Keep adding to the long-term (secondary) educational fund (met goals for 2023 which was good). £20k/year
Keep putting money into investments (ISA) and pension (2023 met goals) so looking at about £40k/year
Travel Costs
This is where I always fail miserably. I try to contain costs but it never seems to work because these days experiences trump all other things (and the prices in Europe are downright astronomical) Also, travelling internationally a dozen times a year to Brazil adds up as well.
Have put my foot down with a few caveats with the wife about not having so many big budget blowout trips (last year was scary as we spent close to £60k on trips)
Formalise a will because I keep putting it off. Both my wifes financials and my own are complex (due to international holdings), so I think this is important for making sure the little one is taken care of if anything happens to us (education, property, inheritance etc). This has started to worry me a lot more this year so I think its time to get it done this year.
Jeepers. Here I’ve been planning/saving for a few years for a vacation to Japan that is probably going to clock in at about $10k, or maybe stretch a little above that.
Sounds like you have something akin to what we call disability insurance in the US.
I’ll let the L&H actuaries respond for details, but basically it provides some level of income replacement in case the earner loses the capacity to work.
Yeah that’s short term disability in the US. We have long term disability on top of that for coverage past 6 months/2 years until retirement age
And also workman’s comp for work related illness/injury
These three benefits are generally all paid for by the employer
You can top up for disability so you are closer to 100% income replacement
Critical illness is usually an elective benefit but we generally we have employer provided accidental death/life insurance. Critical illness is a lump sum payment here. Not tied with medical care at all
Long term care insurance is an absolute dumpster fire in the US. Some companies offer it as a supplemental benefit, most don’t
Told the boss last Monday I was ready to give my notice effective 3/15. He asked if I would delay it to the end of the month, so I made it 4/1. Out of nowhere he shows up in my office today (he lives in TX but I’m sure was in the home office for something else) and asks If I am interested in being an hourly worker. I said that sounds like a good idea. It sounds like it will either be as needed, or a low weekly commitment, we haven’t worked out the details yet but I suspect there’s stuff that will need to get done in the summertime that he doesn’t have the capacity to do himself and can’t easily entrust to a new hire either.
I’m now just north of $1.6M, nice to be $100K above my original retirement target and hopeful to have a trickle of actuarial income ongoing.
This sounds quite promising. I went on an hourly rate for one year after retirement but requested the rate to be higher than the hourly rate that my existing salary translated into. Your company should be amenable to this.
I think it is also good to glide into retirement rather than going from 100% to 0 in one day. Your hourly arrangement should be a nice intermediate step.
It has been over 15 years since I retired but I keep doing little gigs here and there. Once you are financially independent you only have to do the type of work you really like and only do it when you want to: that is a nice part of retirement.
My compensation statement from last year detailed my salary, bonus, stock and options, plus all the other money they pay for matching, insurance, social security, etc. etc.
I sent an email suggesting I would work for this total number divided by the number of days I am actually expected to be in the office. I’m not actually asking for much more, although if they agree to it:
I will only have to pay a fraction of the amount they spend on health insurance
I wouldn’t have to worry about vesting the stock and options.
Just had a fun mishap with the health exchange trying to apply for health insurance effective 5/1. For eligibility in March I said I would have $600 in taxable income for me and my wife. That’s because I am stashing money away like crazy in these three months. Then I checked a box guessing that my real income would be $45,000.
To be surprise, I am being considered for Medicaid, which was not part of the plan. I should have lied and said my March income was $4,000. Because I am being taxed on “only” $600 in March they must figure I am living out of my car. So I’ll have to sort that all out.
Haha yeah if your tax return shows that you are below the poverty line you will qualify for Medicaid in most states. They probably just took your March income and annualized it
Medicaid isn’t terrible either as long as you aren’t terribly sick and have established doctors you visit
And congrats on the hourly offer, if I remember this was your initially desired outcome
I was planning on the 24hr/week variety that offers benefits - because the employee handbook doesn’t really advertise other options. But I really don’t want that now - I don’t mind working 24hrs/week during a busy period, but I don’t want to be locked into that and trying to take all these vacations. So yes that’s exactly what I want and I’m pretty sure there’s stuff they need my help with this summer, not to mention other times in the future.
I finally got the insurance exchange stuff right on the 3rd try. I’m now quitting March 29 and starting insurance exchange coverage on 4/1. I don’t think moving the date should have been necessary but I now have a form saying that I should get $1,248/mo in subsidies based on an income of $45,000.
I actually see a $20/mo BCBS gold plan I like:
Deductible of $2,000/$4,000, OOPmax $8,400/$16,800
$10 payment for primary care and urgent care visits, $5 for generic drugs.
I think it specifies a UnityPoint network but that is reasonably big here in Des Moines.
My wife and I retired late March/early April 2020. We did the ACA thing and it worked out well for us. We pulled ~$40k each year from IRA to show as income and stay off Medicaid. Our ACA premiums ranged from $110.80 per month to $320.66 depending on the year to cover both of us. Unsubsidized premiums were $25k-$30k/year. We viewed it as catastrophic coverage in case of cancer or something. We don’t have any major health problems or medication needs.
We used cash reserves to supplement our spending, wound up spending $110k-$130k each year including IRA withdrawals.
The age-based minimum withdrawal rates from tax sheltered vehicles in Canada is an issue as they have not been modernized like the US ones to reflect improved mortality. You are fortunate in having much more flexibility as to the amount you are able to withdraw each year from your tax sheltered vehicles.
This is an area where I felt the actuarial profession was uniquely qualified to be making the case for lowering the minimum age-based withdrawal rates in Canada but am not aware of any actuarial submissions to our government on this issue. I really wish I could lower the rate at which I have to draw down my retirement savings.
We are pretty limited in the amounts we can contribute to our retirement accounts in the US so this is largely a non-issue for people who keep an eye on their investments