Podcast Summary: "Need a Better Plan to Retire in Three Years"
Podcast: Jill on Money with Jill Schlesinger
Host: Jill Schlesinger, CFP®
Release Date: July 18, 2025
Introduction
In the episode titled "Need a Better Plan to Retire in Three Years," host Jill Schlesinger engages in a comprehensive discussion with John, a listener contemplating early retirement due to health considerations. The conversation delves into John's financial standing, retirement readiness, and the complexities introduced by their unique circumstances as cancer survivors.
Listener Profile: John's Financial Situation
John and his wife are in their early 60s, considering retirement earlier than their peers due to their experiences as cancer survivors. Their financial overview is as follows:
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Ages:
- John: 63 years old (turning 64 soon)
- Wife: 62 years old
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Income:
- Combined Gross Income: $304,000 per year
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Retirement Savings:
- 401(403)B: $900,000 (pre-tax)
- IRAs and Rollover IRAs: $713,000
- Roth IRA: $66,000
- Other Savings:
- Checking and Savings: $4,000 - $5,000
- ALI Account: $25,000
- HELOC: Originally $100,000 (paid off)
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Assets:
- Home Value: Approximately $750,000 (expected to net $700,000 after fees)
- Mortgage: $124,000 at 3.25%
- Collectibles: Some collector quarters and half dollars
Notable Quote:
"We have about $4,000, $5,000 in the checking and our savings account, which is our overflow." ([04:40])
Retirement Timing and Health Considerations
John and his wife are debating the right time to retire, feeling societal pressure to wait until age 70, which they are hesitant to do. Their status as cancer survivors influences their decision, as their life expectancy may differ from their peers.
Key Points:
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Life Expectancy:
- John perceives no significant change, but his wife, an oncology nurse, mentions a potential reduction of five years ([07:33]).
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Health Insurance Pre-Medicare:
- Neither is 65, necessitating a plan for health insurance if retiring early.
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Monthly Expenses:
- Without retirement, medical expenses are just under $11,000 per month ([06:51]).
Notable Quotes:
"Everybody in our peer group seems to say we wait till 70, but we don't wanna wait." ([02:25])
"Five years less." ([07:45])
Jill’s Financial Analysis and Recommendations
Jill conducts a thorough analysis of John's financials to assess their readiness for early retirement.
Social Security Benefits:
- John's Benefit at 67: $3,867/month (pre-deductions) ([09:37])
- Wife's Estimate: Approximately 16% less than John's benefit ([09:57])
Retirement Income vs. Expenses:
- Projected Needs:
- Estimated monthly expenses post-retirement: $12,000
- Expected income from Social Security: Approximately $6,000
- Deficit: $6,000 per month, necessitating withdrawals from retirement accounts.
Golden Parachute Option:
- John mentions a potential $250,000 pre-tax payout if he remains employed for three more years ([10:58]).
Health Insurance Solution:
- By staying employed until 67, John's wife can remain on his health insurance until she qualifies for Medicare, alleviating immediate healthcare concerns.
Recommendations:
- Delay Retirement: Staying employed until 67 to maximize Social Security benefits and secure health insurance coverage.
- Utilize Retirement Funds: Strategically withdraw from pre-tax retirement accounts to cover the income deficit before Social Security kicks in.
- Engage a Certified Financial Planner (CFP): To navigate complex decisions and ensure both spouses are actively involved in financial planning.
Notable Quotes:
"I think that this works really well because what you could do is... you keep working, you pull what you need out of the IRAs." ([12:58])
"I think it's all doable, John." ([14:19])
Estate Planning and Future Considerations
Jill emphasizes the importance of comprehensive estate planning, especially given their health circumstances.
Key Points:
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Current Status:
- Life Insurance: In place
- Wills: Not established ([16:32])
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Adult Children:
- Ages 30 and 27, facing challenges in the current housing market.
- Plans to assist them financially in the future.
Recommendations:
- Draft Wills: Essential for ensuring their assets are distributed according to their wishes and to provide for their children.
- Engage in Estate Planning: To address potential future needs and protect their legacy.
Notable Quotes:
"We have life insurance, but we do not have our wills in place." ([16:32])
"It's nice to tell her that there's like, it's not like... we need to say, 'babe, I know.'" ([15:21])
Conclusion and Final Advice
Jill wraps up the conversation by reinforcing the importance of a structured financial plan tailored to their unique situation. She encourages John and his wife to consult with a CFP to solidify their retirement strategy, ensuring both their financial needs and personal well-being are addressed.
Final Takeaways:
- Customized Planning: Each couple's retirement plan should reflect their individual circumstances and goals.
- Professional Guidance: Engaging with financial planners can provide clarity and confidence in making significant life decisions.
- Holistic Approach: Consider all aspects, including health insurance, life expectancy, estate planning, and familial obligations.
Notable Closing Quote:
"Change your work, change your wealth, change your life." ([19:00])
This episode provides valuable insights for listeners facing similar retirement dilemmas, highlighting the interplay between financial readiness and personal health considerations. Jill Schlesinger effectively guides John through evaluating his options, demonstrating the critical role of personalized financial planning in achieving a secure and fulfilling retirement.