Can I Quit My Job at 57?

0:00Oh, could this vintage store be any cuter? Right. And the best part? They accept Discover. Accept Discover? In a little place like this? I don't think so, Jennifer. Oh, yeah, huh. Discover's accepted where I like to shop. Come on, baby. Get with the times. Right. So we shouldn't get the parachute pants? These are making a comeback. I think. Discover is accepted at 99% of places that take credit cards nationwide. Based on the February 2025 Nilsen report. You know, every year there's a moment when winter finally loosens its grip, especially after the kind of winter we've had this year. It's the first warm afternoon, the extra daylight. And for many of us, it makes you want to reset a little. Clearing out claws, it's firing up the shredder, getting rid of the statements you don't need, and maybe even thinking about the bigger picture. That's where policy genius comes in. Because thinking about insurance and long-term planning can feel overwhelming, especially when you're trying to take care of people you love. Policy genius makes the process so much easier.

1:01They're an online insurance marketplace where you can compare life insurance quotes from some of America's top insurers side by side for free. And their license team actually works for you, helping you figure out coverage amounts, prices, and terms. No guesswork. They handle the paperwork, answer your questions, and help you find a policy that fits your life. This is real peace of mind. Protect the life you've built with policy genius. You can see if you can find 20-year life insurance policy starting at just $276 a year for a million dollars in coverage. Head to policygenius.com to compare life insurance quotes from top companies and see how much you could save. That's policygenius.com. Welcome to the Jill on Money Show. It's Friday, March 27, and we're here trying to help you make better, sometimes less bad financial decisions. If something's going on in your life, all you need to do is go to our website, JillOnMoney.com. Click the contact us button. It's in the upper right hand corner of the website

2:03wherever you scroll and navigate to on the website. You'll always see contact us. When you click that button, a formal pop-up, write us a note. And if you'd like to join us on the air, check the box, Mark, we'll do everything else. Hey, while you're on the website, you should absolutely check out our subscription services called JillOnMoneyLive. JillOnMoneyLive. And for 45 bucks for the next 12 months, you will have access to quarterly live webinars. You'll also have access to the back catalog of the webinars. There's bonus audio and video content. 45 bucks, 12 months. It's pretty amazing. Our next webinar is on Wednesday, June 17. Our guest is Heather Schreiber. Mark likes to call her the Social Security Queen because she knows everything about the Social Security system, claiming strategies, rules, et cetera. Heather will be joining us. It's going to be great. If you don't want to be there live for that webinar,

3:03but you really are focused on Social Security. You can wait till Wednesday, June 17th and the webinar will air live. And then you can go ahead and purchase that webinar for $15 just in isolation. I know a lot of people did that for our last webinar with Ed slot. They wanted to get a little Roth boot camp. They wanted to get a little tax season primer. So that's fine. I just think the 45 bucks for the next 12 months is the better deal. Okay, just me. That's what I think. All right, we are continuing Texas week here on the program. We noticed that yesterday we had a listener from Texas and so do we have today. We have Anthony who joins us from the Lone Star State. Look, I know everything about Texas because I watch Landman. Isn't that it's really it's true to form right Anthony? Is there anything else I need to know about Texas then Landman? Well, I mean, from the standpoint of where I live, I don't see any oil drills already. Anthony, what brings you to the show today?

4:04I am getting closer to where I would love to leave my job. And so I need some guidance on first of all, am I in a position financially where I can do this? And then second of all, I am so not clear on exactly how to do the proper withdrawals once I go into that mode. Okay, Anthony, how old are you? I am 57. And are you married, single, partnered? I'm single. Do you hate your job? Um, no, I don't hate it. I mean, there may be some days when I do and then there's some days when I'm okay. What on the most part? No, I mean, I'm tolerating it, but it's okay. But if you could, it would be nice. And when you talk about, can I leave my job? You mean, can I choose never to work again? Or would it be, can I leave my job and do something else? It's more that, it's more of what I'm visualizing is let's get out of corporate

5:06and let's start pursuing maybe other interest or possible other passions that I need to rediscover. I guess what I would visualize here is take a year sabbatical, so to speak. Now, I would like to go into some classes, learn some new stuff. Yeah, I'm with you. You stick and then maybe then come into doing some part time work after that year. Okay, like financial independence, new or next endeavor, I love a sabbatical. I'm going to just call it your gap year. You forgot to take it when you were 20. Now you're going to take it in your 57. Anthony, do you have any children? No children. Okay, so it's just you that we need to worry about and that in a lot of ways makes it easier. Tell us how much are you earning right now? My base salary is around 150 and then we usually get bonuses, which can put me around 180, 190. Okay, it's 30 to 40 grand a year. Okay, and are you using a retirement plan through work?

