Medical Condition Has Me Pondering Retirement

Summary

Episode Title: Medical Condition Has Me Pondering Retirement

Release Date: June 13, 2025
Host: Jill Schlesinger, CFP®
Podcast: Jill on Money with Jill Schlesinger
Produced by: Audacy

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Introduction to Jane’s Situation

At [03:05], Jill welcomes Jane, a listener from Virginia, who is grappling with the difficult decision of whether to retire early due to a deteriorating medical condition. Jane is approaching her 54th birthday and is concerned about her ability to continue working until the traditional retirement age of 60 or 62.

Jane: "I have a medical condition that's slowly making it harder to work and live an active lifestyle." [03:12]

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Personal and Family Background

Jill delves deeper into Jane's personal circumstances to better understand her financial landscape.

• Marital Status & Dependents:
  Jane is partnered without children but anticipates potential responsibilities in caring for her aging parents. [04:08]

• Parents' Health:
  One parent has been recently diagnosed with cancer, adding emotional and logistical strain. [04:32]

• Living Arrangements:
  Jane and her partner maintain separate dwellings but effectively live together most of the time. They are considering selling one or both properties to consolidate their living situation. [04:50]

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Real Estate Holdings

Jane owns two properties:

1. Primary Residence:

   • Value: Approximately $1.2 million, suitable for sale to developers.
   • Mortgage: $500,000 at a 2.75% interest rate. [06:02]

2. Vacation Home:

   • Value: Around $1.2 million.
   • Mortgage: $503,000 at a 2.875% interest rate. [06:24]

Jill’s Commentary:
"Why don't you just negotiate everyone's mortgage rates? You're amazing." [06:37]

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Income and Savings Overview

• Current Employment:
  Jane earns over $280,000 annually with additional variable bonuses between 25% to 30%. [06:44]

• Retirement Accounts:

  • 401(k): $705,000
  • IRA Rollover: $827,000
  • Roth IRA: $12,000 (initial investment)
  • Brokerage Account: $265,000
  • Savings: $140,000 [07:07]

Jill’s Insight:
"That's a million and a half bucks that hasn't been taxed yet." [08:30]

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Monthly Expenses and Lifestyle Considerations

Jane’s monthly budget is approximately $12,000, covering house payments and other living expenses. Jill questions whether these expenses could be reduced if Jane retires early, especially considering potential changes in living arrangements with her partner. [08:00]

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Retirement Planning and Financial Strategy

Exploring Early Retirement Options:

• Rule of 55:
  Jill suggests Jane explore the IRS rule of 55, which allows penalty-free withdrawals from retirement accounts if retiring in or after the year she turns 55. [15:10]

Consolidation of Retirement Funds:
Jill advises merging retirement accounts to simplify access and management, recommending Jane consider consolidating her 401(k) and IRA rollover into one account. [15:37]

Sustainability of Funds:
Jill calculates that without additional income, Jane’s $1.5 million in retirement accounts would deplete her funds in approximately 8 years at her current spending rate. [15:37]

Jane's Potential Employment:
Jane considers transitioning to a less stressful engineering role, potentially earning around $150,000 annually, which would partially cover her expenses and extend the longevity of her savings. [11:06]

Jill’s Perspective:
"If you could work and basically mostly cover your expenses at $150,000 a year, you're not quite there yet, but you could close." [12:06]

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Partner’s Financial Contribution and Shared Planning

Jill emphasizes the importance of including the partner's financial contributions in the planning process. Jane notes that her partner is financially stable, contributes to savings, and is willing to continue working. [18:41]

Jill’s Advice:
"Have a conversation with your partner about what can you really contribute and consider scenario planning with a fiduciary." [15:10]

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Emotional and Practical Considerations

Jill acknowledges the emotional difficulty of retiring early, especially when health issues are involved. She encourages Jane to prioritize her well-being over potential financial gains.

Jill:
"Your life matters. You're okay right now. So let's do this." [19:58]

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Conclusion and Final Recommendations

Jill concludes by reinforcing the importance of personalized financial planning, especially when facing health challenges and life changes. She recommends consulting with a certified financial planner to explore all available options and create a sustainable retirement strategy.

