Firstly, thanks for looking. I have been called on by a female friend who has asked me to try and come up with some feedback to a problem. Although I
know what I would do, and am not in her situation even remotely,I want to get her some advice and opinions from this site, as I believe there are
literally hundreds if not thousands of bright people here. I have known this lady for about 30 years, when we were kids we did the hubba bubba for a
few years, then rescinded to friends. She once sailed with me from the Vancouver area to the sea of Cortez in Mexico then flew home as I went on to
The ultimate question is: Retire soon (12-18 months) or wait it out for full pension?
Female 59 yrs old.
Single, no children at home.
Full Union retirement income on October 2016 - approx 1300.00 per month.
Full CPP (Canada pension plan) at age 65 - approx 1000.00 per month.
Old age security at 65 - approx 600.00 per month.
Has approx 2500.00 income take home monthly. Increases 3% per year (Union contracts)
Has approx 1900.00 in monthly bills before food and car fuel, clothing, entertainment. She says that bills keep going up up up, and leaves her with
Union income is reduced by 3% per year for leaving early.
91% of 1300.00 on October 2013 = 1188.00
94% October 2014 = 1222.00
97% on Oct 2015 = 1261
CPP can be taken at 60 yrs of age here, but reduced by 31%
So 69% of 1000 is $690.00
She is in a good position with her home, and has approx $200,000 in equity if sold.
She has two inheritances up the road. One is her mothers home valued at 300,000 (clear title) (split 50% with her brother) second is her fathers home
valued at 250,000 (all hers as brother and father not on good terms)
So she has approx 400,000 coming in a few years,when her kin kicks off and leaves her the farms.
So if she opts out early she has:
1188.00 + 690.00 = 1878.00
If she sells her home, and pays off ALL her bills, she will have about 200,000 left.
She wants to buy a boat, worth $60,000
If she deposits this remaining cash (140k) in an ING savings account, it pays 1.35% or about $200.00 per month interest.
If she pulled the interest and added it to her retirement income she would be at approx 2000 - 2100 per month.
She has been taking sailing courses and learning the ropes sort of speaking. I have been helping her get certified.
She is very tired of paying the high cost of city life, she wants to un plug and go travel the world by boat for several years, leaving the employment
slavery and debt chains behind her.
This to me is a tough social issue, that is why I have posted it here. Many people are probably facing the same dilemma and are being squeezed ever
harder by the corporate Juggernaut.
She feels that these next 5 years will be her prime time to do these types of things, she is scared if she waits till 65 it may pass her by.
Her parents are in decent shape, in their 80s but healthy and active, so no problems on the immediate horizon.
The places she is going are very very cheap to live, food, on shore housing, ect are almost give away. South America and the South Pacific islands.
I have told her I think she should go for it, she is having push back from some of her family.
I told her I would ask the question online.
So my question is:
WOULD YOU DO IT NOW OR WAIT IT OUT FOR FULL RETIREMENT?
Opinions, questions, thoughts, flames welcome.
edit on 20-2-2013 by lnfideI because: edit