6:07Yes, I am. Okay, are you maxing it? At this point, I'm not. I was up into a couple of years ago because that 401k is getting to a point of R&D issues. And so I have been only getting that I've been only doing the company match. Then I have been directing all those funds over to Roth and to my brokerage. Okay, great. So let's go through what is the value of that traditional 401k? There's an equities position and a bonds position. Is that all right? Yeah, you do whatever you do. Okay, okay. So on the equities as I just looked yesterday, I'm at 1,851,461. Calm down. Just give me, that's round. 1,850 Euro Rockstar. That's Justin Stocks equities, right? That's correct. What's in bonds? And then I have 503,000 in there. Good Lord.

7:08You are a rockstar. Okay, you've got a Roth as well. What do you got? Yeah, so an equities position and that one I had met 303,000. And then I have 3,121 in bonds and that. 3,000 fixed. What about the brokerage? And in the brokerage, I have 591,000 in equities. Yeah. And then 70,000 in bonds. I do have an HSA. How much in there? I have 56,000 in the HSA. Great. And then I have a high yield savings account. And I have 162,000 in that account. Okay, so that's it for your assets, right? That's correct. Which is amazing, by the way. It's totally awesome. Mark, I can't believe I haven't heard you snicker yet. We're about to get hate mail, but guys, the base is $150,000. He's got $3,000,000. He can do whatever you want. Just because $3,000,000 would allow you to do whatever you want. Doesn't mean he can do whatever you want. Let's, I have a feeling he could do whatever you want also because the way you save all

8:09that money is you don't spend a lot. Anthony, do you own your own home? This, no, I am renting. Oh, okay. Yeah, and I'm kind of caught in that dilemma. Should I secure a mortgage before I pull the plug? Wait a minute, how much is your rent? Right now, I'm paying only 16, 13 a month. $1,600 a month, that's it? Yes. Do you like where you live? Actually, what my thoughts of what to do is to upgrade into maybe increase that a bit and rent a bit higher. So I was thinking about maybe $2,500. Okay, if you did that, if you had $2,500, if you got a rental for $2,500, you'd be happy in that. And we didn't have to like invade any of your money and you could just keep renting. And that would be fine. Especially if you're taking a year off, I think that's a good game plan anyway. What do you spend right now? And then we'll just bump it up by $1,000 for the upgrade. But what do you spend? What are your expenses?

9:10Yeah, so I did a whole breakdown of that right now. I don't know why this doesn't surprise me. This guy sounds way on the ball. Totally. What do we got on expenses? I've got right now for my current budget. It's around $59,000. So if we bumped that to $70,000 just so that we, you know, could a, then you'll be able to have your, or even I'm going to say $72,000 because it's a nice round number on a monthly basis. So $72,000 would be kind of like what we're looking at. So quick question for you, Anthony. In your organization, like what would you have to give notice wise? Like how much, if you set out quit, how much longer would you be working? Well, because I really, I've been with the company for so long, I've got some really good relationships there and respect for a lot of the managers. So I would definitely not do like, I'm out of here, you know, and I wouldn't need sure. I would definitely be like a person who would give at least,

10:12if they need a month or two months, whatever it is to find the right candidate and then do knowledge transfer and then get them onboarded and do all that stuff, you know. You'd hang around for that. You'd do, you'd do, and if they said to you, Anthony, we need you to stay through the end of the year. You'd be willing to do that. Oh, yeah, yeah, yeah. Okay. Okay. And because we also get bonuses that we go into that, it's the first quarter of the next year is when you get it, but you have to be there to get that. So if I had to do that, I might as well just stay until I can get that bonus. Ideally, though, what would you want to happen? Give your notice right now and be like, I'm done before the summer, because who needs to be working in Texas in the summer? No, what I probably do is I, I'm kind of visualizing this end of this year, you know, sometimes this year, really. Okay. And will you turn 58 this year or next year? Next year. Next year. Okay. So we're not 59 and a half yet. I just want to make sure I got that. Okay. So you give your notice at the end of this year,