Jill’s Closing Remarks:
"You have your one life and your one body. If your body is failing you, we're going to figure out how to make your life better." [21:09]

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Key Takeaways:

1. Early Retirement Considerations:

   • Assess financial readiness based on current savings and expenses.
   • Understand the implications of tapping into retirement accounts early.

2. Importance of Comprehensive Planning:

   • Include all assets, income sources, and potential expenses.
   • Factor in partner’s financial contributions and shared responsibilities.

3. Health and Well-being as Priorities:

   • Don’t let financial metrics overshadow personal health and quality of life.
   • Seek professional financial advice tailored to individual circumstances.

4. Flexibility in Employment:

   • Consider transitioning to less demanding roles to balance income and personal well-being.

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Notable Quotes:

• Jane on Retirement Concerns:
  "If I can retire early instead of, you know, trying to make it all the way to 60 or 62." [03:12]

• Jill on Life Prioritization:
  "Your life matters. You're okay right now. So let's do this." [19:58]

• Jill on Financial Planning:
  "Have a real conversation with your partner about, are we really combining our finances?" [15:10]

---

This episode offers a compassionate and practical discussion on navigating early retirement amidst health challenges, emphasizing the balance between financial stability and personal well-being. For more personalized advice, listeners are encouraged to reach out through jillonmoney.com.

Transcript

[Jill Schlesinger]

Hey gang, I was a small business owner. I know how hard it is and starting your business should actually be simple. Now you can get more when you start your business with Northwest Registered Agent, your entire business Identity in just 10 clicks and 10 minutes. Northwest registered agent provides more privacy, more guidance, and more freedom to run your business from anywhere. If you want to build your business while keeping your personal information secure, Northwest is the partner you need. In just 10 clicks and 10 minutes, they'll form your business. Create a custom website and set up your local presence wherever you need it. Don't wait, protect your privacy, build your brand and set up your business in just 10 clicks. In 10 minutes. Visit northwestregisteredagent.com Jill and start building something amazing. Get more with Northwest registered [e-mail] Jill Summer Grilling season is here and Whole Foods Market makes it easy to serve up something delicious without breaking the bank. Whether it's hosting a backyard barbecue or bringing a dish to share, there are high quality options for every summer gathering. The365 by Whole Foods Market line has everything needed for flavorful summer meals at great everyday prices. Look for grilling staples like no antibiotics ever, chicken thighs, ground beef, wild caught salmon burgers and uncured hot dogs. Complete the spread with classic summer sides including organic salad kits, tortilla chips, zesty salsas and kettle cooked chips. Add extra flavor with organic condiments, spice rubs and marinades like no sugar added ketchup and organic yellow mustard. Finish it all off with drinks and dessert. From sparkling water and organic lemonade to pints of ice cream and organic cake cones, there are so many ways to save on summer grilling favorites at Whole Foods Market. Welcome to the Jill on Money show. It's Friday, June 13th and if you are superstitious, I'm sorry, I think 13 is lucky. So it's a lucky day because we get to talk to you. This is the program that is trying to help you make better. Maybe just more informed financial decisions. And if there's something big going on in your life, maybe it's a job change, maybe you're thinking about shifting careers. Maybe it's a house purchase or sale or something that's going on that needs a little bit of a, I don't know, like a mentoring, like a coaching mentoring. Give us a holler. All you need to do is go to jillonmoney.com, click the contact Us button and write us a note. If you want to join us live. Check the box. Mark will do everything else Today we are joined by Jane, who's in her car somewhere in the state of Virginia. So we had to make sure Jane was not driving. She's parked before anybody gets nervous. So, Jane, welcome to the program. What can we do for you?

[Jane]

Hey, thanks for letting me join you today, especially on Friday the 13th. Appreciate it very much.

[Jill Schlesinger]

Of course.

[Jane]

So I have a question that I think everybody else asks. If they can retire early. I'm about to turn 54 next month, and. And over the past few years, I've had a medical condition that's slowly making it harder to work and live an active lifestyle.

