Retirement ages for engineers 8

[geotechguy1]

In your experience, at what age do engineers in these professions retire? Do you find engineers start getting forced out / laid off at 50-55? If that happens, has it been easy to get a new job?

Asking because I had always planned to aim for FIRE at 45 because I hated the first 5 years of my career but it's gradually getting better and 10 years in I actually enjoy my profession and reckon I might want to work until 60 or 65 if my brain holds up but I have heard mixed things about late career engineering

 

[IRstuff]

That's between you and your (prospective) employer; some FIRE participants are basically doing that, i.e., part time work and spending more time doing other things. However, as was recently pointed out to someone in my company, part-time, particularly at the 20-hr/wk level, precludes us from getting ANY time-off benefits, like vacation, sick-time, medical insurance, etc., although we are supposedly still allowed to contribute to the 401K. My recollection is that we need to be at the 32-hr/wk level for that. So, no medical would incur upwards of $10k/yr, depending on your exact plan and deductibles, which has to go into your calculations vis-a-vis lifestyle sustainment.

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[CWB1]

I have to wonder how many FIRE proponents come to regret choosing the (likely small) amount of money they believed they could retire on... say, 20 years down the road and not being able to have as much fun as they once thought they could. Once you cross that threshold, climbing back up the hillside to make money again has got to be 10x worse than if you had just stayed in the game a few more years.

Early retirees aside, its very common for "regular" retirees to underestimate how much they need bc false optimism sells books and garners tv ratings, reality does not. Compounding the issue is the fact that expenses increase significantly over time, spiking in our later years when folks need to hire out everything including minor home and auto maintenance before taking a plethora of pills prescribed by increasingly necessary doctors. They dont change their lifestyle at retirement bc they mistake it as frugal, and the normal bit of growth in retirement accounts over the first decade makes them believe that they're "doing fine." A few years later they're wishing they'd worked longer and changed their lifestyle before changes were forced upon them. Between the VFW, my folks' friends, and retired mentors I've heard the same story 100x like a broken record.

My wife and I are planning to retire in a rural area for enjoyment and cheap living. Our healthcare needs are already covered under the VA, we will both have defined govt pensions, and if trends continue we will have far more in savings than most, plus multiple rental properties for semi-passive income or sale and our other side businesses.

 

[IRstuff]

Part of the allure of the "RE" part of FIRE is the notion that you can get a "side gig" like blogging, etc., but the landscape is pretty well filled at this point; do we really need ANOTHER FIRE blog? To some degree, this is reminiscent of the supposed shortage of engineers that got a lot of wannabees into engineering, only to find that employers wanted more than just a warm body.

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[geotechguy1]

For a contrarian perspective, check out Frank Vetesse's book. It seems that most people - especially outside of the United States - over-estimate how much money is needed in retirement, the point that associations that represent people who collect government union pensions try to hide spending data of their participants because they have so much excess cash.

Think about it - in your working years, you spend about 30% of gross on tax, 30% on a house, 10% on savings, 5-10% on cars, and the rest on food, entertainment, etc. Once you retire you don't need the 10% savings, the house is paid off, probably ok with one car instead of two, and tax is usually a much lower percentage. Data also shows that (at least in civilized places with state sponsored healthcare) retirees expenses tend to decline, usually at least as fast, or faster, than inflation. 80 year olds don't buy new couches or travel to Fiji for the most part.

 

[GregLocock]

Luckily my employer has a scheme for near retirees to work fewer hours, in my case 20 hours a week. All benefits gets pro rata-ed by 50%. When we have crunches I still do heaps of hours but flex time off later.

Cheers

Greg Locock


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[IRstuff]

the house is paid off

Your last point is possibly contentious; since paying off your mortgage must come out of your total retirement savings, and locks up the capital. If you ostensibly can earn more from investing the capital in something that makes more than the interest you'd pay on a loan, that could be a tipping point.

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[GregLocock]

When I was an active share investor there was a school of thought that said you should rent a house and invest the capital. I can only wish that my shares have done as well as my house! Due to the current silliness it is up around 200% in 7 years.

Cheers

Greg Locock


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[geotechguy1]

IRStuff - yes this is true, and for personal reasons I agree because I like moving around every 3-4 years which rules out home ownership unless I want to become a property baron. Vetesse's book(s) is based on what most people do, which is buy a house and pay it off.

https://www.frederickvettese.com/books

 

[LittleInch]

Windwright and LaCajun - I tend to agree with you that one you get past 45 or maybe even 40, it is pointless applying for positions you haven't been invited to (i.e. by the recruiter) or without the "in" from someone you know or have worked with. They may not (in some countries) be able ask how old you are or what your DOB is before you join, but they can work it out pretty well. Companies want experience and competence without paying too much and not too many days off sick or inflexibility in terms of going somewhere shitty to work for weeks on end. People 30-40 generically fit that profile - 45+ and certainly 55+ and you don't get past first base. Life sucks.

