Retirement Planning - Lessons Learned

[JethroB]

I took a lump sum to cash in my pension recently. Rolled over to an IRA. Leading my decision was the company now saddled with the plan. Short version. My first employer of 25 years was bought out in a hostile takeover. I left soon after. New owner immediately froze the plan, went through bankruptcy two years later, then was purchased by a foreign mega Corp with a shady international history. #2. They offered a 20% incentive to cash out. Yes pensions are federally guaranteed but who would want D.C. tending to it?

Everyone's situation is different and the decision can be difficult with the various options offered. This was just the best path for me.

 

[Solitary Man]

I agree with Tallyho; invest in real estate, fix it up and sell for profit. I won't rent as I don't have the right temperament for that. I also think the gold buyer guys are looking for a safe bet that doesn't exist; putting sweat into a property always pays off.

 

[drssg]

I took a lump sum to cash in my pension recently. Rolled over to an IRA. Leading my decision was the company now saddled with the plan. Short version. My first employer of 25 years was bought out in a hostile takeover. I left soon after. New owner immediately froze the plan, went through bankruptcy two years later, then was purchased by a foreign mega Corp with a shady international history. #2. They offered a 20% incentive to cash out. Yes pensions are federally guaranteed but who would want D.C. tending to it?

Everyone's situation is different and the decision can be difficult with the various options offered. This was just the best path for me.

I had a modest pension from one of my employers, so I did the math to compare the options. If I took the lump sum, invested it, and managed to get a 4% return, it would produce the same amount of money as taking the monthly payments from age 65 until 85. If my lifespan is shorter, then the lump sum option is better still.

If the pension had been more substantial, then I might have been tempted by the security of a guaranteed monthly payment for life, but the lump sum made more sense for me.

 

[ultrarunner]

Retirement plans have never quite worked for me... mergers have left me partially vested... one time only 20% which left a bad taste... I mean same job and desk but name on building changed.

The real wild card is health and the other I see is inflation.

Case in point... 8 years ago nice family homes were going for 280k... so 900k to buy 3.

Fast forward 2020 and 900k won't even buy one.

Those 300k homes are pushing a million and close in 3-4 weeks.

I've seen people cash out and watch their nest egg dwindle and even more so with 1% CD rates!

Not to get too far into the weeds but I seen a lot of farm contracts when passed to the next generation in Europe...

Those old farmers were not interested in money...

The contracts specified so many eggs, liters of milk, timber, beef and pork... all things that have value in any economy... eat it, barter it, sell it.

 

[two_bit_score]

Ultra, what is Cash for Keys?

In the old days the simple way to part ways with a troublesome tenant was to simply not renew the lease... this has not been an option for many years with Rent Control and Just Cause Eviction Statutes... and why many owners resort to Cash for Keys as hard as that is to stomach...

 

[goeduck]

Ultra, what is Cash for Keys?

In the old days the simple way to part ways with a troublesome tenant was to simply not renew the lease... this has not been an option for many years with Rent Control and Just Cause Eviction Statutes... and why many owners resort to Cash for Keys as hard as that is to stomach...

Where you pay tenants to move out. They get their stuff out, hand you the keys and you pay them cash. I am not sure what prevents them from coming back, but I would change the locks ASAP.

The world has gone nuts. Bass Ackwards if you ask me.

 

[two_bit_score]

Were you pay tenants to move out. They get their stuff out, hand you the keys and you pay them cash. I am not sure what prevents them from coming back, but I would change the locks ASAP.

The world has gone nuts. Bass Ackwards if you ask me.

Thanks, I’ve heard of that but never have even come close to doing it. Always had good tenants for the most part. But I got out of residential rentals. I don’t want anymore residential.

We did look at a nice duplex the other day because the location was great. Thought seriously about converting it to our primary residence.

 

[ultrarunner]

Just Cause eviction ordinances which is different than Rent Control and Rental Licensing requirements and scheduled Code Enforcement inspections.

Just Cause limits owners ability to remove tenants and sets the stage for litigation.which had made Cash for Keys popular...

Pragmatic owners know it can take months to remove a tenant, cost thousands in legal fees and tenants feeling wrong can destroy the place...

My lawyer said I was smart using it... long term tenant became ill and family stated moving in to care for her and county provided hospital bed...

Tenant passed and the adult kids jump utility meter, get water from neighbors hose and have candles everywhere...

I call a family meeting and tell them they have to leave and would rather pay them the legal fees money instead of the lawyer...

None of these people were even on lease...

The condition is they have to be out by Sunday with no damage and they get the 1500 lawyer retainer...

I was looking at 4-6 months and 3k if contested...

I cleaned the place up and 1031 out...

Had another where tenants moved but left a lot behind... just knew problem waiting to happen... Loaded everything up in my closed car trailer and sure enough 6 months later he a certified claim letter from legal aid saying I had improperly disposed of tenants property with no evidence of public notice or public sale...

I thank lawyer for reaching out and said I have everything in storage but no way to contact and offer to deliver FREE anywhere locally... Lawyer speachless and says let me get back to you...

