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I’m 49, my wife is 34, we have 4 kids and $2.3 million saved. I earn $300K a year but ‘lose a lot of sleep worrying about tomorrow’ — when can I retire?

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I am 49 years old (turning 50 this year) and my wife is 34. We have two young children under the age of 2, and twin girls, age 11, from my prior marriage. College for the twins is fully funded in a 529 plan and I save monthly in 529 plans for my other two children. 

I have had a good career in technology and make about $300,000 a year. We max out all retirement vehicles and we have zero debt aside from our primary residence. We also have approximately eight rental income residential properties that net us about $6,000 per month after all mortgages and expenses. Passive income, if you will. Our monthly target expenses are about $10,000 to $12,000 on the high end. 

Combined we have $1.7 million in IRA and 401(k) assets and approximately $500,000 in cash and after-tax savings in Fidelity and E*TRADE accounts. All are in stock-heavy aggressive portfolios and I self manage my IRA averaging a 12% return. 

I started a new job in November 2020 after being let go from my prior position due to COVID-19 and a need to cut expenses. At 50, while I am employed, I am fearful that my job could end again and going through another 7 month+ job search would be incredibly hard on my family and me. I lose a lot of sleep worrying about tomorrow.  

I want to retire, and have my wife retire, likely in Colorado, when I am 58, if I am not forced to retire sooner. I obsess on retirement calculators and try to see if I can achieve this, but one tells me we will be OK while another says I am going to be short and run out of money in 20 years. 

I also have no idea how to look at health insurance costs for my family when not employed and how to factor that into a plan where my spouse will outlive me by 20+ years. I want to make sure she will be OK and never run out of money. We are both in good shape, workout and have good longevity on both sides of our family. She has worked long enough to qualify for Social Security. 

I want to retire because I am going to be an older father and love my wife and children very much, so if I can maximize my time with them not working, but not sacrificing too badly on expenditures, I would like to do so. I just cannot figure out a plan. I am not opposed to working in retirement, either consulting or maybe an hourly wage job, but neither of those options are guaranteed. 

Can you help? 

See: ‘Retirement? How?’ I’m 65, have nothing saved and am coming out of bankruptcy

Dear reader, 

Even with $1.7 million in retirement accounts, an additional $500,000 saved and multiple income sources, I understand why you may be worried about the future. You have a family that relies on you and the unexpected twists and turns of a pandemic certainly don’t help. 

The good news: Retirement at 58 may very well be within your reach, financial advisers said. And if you choose to just scale back from a full-time job but work in some capacity, such as with consulting work or freelancing, you have even more flexibility, said Jen Grant, a financial adviser at Perryman Financial Advisory. “There are dozens of ways to reach his goal,” she said. “Now he should decide on the best way, spend eight years working toward it and set down the stress and worry so he can enjoy his young family.” 

One of the highest-priority tasks you will face if you retire at 58 (or any time before Medicare is available at 65 years old) is health insurance. COBRA may be available temporarily after you have been separated from your old job but you have to make it to 65, at which point you can apply for Medicare.

There are a few options to be covered, including saving now for whatever cost it will be in the open market later on; taking on a part-time job with health benefits so that you can take advantage of the healthcare, earn a little extra income but still have more freedom than a full-time job requires; or have your wife take on a job that provides the family health insurance (if she isn’t already). Since you are healthy, you may also want to look into a Christian Health Sharing company, which is a faith-based health savings approach where members help cover the costs of others in need, Grant said. [Note: This healthcare option is a faith-based, cost-sharing program but is not traditional insurance or government-protected. Critics say Christian health-sharing plans may be more affordable than traditional insurance policies, but not all essential health needs will be covered.]

To get an idea of what health plans cost now in the market, you can check out Healthcare.gov. Keep in mind though that health expenses have been rising every year, with no indication of stopping. 

You mention your biggest concern right now is losing your job. This makes absolute sense, but try to dig a bit deeper into why you have these fears. Is it that you think you won’t be able to adapt to a new job in the future? Or won’t have the skills to be an attractive hire? Is it that your current expenses would be far too much for you to handle if you were temporarily out of work? Knowing that answer will help you find out what you need to do next. 