[Jill Schlesinger]

Oh, I'm so sorry. That stinks.

[Jane]

Sure. Yeah. So I've been to many doctors, and the conditions are getting worse without a solid diagnosis and treatment. So I'm trying to figure out if I can retire early instead of, you know, trying to make it all the way to 60 or 62. If I can last another year or two and then retire maybe in the next year or so. Not sure.

[Jill Schlesinger]

Okay, well, first of all, you're going to tell us a little bit more than just. You're turning 54 next month, right? Are you married? Partnered? Parenting. What are you doing?

[Jane]

I'm partnered. I don't have any children, so except for potentially taking care of my parents as they get older.

[Jill Schlesinger]

How old are your parents?

[Jane]

My parents are in their 70s and 60s, late 60s. However, one was recently diagnosed with cancer, so I'm helping that situation as well.

[Jill Schlesinger]

And you're nearby them, so that helps.

[Jane]

I am nearby. I'm about an hour or so away. But that's almost a lifetime in D.C. traffic.

[Jill Schlesinger]

Isn't it just. You're so right. So, Jane, first of all, do you live with your partner or you have separate dwellings?

[Jane]

We have separate dwellings, but we pretty much live almost together all the time anyway.

[Jill Schlesinger]

Do you think. In other words, when I'm looking at these numbers, should we include partners, money, or cohabitation, or what do you think is the likely scenario going forward?

[Jane]

The likely scenario is that if I do retire, that we would either live in one of my homes or buy a home together and live in that home and then rent out the other condo. That's that she's currently dwelling in.

[Jill Schlesinger]

Okay, got it. And is she older, younger, same age? Ish.

[Jane]

She says she's younger, but it's only about nine months.

[Jill Schlesinger]

You know what? Stop that. This is just silliness. Okay, Jane's girlfriend, calm down. Okay, so let's Tell me a little bit about the house. So you live in a condo now yourself? Tell us about your real estate?

[Jane]

Sure. I live in a single family home. It's my primary residence. And then I have a second home that's more of a vacation home that I try to get to on the weekends. Okay, that's about an hour and a half away.

[Jill Schlesinger]

How much is the single, the primary worth currently?

[Jane]

You know, if I were to sell it today to some people that want to tear down homes and rebuild them again, about 1.2.

[Jill Schlesinger]

Is there a mortgage that's outstanding still on it there?

[Jane]

It's about 500k at 2.75.

[Jill Schlesinger]

Oh, gosh. Okay. What about the vacation home?

[Jane]

The vacation home is worth about the same amount. It's also got a mortgage on it for about 503 at 2.875.

[Jill Schlesinger]

Why don't you just negotiate everyone's mortgage rates? You're amazing. Is that it for the real estate?

[Jane]

That's it for the real estate.

[Jill Schlesinger]

Okay, so you're working full time right now. How much do you earn?

[Jane]

I earn about a little over 280k annually. And then I get a variable bonus that's between 25% to 30%.

[Jill Schlesinger]

Okay, you're putting money into a retirement account. So tell us about what you've saved so far.

[Jane]

I've been working pretty hard to try to combine my past 401ks. So right now in my 401k, about 705k.

[Jill Schlesinger]

Okay.

[Jane]

Got a IRA that I rolled over, that's about 827. And then I've just got a small Roth because I haven't been able to contribute that much. Once I made the mistake of opening an IRA that's at 12K.

[Jill Schlesinger]

Okay. Don't worry. No big mistakes being made here. Do you have a brokerage account as well?

[Jane]

Yes. And that's about at 265 right now.

[Jill Schlesinger]

Okay. Money in the bank safe. Boring money.

[Jane]

About 140.

[Jill Schlesinger]

Any other asset that we have not accounted for right now?

[Jane]

No, not that I can recall.

[Jill Schlesinger]

This is not a deposition. Okay, Condo.

[Jane]

I know.

[Jill Schlesinger]

When you look at your spending, what are you spending? Pretend that we're just going to keep your single family home and the second vacation home. What's your spending on a monthly basis look like?

