I RETIRED ON MAY 27, 2022, which was my 55th birthday. I chose my birthday because it was the earliest date I could leave my job and still be eligible to receive the early retiree health-care benefit offered by my employer.
Mentally, I was ready to go. I’d been employed at a small liberal arts college for 24 years. I’d been there long enough to see an almost complete turnover of the faculty and staff in my department. I struggled to find purpose in my work. I felt out of touch with most of my coworkers. I had grown weary of various pandemic-related restrictions and protocols that had dominated campus life for more than two years.
Financially, I felt unsure about leaving behind my $75,000-a-year salary. I had been working fulltime since I was in my mid-20s. For 30 years, I’d been accustomed to getting a regular paycheck, paid time-off and a variety of other work-related benefits. I wasn’t sure how my husband and I would cope living solely on his retirement income.
A year later, I feel more comfortable with our financial situation.
On the day I left my job behind, I started a two-day road trip from Portland, Oregon, to Phoenix. My husband was already living in the home we’d purchased in a Phoenix suburb in 2019. The trip gave me plenty of time to contemplate how I was able to turn my dream of retiring at age 55 into reality. In the HumbleDollar book, My Money Journey, I describe the frugality that was necessary to retire at a relatively young age. But I also realize that luck—and timing—have played a significant role in my financial success.
I graduated without student debt. When I went to college in the late 1980s, it wasn’t difficult to graduate debt-free. By attending public colleges, earning scholarships and working part-time, I was able to get my bachelor’s degree without taking out any loans.
I was steadily employed for 30 years. I feel fortunate I made the choice to work in academia at a time when enrollment at higher education institutions was steadily increasing. Working at colleges and universities meant earning a modest salary. But it also meant never being subjected to lay-offs, downsizing or other staff reduction strategies.
I received generous benefits from my employers. While employed at my first job, I became vested in a lucrative pension. Two years after I quit, the pension benefits were significantly reduced. Being vested allowed me to keep my money in the original plan.
I had similar luck with my final employer. Five years after I started my college job, the retiree health-care benefit I’m now receiving was discontinued. I was still eligible to receive it by maintaining my fulltime work status for more than 20 years. Both my pension and health coverage are lifetime benefits, so they could help me financially for the next 30-plus years.
The real estate market has been good to me. All three of the homes I purchased during my working years appreciated while I was living in them. But it was the third home I owned that proved to me just how much luck and timing can positively affect a person’s financial success.
I bought my third home in 2018, shortly before getting remarried. I knew purchasing a house four years before I was hoping to retire was a gamble. It was possible I might not recoup my down payment—much less make a profit—by buying and selling in such a short time frame. To make matters worse, I was a buyer at a time when the market clearly favored sellers.
During the first 18 months my husband and I lived in the house, its estimated value didn’t change. Various online real estate websites suggested it would sell for the same or slightly less than the $375,000 I’d paid. I knew that, by the time a real-estate agent’s commission was subtracted, I could end up losing a fair amount of money when it came time to sell.
By late 2020, it was clear the property market was changing. Homes in our Portland suburb were selling within days of being listed. Prices seemed to be heading upward. For the first time, I believed there was a chance I’d break even when it came time to sell.
In September 2021, my mother sold her house. She lived less than a mile from my husband and me. My mom’s home was almost identical in size and style to ours. When the real estate agent suggested she list it for $500,000, I was skeptical. But when her house ended up selling for some $65,000 over the asking price, I became a believer. With my target retirement date of May 2022 in sight, I could only hope the housing market wouldn’t crash before I could take advantage.
In February 2022, my husband and I put our house on the market. Within 48 hours, we accepted an all-cash offer of $600,000. In addition, the buyer waived all of the inspections and allowed us to stay in the home rent-free until we needed to move out. Walking away with more than $250,000 in cash, just weeks before I retired, removed some of the anxiety I’d been feeling about leaving a regular paycheck behind.
My husband and I pulled the plug on a business opportunity in the nick of time. Shortly after moving to Arizona, we contemplated opening a dog training business. Both of us have been lifelong dog owners. We’ve trained our own dogs in a variety of sports. We thought it would be fun and profitable to open a dog training center in our community.
