Suze Orman says 70 is the ideal retirment for most

[QuarterMillionMan]

https://www.yahoo.com/finance/news/suze-orman-says-age-retire-100002931.html

Ideally I would prefer to retire before 70. Realistically 70 is the age I come to the same conclusion as Suze Orman for myself. Most people I know wishfully plan to retire before 70 but I foresee them no where near their ideals, unless they retire early and find out they have to cut their standard of living in half. Where do you think you fall (realistically not ideally)?

[Nutria]

https://www.ssa.gov/planners/retire/1960.html

Well, for people born in/after 1960, "Full Retirement" is at age 67, so retiring earlier than than is a huge waste of money. Postponing until 70 bumps up your SS check even higher.

[kork13]

I think it's very reasonable & sound advice for 70% of folks. People who will be largely dependant on social security in retirement (who only have, say, <$500k in savings), it would be quite unwise to retire any sooner than SS's "full retirement age". Plus, if someone doesn't have enough in savings, every year they can stay in the workforce helps them twice-over. First, it reduces their savings needs by 1 year's worth of expenses. Second, it gives them a chance to save a little more for retirement.

With that said, just because people *should* delay retirement doesn't mean they *can*. Sure, people are living longer, but that doesn't necessarily mean that they're still physically capable of working at age 70. Health challenges can build up in people's 60's & 70's, so they may not be able to continue working, even though they're likely to live into their 80's or 90's.

All of that said.... I have no intention of working that long. My goal is to retire around age 55, and we're currently on track to do that. Though that's still over 20 years away, so plenty can change. But the reason that retiring earlier like that is possible is because I have no intention of having any reliance upon SS in retirement, and we're saving enough to most likely cover our needs solely from our savings.

[bjl584]

I'll probably never fully retire.
My goal is to shift away from earned income into more passive and semi-passive income sources.

[disneysteve]

I think it really depends. Do you have a pension? Have you been saving consistently for years? What do you envision for your retirement lifestyle? How is your health? What type of work do you do?

Where do I fall? I have no intention of still working full time when I'm 70. I'd like to hang up my stethoscope at least for the most part around 62 or 63. As I've said in other threads, now that I've transitioned from private practice to urgent care, I can easily see myself still picking up shifts on a limited basis, perhaps 10-20 hours/week, as long as my health allows. It wouldn't be out of financial need but it would obviously help stretch the retirement dollars.

The biggest wildcard, as Suze points out, is the cost of healthcare. Many people work until 65 and they get on Medicare only to discover that Medicare doesn't cover everything and they may still struggle to pay their medical expenses. If you retire before 65, then what? With the ACA, it's possible to get affordable coverage but who knows if that will last or if the administration will ultimately succeed in dismantling it. If we go back to pre-ACA conditions, early retirees will be screwed as they may no longer be able to find a plan they can afford. Or if the pre-existing rule gets reinstated that would also be a huge problem for older folks.

At my current employer, I have to work 20 hours/week to be eligible for health insurance so I could keep working that schedule to keep my coverage (which I know a few people who currently do).

[bennkar]

I certainly plan on retiring earlier, but my situation isn't what most people have. Good savings, a good pension, good health, no debts - I am only going to stay working until the golden handcuffs come off then it is sayonara.

Now my mother is still working at 73, but it is part time, she sets her own schedule, and works from home, she likes most of the clients, and she really only does it now to pay for her vacation trips (3 Europe trips in the past 5 years). She's a little crazy, but it works for her.

[LivingAlmostLarge]

benny what does your mom do?

Realistically 55. Probably could do now but it'd be tight. 45 pretty comfortably but 55 is ridiculous retirement. College paid for, lots of money, probably enough to pay for 2 weddings, 1st cars, and 1st home down payments. Maybe even money for grandkids college.

[phantom]

I find it really unlikely that I'll still need to work at 70. But, I'm in my mid-30s and 70 is still a really long way off, so who knows what my life or the world around me will look like when I get there. My husband and I have both seen substantial salary increases in the past few years and put most of that towards ramping up our savings. My husband would like to be done working around 60. Meanwhile, I'm not sure how long I'll want to work, but I'm thinking of seeking out more flexibility in the short-term, even if it means working longer in the long run. There are so many unknowns between now and retirement that it seems crazy to me to aim for a particular age. I can't fully predict my expenses between now and then, I can't fully predict how my investments will grow between now and then, and I definitely can't predict what my job prospects will look like or how I'll feel about them.

