Yes, if I could just wait another five years to start drawdowns, I’d be more than OK. The problem is, that’s no longer a possibility: I’m out on the street in December, and at my age I have virtually no chance of finding another full-time job. What employers see when they look at a 64-year-old job applicant is a) higher health insurance premiums (because older people run up high medical bills–even if you’re in excellent health, the chances of an expensive ailment rise with every month you age); and b) someone who is going to quit in one to three years. The ageism inherent to our culture aside (and it’s a significant enough issue that one probably ought not to put it aside), these are excellent reasons not to hire an over-60 worker.

As my late father (he died in November, just after the major tanking of all his accounts) said, “You only lose money when you sell at a loss.” So if you can make it for a while without drawing down, there is hope. Of course, I don’t know what my father would be saying now.

At the time I met him, he did have a small mortgage. He had purchased a condo for about $40,000. Then along came the savings & loan crisis, precurser to today’s economic fiasco. Then as now, the bottom fell out of real estate. Owners in the condominium couldn’t sell their places, and so many walked, leaving them to the banks. Others converted them to Section 8 rentals. As a result, the place went downhill.

I was renting a condo in the same little development. A drive-by shooting led me to buy a house and move out. He followed, moving in with me. Amazingly, he managed to give his condo back to the bank deed in lieu. (The bank sold it for $12,000, shades of the bubble!).

He now was paying me rent, in the amount of half my mortgage payments. This worked out OK for a while, until we couldn’t stand each other anymore. Then he bought a house down the street from me. Interestingly, at that time he had enough cash to buy it outright (he got a smokin’ deal on a fixer-upper). In spite of not having held a steady job for many years, he had that much cash in the bank.

From what I can tell, this had to do with sheer frugality: a combination of smart investments before the S & L crash, avoidance of debt, and cultivation of very frugal habits. Once he owned a dwelling and a car outright, his expenses dropped to near nothing: insurance (assuming he carried homeowner’s at all), taxes, utilities, maintenance, gasoline, food, clothing, a few household goods, and whatever he needed to keep himself entertained.

Hmmmm. The debt stands between me and the ability to step off. Debt represents the absence of freedom. So I am focusing on getting rid of that obstacle and then yes, stepping off. Why not? What have I got to lose at this point? The career that I have come to hate? My (cough cough) retirement security? Makes no difference anymore. I am inspired by SDXB and his story, thanks for posting it.