We found a small retail space that was available to lease. We started planning renovations, applying for permits and purchasing equipment. But when it came time to sign the lease, we balked. The terms would require us to make a 36-month commitment. We’d be responsible for much of the maintenance on the space. We calculated the overall cost of running the business for three years would be well over $100,000.
The day before we were set to sign the lease, we changed our business strategy. Rather than renting a space, we decided to offer in-home dog training lessons. We were able to get the business up and running for less than $2,500.
Forgoing that original business plan may be the single best financial decision I’ve ever been a part of. It’s clear my husband and I both overestimated the need and desire of people in our community for dog training. After almost a year of offering our services, we’re barely making a profit.
I’ll never know what my financial life would look like today if any one, or all, of the above life events had played out differently. Perhaps I’d be wealthy beyond my wildest dreams. Or maybe I’d be broke and forced to work for another decade or more. For now, I’m content with exactly what I have.
Kristine Hayes Nibler retired in 2022, and she and her husband now live in Arizona. She enjoys spending her time reading, writing and training their four dogs. Check out Kristine’s earlier articles.
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Kristine, thanks for an interesting post, which resonates with much of my experience. I too have had a 30+ year career in higher education at small liberal arts colleges. There have been some bumps along the way, such as having my position eliminated at one school because of financial stress, but overall I’ve enjoyed many of the benefits of academia, as both a faculty and staff member, that you describe.
I’m currently 63 and planning to retire in about three years. To be honest, we could probably retire now, but I’m hoping to defer claiming Social Security until age 70, and while I have part of my portfolio earmarked to serve as a bridge from retirement to claiming, I don’t think I quite have seven years’ worth. Another issue is that, because I was in graduate school during all of my 20s and early 30s (I took the long route to finishing a PhD), my social security earnings record still needs some shoring up. I actually still have a few years in my top 35 years of earnings in which I had zero income for the purposes of social security … so I definitely want to replace those zeroes with, let’s say, a somewhat larger number. My wife does mostly volunteer work and doesn’t have a retirement plan of her own, so she’ll be claiming spousal benefits on my earnings record. Another reason to build up social security credits and dealy claiming.
Another issue is health insurance. Your post has prompted me to look into whether my current employer, Grinnell College in Iowa, offers an early retiree health benefit. I hadn’t thought to look into that before. Grinnell is well-positioned financially, and so it could be that they do offer this benefit though I have not heard about it. My wife will turn 65 in the same week that I reach my FRA (though again, I will delay claiming), so that’s when I’ve targeted retirement. Another option, I suppose, if I retire before one or both of us are eligible for Medicare is enrolling in the ACA. With a very low income we could probably qualify for subsidies, but again, that would stretch out the time that I would need that bridge to social security.
Finally, we will also relocate when I do retire, back to Texas where our daughter and extended family live. I’m not sure how the housing piece will shake out … we own our current home with no mortgage, so presumably that should be a fairly even transition.
Again, thanks for sharing your experiences and perspectives. I’m glad that things have worked out well for you.
Thanks for the kind words. Yes, definitely talk to your HR department about benefits you might be eligible for. The college I worked for had a ‘retiree benefits’ informational meeting every year. I started attending them when I was in my 40’s. It was useful to know about all the various benefits I could take advantage of.
A quick search of the internet came up with this pdf file from Grinnell:
https://www.grinnell.edu/sites/default/files/documents/Retiree%20health%20plan%20changes%20August%202015.pdf
It appears they may have changed some of the retiree health care benefits a few years ago.
It does appear that Grinnell is financially healthy–they have an enormous endowment!
I’m glad you posted this. It makes two good points. Employees typically pay little attention to benefit changes and nothing is assured. The HRA in their plan will not keep up with inflation and retirees are now using Via Benefits to shop for Medicare supplement coverage.
Many employers are doing this to retirees. The employer saves money and over time, retirees lose.
Yes, very interesting that you found that pdf on the public website … the college is usually pretty strict about putting information there that is primarily for an internal audience. In any event, that document is from eight years ago, and while those policies may still be in effect, I have only been at Grinnell since 2017, so I would not have the requisite ten years of service at Grinnell in order to qualify.