[bennkar]

LAL, my mother is a beautician. As she has aged, so have her clients. And a number of them have died off, so she hasn't had to turn anyone away, instead the work level has slowly decreased. I don't ask, but when I visit it seems like she works maybe 10 hours a week, mostly over 3 days. And if she plans to go on travels she lets her customers know and they plan to come in before she heads off (so the week before she leaves she is usually busier than normal).

This keeps her active, she is very healthy, so it works for her.

[MonkeyMama]

As with anything, probably good (great?) advice for the masses, but doesn't mean much in a forum like this.

"Healthy people in their 60s today have about a 50% chance of living into their 90s. Can you honestly tell me you’re 100% sure you will not run out of money if you start spending down your retirement funds in your 60s and end up living into your 90s?"

I have never seen a frugal saver "spend down" their retirement principal throughout their entire retirement (certainly not during early years or early retirement). So this comment is completely irrelevant in my opinion. But longevity does run in my family and maybe more of a "grow wealth during retirement" approach is more sensible if you retire at 50 and live to 110. (It has worked well in these cases).

I also notice many similarities between our ability to raise our kids on one income and the experience of early retirees. Both decisions are very tax efficient, for example. Keeping expenses low is very powerful in both scenarios. In both cases, people tend to envision being cash strapped and poor, but the opposite is the truth. Just as an example, both our parents retired in San Francisco area and have no plans whatsoever to sell their homes to finance their retirement. I'd say that about 99% of their friends did not prepare for retirement and have to move somewhere cheaper to make ends meet. So when I say "low expenses", and most imagine lack of choice or "cutting back," this is not *at all *what I mean. I mean more being careful/efficient with money. If you can keep expenses low, you don't need to save near as much to retire very comfortably. My parents' basic living expenses are virtually nothing (their home is paid off), which allows most their spending to be luxury spending. Anyway, I feel very prepared for retirement, given this mini-retirement experience we did throughout working years. (I think weirdly enough that I feel more in a place to retire early than otherwise. I know this is opposite of what most people presume).

[Nutria]

As with anything, probably good (great?) advice for the masses, but doesn't mean much in a forum like this.

"Healthy people in their 60s today have about a 50% chance of living into their 90s. Can you honestly tell me you’re 100% sure you will not run out of money if you start spending down your retirement funds in your 60s and end up living into your 90s?"

I have never seen a frugal saver "spend down" their retirement principal throughout their entire retirement (certainly not during early years or early retirement).

There are more than frugal savers in the world. Specifically, there are people who saver and spend.

My parents' basic living expenses are virtually nothing (their home is paid off), which allows most their spending to be luxury spending.

Health insurance?

[MonkeyMama]

Health insurance?

They have expenses, obviously. Their monthly/annual expenses just don't amount to a hill of beans.

[snafu]

I think those who retire in their late 50's will discover it's b-o-r-i-n-g after 2nd year. There isn't much spending needed. You've done all the right things, paid off your mortgage, don't owe anyone a dime, successfully launched DKs towards 1st mini steps towards career and have paid in full for household stuff in place. Retirees are not motivated to create a lot of turmoil.

Ingrained habits don't melt with age. Savers don't abruptly turn into spendthrifts. You're smart enough to take good care of health in your 30's, 40's, and 50's. I'm guessing that technology will have solved a lot of genetic and environmental problems.

Have you looked at your retirement plan January 1 - October 27th, 2017 ? If you've a reasonable allocation for your age, at least 'sleep at night' moderate allocation, you've noticed a major uptick! As a retiree, your allocation shifts a bit but the plan continues to compound.

With expenses considerably lower, you work out annual sums and arrange for an automatic monthly withdrawal, to cover expenses.

[LivingAlmostLarge]

The biggest problem with retiring before 65 in the US is medical insurance. Right now NO ONE knows what is going to happen. If pre-exisiting conditions come back expect early retirees premiums to skyrocket. And mr Money mustache is barely 40. Tell me his premium is still $300/month at 45 or 50. Or getting diagnosed with something and then see if it's still affordable. It's a wild card in the US.

[disneysteve]

If pre-exisiting conditions come back expect early retirees premiums to skyrocket.

If pre-existing conditions come back, a lot of early retirees are going to be looking for work because that's the only way they're going to be able to get affordable coverage.