I’m going to jump into something next week, I think. But I jump in and out pretty fast, which most of the fun. However, it would be helpful to have something with good long term prospects, just in case it doesn’t go up quickly enough
@busdriver11, those very large deposits might be mandated, as for example, some US insurance companies must keep all or a legislated percentage of their assets in US Treasuries.
And, sometimes it is more about the return of capital than the return on capital 
@IxnayBob, We were thinking of coastal Oregon or Sierra foothills but Ibiza looks beautiful too! Ironically, the only foreign location that has appealed is Switzerland, but I’ll probably never get my husband away from California.
The Euro has been dropping relative to other currencies, so the Swiss franc is considered a safer place to park money. Even with the negative interest rate the Swiss currency is still a better hedge than the risk of further devaluation of the Euro. Greeks are pulling their cash out of banks in fear over the potential exit from the EU and Putin’s shenanigans and consequent trade sanctions continue to drag on Germany and other northern European countries. Plus, Europeans are notorious savers, rivaling the Japanese. They need incentive to spend their money and stimulate the economy.
@momsquad, retiring to the Euro zone is difficult for American citizens now, for healthcare and related reasons (say this with a haughty foreign accent: “so, you want to fill up on Big Macs and get no exercise in the United States and then come here for the free medical care? No!”)
I am trying to get EU citizenship in part because I’d like to consider retiring in Scotland and/or southern France, maybe Italy. Without citizenship, I think you’re restricted to 6 months per year. There’s a similar situation with Canada.
My sister semi-retired to Eugene, Oregon. I predicted it wouldn’t be a good fit for the decades-long New Yorker. I was wrong, and she made me promise to at least visit before I decide anything.
I used to spend time on Zillow (real estate porn ) picturing where we might land. My wife has made that probably a 5-years from now fantasy (big brag coming on the Brag thread, I hope, in two weeks; knock wood, fingers crossed, salt over shoulder, etc.). One thing I noticed is that there is a shortage, at least where I’ve been looking on the East Coast, of what we are looking for: 3 bedroom, not on top of the neighbors, and near water (lake, river, pond), and built for comfort. Once you include waterfront in the selection criteria, they seem to become 7 bedroom and 7,000 square feet – not what we’re looking for.
People build in part based on what they paid for the lot.
So if you have a million-dollar lot on the water, you aren’t going to build a 1500 sq ft ranch.
LOL! My husband still has German citizenship and we both worked in Switzerland for a time, so we did pay into the system. The one thing we found we can’t handle anymore is lack of sunshine though, which is why Oregon is slipping down the list. During the peak of the housing crisis I was on Zillow every day, inching my way up and down the west coast looking for bargains. I did find some temptations, some smaller houses perched near the ocean bluffs in Cambria. But the nearest larger towns with hospitals are at least 40 minutes away, and the area does get socked in with fog a lot. We have had many wonderful trips staying in vacation rentals, so I suspect we will stay put and do some extended stay trips to our dream locations. Who knows, maybe one of the extended vacations will turn in to a plan to move but we probably won’t jump into anything feet first.
momsquad, I join you in thinking about vacation-like locations for retirement. Early and often. But the realities of wanting to be nearer to our only child trumps those thoughts. As she has still a good 8-10 years before she lands (because of intended grad school attendance), my concern has been whether we downsize once now and then move again to be closer to whereever she ends up. Weather and health care are definitely a concern. I envy those who have robust health who can plan for 20 years of hiking and kayaking. Years ago the notion of retiring to the Oregon coast was high on the list. One bad turn in health has changed it all and the idea of driving almost an hour on beautiful but twisty roads to big-city health care is something I have to avoid. There’s a great deal of comfort in knowing that I have all the health care I need just 20 minutes of suburban driving away.
Do we have until tax filing deadline (+ extension) to do a back-door conversion of 2014’s nondeductible IRA? In other words, until 4/15/15 (or 10/15/15)?
@AttorneyMother, my understanding is that the deadline for the (non deductible) contribution to the tIRA is April 15, regardless of filing extensions. The conversion to rIRA can be done anytime thereafter, but I don’t see a benefit in waiting.
Thanks. I was confusing the contribution deadline with the tIRA-rIRA conversion deadline, of which there isn’t one. As I’ve said, Roth conversions give me a headache!