[Jane]

My spending varies depending on just whatever comes up in house payments, but pretty much I've budgeted around 12k.

[Jill Schlesinger]

Okay. You're not entitled to a pension. Or are you? I didn't ask you that.

[Jane]

I had a pension, but that was one of the things I rolled over to manage myself.

[Jill Schlesinger]

Okay, so you got a million and a half bucks that hasn't been taxed yet. Right. In terms of 401k IRA rollover. And then you've got a Roth and you got a couple hundred grand in your brokerage and 140,000 that is in the bank. So if you were to retire next year at age 55, would your expenses go down at all? Probably not. Right? We have to still do our 12k a month. Or is it fair that we would say that partner would either move into your house, you'd move into her house, or whatever? Like, what would happen at that point? So what can we count on for stream of income going forward?

[Jane]

We would move in together, live in the same dwelling. So we would probably either sell both my homes or move into one of my homes.

[Jill Schlesinger]

Okay.

[Jane]

I think the former is preferable just so we could have a place together that we can start. And then. And then, by the way, I just.

[Jill Schlesinger]

Want you to know, I just want to say for everybody listening, I'm going on the record as saying that when I met my girlfriend, now wife, I did that total lesbian thing. Like, we've known each other for three minutes. Can I move in? And I did. And so it took a big renovation to kind of be like, okay, this is actually my apartment. It's not Jackie's, so it's not the worst thing in the world. So are you saying, though, that if. If I'm looking ahead and we were to sell both of these, I mean, if we sold your single family, would you like to keep the vacation home?

[Jane]

I think we were trying to find a place that could check all the boxes and still have that water lifestyle, but still be in an area that is accessible to the city and restaurants and fun things to do. So some of the water properties that are decent around this area are kind of really far out there.

[Jill Schlesinger]

Yeah. So if I. But if I were to. If I were to assume that you sold both of these places and you bought something brand new together and you had 700 grand come out of each of these in equity. I mean, I know there's going to be some taxes, but just stay with me for a second. That you'd have. Let's say it's 1.2 million cash out after taxes. Okay. Would you need to spend that exact same amount of money to get into a place that you'd want to live in?

[Jane]

Yes.

[Jill Schlesinger]

Okay. So I can't count on having that extra money as available to me. All I could count on is that your expenses might go down because we have another person contributing.

[Jane]

Yes.

[Jill Schlesinger]

Okay, got it.

[Jane]

Could I add too that, why not? You know, that, you know, retirement is, I don't necessarily want to do, you know, nothing. What I'd like to do is potentially consider work as just a plain old engineer where I, I'm not in a stressful situation, stressful job, you know, and having to present in front of people. So I was thinking, you know, for a different career, perhaps an AI ML engineer, that, that would take me to a, you know, a third or half of what my salary is now.

[Jill Schlesinger]

Okay, let's do that sort of amount. Let's look at that then. Let's say that as of next year. I mean, maybe it's not even next year, maybe it's next month. Okay? So as of next month, instead of making 300 something thousand that we could, you could, you think you could find something comfortably like you're an engineer, you know the market, 150 grand a year.

[Jane]

Yes.

[Jill Schlesinger]

That's easy for you, right? Because you're an engineer, you know your stuff. Okay. So if that were the case, then I'm really, I'm not afraid as long as you can keep working a little bit just to, you know, because I don't know what the, your medical condition. I don't know if this means that you're going to have more expenses in terms of care and things like that. But let's. Just looking at the numbers, if you could work and basically mostly cover your expenses at 150 grand a year, you're not quite there yet, but you could close. And one thing that might be interesting is if you were to do a job where you would make 150 grand, do you think you'd be more of a consultant or do you think you'd be an employee?

[Jane]

Probably first as an employee, I think.