It is where Linked In can come in handy to update your profile every now and then with a come and get me plea as it alerts all your contacts of a change in circumstance or that you are still "available" and that may fit their bill.

When I was looking after being made redundant in early 50's, I started a spreadsheet with everyone I even vaguely knew and noted when I had sent any message to make sure I didn't overload them more than once evert 2 months or so or to follow up any vague - call me in 3 months type replies. in the end went contract and worked at a place i had been for several years beforehand. Now works well for me - i avoid the office bull shit and intrigue / magt guff and get to do work when I like. Whether I'll actually be able to slow down and choose projects to do for a while and then not do things for a while I don't know. I've seen others try and fail and either end up working all week or get too involved in their other hobbies and interests.

Remember - More details = better answers
Also: If you get a response it's polite to respond to it.

 

[lacajun]

miningman and WindWright, I don't think it's restricted to just CO. I've applied for jobs all over the country with multiple companies and get nothing. A PE, Civil applied for about 75 jobs and got one through a company she knows and didn't apply to. She called for a reference and they offered her a job. Her son, a very bright Computer Science UT, Austin graduate in his mid-30's, applied for about 75 jobs before he got one. There are many looking to make changes for the better but they're not finding it easy to do so.

I think part of the problem is the lack of recruiting by companies. Too much of it has been outsourced, to me. It seems that your engineering talent pool should be done completely by your own HR people. They know the business best.

I've gone after projects with smaller manufacturers in the area but ultimately I am told I am too expensive. Part of that is due to, what I would deem, unfair competition. But that's not what everyone thinks so I am stuck, at least in CO. I can look at their equipment, trends, etc. and know they need help but they won't engage me.

As an example of a rock bottom price, I quoted $250k for an energy project to provide 300+ loops sheets, several P&IDs, data sheets, scope of work, on site management of the stick build (anticipated to be 3 months in duration), hiring a construction company in another state, etc. They needed all of the design work to be done by a PE because it was a DOE project. The company is full of young engineers with no experience in industry because they're all PhD research types. You need the education and practical experience to do industry projects.

Another company hired me to some automation. When I began to submit my invoices, they complained about cost. What they really were after was a free scope of work from me for free. I explained why that wouldn't happen and I was nice about it. It's business; not personal. There were other problems, on their part, but it's best to not divulge those.

I may be old but I am not dead and still know quite a bit. I have contacted people I've worked with in the past but I haven't gotten any help. I think part of the problem is that I have a master's in engineering and I am licensed. They don't. A female friend, who did technical sales, told me that another female wouldn't help me, ever. She would view me as a strong woman and too much competition. I don't see things that way but others do.

Pamela K. Quillin, P.E.
Quillin Engineering, LLC
NSPE-CO, Central Chapter
Dinner program:

http://nspe-co.org/events.php

 

[CWB1]

Think about it - in your working years, you spend about 30% of gross on tax, 30% on a house, 10% on savings, 5-10% on cars, and the rest on food, entertainment, etc. Once you retire you don't need the 10% savings, the house is paid off, probably ok with one car instead of two, and tax is usually a much lower percentage.

That's the idyllic stereotype the personal finance talking heads want us to believe, but at least stateside it usually isnt true. Half of retired Americans (sorry, selfish focus/knowledge) owe on a mortgage. Most carry large consumer debts. And bc they have more free time, younger retirees aren't spending less than they did during their working years but more. They're home more so utilities are higher. They can drive more, and do. Its also not uncommon for them to splurge on more or nicer things than they would've previously bc they're now focused on enjoying life rather than deferring it. Many also get hit hard with inflation and cost of living increases over time.

Regarding ageism, I concur that its a very real problem however the flip side of that isn't just older employees' cost and expectations but also their abilities. IME its rare for engineers over ~50 to be able to run CAD and analytical tools to a high competence, release designs, and do the same job that younger counterparts do daily. Hopefully things will improve over time but many managers see elders as stuck in 1990 for good reason, bc they need 2-3 bodies (engineer, designer, and/or analyst) to do the job of one, and extra/unnecessary bodies on a project is like waving a red cape at management bulls. The consulting world compounds the technology issue bc customers today often turn up their noses at step/"common" "dumb" files, engineers are expected to know a big variety so they can work natively in the customer's chosen software. That said, elders with modern software skills should highlight them bc it could be a major differentiator.

 

[TheDW]

Half of retired Americans (sorry, selfish focus/knowledge) owe on a mortgage. Most carry large consumer debts. And bc they have more free time, younger retirees aren't spending less than they did during their working years but more. They're home more so utilities are higher. They can drive more, and do. Its also not uncommon for them to splurge on more or nicer things than they would've previously bc they're now focused on enjoying life rather than deferring it. Many also get hit hard with inflation and cost of living increases over time.