That said, Grinnell’s benefit are exceptionally generous. Our health insurance plan is a low-deductible plan that costs about $300 per month for a couple. I’m on a very high cost medication (Sprycel) for chronic leukemia … it bills at $15,000 per month, and I pay nothing! (The manufacturer, Bristol Meyers Squib, has a patient assistance program that covers the small amount that my insurance doesn’t pay). Fortunately, I am currently in complete remission. The college also contributes 10% of salary to TIAA-CREF with no required match. These are further reasons for my to keep working another couple or three years. Not to mention other perks, like being able to work from home most mornings, etc.
As you note, the college is extremely fortunate to have a substantial endowment. Much of that accrues from an early investment in Intel, which was co-founded by Grinnell alum Robert Noyce, the inventor of the integrated circuit semiconductor. Warren Buffett and Steve Jobs also served on the Board of Trustees back in the day and were investment advisors to the college.
Kristine, I was in Oregon at the same time you were and experienced the same real estate insanity. Realtors were literally knocking on the door of our “retirement” beach house, which my wife had grown tired of anyway. So we sold in spring 2021 for a profit similar to yours. It significantly helped our retirement accounts. And now we’re up in Washington in what will certainly be our last home.
As I have expressed here before, luck matters. A lot.
It was a crazy time, wasn’t it? I still keep tabs on the real estate market in Portland. I do it only because it reinforces just how lucky my husband and I were. The timing of the sale of our home could not have been better. Based on what I’ve seen online, I’m pretty sure that if we had needed to sell now, we would have ending up getting significantly less money than we did a year ago.
I’m also convinced the days of waiving all inspections and allowing free rent-back are over.
A successful Gen Xer retiring early is not helping the Fed fight inflation. Enjoy your early retirement.
Thanks for sharing a useful case study. The principals of keeping an eye on the long view is timeless. The grass-is-greener crowd sees this as a story of better benefits for public sector workers compared to those in the private sector. My own experience is that benefits have shrunk and continue to shrink on both sides. I have done OK–my daughter will have to do her best with fewer opportunities as she finishes college and enters the workforce.
I agree with your statement about benefits shrinking in both public and private sector jobs.
What I’ve also seen is the increase in wages. When I stopped working at the college, the student workers I supervised were making a minimum of $15.00 per hour. I recently heard about a 17-year-old who is working at Walmart making $19.00 an hour.
With those kinds of wages, it may not be too surprising that employers can’t offer as many benefits as well.
There was a time when “good benefits” bought employee loyalty and a low turnover rate for the companies with the nation humming along just fine. That’s all part of history now as the Biz School wizards created multiple generations of quarterly results heroes.
A little luck and common “cents” can go a long way.
I am happy that your goal of retiring at age 55 was achieved. Your good planning and sticking with the plan made this happen.
Those that may be envious of your pension and health benefits need to realize that working in the government sector means getting paid less money than in the privet market. Better job security and benefits with lower paying salary.
Enjoy the new chapter of your life’s journey.
Actually the government sector in both total compensation and wages and salaries is higher than the private sector. There are only certain professional jobs paid lower. https://www.bls.gov/news.release/ecec.nr0.htm
I don’t doubt the document supports your statement, but there are always unique aspects when you compare an individual’s circumstance with a broad government compilation. I spent about 30 years working in the private sector and my last annual salary was about $115,000 before I took a job with a local government agency in their finance office about 6 years ago. I’m a CPA with an MBA, but the table used by the agency said the top rate that could be offered for the position was $68,000 regardless of credentials and/or years of experience. Luckily I was in a position to quit a job that was literally killing me. The job was going to kill me or my wife was… I received 10 days a year in vacation plus holidays for the first 4 years and received another 5 days starting in year 5. The health plan is comparable to what I had before, but a little cheaper. There is a 401k offered, but it’s only funded by employee contributions. The agency does participate in the state’s pension plan but I will not be here long enough to qualify for an annuity. I wouldn’t say these are overly generous wages and benefits, but the stress-free job, peace of mind and quality of life are priceless.
Thanks for your kind words.
Yes, I agree with your assessment about government vs private sector jobs. During my career, I had one government job and two private sector jobs. They all came with generous benefits, but not so generous pay.