For example, if you’re worried that you might need to brush up on skills (or develop new ones) to keep the job search short, start now. You may not need to do this for applications, but doing one thing every week to brush up on old skills or learn new ones could keep you as a key asset to your current company and make you a catch to a future hiring manager. Plus, you might even be able to leverage this continued education (in the form of a class or a YouTube video) for a higher salary later on. 

If you’re concerned about losing your job because you think your current expenses would be too much to handle, even temporarily and knowing you have that rental income, then look at your cash inflows and outflows right now and ask yourself what it would look like if you were to be out of work tomorrow. You obviously know how to save, so does it come down to spending? 

“Are they spending in areas that are not meaningful to them as a family? If so, yes, reduce expenses,” said Jeremy Finger, certified financial planner, founder and chief executive officer of Riverbend Wealth Management. 

There are a few other things you can do now to alleviate some of the stress. Because of the age difference between you and your wife, Grant recommends life insurance. You’re a high earner and if something were to happen to you, life insurance could assist in replacing your income. Along with life insurance, look into disability insurance too, she said.

Keeping your investments in an aggressively-allocated portfolio is fine, but make sure you have about two to three years’ worth of living expenses in a more conservative portfolio, Grant said. “This will protect him if the market goes haywire the year he plans to retire,” she said. “He won’t be forced into selling stocks at a loss or liquidating real estate.” A larger emergency fund would also provide you with some comfort — the money could be used in an unexpected situation, or if nothing happened between now and your target retirement date, the money could mitigate the stresses when transitioning into retirement. 

Also, even if you aren’t worried about your investments, check them periodically to ensure they’re properly allocated. A balanced — the key word here being “balanced” — 80% stock/20% bond portfolio, or even a 90%/10% mix, could work with extra cash on hand, such as $200,000, but those portfolios must be balanced, Finger said.

Check out MarketWatch’s column “Retirement Hacks” for actionable pieces of advice for your own retirement savings journey

Finger had a few other thoughts based on your situation. He suggested consulting an attorney about placing your rental properties in an LLC to protect liability, and would also consider adding umbrella insurance to protect yourself. If you’re netting $6,000 in rental income, you’d only need about $4,000 to $6,000 a month from other income and investments (or $72,000 a year?), so he recommends having at least that in cash-like assets to play it safe. 

I say this in nearly all of my letters, but you might want to consider working with a financial planner who could create a financial plan for you. A professional could advise you on your investments — for retirement and the kids’ college funding — as well as provide clarity on how to retire comfortably in the future. “He can outsource the worrying to someone who does this for a living and then let them monitor the plan and adjust as needed,” Grant said. 

If that’s not of interest to you, do the work yourself. Create a full financial plan for yourself and map out what-if scenarios, and keep this stored somewhere nearby so that you can look at it or make adjustments if life changes occur. 

“You cannot completely neutralize every possible thing that could happen, but you can prepare the best you can,” Finger said. “Also be flexible and prioritize your time and expenses. If he can accomplish more time with his family, any little shortfall later in life as he looks back on it would be an easy trade-off.” 

Readers: Do you have a suggestion for this letter writer? Add them in the comments below. 

Have a question about your own retirement savings? Email us at HelpMeRetire@marketwatch.com

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After pandemic drop, Canada’s detention of immigrants rises again By Reuters

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© Reuters. FILE PHOTO: Two closed Canadian border checkpoints are seen after it was announced that the border would close to “non-essential traffic” to combat the spread of novel coronavirus disease (COVID-19) at the U.S.-Canada border crossing at the Thousand Isla

By Anna Mehler Paperny

TORONTO (Reuters) – Canada is locking up more people in immigration detention without charge after the numbers fell during the pandemic, government data obtained by Reuters shows.

Authorities cite an overall rise in foreign travelers amid easing restrictions but lawyers say their detained clients came to Canada years ago.

Canada held 206 people in immigration detention as of March 1, 2022 – a 28% increase compared with March 1 of the previous year. Immigration detainees have not been charged with crimes in Canada and 68% of detainees as of March 1 were locked up because Canada Border Services Agency (CBSA) fears they are “unlikely to appear” at an immigration hearing, according to the data.

