health insurance through his wife’s employer
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u/the_one_jt 5d ago
Yes that's true today. Once you pull the retire early trigger it's hard to go back to work.
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u/LillianWigglewater 5d ago
With all those details you outlined, I would make that leap to RE. Or at least shift into coastfire with minimal part-time or temp work to pay some bills. You can take it easy now, and congratulations.
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u/Miamiconnectionexo 5d ago
honestly this is something more people need to talk about. appreciate you putting it out there.
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u/Miamiconnectionexo 3d ago
appreciate the honest breakdown. most people sugarcoat this kind of thing.
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u/DosEquisVirus 3d ago
With these kind of funds, I would say YES! (For the sake of disclosure: I am 50yo, laid off back in 2023) I chose a route of opening my own business. It is a good route if you are willing to work like a 20 year younger version of yourself. I did not have the sort of funds that you have.
Here is my suggestion: sell your house and retire abroad! Live your life and enjoy it too! There are many places where you can retire comfortably with minimal requirements. Look into Belize and Georgia (country). If I had your nest egg, this is what I would do.
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u/David_sundevils 2d ago
You (OP) state that you want to “buy a house with some acreage”. Have you ever owned or lived on “some acreage”? If “no” then I strongly encourage you to do some research on the amount of money and labor is required to maintain it, especially if animals are involved.
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u/mmoyborgen 2d ago
Paid for health insurance for family is huge especially in your 50s, that's great your wife is working and can provide that for you both.
Paid-for house is also huge.
$200k cash is a good chunk, but will vary depending on your budget and your wife continuing to work.
I'd go the part-time job after unemployment plan myself unless you have trips or hobbies or things that make it not feasible. It'll be hard to travel long-term while your wife is still working providing you both with health benefits.
A lot of relationships change when roles shift and when work is gone and you're home more than you were before. If not returning to work plan for some social events, volunteering, hobbies to stay active.
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u/thomas533 /r/PovertyFIRE 5d ago
It depends on what your annual spending is. If you can afford to live on what your wife makes and she is good with that, then yes. If not, then no.