My first full-time job, working in a human diagnostic laboratory as a technician, paid $16,000 a year. My primary responsibility was to diagnose abnormalities in patients. The job required an enormous amount of attention to detail since lives were, literally, on the line. Mistakes simply weren’t an option.
Despite the low pay, the benefits were generous. I had access to excellent health insurance, a state pension plan and received five weeks of paid time off each year.
Excellent article and I related to your feeling on how the workplace changes and one can lose the desire to continue working at a place that changes with time. I too worked at a University and after 31 years where the workplace’s professionalism and morale declined and it was hard for me to stay now, I’m grateful because I retired this year and I love it and realized I was very much ready.
Thanks Julie. Congratulations on your retirement!
It is difficult to remain motivated to work somewhere when you see changes being made that don’t seem to be for the better.
Thanks for your comment and enjoy your weekend!
Enjoyed the article, Kristine. Definitely resonated with much of it. I retired the day I reached thirty years with my company, because my pension wasn’t going to increase and I had retiree medical benefits. (I did go right back to work the next day, but as a part-time contractor.)
I grew up and went to university in England, which meant that not only did my Local Education Authority pay my fees, it gave me a (means-tested) living stipend. I did work, but only in summer vacations. I didn’t make out as well as you with real estate, but well enough to cover the entry fee for my CCRC. I paid off my mortgage in about eleven years, so I lived rent free for the next twenty two (while paying low real estate taxes but increasing amounts for maintenance).
It seems to me that there are far too many badly trained or even untrained dogs in this country. Good luck with improving the situation!
I have yet to achieve the goal of living in a paid-off home. That you were able to pay yours off in 11 years is inspiring!
The pandemic created a huge dog-ownership/dog-training problem. So many people got new dogs during the pandemic. Many of those dogs weren’t trained as puppies and now we’re seeing the consequences. Animal shelters are absolutely overflowing with young dogs who have been surrendered by their owners. It breaks my heart to see so many dogs–with so much potential–living in these facilities.
There seem to be two opposed schools of thought on paying off a mortgage, but I never had any doubts. It helped that I bought rather less house than I could supposedly afford, and I refinanced for 15 years when rates came down a bit. (Although not to today’s levels!) I also made sure my mortgage allowed extra principal payments.
I always tell people if they don’t have their dogs well trained, they definitely need to increase their insurance coverage. We paid several hundred thousand dollars for a dog “bark” claim. While walking by a house the homeowners dog started barking through the screen door and startled the walker, who fell. They were rushed to the emergency room and due to a blood disorder, they required extensive treatment. Obviously, an unusual case, but it does happen.
Your comment made me do a quick check on our homeowner’s (and umbrella) policy. It appears we are covered in such a situation. It does seem like dog owners might want to check with their insurance companies to see what, if any, exclusions they might face. It appears that some insurance companies may have breed restrictions built into their policies.
When you say “we,” I assume you mean the insurance company you worked for, right?
That’s correct. The company I worked for. The claims side of the business (which I wasn’t directly involved in) was the most interesting to me. There were a lot of unusual claims that were turned in.
Wow. What an interesting bit of information. Living in an age-restricted community, we see lots of elderly people walking their dogs. I’m always afraid some of the people will fall down if their dog pulls too hard on the leash.
I’ve always been of the opinion that dog training is a misnomer, and what’s needed is dog OWNER training. I took a bad fall recently because of an owner’s incompetence. He had his five-year-old daughter holding the leash of their 150-pound Rottweiler. When the dog broke loose towards my diminutive wife, I had to throw a flying tackle on him. Fortunately, my 66-year-old shoulder survived the impact on the concrete (decades of gym work) but I lost a lot of skin. Had the consequences been worse, I definitely would have sued the guy. And Rottweilers are frequently breed-restricted on homeowners policies.
(Incidentally, only the dog apologized. He was just overly eager to meet our Chihuahua. I assured him it wasn’t his fault.)
90-95% of dog training is really owner training.
I’ve never understood why some people allow their dogs to behave the way they do.
And why–why!!–would you let a 5-year old walk a Rottweiler? I don’t care how well behaved and/or trained the dog is.
