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Retirement/unemployment: A slightly brighter light

A meeting with the investment adviser yielded a little decent news on the pending unemployment (i.e., forced retirement) front. He figured out that $10,000 of the $25,000 sitting in the whole life insurance policy my ex- bought back in the early 1980s is not subject to taxes.

So, he proposes that I withdraw that in January 2010 and use it to pay my share of the mortgage on the investment house. This should keep taxes low and, because it’s not earned income, will not work against me in the Social Security earnings limit department. With the mortgage covered and the likelihood that the community college teaching gigs will max out the earnings limit, I may not have to take a drawdown from investments at all next year.

This, he thinks, will allow my much-battered investments to recover from the depredations of the Bush economy.

If, as planned, I add the net amount of the vacation pay GDU will owe me to the living expenses fund, I should end up with about the same monthly income that I have right now. It will delay having to raid my retirement funds for as long as a year, and meanwhile, it’ll give me a chance to apply for full-time work. The community college district has had a hiring freeze going for quite some time; that one job has opened up means the ice-pack may be melting. Between now and next fall, several more opportunities may arise.

O’course, the fly in that ointment is Medicare. Even with the inflated health-care premiums presented to us in this month’s open enrollment, the cost of cobbling together coverage comparable to my present health-care coverage will be about 10 times what I’m paying now. That’s going to be a big hit, and because of the earnings limitation, I won’t be allowed to use freelance income or take on a summer course to take up the slack.

So…2010 is gonna be a little pinched, but it should be survivable. As for 2011: it’ll just have to take care of itself.

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