Mortgages, consumer debt, splurging, and inflation are all problems in retirement if you spend zero time and energy planning it.

The FIRE community is filled with people planning this stuff out 15 years in advance, so none of those things are surprises.

Insurance and medical costs however...those are the actual question marks

 

[cranky108]

One would think that as engineers, we would know how to handle money. credit or whatever else passes for money.
The actual green pieces of paper have no value, except what we place on it.

 

[Guest090822]

A female friend, who did technical sales, told me that another female wouldn't help me, ever. She would view me as a strong woman and too much competition

100% correct. I have seen this many times.

 

[IRstuff]

One would think that as engineers, we would know how to handle money. credit or whatever else passes for money.

We can design the money, i.e., crypto, etc.; we just don't know how to manage the money and its attendant consequences. Not unlike the crypto depository where the CEO was the only one with the passcodes and croaked, leaving their customers in the lurch.

But, spending rates don't necessarily diminish with "normal" retirees; they expect to do a lot more traveling, visiting kids, visiting/spoiling grandkids (I wish), finally blowing money at Hell's Kitchen or Chez Panisse, etc. Index funds did 20+% last year, so keeping a mortgage, even at 4%, wasn't necessarily a hard decision.

However, as a "normal" retiree, the probability of sudden illnesses and medical expenses do dictate trying to hit something like $5 million in retirement savings, etc., and knowing that this figure is only going to go up over time, at much faster than the CPI is going, even now. That's another reason to keep assets more liquid; it's just not clear that reverse mortgages are that good of a deal, since their LTVs are limited by their risk/actuarial calculations, while current refi's could get you nearly double the LTV.

$5 million also means that even a "SWR" of 4% is feasible, and cutting down to 3%, supplemented by SS and pensions is viable.

TTFN (ta ta for now)
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[drawoh]

Not unlike the crypto depository where the CEO was the only one with the passcodes and croaked, leaving their customers in the lurch.

This is Gerald Cotten is it not? He was an iffy character all along. According to Business Insider, experts finally tracked down the digital wallets of the crypto CEO who died with sole access to millions. They say the money's gone

--
JHG

 

[geotechguy1]

The BLS Consumer Expenditure survey and the RAND health and retirement study both support the notion that spending declines faster than inflation in retirement. Retirees 20 years into retirement spend 2/3rds what they did at the beginning in real terms.

Some other references:

https://www.kitces.com/blog/age-banding-by-basu-to-model-retirement-spending-needs-by-category/

https://am.jpmorgan.com/us/en/asset...ribution/three-retirement-spending-surprises/

 

[lacajun]

I think engineers know how to plan for the future. I certainly did and was on track. What I didn't plan for was Lyme disease, with 6 coinfections, parasites, EBV, heavy metals, Roseola, and CIRS. When I learned about all of that, I consistently thought I would rebound quickly because I have always been a fast healer. I have good genes, mostly, and I have a healthy lifestyle. Even though I knew others took years to recover and some never do, I thought I would be different. I only have one gene that makes me susceptible to mold, it took a year+ of concentrated treatment to eradicate it and for my body to heal. I am in the last stretch to make my body begin producing antidiuretic hormone again. It's producing melanocyte stimulating hormone again as well as vasoactive intestinal polypeptide, etc. You cannot plan for events such as this in life. The burden is heavy because insurance doesn't cover much of it. You cannot imagine the expense of treatment for those. Binding the heavy metals was $2500 and insurance doesn't cover it.

There were other events I couldn't plan for and I don't know how I or anyone could. I have no control over tick bites or what they carry. I had no control over aspen trees.

Many in the US think we have a bloated social safety net. My experience says it's really hard to get help because I couldn't get any aid from social security. Thus, I shouldered all of the financial burden. So, if you've not had burdensome health problems, count your lucky stars. I will never discount luck again. It plays a huge part, from your parentage onwards.

The value of money is only gained when you don't have it. So I understand how some people really suffer.

Most of my employers had designers to do the basics of drawings, BOMs, etc. because they are much lower cost than engineers. They had engineers managing designers as well as others on their projects, while they engineered multiple projects. They thought that was the best use of the resources and costs. Perhaps they were wrong but they're large corporations so they must be doing something right.

Pamela K. Quillin, P.E.
Quillin Engineering, LLC
NSPE-CO, Central Chapter
Dinner program:

http://nspe-co.org/events.php

 

[phamENG]

dik - just a thought, but you have not only your name at the bottom of that picture but what appear to be the names of other patients who maybe don't want them posted online within a medical context..

 

[dik]

Thanks pham... didn't notice that.

Rather than think climate change and the corona virus as science, think of it as the wrath of God. Feel any better?

-Dik