[Jill Schlesinger]

Given everything you've said and having a medical condition where you. I just wrote this down verbatim. You said I have a medical condition which makes it harder to work in your current job. That to me is like, just stop right there. We're going to make the numbers work for you. So they're going to work for you. They're going to work for you. Okay. What you may not be able to do is save as much money in the next phase of your career, but so what? Who cares? It doesn't really matter. You got your million and a half bucks. You are going to hopefully be living with your girlfriend and having a little bit of a lower expense for yourself. Because even at 12 grand a month, if, if she's kicking in, I don't know three, four thousand dollars that you know towards living, et cetera. Great. And then we know that you have 150 grand a year coming in, work wise, I'm not even including what she has. Then I think this all works just fine for you. I don't think that you should be thinking, how can I stay in this job as long. I mean, the, the. If you didn't say, like, it's harder to work, if you just say, I don't like it, that would be one thing. I might be like, bucket up, maybe a couple of years more and you're done. But that's not what you're saying. Harder to work in this job is something I pay attention to. And I think you should too. I think that you're actually in very good shape. And I would suggest that if you have a condition like you do, and if you have parents who are aging, this is a great time to really think about your living situation and in a more sober way. And what I mean by that is there are a lot of things when you say like check the box. Checking the box may be, you know, what I gotta be. We, we should move closer to my parents because we're gonna have to take care of my parents or if she's like, no, my parents or whatever, you know. But all I can tell you is that as they get older, as having, you know, all of my friends who have parents in their 80s right now, the pull and the needs are going to only get bigger and bigger. And I think you should just factor that into your living situation as well. So did you know because you're an engineer, you're a math head, you know that you're okay, right?

[Jane]

I think if I took the other job, a lower, you know, paying job, I would be okay. I was just trying to figure out if I could not work at all. Just okay.

[Jill Schlesinger]

So then let's do that worry. Okay. Let's say you wanted to not work at all. Okay. So you'd stay for a year. You'd see if your company allows for the rule of 55 where you can access that $700,000 that's in that 401k. And maybe what I might do is the money that's in your 401k right now is. You said 705. It's pre tax. You also have a separate IRA rollover account of $827,000, right?

[Jane]

Yes.

[Jill Schlesinger]

I think what I might do is if you really want the option to stop working at age 55, I would take my IRA rollover of 827 and I would roll 401 that I'm in right now so that in your 401k there would be a million and a half dollars that would allow you to tap that money and have it in one place and maybe keep it there. It consolidates things. It just makes your life a little bit easier. Then what I would do is, if you're allowed to, you have to check with your employer if you can invoke the rule of 55. I'm 55 and I am retiring from this company. I can now pull money out of my retirement account early. Five, four and a five and a half years early. Right, because I'm 55. So you start pulling the money out and you could essentially pull that money out and live on that. It's going to freak you out. Absolutely freak you out. Okay. You will. If you have no other income, you will start to spend that money down. Now, I don't know if this medical condition means you have a, a life expectancy that's curtailed, but you know, if you're going to spend 12 grand a month without any other income, you're going to blow through this million and a half bucks. You can tell. Just do the math, right? Just very easily you're done, right? So you can do that if you make different decisions. If you say, well, what we're going to do is I'm not going to make money. Maybe I wouldn't make 150 grand a year, but maybe I could make 50 grand a year. I'm just putting it out there. It's money because, like, we now have to pay for your health insurance. We're going to sell both of our homes. Sell both. You're going to sell both of your homes. You're not going to spend, you're not going to spend all. You need some of that money. We need that money to actually work for you. So you can't live in the same kind of house. You can't spend the $1.2 million. Or you might say, we're going to stay in the primary and we're going to sell the vacation home. And I'm going to take that 700 grand and I'm going to pop it into my brokerage account. And now I've got a million bucks in my brokerage account, and now I can build on that and I don't have to touch that for a while. So, I mean, I think there's different things to do. And you have to have a real conversation with your partner about, hey, what can you really contribute? In some respects, what I think, Jane, is that I think if you really say, I cannot do this anymore, then this is a much bigger conversation that maybe is best to have with a financial planner, with a, you know, a certified financial planner, a fiduciary who can really map out what your options are. If you're going to be able to work for 150 grand a year, it's easy. Fine, do it. If it's. I want to, like, stop working. I think that you're in a place where you have to have a conversation with your partner about, are we really combining our finances? And that's. Of course, now I'm into relationship counseling. Mark, did you notice the silence that went there? Did you hear that silence? I heard it. It was deafening. Tell me that, please. Can't you just tell me that the partner is really rich?