The rise puts Canada at odds with Amnesty International and other human rights groups that have urged Ottawa to end its use of indefinite immigration detention, noting CBSA has used factors such as a person’s mental illness as reason to detain them.

A CBSA spokesperson told Reuters that “when the number of entries (to Canada) goes up, an increase in detention is to be expected.” CBSA has said in the past it uses detention as a last resort.

A lawyer told Reuters her detained clients have been in Canada for years.

In the United Kingdom, too, immigration detention levels rose last year after dropping earlier in the pandemic, according to government statistics. Unlike Canada, the United States and Australia, European Union member states have limits on immigration detention and those limits cannot exceed six months.

The rise in detentions puts people at risk of contracting COVID-19 in harsh congregate settings, refugee lawyers say.

Julia Sande, Human Rights Law and Policy Campaigner with Amnesty, called the increase in detentions “disappointing but not surprising,” although she was reluctant to draw conclusions from limited data.

The number of immigration detainees in Canada dropped early in the pandemic, from a daily average of 301 in the fourth quarter (January through March) of 2019-20 to 126 in the first quarter (April through June) of 2020-21.

FEW NO-SHOWS AS DETENTIONS DROPPED

Detaining fewer people did not result in a significant increase in no-shows at immigration hearings – the most common reason for detention, according to Immigration and Refugee Board data.

The average number of no-shows as a percentage of admissibility hearings was about 5.5% in 2021, according to that data, compared to about 5.9% in 2019.

No-shows rose as high as 16% in October 2020, but a spokesperson for the Immigration and Refugee Board said this was due to people not receiving notifications when their hearings resumed after a pause in the pandemic.

Refugee lawyer Andrew Brouwer said the decline in detention earlier in the pandemic shows Canada does not need to lock up as many non-citizens.

“We didn’t see a bunch of no-shows. We didn’t see the sky fall … It for sure shows that the system can operate without throwing people in jail,” Brouwer said.

He added that detainees face harsh pandemic conditions in provincial jails – including extended lockdowns, sometimes with three people in a cell for 23 hours a day.

Refugee lawyer Swathi Sekhar said CBSA officials and the Immigration and Refugee Board members reviewing detentions took the risk of COVID-19 into account when deciding whether someone should be detained earlier in the pandemic but are doing so less now.

“Their position is that COVID is not a factor that should weigh in favor of release,” she said.

“We also see very, very perverse findings … [decision-makers] outright saying that individuals are going to be safer in jail.”

The Immigration and Refugee Board did not immediately respond to a Reuters request for comment.

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Nasdaq futures rise as market attempts comeback from April sell-off, Meta shares soar

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Futures on the Dow Jones Industrial Average added 70 points or 0.2%. S&P 500 futures gained 0.7% and Nasdaq 100 futures jumped 1.2%.

The moves came as shares of Meta surged more than 18% after hours following a beat on earnings but a miss on revenue, a sign that investors may see signs of relief in the beaten-up tech sector. Shares were down 48% on the year heading into the results.

Meanwhile, shares of Qualcomm gained 5.6% in extended trading on the back of strong earnings while PayPal rose 5% despite issuing weak guidance for the second quarter.

“I think a lot of people want to believe that earnings are going to pull us out of this, but earnings are not what got us into this,” SoFi’s Liz Young told CNBC’s “Closing Bell: Overtime” on Wednesday. “… But the reality is there are so many macro headwinds still in front of us in the next 60 days that the market is just hard to impress.”

The after-hour activity followed a volatile regular trading session that saw the Nasdaq Composite stoop to its lowest level in 2022, as stocks looked to bounce back from a tech-led April sell-off. The index is down more than 12% since the start of April.

In Wednesday’s regular trading, the tech-heavy Nasdaq ended at 12,488.93, after rising to 1.7% at session highs. The Dow Jones Industrial Average rose 61.75 points, or 0.2%, to 33,301.93 propped up by gains from Visa and Microsoft, while the S&P 500 added 0.2% to 4,183.96.

Investors await big tech earnings on Thursday from Apple, Amazon and Twitter, along with results from Robinhood. Jobless claims are also due out Thursday.

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