Can I retire comfortably on $65k?

  1. Due to the number of rule-breaking comments this post was receiving, especially low-quality and off-topic comments, the moderation team has locked the post from future comments. This post broke no rules and received a number of helpful and on-topic responses initially, but it unfortunately became the target of many unhelpful comments.

  2. Don't forget to factor in the cost of healthcare - without employment you're likely to need private insurance which can be quite expensive.

  3. It can be quite expensive, but then you hit Medicare. When that happens the cost of coverage gets so much better. Insurance costs at the age of 65 when enrolled in part B, compared to insurance costs earlier in life are night and day.

  4. Yikes, surprised no one mentioned this: does your pension have a Cost of Living Adjustment (often called COLA) clause in it? This allows it to index up with inflation, $65k today will likely be very different than $65k 20 years from now. Many unions bargained away their COLA’s (which was not ideal in my opinion).

  5. I thought I was going crazy when people were saying $65k was okay to retire on but I now realize it's annual and not total.

  6. I assume $65,000 is gross, and pensions are still taxed unless I missed something. So depending on the exact tax figure, you're probably looking at closer to like $4,000/month you want to be training on.

  7. People don't make 65k a year and they seem to be living. If your expenses are low in retirement then this should be easy.

  8. Can you live comfortably off $65k annually before retiring with no mortgage or other major debt? My spouse and I live pretty comfortably off $59k annually with no mortgage. It’s all about the lifestyle you accustomed to before retirement.

  9. My in-laws in NJ have day and night in home aides. They cost about $150k a year. Getting old is not cheap.

  10. I retired a few years ago at 49 y/o. It was the culmination of a 7 yr plan. During that time, we lived off of what our retirement income would be. Do that. It will tell you how much you can retire on.

  11. Is that $65k/year? If so, you’re probably at least ok on that especially with your house paid off. Ultimately you need to figure out what your monthly expenses are and make sure they’re less than about $5k or so

  12. Well, gross I think it's around $5400. Im sure I won't starve, but with inflation going batshit lately it's a scary proposition when it comes to what utilities, food, transportation, internet, etc. Are going to cost in the future.

  13. The biggest shocker for people in retirement is health care, at least for those that had jobs that covered it really well. They underestimate what Medicare provides and how much co-pays and out of pocket will be. I've heard some people be mostly covered for knee replacement if they had the right type of plan and the next be out of pocket $25k+ because they got the minimum.

  14. For most, probably. With no mortgage, cost of healthcare insurance, copays and prescriptions coverage will my next worry. Property taxes and home maintenance will be next.

  15. I think it really depends on where you retire to. The cost of living can vary enormously from one location to another.

  16. Does your pension match inflation? I would say yes that’s plenty for two people barring any unforeseen medical needs that aren’t covered. As a family of 6 in the most expensive part of raising kids in to their teens I’m not sure I could do it where I live. But we’d just move to where we could. It’s a matter of circumstance.

  17. Yes. A 65k pension is actually really great. You are in much better position that the vast majority of retiring people.

  18. My FIL got $64k and some change through his pension and made it work with a $1.1k ish payment (including escrow - so likely to go up over time, car note of $400 and some change (not sure of the price of the truck) and he financed a 24k tractor.

  19. Looking for some ideas on common expense categories I should be considering, or maybe if there are any good online tools I should look at.

  20. Are you military? Do you get TriCare as well? If you have guaranteed health insurance, I’d say 65k is more than enough to retire early. Just a thought, but yo I could walkways pick up a part time job just for side money 🤷

  21. Try living on $55k now, adjusting for taxability of your current and retirement income sources (leaving at least $10k for medical). See how that feels. What will you do with all the free time that doesn’t cost a bunch of extra money? Or will you drive Uber for green fees/ammo/bait?

  22. this is 4 times the average annual salary of a citizen of greece. you have many many options and can live comfortably in hundreds of places around the world. If your plan is to live in Manhattan the answer is obviously goiing to be different.

  23. That’s a lot more than a lot people current making. If you have that much for pension, means you making A lot more. So you need to adjust spending habits to match the 65k pension.

  24. Title had me confused. So you'll have a $65k salary to live on? Not $65k total? If you have that as a salary and very low financial obligations as you say, you'll be fine if you know what you're doing. Only factor I'd consider is where you live. That could be the only thing that would change my answer.

  25. Have you looked into what you will get from Social Security? Add that to the $65k. Do you have any other savings? To me the big one is long term care. Assisted living and nursing home care is crazy expensive. You can buy insurance for that but it ain't cheap.

  26. Should be no problem. That's the equivalent of about $1.6M in a retirement account. Most retirees have far less - no pension, little or no 401k, and a much smaller social security benefit. Median retirement income right now is $46,360. Over 50% of that comes from social security. What other savings do you have on top of the house and pension, and what social security benefits have you accrued? If the pension is from an employer, not the government, it won't impact your social security and you will have more money coming at age 65 or whenever you decide to take it.

  27. Depends on where. The Bay Area? I'm going to say no. Small town Mississippi, Kansas, Oklahoma? Probably fine. I wouldn't feel comfortable going into retirement with just a pension rather than a significant saved up sum.

  28. What will your health insurance bill be? Dental? Eyes? Are you in US and are you taking out social security? What other retirement do you have? Private pension or public?

  29. How close are you to collecting social security? Also what are you doing about health insurance? Do you have any other income streams besides the pension?

  30. I would be 17 years from getting SS but I would keep my healthcare coverage but at a higher rate of about $500/mo. I have a 401k as well but want to keep that for emergencies.

  31. How is your health insurance and how much does it currently cost? Health care is the real wild card expense because you never know what could happen to you.

  32. That’s a hard question. I’d talk with a financial advisor because there will be a lot of specific factors to consider. They’ll have the calculations to give an estimate based on your lifestyle and age. Now would be a good time too so u can prepare and save and invest more in the mean time. I’d recommend talking to a fiduciary that your bank might have.

  33. Depends for me! If I had $65k annually with no mortgage but $4,500 property taxes! Depends! Did you factor in insurance, Rx copays, gifts such as birthdays, graduations, weddings, bereavements, or home maintenance (appliance replacement) included, car repairs/maintenance, or eating out, groceries, toiletries, travel, or or or or! 🫣

  34. There are a lot of unknowns. I know I could as the wife and I have made it on less and hopefully by that point, the kiddos will be gone and we'll just be taking care of us. The will be at least 20 years from now though, so who knows. I am in the same boat of no mortgage, just taxes and utilities. I am sure I will be done gaming by then as well

  35. To address your question about expenses in a typical budget, below is a link to a sample retirement worksheet. Scroll down the page and it has a good section showing expenses.

  36. How old are you? Remember healthcare is fucking expensive, especially if you go full private. If you're not eligible for medicare/medicaid you need to factor in that cost.

  37. Bear in mind that even at a 3% rate of inflation, the purchasing power of that $65k is halved about every 25 years.

  38. Start living that way now and see how you do, and remember to factor in the trips you plan to take in retirement, any hobbies you plan to pick up or restart, etc. Set aside a generous amount for those activities and base that amount on current rate plus whatever the inflation rate for that particular activity/ industry is.

  39. as long as your living expenses are below 65k than yes. for some, 20k is enough... its all about your lifestyle.

  40. This really depends on how luxurious/comfortable you intend to be, who else you plan to support, how healthy you plan to be, how long you intend to live, and where

  41. Remember food, auto expense(s), insurance costs like homeowners, health, drug, car. Housing repairs. I don’t know we’re you live, but check inflation. I am retired and I couldn’t even come close with that in Southern California . Good luck and be careful with your numbers

  42. If you have a pension, can’t you retire and then find another job and double up income for a few years? I knew a “retired” cop in CA who made like $90K on pension, then had another job and his own business. He was stacking cash.

  43. I did not intend for this to be any kind of brag, and I don't think the average UK salary is $35k a year. Even if it was, that doesn't take into account what the average salary prior to retirement is, which is usually the time your salary would be highest.

  44. Beyond your normal expenses now, I think healthcare and caregiving are important considerations. You can expect both expenses to go up with age but with advanced age caregiving can become a huge out of pocket expense. Think about what you and potentially SO would want/expect if you live to a very old age and need help. In home caregiving is expensive and largely out-of-pocket. Facility-based varies and depends on financial resources and insurance. Assisted living and long-term nursing facility care costs vary depending on how much help is needed but frequently cost 10k/mo. In home 24h nursing care through and agency can cost about 15k/mo. It’s something that many people will need, some for a short time, others for many years, some not at all which makes it hard to plan for but still important to consider.

  45. I live quite comfortably on $22k in Social Security benefits. I guess it depends on where you live and how much you spend on non-essentials.

  46. Wow, 6500 is basically what someone earning about 130k gets back per month after taxes and retirement savings.

  47. im on disability and survive on 1100 CAD/mo. , no home - i rent a room, minimal possesions ... it's like you're bragging at this point.

  48. Your comment makes no sense. They’re not bragging and are just asking a question. Someone in another county could say that you’re bragging about bring in 1,100/month CAD as it’s all a matter of perspective.

  49. Move to Mexico and live like a king. Big American ex pat communities over there now. Do you Dr visit with telemedicine, come to the states for anything major.

  50. Depends on your ago too. 70 years old retiring on $65k is way different than 55 retiring on $65k.

  51. Right now I have roughly 200k between 401k and a annuity. I still wouldn’t retire unless I was near a million or more in the bank. I hate to say it but you’ll burn through that in 5 years easily. Unless you don’t go anywhere and grow your own food.

  52. I’ve never spent 65k in a year on living expenses (except the year I bought my house). Depends on how much stuff you want to buy/where you live. It’s pretty much impossible for us to give advice with no actual budget.

  53. Why not just calculate what it costs you to live now. Add in extra expenses that you will experience as a retired person which you are currently not paying for. Subtract expenses that you will no longer have that you currently are paying.

  54. It's inflation adjusted. And I agree, it comes down to expenses and such that will be unique for each person but I want to be sure I'm not forgetting any expenses I'm not thinking of.

  55. sounds good, just set side some money for major repair job of the house. otherwise, you should be good living off $4000+ a month

  56. Depends if you can live with the same or less expenses than you have now ie. Will your income keep up with your spending habits?

  57. How many years do you expect to live, is that 65k going to be coming in until then? Write out all your expenses including food gas and miscellaneous and then decide

  58. Probably end of life expenses; unexpected medical, funeral, estate taxes/costs/fees. Unpleasant, but very hefty. Example: one of my elderly family members spent perhaps 10-15 days total in ICU($10-12k per diem), and at least a month or two in a 24-hour care facility. Small private funeral; open casket service, minor graveside service (military honors). Many financial matters still had to be navigated post mortem (left a widowed spouse).

  59. what is your current level of expenses? could you live on 65k right now? What things will you do with your time when are retired? Will they cost money? How much would you have on them? Are you prepared for medical expenses? What about long-term care costs if you get to the age of requiring a visiting nurse or to stay in assisted living or hospice setting (there are insurance options for these expenses you can look into)

  60. How long do you need to live in retirement i would say no if you plan on having nothing but that and ssi to live on going forward.

  61. If your property tax is your only concern it sounds like you have the capability of living very modestly. If you will be purchasing crap on amazon everyday then maybe rethink your pension.

  62. I mean depends on where as COL values, but yeah it's definitely doable. In US at least, average household income is around that (meaning multiple earners fully employed typically with a child ab unpaid home). So yeah, it's doable. I personally just don't ever put my eggs in one basket and save for my own retirement regardless and pension is icing on the cake since technically it's possible for pensions to run out of money uf not federal in particular especially.

  63. Healthcare expenses are your highest potential unplanned cost in my opinion. If you are over 65, you should look into purchasing a Medicare supplement plan, usually a decent one is around around 200-300/mo

  64. You certainly can if you’ve taken care of your healthcare needs and have a diversified portfolio that gives you both passive income and capital growth potential. That said, comfort is subjective, so it really depends on your lifestyle. My husband and I only need 55k per annum and that includes a 10k travel budget. Anyway, congrats on your impending retirement! 🤗

  65. Well that's 20k more a year than I make, so most likely yes, depending on health insurance and other expenses. My grandma lives solely off of half of her ex husbands pension, from the DEA, for the last 30 years. Most of her money ends up going towards hospital bills though, so that is something to be aware of!

  66. Do you have any other savings or an emergency fund or anything? Or will you be living off your pension solely until you can claim social security? You are young, so not having a cushion for major life expenses would be my biggest concern.

  67. Have you considered retiring overseas? I actually have several friends who are happily retired in Thailand and the Philippines. Their pensions are not large but still buy them a very comfortable lifestyle. Plus medical services are significantly cheaper.

  68. And Medicare doesn't kick in immediately. I believe I had to wait 2 years. And yes, one health crisis can take so much, I lost my savings in 6 months, though I am in a much lower tax bracket. Much, MUCH lower. Just consider all the variables. Best of luck to you.

  69. Depends where to be honest. If you're in a low cost of living state in the southern US like Alabama, Mississippi or a zero state income tax like Nevada or Florida or Texas then sure you can live a simple life on $65k a year. Don't forget at 62 to 70 you'll also get social security which will add another couple thousand dollars per month to your income, and you'll qualify for Medicare which means you no longer will have to supply your own Healthcare freeing that money up for other expenses.

  70. I mean, it's hard for us to think of what expenses you might have without listing any expenses already. Plenty of people live on far less but we have no idea what your personal situation is or standard of living.

Leave a Reply

Your email address will not be published. Required fields are marked *

Author: admin