11:12you have all this money that you have accumulated. It does not go without saying that you've done an incredible, incredible job. You really have. I mean, you have so much money. What was your game plan going to be for social security? The claim at 67 or 70 is your health good? What does that look like for you? Yes. So for me, health is good. I'm a major advocate for keeping healthy, because as we age, you know, you just, that's just one of the things, right? So when I turn set, I really want to take Social Security at 70. Oh, what would that be? And that amount is $5,222 is what it said on the site. All right, 5,200. Okay. And do you have family that needs your help? I know you said you didn't have kids. You have parents, siblings, tell me. Yeah, my parents. So right now my brother and I are both assisting. We're supplementing the portion that they need to, you know, pay rent and live in an independent living community.

12:14So right now we help them out. And so my portion of that, you know, right now is 600 bucks a month that I give towards their budget. And so I'm including that, by the way, in my, in your, in your, okay. And are your parents in good health, not so good health? Like where are they in the timeline here? Yeah, I would say they're, they're decent health. Let's just say decent, not great, but there have been some issues that have been coming up recently. So yeah, it's, it's, yeah. Okay. And do you live near them? Well, I don't live too far. You know, I'm about maybe less than an hour, depending on traffic, but yeah. Yep. Okay. So let's say that you give your notice. You finish out this year and we need to float your cash flow for two years and also you'll have to, you'll have to be purchasing health insurance for a while. Right? Yes. There's no pension, right?

13:15No pension. Okay. So you have to buy health insurance. So instead of, I mean, 72 grand a year or 6,000 a month, we'd have to kick that up a little bit just because you'll have to buy your own insurance, right? That's correct. So now I've increased your monthly because of we're going to get you a nicer place to rent and we'll make it in, I mean, it's not going to be a thousand dollars a month, but I like round numbers. So I'm going to say seven grand a month is what we need between your health insurance and maybe your parents ongoing needs. You'll need a little extra money. So we'll say seven grand a month or 84 grand a year. Okay. So year 2027, you know what you're going to do. You got money in your brokerage account in 2027 and 2028. You can use money for those two years to get money out of the account, use it to live on and the money that's all in equities. You're going to have to make sure that, you know, between the high yield savings account and whatever you free up in your brokerage account,

14:17you will have to make sure that that money is in cash for the next couple of years because you know you're going to need it. So it can't be at risk. Like so this year maybe as you get into the end, you're going to have to start freeing up some of that money and make sure that it's not at risk because next year, you know, that's what you're living on. Then after those two years, it is time to start attacking that 401k and getting that money out. And at that point, what you're really going to try to do is pull money out of that traditional environment in order to pay the tax that is due. And I'm presuming that whatever you do next, to be honest with you, Anthony is going to be a much lower paying. Maybe it's going to be very satisfying, but you know, it's not going to be, not going to be something where you're like, oh, I'm making so much money that my tax bracket's blowing up. So you've been paying the 24% bracket. I think you should continue to do so and you would start pulling out a couple hundred thousand dollars a year

15:19again, up to whatever that 24% bracket is out of your traditional assets and you're going to live on that from, you know, age 59 and a half to 70 and you're going to pull as much money as you can out of that traditional account. You're not going to worry about it. You're going to pay yourself. That's the money you saved. You're going to work that and you will still have, I presume you're still going to have a problem because it's going to be hard for you to get rid of every single bit of traditional money. It's possible, but it's unlikely. I mean, you're just not going to, you had 1.8 inequities and another half a million in bonds. So that's just like a lot of money to get out. I think you can get a bunch out, but remember, you've got until you're 75 before you have to take it out. So the goal would be to just live on that traditional money during the period of time between now or let's say 59 and a half and age 70, right? At age 70, you'll have that money

