My mom works a very physically demanding hard labor job standing on her feet and using force with her hands a lot. She lives very frugally but it’s also a very low paying job. If she can manage to have 100k by 63, and her yearly expense is 25k, do you think she can afford to retire at 63? Asides from social security (which will probably be around 700 or 800 a month, which state and federal sources of financial assistance could she rely on? The state is Pennsylvania. Thank you!
Looking for advice to see if my mom can afford to retire.
byu/Ok_Crazy6145 inpersonalfinance
Posted by Ok_Crazy6145
4 Comments
The rule of thumb is that a well-funded retirement can sustain your expenses if you withdraw 4% of your total each year. If we assume she gets $700 a month from SS, that leaves her needing to cover $16,600 out of $25,000 — which would call for a total of $415,000
Unfortunately if you are in the US this is not nearly enough to retire on. You didn’t mention her current age so it is difficult to figure out how much time she has til retirement. Even 100k would be better than nothing though.
She needs to work at least until 65 in order to qualify for Medicare. 25k from 100k is not realistic either. Sorry.
Why not get an easier job if her pay is already low? Taking 4% yearly from 100k would only give her 4k per year to work with.