You have probably daydreamed about walking out of work one day and never returning. For some the impetus is retirement, but for others the desire is for a little more control over life through semi-retirement or starting a business.

How Much Cash Do You Need to Quit?

A recent Wall Street Journal article, by Brett Arends, takes a look at the elements that go into deciding if you can afford to walk away from work.

First, seniors need to investigate their health insurance options to see if they can find affordable coverage.
Other considerations:

• Think about your transition costs--how much do you need to cover your living expenses while you change careers or look for part-time work? How much do you need if you opt to move out of your current home?
• Consider the cost of living in your hometown and the option of living somewhere with a less expensive cost of living
• Make a realistic plan. Are you retiring permanently, looking for a new job, or starting a business? The funds needed are different for each choice
• Estimate how long your cash might last. The Wall Street Jouranl article estimates that people investing conservatively should be able to earn 3% per year over inflation. If you want $10,000 per year for 30 years, you need about $200,000
• See how far you can slash your expenses to evaluate how much you really need to live on

Consider a Reverse Mortgage

If you are over age 62 and have significant equity in your home, investigate the potential cash flow benefits of a reverse mortgage by getting quotes from reputable lenders. A reverse mortgage can even be taken on a newly purchased home if you are moving to a new area.