@momsquad, I’d hang onto that German citizenship! My father and mother gave theirs up, but I might be able to file for a reinstatement. My FIL gave up his Canadian and my MIL her UK (Scotland), so I’m batting 0 here with the family 
I haven’t been to Switzerland for years (40?), but what a beautiful albeit expensive country. Bringing the topic full circle, one of my financial porn indulgences is Bloomberg Surveillance, a morning talk show that is mostly economics and contains very little stock talk. I really like one of the hosts, and his contribution recently was
My H’s Schwab representative directed me to this sample rIRA conversion report. It is Schwab’s sample report, obviously, but it lays out in fairly clear fashion the considerations and if you use Schwab, they can crunch numbers for you.
http://www.schwab.com/cms/P-3403006.0/roth007-1_samplereport.pdf
Just a BTW, for our meandering thread, you may not have actually given up your citizenship in another country unless you formally filed to do so. YMMV of course, but, for example, I had always believed that I gave up my British citizenship when I applied for USA citizenship when I was 18. After all, I no longer had a passport and had to pledge my allegiance to the flag… It turns out that GB only recognizes that as renouncing your citizenship if you formally apply to renounce, and fill out forms, etc. DD researched the issue because she had reasons to want EU citizenship. I was able to file paperwork and obtain a new British passport, and she applied for one as ¨British by descent.¨ DS hasn´t expressed much interest in doing so, but might in the future. The benefit is that DD can apply for any EU jobs and work overseas if she wishes.
For those of us with Defined Benefit plans but without Cost of Living Adjustments… how do we value those in our retirement portfolios? DH and I both will have DB plans, and he will likely retire at 63 w/100% of his salary, plus the option to purchase subsidized health insurance. I will retire w/80% of total, but I will start recieving some of that as 50% of former salary in two years, due to proportionate share retirement plans. (So I will start collecting what will seem a ludicrously small amount to many of you, but I will start receiving it at age 57, whilst I continue working until planned 63 at current job.) House will be paid off in a few months - due to my desire to get out from under Green Tree mortgage processing - and we have no plans in the near future to move or downsize, as we are already fairly modest in size. We are now maxing out our ROTH ira contributions, but haven’t been doing that for long, as we were paying our share of college out of income stream only. We have a small amount of deferred comp. Big concern with Defined benefit is that we will be screwed if the city files for bancruptcy and/or the state doesn’t fully fund the other retirement plan which is the current situation. It is so hard to plan without knowing how inflation will go!!! (Maybe time to see a fee-based financial planner? We’ve never done that…)
One way would be to calculate the Net Present Value, which is how much money you would need today to generate a fixed payment per year for a certain number of years, if you make a certain interest rate.
You have to pick an interest rate and guess how many years you will live.
For example, a $50,000 yearly payment for 20 years, with a 3% interest rate gives a NPV of about $744,000. There are various calculators on the internet that can calculate this, just google “net present value calculator”.
To value a Defined Benefit plan, I’d see how much an Annuity for that amount would cost. It’s an approximation, but you can always add a few percent to account for the issuing company’s profit. I would do this using a calculator for a Single Premium Immediate Annuity (SPIA) rather than any of the fee-loaded insurance products.
^ Isn’t that the same thing as NPV?
@anxiousmom
I’m sure others will chime in but you if are reasonably sure about your pension benefits (i.e., because you understand the terms of the DB plan and its requirements or your employer has provided you with an annual statement, etc.), you can factor those in so long as your projected spending needs are adjusted for inflation.
Assuming that your spending needs are adjusted for inflation each year before and during retirement (say by 3.5% annually), you can subtract the flat sum coming from your and H’s DB pension benefits. The difference that must be funded through SS and your own retirement funds will grow each year and that will determine your relative preparedness for retirement.
As for the uncertainty regarding some government pensions, one way to protect yourself would be to assess (by getting the best possible annual report on the matter) the risk of municipal bankruptcy and anticipated political moves going forward (difficult to do). I imagine then that you would know whether your time horizon until retirement leaves you at moderate or great risk. This is where I have seen friends and acquaintances retire earlier than desired for the sake of “locking in” benefits. But employers always reserve the right to modify plans and benefits even then though government employers have to deal with the legislature.
But, in general, if your H will earn a 100%-salary pension benefit at age 63, he is to be congratulated!!
Edited: Do government pensions allow a lump-sum option at retirement? If so, then the SPIA comparison is helpful.
@notrichenough, Not really, because an annuity includes mortality credits and actuarial assumptions.
This website seems to have a good listing of state-by-state public sector pension discussion and each payor’s legislative basis, though I have no idea how current some of the proposals are: