# Retire early on $32K/yr?



## Huntmo1 (Nov 30, 2011)

Hello everyone, I wanted to get some opinions/recommendations from those of you that are already retired...especially those that retired early (40s/50s). Here is my situation...

I retired from the military and have a pension that pays around $30K/yr. I have insurance for myself and my family and have 2 kids in high school. We have a little bit of money in savings to pay for about 1/2 of their college in the next few years. My goal is for my wife and I to downsize to a smaller home on an acreage and do what we love to do (garden, raise a few animals, hunt, fish, and other outdoor hobbies). 

I am perfectly happy with a smaller home on a few acres and know that I can get something like that with a relatively low monthly payment on a mortgage. However, my concern is that while my wife and I can live fine on a much smaller income than we have now, I'm worried that my kids may need more help getting their feet on the ground as they start their own careers. Of course, I always have the option to go back to work...but, the problem with that would be finding a job in a more rural area (where we'd want to live) so that we wouldn't have to move (which I wouldn't want to do).

So, my dilemma is...would it be selfish of me and my wife to 'retire' in our mid-40s and not have much in the way of extra money to help out our kids as they get started? I am always dreaming about having a little farm and doing all the things we love...but, not sure if I should wait longer to live it.

Anyone been in our situation? If so, what did you do and how did it turn out? How easy/difficult is it to retire on about $30K/yr? I know that a lot of people actually live on $30K/yr or less now, so that is probably a dumb question...but, I remember when I was making very little money myself and I don't want to get in a situation were I'd have debt starting to pile up.

Open to all viewpoints on this...


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## secuono (Sep 28, 2011)

I'm not a kid person and my family didn't help me much. And really, in this world, they really need to learn to do things on their own and start at it early.

Can you buy the house outright or will you be paying for it? Do you need other things like fancy tv, cell phones, internet and other things that can be downgraded to basic and still be useful? 

I was working, I was using $250 for my food and $300 for my animals food each month. Then you add other monthly bills in total, I could of easily lived off 10g a year. 

I think you should count up all of your monthly bills and see how much a year you actually need. Then tack on 2-3 grand for emergencies and random overages. Where does that leave you?


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## Huntmo1 (Nov 30, 2011)

My wife and I both joined the military after high school and had zero financial help from our parents either; however, that doesn't mean that we have to do that to ours. We have raised them right and they're smart kids so I think they'll do fine...

I can't buy a home outright...probably need to pay on it for a while. Although we do want to have some basic amenities (phone, internet, cable), we are pretty low maintenance and can be very happy with just the basics.



secuono said:


> I'm not a kid person and my family didn't help me much. And really, in this world, they really need to learn to do things on their own and start at it early.
> 
> Can you buy the house outright or will you be paying for it? Do you need other things like fancy tv, cell phones, internet and other things that can be downgraded to basic and still be useful?
> 
> ...


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## pancho (Oct 23, 2006)

My situation and lifestyle may be different than others but I can live very nicely on less than half of $32K/yr.
My bills are all paid off. I don't owe anyone a cent.
My only monthly bills are phone bill, water bill, and electricity.
Food bill is small as I can raise just about all I want to eat.

If you want a simple life it is easy. If you want all of the latest gadgets and continue to support your grown children it will be very hard.
A person just has to decide what they want.


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## where I want to (Oct 28, 2008)

Depends on the kids and your level of participation. Having a lower income will make it easier for them to qualify for college aid progams. If they are good academically, they can get scholarships. 
If you are trying to send a kid through medical school without aid, then no, you can't. If they are going to community or state colleges, you probably can.
One thing I would warn about was the mistake I made. I had a brand new house paid off so I thought I was good for a few years on repairs. I wasn't and had several things (expensive things) happen in one month. I learned that my income was not enough -I had to dip into saving.
While you may have good medical coverage, it may not cover a lot of things you don't neccessarily think about. I had to have surgery that was not available in my area- I had to go to the big city!! And San Francisco at that. I had to make 6 trips down- the least expensive hotel room was about $170/night. I had to pay for cabs and transportation down there. My total non-medical expenses for that year were $10,000. Out of savings agian.
You can see the trouble with income meeting living expenses only- something seems to always come up over that.
Then there are taxes- less income less taxes mostly. But not always- sometimes government can just nibble away at your cushion.
What happens to the remaining spouse if one dies? Will they be able to make the mortgage?
Having said all these things that have gone wrong, I still have enjoyed every bit of my retirement.


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## Belfrybat (Feb 21, 2003)

I don't think you are selfish at all. You state you have about 1/2 the kids' college expenses in savings. That's a whole lot more than my parents ever did for me, and probably about what I would have done had I had kids. Your children can raise the rest through scholarships, grants, work programs, etc. If they need a boost up after college, what's to prevent them from moving back home for a few months before they get on their feet? 

Go for your dream. You will be happier and I bet your kids will be also.

In this day and age $30,000. a year is probably about the least you could live on easily. But it is certainly doable, especially if you live low maintenance lives. And, depending on what it takes for you to get established, you might still be able to save in case of emergencies either for yourself or your kids.


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## where I want to (Oct 28, 2008)

Something to think on- is there anywhere you could live pretty rural and do what you want yet be close enough to a militay center to access the perks like tax free gas and cheaper commissary groceries and officer's clubs, etc?


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## agr8day (Sep 14, 2009)

Being retired military, you should be able to access the military program the will pay for your kids' books and tuition at least. There are still grant and loan programs available for room and board, it needed. As "where I want to" mentioned, your lower income will help the kids' eligibility for grants and loans.
If you and your wife have whole life policies, you may have cash reserves in them. You can keep them in force by just paying interest back on money borrowed out. Keep in mind the principal will be deducted from the death benefit when the time comes. This money should be kept for just the most extreme emergencies, probably.
I think it is doable on $30,000. We have under $24,000 a year but have had to dip into our savings for some remodeling and a newer vehicle. I am planning next to go to just internet--no more cable and land or cell phone--with a Magic Jack. Should be able to save about $100 a month, at least. We are currently living in town, but before this we lived in the country for 47 years as dairy farmers. We may move back--town living is too costly. Utilities and taxes and who knows what-all! No decent garden here, either. We miss that!
Yes, a military base would be a big plus for you. "where I want to" sure has some good advice in his postings.


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## emdeengee (Apr 20, 2010)

It would not be selfish. You say that your kids are in highschool and that you have half the money for their college saved. That is already a good start in life and much more than many have. Depending on the age of your kids they could be earning towards their own college expenses and continue to do so while in collge. And then of course there are scholarships and loans that they could apply for and use. 

You are young enough to really have time to work towards the life you want to live. If in the future you need to go back to work you may find work near you or if it is specialized work you may end up doing contract work that would take you away from home but that is not unendurable. There are a lot of possibilites.


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## jassytoo (May 14, 2003)

I don't really have a viewpoint but I did find the question very interesting. Being that you are only in your 40s you probably, hopefully, have another 40 years to go. I keep all our old account books so I looked up what we were doing 40 years ago. Couldn't find the 1972 book but did look at the 1973 one. We were a family of 5, 3 kids ages 8,5 and 2. We were living in S.California at the time. No homestead yet, we got that a year later when we moved back to WA. We had no health insurance then either even though DH had a decent job. I was a SAHM.

In March we paid,

$8.36 for the telephone
29.86 for electricty
$25.97 for gasoline
$21 at the doctors
$120 for food,cleaners etc
Our rent was $110 a month.
Our last child was born in the hospital in 1971. The bill was $300 +
The next year when we started to homestead we got hay for $0.50 a bale.

I guess my thought would be, how are you going to handle the long term and will you have enough ?


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## Ramblin Wreck (Jun 10, 2005)

Some good advice above, and I would add that it presents a great opportunity to plan and act dilberately. For example, the suggestion above about living near a base would certainly provide an economic benefit for you, and there should be plenty of opportunites to buy land near bases. In Georgia there are two large bases near Brunswick and Savannah (on the coast), a large air base near Warner Robins in the center of the state, and the biggest facility, Fort Benning, is on the Georgia/Alabama border. There are plenty of great land deals near all those bases in the current economy. Check out the tax advantages or disadvanatages (property/income/sales) of each location you are considering. As for higher ed for your children, look at states that offer good values in public higher ed, which can be much less expensive than private schools. Many states grant in-state residency rates to active duty and retired members of the military. Put all the variables down on paper that are important to you and just have fun putting little pins on the map. 

On the question of having enough, I'd suggest using your retirement as your base, allowing you to pick and choose what you want to do to earn a little extra income rather than having to do something you would rather not.

Best wishes.


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## Huntmo1 (Nov 30, 2011)

Thanks for the feedback everyone. I think my best option is to see where we are when my son graduates in 4 years and go from there. It think I'll start looking for a decent job in a rural area where we want to retire to and see what happens. Although I would like to not have a job, my main priority really is to move to a place where I want to live...a more rural, outdoorsy place. Since I'll have the flexibility to wait and look for a job, I hope to have some options to choose from. I really don't need a lot of extra $s, so as long as I can live where we want to live, I think we'll be happy.



Ramblin Wreck said:


> On the question of having enough, I'd suggest using your retirement as your base, allowing you to pick and choose what you want to do to earn a little extra income rather than having to do something you would rather not.
> 
> Best wishes.


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## Wanderer0101 (Jul 18, 2007)

lanewilliam21 said:


> Thanks for the feedback everyone. I think my best option is to see where we are when my son graduates in 4 years and go from there. It think I'll start looking for a decent job in a rural area where we want to retire to and see what happens. Although I would like to not have a job, my main priority really is to move to a place where I want to live...a more rural, outdoorsy place. Since I'll have the flexibility to wait and look for a job, I hope to have some options to choose from. I really don't need a lot of extra $s, so as long as I can live where we want to live, I think we'll be happy.


Excellent idea. While I think the other way is doable you wouldn't have any real margin for error or the unexpected. Transitioning gradually to what you ultimately want makes more sense. I put three kids through college and while they all got academic scholarships, worked, etc. it still cost more than I thought it would.


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## Chuck R. (Apr 24, 2008)

Make hay while you can!

I retired in 2005 at 43 with a pension of 52K, and I went right back to work for a defense contractor. I changed over to a Dept of Army Civilian in 2009 working towards a 2nd pension. While the military pension seems like a lot, thereâs a bunch of unknowns that can/will eat away at it. 

Right now Tricare Prime is a bargain at $460 a year for a family, but thereâs legislation thatâs afoot to raise the costs to about $100 a month, and add co-pays. Also, dental, even the government plan isnât cheap. Still a bargain IMHO, but it eats into your base. No one can say exactly where taxes and inflation will be in the future, but my âguessâ is âhigher than they are nowâ. 
The other factor to think about is your âhireabilityâ, which decreases with age and the longer youâre out of the workforce. By the time you realize the early retirement wasnât such a hot idea, it may well be too late to do much about it. 

Thereâs a bunch of folks that retired early based on current factors without considering the unknown variables, and only ended up rejoining the workforce when the money ran out. âMurphyâ loves to prey on the unprepared. 

Chuck


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## emdeengee (Apr 20, 2010)

By waiting until your kids are in college you have given yourself 4 years to prepare yourself. If you are worried that your current skills will not be marketable in a rural area perhaps you should research what would be marketable and study that now. A friend of ours retired but before she did she shifted from nursing to veterinary technician (took courses and did practicums) and she has never been without work.


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## Tinker (Apr 5, 2004)

My dh retired from the AF after 28 years. Our kids were through school & gone. After 1 year, he got antsy, and went back to work. Now, he is getting ready to retire for the second time, and we are in a much better financial position, and I think he is ready to relax. In the 1 year he was off, he kept plenty busy building a 2 story garage, and fixing up the house, but he just was not ready to stay at home.

You could try it for a few months, and see what happens. You could always find something part-time, to keep your foot in the door, and to give you a bit of extra money. Farming/homesteading can get quite pricey, even when you are able to do most of the work yourself.

Good luck in whatever you decide.


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## motdaugrnds (Jul 3, 2002)

Lanewilliam21, it is obvious you are a concientious person wanting your kids to have an easier time than you had. I praise you for that!

Still, a solid "work ethic" is a must in today's society and your high-school children are not too young to learn that. If I were in your shoes I would sit my entire family down and have a discussion about finances. You stated you have already set aside enough to pay for half their college tuition. It would not be unfair to them at all for them to be responsible for the other half and they are not too young to start saving for it.

As for retiring on 32k, you're getting some great suggestions here...as usual in these forums...and I can only tell you what is working for us.

I actually retired on nothing! My mother became very ill in the last stages of parkinsons disease and did not want to go to a nursing home. I knew I could not be with her 24/7 without having some way of getting away from the situation at times. That determined my setting us up on a small piece of land where I could grow our own foods. Mother bought 6 acres and had $1,000 left. There was no house, no disposal system nor well. My grown son came to help and together we managed to get a well and disposal system. (A stranger gave me a 3-bedroom 1-1/2 bath trailer and we set it up on the land in a way that was sanctioned by the Building Inspection Department.) Thus, we literally had no debt and still don't. We are surviving on less than $2,000 each month because we grow our own foods (veggies, meats, fruits). So my response to your concern about living on $32,000 a year is .... duh! ROFL

My suggestion is that you go for it NOW! Let your high-school children experience the entire transition, get onto your property with whatever housing you can without going into debt to do so. One never knows what is going to occur down the road and making the best out of TODAY is not a selfish thing to do.


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## Huntmo1 (Nov 30, 2011)

Chuck,

I'm in a similar situation, I retired last year and am currently a defense contractor on a 3 year contract (2 yrs left). I'm also exploring federal/GS positions and if the right type of job was out there, I could see myself working longer. 

But, what I don't want to do is work another 20 years and not have the time to enjoy life. I have more things that I could do with my time than I would have time to do them, most are free or cost very little to do. So, I'm not concerned about getting bored and getting the itch to go back to work. Actually, I always say that I want to "work" the rest of my life, I just don't want to have to have a "job" the rest of my life. I can find a ton of fun work that I choose to do around the house and with the family.

However, I realize that $32K (after taxes) is still may not be enough to live worry free. I definitely don't want to slowly slip into debt if expenses come up that I can't cover (e.g., auto/home repairs). So, I think I'll concentrate on trying to save as much as I can over the next 4 year and re-assess where we are. I'm thinking that I'll look for a decent, low stress job that will give us some extra income to use for savings and rainy days.

Thanks for the inputs.



Chuck R. said:


> Make hay while you can!
> 
> I retired in 2005 at 43 with a pension of 52K, and I went right back to work for a defense contractor. I changed over to a Dept of Army Civilian in 2009 working towards a 2nd pension. While the military pension seems like a lot, thereâs a bunch of unknowns that can/will eat away at it.
> 
> ...


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## Ramblin Wreck (Jun 10, 2005)

Kinda' in line with the last post, I've not had a boring day in retirement. Not one. 

I'm working this Summer, because some friends/colleagues twisted my arm to help out at a small college that needed some assistance. Love the folks I'm working with, and the extra money is great. But I'm counting the days and hours and minutes until I can "re-retire", start a Fall garden, build a chicken coop and garden shed, put up one more hay cutting, and maybe even go fishing one day. 

Lot more to life than money.


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## jwal10 (Jun 5, 2010)

We don't touch any of our retirement funds right now. We have rentals, payments from the farms we sold way back in 1992 when I was forced to retire the second time. Also a small salary from the 16 hours a week I am working for the city and some little construction/handyman jobs. I have to stay busy. I make sure I go for walks to enjoy the beauty of this little valley and the creek. I fish, hunt and gather food from the woods that surround me here. I am on the hunt for an old locomotive that fell off a tressle way back up in the woods while logging in the '20s. An old logger friend saw it 15 years ago. I don't need a lot, pretty selfsufficient here. We are enjoying the easy life. We want to get back to the off grid cabin but feel this is where we need to be right now. Tuesday at 0500 We will be on our way to a family vacation at Joseph and Wallowa lake for a week. Life is good....James


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## Shrek (May 1, 2002)

lanewilliam21 said:


> Hello everyone, I wanted to get some opinions/recommendations from those of you that are already retired...especially those that retired early (40s/50s). Here is my situation...
> 
> I retired from the military and have a pension that pays around $30K/yr. I have insurance for myself and my family and have 2 kids in high school. We have a little bit of money in savings to pay for about 1/2 of their college in the next few years. My goal is for my wife and I to downsize to a smaller home on an acreage and do what we love to do (garden, raise a few animals, hunt, fish, and other outdoor hobbies).
> 
> ...


What did your folks get given to them by your grandparents? Neither of my parents was given anything when they started and my father started "teaching me to fish" by charging me 30% of whatever money I earned while living under their roof as room and board and teaching me to live as a renter when I moved out by living below my means to save for my own house as he and my mother did theirs.

25 years after I moved out of my parents house and needed to replace my roof by seeking a signature loan my father offered me the loan at 3% instead of the higher interest the bank offered, which I accepted only after he explained to me why he was offering it to me at half the interest I could qualify for at the bank. 

The loan for my roof was coming out of the savings account he had put my room and board money into for the nine years I had worked part time jobs while living under his roof.


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## Tatorbug (May 14, 2007)

My situation is like some of the others who have posted. I am 61, semi-retired. I work part time in an administrative position for a small rural school district who is willing to pay my single insurance. I would really have been in a fix this year without it. Needed a knee replacement and then had a severe alergic contact dermatitus reaction to posion sumac/wild parsnip. I have been going to wound car 3 times a week for 3 months. (expensive and also costs in gas, medication and suppplies)

I am really afraid to fully retire. First of all, I need the mental stimulation and then I worry about upcoming unforseen expenses until I am medicare eligible and even then I know I will pay more for supplemental and drugs. Health is everything. It factors heavility into the decision. I now need a 2nd knee replacement this year. (Other knee) How is your overall health.

I do have a pension coming in WI State Retirement. I runs about $1,200 per month. I would expect my social security to run about the same. I am working also very hard to pay off not covered medical bills, and the remainder on my morgage, which is about $30,000 on a $180,000 property. I would be very reluctant to fully retire until my morgage is 100% paid. The property taxes here alone run over $3,600 per year, insurance for vehicles and home and property another $1,350. per year. That means on a retirement income, I would be hard pressed to cover unforseen mainteance bills that are sure to come up.

My advice is pay all debts--including morgage and save as much as you can prior to retirement.

As far as paying for more than 1/2 for college education, I don't recommend that. I have seen too many neices and nephews waste time and money in college, as parents were paying for everything. It makes a difference if the student has an investment personally as well. Just my 2cents!!


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## edcopp (Oct 9, 2004)

Many people have never (ever) made $32K in ONE year. They will either retire on a lot less, or keep working until dead.


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