Great decision and luck on that business plan! My daughter almost went that route with a party store, but the outrageous commercial rents made the decision finally, as I fretted around about it knowing retired friends and their franchise tales. The world is certainly full of helpful folks willing to help themselves to whatever money you have.
Yes–in hindsight, my husband and I are so thankful we didn’t sign that lease. As I continue to evaluate which dog trainers are the most successful, it’s usually those folks who either have multiple revenue streams, i.e. they also board dogs at their facility, or those who run their businesses out of their homes instead of renting space.
Kristine, it’s wonderful when plans go the way we plan, and when the breaks happens in our favor. You sound thankful. I hope providence continues to smile on you.
My copy of My Money Journey arrived this week. I just picked it up and read your story. It’s a good story, with good lessons.
Thanks Edmund. I enjoyed being a small part of the book.
As far as what you relate here, you have been fortunate and kinda living the dream. Nothing wrong with that especially for anyone who sticks with a job through thick and thin.
These days only governments and academia offer benefits as you describe. But as I have mentioned before I urge you to have a Plan B when it comes to health benefits.
I can show you thousands of workers who thought they had lifetime (guaranteed) health benefits, including me, only to have them taken away or radically changed after they retired.
I hope your good fortune continues, but you sure don’t want to unexpectedly face several hundred $ in new monthly premiums down the road without a plan.
Count me among those whose former employer has downgraded medical coverage. More than once. I suppose I should be thankful that it hasn’t disappeared altogether. Last year the megacorp also discontinued pension payments and bought those still receiving pensions (a shrinking cohort) annuities instead. They are for the same amount, but instead of coverage from the federal Pension Benefit Guaranty Corporation we are covered by our respective states, and mine is considerably less generous.
I was looking forward to collecting my IBM pension in a few years, but now it sounds like we’re in the same boat.
It may, or may not, come through in my writing, but I’m a planner. A compulsive, excessive, over-achieving planner. I make plans for my plans. So, yes, I not only have a Plan B, but also a Plan C, D, E and F.
The pension I’m vested in has undergone multiple court challenges. Some of the terms have been changed by the courts, but for the most part, it remains similar to the original plan.
It’s becoming apparent that higher education is undergoing a major change. Enrollments are declining and more colleges are shutting down their operations.
So yes, it’s quite possible the benefits I’m entitled to today, may not be there for me tomorrow. Time will tell.
Thank you for the add-on about the pension and retiree health plan. As I read your good article above, I couldn’t help but be a little envious. I had none of that. Just a 401(k) and medical while I was employed, which I actually thought was a good deal. If you fund a pension correctly, based on good actuarial calculations, it’s possible to bankrupt a business. If you kick the can down the road, you live to fight another day, but it can sure hurt retirees if the plan does fail.
Wow. Few others will have all of those “good fortunes”!
It can be disheartening to hear about so many government workers that have pensions and lifetime medical while private sector employees get everything taken away from them. It feels like the weight of the world is on your shoulders when you have paid a crazy amount of taxes over the past forty years only to see Social Security and Medicare running out of money exactly when you will be retiring in a few years.
Point of information: Any Federal employee who has started since the 1980s has paid into the Social Security system and has been told repeatedly by the Office of Personnel Management that Social Security is a third of their retirement plant. The other two-thirds are the Thrift Savings Plan (a 401k by another name); and finally a traditional defined benefits pension that, for most employees, tops out at around 33% income replacement after 3 decades and if one retires after 62. Even at that current Feds should not complain, but they should also tell the next generation not to count on that good a deal.
That 33% income replacement is pretty good. My corporate pension replaced about 40% of my final year’s salary after 30 years, although I was able to retire at 30 years regardless of age. However, I was one of the last employees benefitting from that plan.
I should probably clarify that my pension was the result of a government job, but the health care benefit came from a private sector employer. The private sector job also came with a generous retirement benefit–they paid an amount equal to 10% of my salary into my retirement plan.
I think there’s often a trade-off between benefits and salary. After thirty years of working full-time, I never came close to earning a six-figure salary. It’s possible, given my education and experience, I could have found higher paying jobs. But I opted for job security and good benefits. I’ll never know if earning more money–but not having as generous of benefits–would have been a better strategy.