I deliver and tenants start cherry picking... I say no, promised their lawyer to deliver everything and do and take pictures....

 

[Solitary Man]

Where you pay tenants to move out. They get their stuff out, hand you the keys and you pay them cash. I am not sure what prevents them from coming back, but I would change the locks ASAP.

The world has gone nuts. Bass Ackwards if you ask me.

That is why I will not rent. Fix them up and sell. Done deal.

 

[two_bit_score]

That is why I will not rent. Fix them up and sell. Done deal.

Do you owner finance?

 

[goeduck]

Well I made an appointment to have a web meeting with a Vanguard Senior Advisor. Fidelity pushes you to a local advisor. I have not checked T.Rowe Price yet.

I will settle on either 1 or 2 of them. Ameriprise is out.

 

[ultrarunner]

Fidelity has been missing in action... two appointments cancelled with the first by a note on the door and second by email when he left the firm.

Any thoughts on LASER fund for retirement also known as rich man's Roth?

 

[dmccarty]

Have you settled on a particular boat? I always wanted an RV but that changed about 15 years ago when sailing replaced it. I致e read countless blogs and several years back people started making vlogs (YouTube)

I do worry that world cruising won稚 be normal for some time due to COVID. As an American hopefully at the very least the Bahamas will be welcoming. I could do that for a few years alone.

*edit.. If it were me in your position I壇 consider selling now before the next correction and buy something small that you could rent after you shove off.

As they say in Harry Potter, it is complicated. :laughing:

We first wanted a specific design of trawlers. Still kinda do but the designer died a few years ago so that made things problematic. We had traveled to China to see the yard where many of the boats are built, we have met and talked with many owners, and the designer before he died.

Now we are looking at few sail boat designs. We had planned to visit a builder in the EU last March but that did not happen. The builder is first class and happens to have built two of the designs we like.

We have had sailing classes, have more to do, and we have lived on boats for a couple of weeks. We love the lifestyle. Having said that, sailing is physical, which is a good thing, but could be a problem as we get older. Having said that, we "know" a couple that are around 80 and still sailing. Soooo, we are still interested in sail boats but trawlers are still in play.

Regarding the pandemic, almost certainly we will return to having vaccine "cards" as was used in the days of yore. There is already talk of this in the EU to allow people to cross borders.

Later,
Dan

 

[JethroB]

Well I made an appointment to have a web meeting with a Vanguard Senior Advisor. Fidelity pushes you to a local advisor. I have not checked T.Rowe Price yet.

I will settle on either 1 or 2 of them. Ameriprise is out.

I have been very pleased with Vanguard advisory service. My needs match their philosophy and service level. Note that the level of service increases along with $ amount managed. I believe they used to have decreasing % fees, now it seems all are 0.30% but get more personalized as you go up $ wise.

 

[riptides]

I have both Vanguard and Fidelity. It's complicated. Lol. Vanguard is more aggressive and Fidelity is more conservative looooonnnnggg term. When I sit with them....they both acknowledge the mix and really cannot outdo the other for the particular portfolio.

 

[JethroB]

I have both Vanguard and Fidelity. It's complicated. Lol. Vanguard is more aggressive and Fidelity is more conservative looooonnnnggg term. When I sit with them....they both acknowledge the mix and really cannot outdo the other for the particular portfolio.

Huh, I would have expected the opposite. My only experience with Fidelity was when i shopping for a new administrator (TPA) for our company retirement plan. Fidelity guy was a fast talking sales type that turned us off. We weren't big enough for Vanguard sadly.

 

[goeduck]

Huh, I would have expected the opposite. My only experience with Fidelity was when i shopping for a new administrator (TPA) for our company retirement plan. Fidelity guy was a fast talking sales type that turned us off. We weren't big enough for Vanguard sadly.

I would have thought the opposite as well. My current employer has my 401k at Fidelity so maybe they are into conservative investments if they are chasing 401Ks from multiple companies.

 

[goeduck]

Anyone using T.Rowe Price?.

 

[RickB]

Not I. I've been with Schwab for almost 20 years and after relocating we have consolidated various older accounts by moving them to Schwab. I've been very happy with their breadth of service.

 

[MossRoad]

My 401k is with Fidelity through my past and present employers. 30 something years. The only time I ever met with them in person was 3 years ago when my past employer gave me a lump sum buyout of my pension and I had to sign the papers and make sure I didn't take possession of the funds. We set up a rollover IRA through Fidelity and had the funds deposited in that. They offered us a look-see at our financial situation. I gave them our info and went back a week later with my wife and we went over it with them. Guy had a nice folder for us, went over it all thoroughly, and then said we did everything right and keep up the good work. No changes.

Wife and I left and had a good chuckle.

We do meet with a person from our credit union once a year to go over our investments and get her opinion on how we're doing. It's a free service. She's also very happy with our choices. She has pointed out a few stinkers to us a few times in between annual meetings, so I know she's keeping an eye on the funds that she knows her people are invested in. Great service and free.