Work/House/Move Considerations?

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rich126
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Joined: Thu Mar 01, 2018 3:56 pm

Work/House/Move Considerations?

Post by rich126 »

Overview

I'm pondering multiple big decisions as I near retirement and have laid out some thoughts/options below. I'm asking if anyone has any thoughts or maybe can point out important/financial things I've completely overlooked. Thanks.

Me: 58, recently married (wife same age). Can get a small pension and (federal) health insurance at 60 for both of us, plan to retire somewhere between 60-62. Wife isn't currently working. Between a small pension at 60, another smaller one at 65, savings and eventually social security somewhere between 65-70 (I have some "bridge" money in a couple of MYGAs to cover at least 5 years) I don't think we would have any serious money issues since we aren't big spenders.

I've lived both places multiple times so there are no unknowns there and my wife wouldn't have an issue living a couple years back east to experience some cold weather and snow. After 50+ years of AZ heat she is a bit tired of it.

We are currently living in a very small house that was my wife's parents home that she grew up in. It is paid off so our current expenses are low. The size (1,000 sq ft), makes it impractical to stay long term (maybe 2 ft of counter space in the kitchen) and because of the memories, my wife would like to sell it and get a fresh start elsewhere. Adding to it, tear down/rebuild could be done but the neighborhood is a mixture of rebuilds/remodels as well as homes that should be condemned or look abandoned so it doesn't seem wise to invest in it unless you felt sure you were going to stay there long term. If you invested in it, and everyone else did as well then it could be a nice bump in house value but if others didn't then you may never get anything close to your investment back. There isn't any kind of HOA to maintain any remote housing standards.

Job:
Currently out west (AZ) but have a job offer to return to government (turned down another private company offer) back east. My current job knows I've been looking but I've known the manager 20 years and he would prefer I stay and keeps trying to find me something more interesting so I'm lucky here.

West Job Pros: Great manager although close to retirement, he keeps delaying it but can easily afford it and his wife retired a few years ago. Due to long commute and unable to work frequently from home (security work) I've cut back hours to 27 (3 days) hrs a week. With current limited expenses the pay cut is ok. 3 working days a week is a huge plus.

West Job Cons: Uninteresting work. Long commute, even 3 days a week (82 miles R/T). Unknown job security although supposedly with current contracts the next few years should be fine.

East Job Pros: Bump up pension, more leave, job security, close to my family, likely more interesting work. (No real difference in pay.)

East Job Cons: Requires moving, traffic/parking, requires finding a rental (quite tough & $$$ now), moving east they will cover a lot of expenses but moving back west is on me (obviously). 1 year job commitment or pay back moving costs.

House Money

I sold my house and while I got a good price, I left a bunch of money on the table selling ~7 months ago. So now I have money earning 1% or less while housing has been going up a lot more so I see a few options here.

1. Wait: Do nothing until I retire and then when prices/bidding calms down buy something. Complete unknown as to prices at that time but a work commute wouldn't factor in. (If I was younger and/or still single, this would be my choice.)

2. Buy Now & Rent it out: Buying now and then renting it out while moving back east would provide at least 4-5% return on my "house" money, and it would lock in current (high?) house price. Essentially the rental income would cover most of a rental back east. (I had a property manager previously rent out my SFH for ~8 years and she was excellent and is still in business so that isn't an issue, along with a strong rental market.)

3, Buy Now and stay in it and stay out west: If I don't change jobs, I could do this although the work commute would limit where we could buy since I know I can't handle a long commute 5 days a week.

Intangibles

Wife is very supportive but I know she would like her own house at some point. She has lived with others and/or supporting her parents all her life so I think the thought of her finally having her own home would be a dream come true for her. I've tried to point out to her that we need to keep the house at a reasonable size because we aren't getting younger and the maintenance\cost on a 2,300 sq ft home is high (utilities, roof, painting, whatever or just cleaning it. I think she realizes that is true (she used to say how big my 2,000 sq ft home was back east and how long it took to clean it) and ideally I think a home around 1,800 sq ft would be ideal (ideally we need a decent sized 3rd bedroom to use for all my computer stuff).

The location is an issue because her family lives way west of town and I can't commute from that daily and am not familiar with that area (lived my decade east of Phoenix). You do get a ton more for your housing $$$. And if there is a housing collapse, usually the further out areas get destroyed much worse than more desirable areas, at least from what I've seen before. Of course we are hopeful the next house will be the last place unless we really have to move into some kind of retirement center, etc.

And neither of us has any ex-wives, or children of our own. Just nieces, nephews.

The wife does have a small pension at 65 as well as social security and a little bit of savings but not much due to taking care of the parents.

Family

One of my main reasons to move is my father's health has declined quite a bit over the last 18 months. Nothing terminal but now he requires a walker to get around due to back issues and has various other issues. My uncle is 80 and we were quite close when I was young. I haven't seen either in a few years due to the virus. My wife lost both of her parents while taking care of them and understands the needs of family.

My wife has a ton of family and friends from living in AZ all her life. We will end up in AZ in retirement due to those reasons and the nice weather for 8 months of the year.

My original plan was to come out to AZ a couple of years ago, work ~4 years and retire. A variety of reasons were involved such as my GF (now wife) couldn't move east because she was taking care of her mother (she passed away last year), my father was doing fine, I wanted a job change, etc. Obviously things have changed so considering a move back east is now back in the picture.

Money
If we had a ton of money I wouldn't be posting this but while I've done reasonable well, money and housing is certainly a factor now (pre-virus it would have been less so). I think we'll be in pretty good shape barring something unusual happening since at some point we'll have 2 social security checks, my government pension (COLA) at 60, and 2 smaller (total of maybe $10K/yr) no COLA pensions at 65. I figure on 4% wd from the core retirement account. The MYGAs (cd like) to cover 5-7 years of retirement before social security and a smaller emergency fund.

My wife has worked most of her life in HR but hasn't worked for 6+ months due to her small company having some money issues and we didn't really need to money. Since she knew we may be moving, it seemed pointless to look/start a new job and then leave it soon afterwards.

I've left out a possible inheritance since until you get it, it is just kind of vaporware.
----------------------------- | If you think something is important and it doesn't involve the health of someone, think again. Life goes too fast, enjoy it and be nice.
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