Detailed Summary of "I'm 57, Can I Retire?" Episode of Jill on Money with Jill Schlesinger

Podcast Information:

• Title: Jill on Money with Jill Schlesinger
• Host/Author: Audacy
• Description: Host Jill Schlesinger, CFP®, addresses sometimes uncomfortable and controversial money and investing topics without the financial jargon. She engages with listener calls and informative guests to uncover surprising insights and provide actionable information for financial empowerment.
• Episode: I'm 57, Can I Retire?
• Release Date: December 22, 2024

Introduction

In the episode titled "I'm 57, Can I Retire?", Jill Schlesinger engages with Joe, a 57-year-old listener from Florida, who is contemplating retirement. The discussion delves into Joe's financial standing, retirement readiness, and strategic planning to ensure a secure and enjoyable retirement.

Caller Background and Retirement Motivation

Jill Schlesinger [02:09]: "Welcome to the Jill on Money Show... Let's talk to Joe, who's on the line from Florida. What can we do for you?"

Joe [02:53]: "You know, it's. I have a classic 'Can I retire yet?' question."

Jill begins by understanding Joe's motivation for considering retirement beyond the surface level. She probes into whether burnout or dissatisfaction with his current job is influencing his decision.

Jill Schlesinger [03:14]: "Is the retirement because you're, you know, what's prompting it? Is it like I'm burnt out? Is it I hate what I do?"

Joe [03:35]: "It's not that I hate the organization I work for. It's been 20 years with them though, and it's getting... It's just played out. So I think I'm just done with this company."

Joe clarifies that his desire to retire stems from feeling that his long-term position has run its course, not from disliking the organization per se.

Financial Assessment

Jill conducts a comprehensive review of Joe's financial situation to determine his readiness for retirement.

Income and Savings

Jill Schlesinger [04:29]: "How much do you earn right now?"

Joe [04:31]: "$142,000."

Jill Schlesinger [04:34]: "And are you contributing to a retirement account?"

Joe [04:34]: "Yeah, I fully funded both the HSA and 401ks for the last three years."

Retirement Accounts and Assets

Joe provides detailed information about his retirement accounts and other assets:

• Traditional 401(k): $436,000
• Roth 401(k): $356,000 (including a backdoor Roth)
• IRAs: $650,000 (combined for him and his wife)
• Brokerage Account: $279,000
• Cash in Bank: $102,000
• Home: Owned outright, valued at approximately $900,000

Jill Schlesinger [05:13]: "Wow, that's great."

Jill acknowledges the substantial savings and assets Joe has accumulated, indicating a solid financial foundation for retirement.

Living Expenses and Social Security

Joe outlines his annual living expenses and potential Social Security benefits:

Joe [06:55]: "46,500 is what I need."

Jill Schlesinger [07:00]: "It's shocking. When you hit your Social Security full retirement age, what will your benefit be? It will be 67, probably is the age."

Joe [07:13]: "$3,011."

Jill Schlesinger [07:15]: "Let me round it down to 3,000. And your wife would get half of that, or did she have her own record on which she can claim?"

Joe [07:23]: "She has her own record on which she can claim. It's probably going to be close to half of that, though."

Joe reveals that his Social Security benefit will be approximately $3,000 per month, with his wife having her own record to claim a similar amount.

Retirement Strategy Discussion

Jill and Joe discuss the practical aspects of retiring at 57, considering the ages for accessing retirement funds without penalties.

Joe [08:00]: "What I'm thinking is it's gonna be cash in the brokerage account until I hit 59 and a half, and then I'll probably start tapping my IRA."

Jill Schlesinger [08:18]: "I think you can do it. I do think you can do it. But I would like you to have a little more cash now."

Jill suggests that while Joe's plan is feasible, increasing his cash reserves could provide additional security during the transition period before he can access IRA funds without penalties.

Managing Investments Post-Retirement

Joe considers withdrawing from a managed 401(k) account and transitioning to self-managed IRAs and brokerage accounts.

Joe [09:56]: "I have this 401k that's sitting around $437,000. When I do decide to pull the plug, I'm assuming I'm wrapping that into an IRA and a brokerage account. And then my question is the financial planner that's currently got my money under management for the, for my wife and I's IRA's, what is your opinion about just pulling from him and just going all because he's... I'm paying five basis points that I'm paying him. I'm thinking about just pulling it all, establishing the IRA's in the brokerage account."

Jill Schlesinger [10:34]: "Have to be great. It's not that hard... If you don't think that your advisor is providing you with enough of a value, then I have no problem with you doing it."

Jill assesses Joe's capability to manage his investments independently, considering his disciplined approach to tracking expenses.

Jill Schlesinger [11:10]: "It's certainly worth it if you are, don't trust yourself. And if you do trust yourself, then don't worry about it."

She emphasizes the importance of involving his wife in financial decisions to ensure continuity and preparedness.

Recommendations and Conclusions

Jill provides strategic recommendations to Joe to enhance his retirement readiness:

1. Increase Cash Reserves: To better handle unforeseen expenses and provide a cushion during the transition to retirement.

2. Involve His Wife: Ensuring both partners are on the same page regarding financial management and future planning.

3. Consider Part-Time Work or Hobbies: Exploring alternative income sources or engaging activities to maintain engagement and financial flexibility.

Jill Schlesinger [09:10]: "I'm going to just encourage you to say, at least think about if there's something you can do that would be fun for you. Engaging. Because it's tough... There's a real, like that downshift can be helpful."

Jill concludes by affirming Joe's ability to retire while encouraging thoughtful preparation and holistic planning.

Notable Quotes with Timestamps

• Jill Schlesinger [06:55]: "Are you kidding me? 50 grand a year? That's it?"

• Jill Schlesinger [07:15]: "Let me round it down to 3,000. And your wife would get half of that..."

• Joe [08:00]: "What I'm thinking is it's gonna be cash in the brokerage account until I hit 59 and a half..."

• Jill Schlesinger [10:34]: "Have to be great. It's not that hard."

• Jill Schlesinger [11:10]: "It's certainly worth it if you are, don't trust yourself. And if you do trust yourself, then don't worry about it."

Final Thoughts

This episode serves as a comprehensive guide for individuals in their late 50s contemplating retirement. Jill Schlesinger adeptly navigates the complexities of financial planning, emphasizing the importance of disciplined saving, strategic investment management, and holistic life planning. Listeners gain valuable insights into assessing their financial readiness, making informed decisions about retirement timing, and ensuring that their retirement plans align with their personal and financial goals.

For those considering retirement, key takeaways include:

• Thorough Financial Assessment: Understanding income, expenses, and asset allocation is crucial.

• Strategic Withdrawal Planning: Knowing when and how to access retirement funds can optimize financial stability.

• Holistic Life Planning: Incorporating personal fulfillment and engaging activities can enhance the retirement experience.