I’m a veteran, 57, and on disability benefits. How do I persuade my wife, 52, to downsize so we can both retire?

“We all would like to move somewhere warmer and are thinking it will be South Carolina or Texas.” (Photo subject is a model.) -

Dear Quentin,

This is my second time writing to you. It seems my previous plans to retire and move to the Philippines with my wife have been destroyed and I am now medically disabled/retired and can’t work. This throws my retirement plans off course, and I sure could use some help navigating my next financial moves.

I am now 52, my wife is 57, and we still reside in Maryland. My father-in-law would now like to move back to the States and live full time, so we all would like to move somewhere warmer and are thinking it will be South Carolina or Texas. It will need to be near a VA hospital for my ongoing medical care and we are hoping to be near a beach.

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We are aiming to spend $250,000-$300,000 for a three-bedroom, two-bath rancher. My wife would like to work another 8 years and I am trying to get her to retire at 60. I need help in convincing her that we have enough saved up to retire. We are looking to withdraw 4% to 5% yearly for the next 20 to 25 years. Does the math work?

We have $150,000 in liquid savings, $100,000 in a 4.5% CD, $20,000 in a 3.6% high-yield savings account and $30,000 in an emergency fund. We have $300,000 in our portfolio (80/20 stock/bonds), $115,000 in a 403(b), $75,000 in stocks, $20,000 in a traditional IRA, $8,000 in a Roth IRA and $20,000-$25,000 in gold coins and watches.

Our home is valued around $400,000 and there is only $50,000 left to pay on the mortgage. We both have life-insurance policies valued at $250,000 each that we have been paying for the last 25 years. We also still own all three vehicles outright. However, our finances are drastically different now.

I am now medically disabled/retired and receive $2,100 a month from Social Security before taxes. This fortunately covers our mortgage. I still am receiving my VA disability pension of $347 a month and I am waiting for an increase of benefits to be approved that will boost my pension by about $1,200.

My wife is now the breadwinner and earns about $90,000 a year between salary and bonuses. We continue to file our taxes married/jointly. What options do I have now to make our money continue to grow? Could I cash out our life-insurance policies? I have tried to diversify and have taken on as much risk as I am comfortable with.

Lire la suite

I am considering selling down my stock positions in my portfolio, but do not know what to invest in instead. I’ve met with financial advisers in the past and haven’t agreed with their recommendations. I have family members in finance and I have asked their opinions, but they have always tried to push me into their firms’ products. This has been a bone of contention with me and is an immediate turn-off.

Retirement Ready

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Dear Ready,

Your wife will retire when she is ready and feels comfortable with her plans and finances.

Trying to convince her to stop working when she is unwilling is not a helpful course of action and, if something goes wrong, she will turn to you and say, “Why did you push me to give up my job? I told you so.” I agree with you 100% on your other point: Don’t hire family as financial advisers. You should choose an adviser based on mutual trust, shared goals and expertise, not because you want to throw a relative some extra business and/or “keep it in the family.” I found some homes in Myrtle Beach, S.C., under $300,000, but they were a car ride from the beach. Your price limit will limit your options, but maybe not impossible.

That said, your fortunes have improved significantly since your last letter in 2023. You have over $840,000 in investable assets by your own accounting, or nearly $1.2 million including the equity from your home. So despite everything you have been through with your health and your original plans to move abroad, you are both living proof that it’s never too late to start saving for retirement, and that every little bit you put aside will have an outsize impact 10, 15 and 25 years from now. Downsizing to a cheaper location is a good idea in the medium term, without a mortgage.

Your wife is 52, and won’t be eligible for Social Security for another 10 years and, if she does apply for benefits at 62, she will receive a vastly reduced sum for the remainder of her life (roughly 30% less than her full benefit). If she waits to claim when she is 67, she will receive her Full Retirement Benefit. If she waits again until 70, she will get another 8% on top of that every year. You can read more here. (I assume she is eligible for healthcare benefits on your VA disability plan.)

And so to your questions: Whether you should both retire and whether you can retire are two separate questions. Your wife, I believe, should hang up her hat when the time is right for her. Retirement is feasible, from a financial standpoint. The longer you wait before you start those 4%-plus withdrawals, obviously the better off you will be. A 4% to 5% withdrawal from your total investable assets would give you $34,000 to $42,500 a year; in addition to your $25,200 annual Social Security and expected $18,000 VA pension, that brings your income to $77,000 to $85,000 without your wife’s contributions.

Your life in 2050

Here’s a snapshot of the 25 years, assuming 3% inflation, 5.5% return on your existing investable assets and $1,000 a month in expenses (accounting for inflation), with a 60/40 or 70/30 allocation of stocks and bonds, while leaving your emergency fund, life insurance and gold coins/watches untouched. By 2050, taking an inflation-adjusted $69,600 a year from your retirement pot with annual expenses (before leisure activities, etc.), you would have $900,000 left. That’s a rough projection, and one that assumes modest expenses (assuming your wife has additional income).

Advisers come in all shapes and sizes, some with their own agenda and/or way of doing things. As I told this man who hired a family member as his adviser, it’s not advisable. They may invest your money in ETFs or mutual funds, actively manage your finances or, on the other hand, place your savings in certain funds and not even touch your money. They may have different communication styles. Not all money managers are fiduciaries, who are professionals that have to act in their client’s best interest under the Investment Advisers Act of 1940.

You are both relatively young and, while you’ve been through the mill with your health, your wife likely wants to work a few more years for reasons that go beyond mere finances. She may like her job and the people she works with, and feels that it gives her purpose. So before you persuade her to give all that up by running the numbers — in a Monte Carlo simulation where you view your retirement with different variables (some unexpected) or simply outline the basic figures as they stand — know that money is one piece of the jigsaw.

This may be a time when you compromise, even if it’s the last thing you want to do.

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