16:20of social security, but then you'll just take whatever you need in an excess of social security from the traditional account. And your goal is that by 75, you basically empty that account. It'll be fabulous because then maybe you won't empty it because you'll make too much money. Maybe you won't spend as much, but then you're left with your Roth, your brokerage, your bonds, your savings. And it works pretty beautifully. I mean, I think you can, if your question is, can I quit? Yeah, Mark, do you agree with that? A hundred percent. I mean, I know he's going to do something. He wants to do something else, but you know, worst case scenario, you can go a long time without having to work. Yeah, a long time. You know what's kind of cool? Is I hear that also in your voice. Like you just want to take a break from what you're doing now. You know, if you make extra money from doing anything, even if you said, I'm never going to make 150 or 180, I'm never going to have a corporate job. But let's say even you made 50,

17:21or let's say you just got something where you're making a little bit of money, you know, 40 grand and you get health insurance. Like, wow, that will save you something. You know what I mean? So there are little things here. Doesn't have to be a lot of pressure. You've got plenty of time to find your way. You know, you might fall in love with not working at all, perhaps, or maybe your parents are going to need you to be, you know, more hands on. So that's one of the big reasons I don't think buying a home right now makes a ton of sense. That I think that you would want flexibility. I mean, what if you found out that like, gosh, I really want to be not an hour from my parents. I need to be 15 minutes from my parents. That's important to me, you know? I think that it's better to preserve that as an option just given where you are in your life. Well, I totally agree. That is exactly why I was like, I really don't want to assume a mortgage because I really like the flexibility as well. Yes. Right. But let me keep your brain on something because I didn't mention this. And that is I do have the company does allow us

18:23to utilize the rule of 55. Oh, yeah, you can do it right. Tap it right out of. Do I can tap into now? Yes. Okay. And so my plan was, and I need your expertise on this. What I was planning to do is, you know, I was going to do a certain percentage withdrawal of the portfolio and added that percentage. Let's just say like, you know, let's say that if my portfolio gets to that 3.6. Okay, let's just say it gets to 3.6. And I take, I want to take like a, I'm going to take maybe a 2.8% withdrawal. You know, that right there is going to give me $98,000. Right. Done. I would even do, I would take out whatever I could to keep me in the 24, maybe the 32% bracket. Well, actually what I was thinking of is still staying the 12% tax bracket. No, no, no, no, take out more. You're not going to have a problem. If you stay in 12, the problem is you're going to

19:25accumulate money faster than you can get it out. And then you're going to be forced to take that money out later when we have no idea what the tax brackets are going to be. Okay. I mean, at the very least, I would say 22. Mark, do you agree with that? Yeah, otherwise it's just like, you know, it's like a snowball going downhill. You know, you see why? Because like if you don't take enough money out, it just keeps growing. And then we do have that's the tax time bomb that Ed Slot always likes to talk about. Because if the money stays in there, it's going to continue to grow. Then when you're, you know, then all of a sudden you're going to get to the point where you're like, oh darn it. Now I'm forced to pull money out. Oh darn it. Now I have to pay for Irma. Oh darn it. Now I'm in the tax law has changed. Tax rates are up. Oh darn it. I should have taken more out sooner. So at the very least, I mean, right now the 22% bracket is 105, right? You're going to work this year, right? And you're already up in the 24% bracket. So as far as I'm concerned, 24 or lower is great.

20:28I would not worry about, you know, when you're making no money, I would at least take out at the 22. That's 105. The top of the 22 is $105,700. So you got to get the money out, man. It's going to grow in a rule of 55. It's like, great, you're 57. That's me leaves 18 years of growth in there. Your money is going to keep doubling every seven years. So you're, you're going to get screwed. Well, part of the withdrawals that were included in that 98,000 that I was planning to do is max out the contribution to the HSA and to also the Roth. I mean, that's fine. Yeah, but I'm not worried about paying taxes at 22 or 24. That's where you are right now. That's where most of your money is taxed. Don't hyper focus on that. Truly. It's not worth it. Because right now, right, you're in the 24 bracket, right? You make your 50. That's your top bracket. Your bonuses, let's say your bonus is 30 this year.