[Jane]

No, I mean, she. She does really well, though, so she saves. And. And I can always get on her insurance policy at work. And she wants to work forever, so.

[Jill Schlesinger]

Oh, good. So get married and get on that policy and stop messing around with me. Stop it. I mean, look, that's what I mean, that this is a larger conversation. And also, by the way, if she lives in a place where you say, I'm selling my place, two places. I'm taking my money, I'm putting it into the brokerage account, both of them. And now you're talking about you got a million and a half in brokerage, a million and a half in a retirement account. You're able to pull that money out of the retirement account over the next 15, 20 years, and it'll be done. That's fine. And so be it. That's it. And you're done. And you're living in her house. And now your expenses are not 12 grand a month or 8 grand a month for you or whatever it is. Put this plan in place and look at it. I think that you are definitely a person or a couple that could really benefit from doing some scenario planning with a fiduciary. How does that work for you?

[Jane]

It does. I'm glad that you're not saying I have to work till 60. Just feel like these are my biggest earning years and I'm losing out and trying to force myself through this and trying to make it work.

[Jill Schlesinger]

Yeah, I mean, look, you know, it works better if you work till 62, but you don't feel good. And that's different. That's a very different thing. I have a friend of mine who has ms, and at some point we were running numbers and I was looking. She works in a pension system. And she kept saying to me, but if I Keep working to 65, the amount goes up, the amount goes up. And I'm like, babe, you know what? Like, your life, your life matters. You're okay right now. So let's do this. Let's pull the trigger on the pension, get paid your money, and it's okay. You're not going to maximize your money. That's okay. And that's what I would say to you, Jane. Of course, if you work till 62, the numbers work better, but you don't have to. And if you're willing to maybe do something else or if this medical condition allows you to do something else but not the thing you're doing now, I think that that's worth considering as a viable option. So that's where I land on this. Do you have any other questions for us?

[Jane]

No, I just want to say thank you for the feedback. I think it's really affirming and gives me some strong options for the future. I just have to stop just to pull the trigger and just. And just do it.

[Jill Schlesinger]

You know, it's hard to do that when you've been working your whole life. That's the thing. It really is. So it's worth planning out. And maybe if you had a. Because you're. Because of the way your brain works, because you're an engineer, maybe it would be easier to do if you had three different options, three different scenarios that you work through and you've paid someone some money to do planning for you. All those things can be beneficial and that might give you a little bit more courage to pull the trigger as well.

[Jane]

I appreciate that. Thank you so much.

[Jill Schlesinger]

Okay, that's Jane from Virginia. She's not driving. Remember, if you have a question about something like this, I am not a dream crusher gang. This is reality. You have some. You have, you know, you have your one life and you have your one body. And if your body is failing you, we're going to figure out how to make your life better. Better. We're going to figure out how to try to give you different options. So if that's you or if you're in a career that you despise and you need to make a change and it means less money, maybe you can do. May not be so out of reach. Just get in touch with us. Go to jillonmoney.com, click the contact us button. Let us know if you want to come on the air live with us. We love that more than anything. While you're on the website, don't forget we've got a free weekly newsletter. We've got a blog. We've got resources. We even have a separate program called Money Watch, which is on Saturdays and Sundays. You can check that out by subscribing to us on the Odyssey app, because you can subscribe to Money Watch there as well. And while you're there, by the way, leave us a rating and review wherever you find your podcasts. It's Friday. Let's do some business. Our music is composed by Joel Goodman. Mark Tularsio is the executive producer, King of all things Web Best Guy Ever. We are discussing distributed by the fine folks at Odyssey. Try to lift someone up. Change your work, Change your wealth, Change your life. Thank you for listening. We'll talk to you on Monday.

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