The Money Mustache Community
Around the Internet => Antimustachian Wall of Shame and Comedy => Topic started by: Dicey on March 05, 2018, 11:06:34 PM
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DH and I had a dinner date tonight for my birthday. He told me a story about a colleague that just screams to be posted here.
Seems the guy chose to retire in March, after 27 years on the job. If he had waited just one more month until April, his Defined Benefit Pension, which includes a COLA, would have increased by $100/month + COLA for the rest of his fucking life! This is significant because the guy is only 54! I asked DH why he didn't just wait just one more month. The guy's reason for choosing March? His lease was up. OMG, it's one thing to know what "enough" is, but this sounds seriously short-sighted. He could have moved into a hotel and stored all his crap for a month and come out literally tens of thousands of dollars ahead. He could have asked his LL for a shorter lease term. He could have renewed the lease for a year and broken it and still come out ahead. He could have...nevermind. Worst of all? He doesn't have any specific plans, he just didn't want to renew his lease. WTF?
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That's crazy. $100 is going out for a $3 coffee, every day, for the rest of your life. Or half a tank of petrol, or a lunch out each weekend, forever. Plane tickets each year. How short-sighted.
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Ummmm, wow.
And happy birthday Dicey!
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If nothing else, he could have waited that month and donated the extra $!
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My mother in law nearly did the same thing. Her birthday is mid November. If she retired on 11/1 vs 12/1, the difference in her monthly SSA check was going to be about $150 more. My father in law had already retied too early at 62, so he was getting a check that was nearly $300 less than hers, and they hadn't saved for retirement, so the plan was to live on their SSA income.
My mother in law was always bad at math, she just looked at $150 more as "not that much money". I had to point out that she was passing up nearly $2K/year for basically working an extra 3 weeks, since Thanksgiving week was only 2 days at her job. Eventually, she conceded and stayed on till 12/1.
Fast forward to a few weeks ago, where she had a sudden bout of illness and passed away, barely 2 years after retiring. :( My father in law has a tough road ahead, but at least he will be able to claim her SSA amount now, so that $150 extra/month has become incredibly valuable.
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My mother in law nearly did the same thing. Her birthday is mid November. If she retired on 11/1 vs 12/1, the difference in her monthly SSA check was going to be about $150 more. My father in law had already retied too early at 62, so he was getting a check that was nearly $300 less than hers, and they hadn't saved for retirement, so the plan was to live on their SSA income.
My mother in law was always bad at math, she just looked at $150 more as "not that much money". I had to point out that she was passing up nearly $2K/year for basically working an extra 3 weeks, since Thanksgiving week was only 2 days at her job. Eventually, she conceded and stayed on till 12/1.
Fast forward to a few weeks ago, where she had a sudden bout of illness and passed away, barely 2 years after retiring. :( My father in law has a tough road ahead, but at least he will be able to claim her SSA amount now, so that $150 extra/month has become incredibly valuable.
Oh crap! I'm sorry for your loss. Wow. Hopefully, your FIL will be okay, but it won't be easy.
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If he had waited just one more month until April, his Defined Benefit Pension, which includes a COLA, would have increased by $100/month + COLA for the rest of his fucking life! This is significant because the guy is only 54!
Ouch. An annuity paying that much would probably cost about $40,000 on the open market - so effectively a salary of $480,000 per year for that month!
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DH and I had a dinner date tonight for my birthday. He told me a story about a colleague that just screams to be posted here.
Seems the guy chose to retire in March, after 27 years on the job. If he had waited just one more month until April, his Defined Benefit Pension, which includes a COLA, would have increased by $100/month + COLA for the rest of his fucking life! This is significant because the guy is only 54! I asked DH why he didn't just wait just one more month. The guy's reason for choosing March? His lease was up. OMG, it's one thing to know what "enough" is, but this sounds seriously short-sighted. He could have moved into a hotel and stored all his crap for a month and come out literally tens of thousands of dollars ahead. He could have asked his LL for a shorter lease term. He could have renewed the lease for a year and broken it and still come out ahead. He could have...nevermind. Worst of all? He doesn't have any specific plans, he just didn't want to renew his lease. WTF?
Could it be that this man was not very well-informed about the consequences of his decision?
Strange situation in my case: if I enter my pension calculator I am told that they can't calculate my pension yet, because the rules are not finished. Just wait a couple of years. I intend to FIRE within a couple of years and I really want to know the consequences of my decision. Maybe it could pay off working part time for another year, or something like that. It's very frustrating not to be able to investigate this.