21:30That puts you at 180 and the 24 percent bracket single goes up to 200. So you're paying from 105 to 200 ish. You're paying at the 24 percent bracket. So I don't know. I am not hyper focused on 12. You're not going to get because it doesn't matter. Let's say you'd pull it out of 12 now. Then what you are risking is that in 18 years, you're in 22, 24, 32. You don't know. You don't know where you're going to be. And I'd rather have that money out. You could pull it out, convert, but I don't think I want to convert because I don't want to convert. I want to hold until we figure out what you're doing. I mean, I will happily happily have you convert eventually, but not now. I've got a nice chunk of years. Yeah, this is so good. I've used this bomb, right? Yes. Oh, Mark, you are. Yeah. And then when you pulled this money out, the other question is, should taxes be included in that amount? What do you mean? Like, should you...

22:30Let's say out of that 98,000 that I was giving in that number, right? Yes. Should that also include the taxes? Yeah. I mean, whatever. You have to pay taxes on it. Whatever you pull out, you have to pay tax on it. I was thinking because that savings account, and I'm also getting this interest income that I had to also declare, that is also a part of income that's going to show up on taxes. So I was thinking with that interest, that could build up my tax amount. So I don't necessarily need to withdraw those taxes. Dude, pay the taxes now or pay it later. You've decided. Okay. We cannot avoid paying the tax. That's the problem. Yeah, I'm just... I'm just in the mindset of... God, minimize your taxes. Try to keep it as low as possible. Dude, get over it. You have a $30. You're going to pay taxes. Calm down. I mean, really, you have great opportunity here. You want people who are 57 years old with aging parents who they have to help or in the position be like, oh, you know what? I can do whatever I want. That's where you are. And you know what? The price of that is you have to pay taxes.

23:32Big deal. Yeah. Get over that. You're in great shape. Answer to the question. Can I quit? Answer. Yes. Go find something else to do. Anthony, do you have all of your beneficiaries and estate stuff all set up because you do have a lot of money? Yes. So I do have all the beneficiaries set up. I have it in the paperwork. It's also written out. I need to get it... Noterized. Thank you. Yes. Noterized. Let's get that done. Get that done. Your parents have older. Do they have a state documents? Do they have like their wishes known to you guys? My parents are not in a financial position where they have any assets. I mean, I mean more of the other stuff like the healthcare proxy. Oh, yes. Yes. All right, Anthony from Texas. Go forth and quit. Mark another Texan who's in just fine shape. We must be very popular in Texas. I'm excited about that. Hey, are you like Anthony?

24:33Are you kind of done? Do you feel like you need a sabbatical, a gap year? Is that something we can help you with? Get in touch with us. Go to JillOnMoney.com. Click the contact us button. Write us a note. And if you'd like to join us on the air live, check the box. Mark will do everything else. Hey, you know what? While you're there on the website, sign up for the free weekly newsletter. Comes out Fridays. Today. How great for you. And you can subscribe to us on the Odyssey app or wherever you find your favorite podcasts. On Fridays, we thank the folks who make this show possible. Our music is composed by Joel Goodman. Mark Tolercio is the executive producer, King of All Things web, and a fine individual. We are distributed by the lovely people at Odyssey. We ask that you please do something nice for someone else today. Change your work. Change your wealth. Change your life. Thank you so much for listening. And we'll talk to you on Monday. Hey, gang. I just made a first time ever purchase on behalf of the pod.

25:33I was so psyched because Mark and I don't do a lot of promotional materials. But I was able to create a branded sweatshirt. Yep. A Jill on Money branded sweatshirt with Vista print. Now, I'm not usually good at these things. But Vista print made it simple to bring this idea like, how would it be cool if Mark and I could create some sweatshirts that we'll try out? Maybe the listeners would want to get them as well. They've got these great design tools. They've fast shipping. Human support, if you need a little guidance along the way. Because the sweatshirts were so easy to execute. Now, I'm thinking about doing some other stuff. Maybe there's some baseball caps, or I don't know, other fun stuff that you guys would want. You'll let us know. There's a reason that over a million people trust Vista print for their small business print needs. Vista print. Print your possible. Right now, new customers get 20% off with code new20 at Vistaprint.com. Have you ever felt like you were living just a B or B plus life?

26:33It's so dangerous to live that more dangerous than a B minus or a C plus life because when you're living a B or B plus life, you don't change it. You think it's good enough? Is it? I'm Susie Welch. I host a podcast called Becoming You. People think, okay, an A plus life is not available to me, but there is a way. We are all in the process of becoming ourselves. Listen to Becoming You, wherever you get your podcasts.