# Retirement and saving



## BullyARed (Jun 19, 2010)

There have been threads about retirement and I just like to poll how much saving would be adequate for one to retire to live a life comfortably but not expensive?


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## Tortuga (May 21, 2004)

Whatever number you come up with........DOUBLE it !!!


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## davis300 (Jun 27, 2006)

Lots of factors obviously...but my goal is a minimum of 1 million dollars in 401k and Roth accounts...4% withdrawal a year is $40,000 just for minimal living expenses and having fun.


Sent from my iPhone using Tapatalk


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## Rubberback (Sep 9, 2008)

davis300 said:


> Lots of factors obviously...but my goal is a minimum of 1 million dollars in 401k and Roth accounts...4% withdrawal a year is $40,000 just for minimal living expenses and having fun.
> 
> Sent from my iPhone using Tapatalk


This if you have everything paid for.


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## Grumpy365 (Oct 21, 2010)

davis300 said:


> Lots of factors obviously...but my goal is a minimum of 1 million dollars in 401k and Roth accounts...4% withdrawal a year is $40,000 just for minimal living expenses and having fun.
> 
> Sent from my iPhone using Tapatalk


What about money from SS?

I mean we all have paid in a metric sh!/t ton of cash in.


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## Rubberback (Sep 9, 2008)

Grumpy365 said:


> What about money from SS?
> 
> I mean we all have paid in a metric sh!/t ton of cash in.


I wouldn't rely on SS. Gov. is broke.


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## Troutman123 (Mar 21, 2007)

*SS*

Gross 2,600 THEN IRS on April 15


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## BretE (Jan 24, 2008)

davis300 said:


> Lots of factors obviously...but my goal is a minimum of 1 million dollars in 401k and Roth accounts...4% withdrawal a year is $40,000 just for minimal living expenses and having fun.
> 
> Sent from my iPhone using Tapatalk


That was my goal but didn't quite make it. I do have a pension and some other income and investments so I'm going Dec 1st......


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## WillieT (Aug 25, 2010)

I've already retired, but according to the figures I see here I better go back to work RIGHT NOW. Ain't gonna happen though. Guess I'll see.


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## TranTheMan (Aug 17, 2009)

davis300 said:


> Lots of factors obviously...but my goal is a minimum of 1 million dollars in 401k and Roth accounts...4% withdrawal a year is $40,000 just for minimal living expenses and having fun.
> 
> Sent from my iPhone using Tapatalk


Assuming you would retire in 20 years or at 59 year-old, then $40K/yr today dollars would be $72K/yr with a moderate 3% inflation rate. You may need a total of $1,806,000.


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## acoastalbender (Jul 16, 2011)

After some 45 years it occurred to me that I'd wasted a lot of time working for money....it ought to be the other way round! Researched plenty on investments and decided for me rental property was the way to go. I get paid every month and hardly do anything for it. Meanwhile, it increases in value every year but gets written down every year on the tax return. As it's paid for I don't have to deal with a bank, and if my expenses go up well, so does the rent! Eventually I will have to pay some capital gains on it if I sell. Meanwhile I write off every nail and lick of paint I put into it...

.


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## mas360 (Nov 21, 2006)

BullyARed said:


> There have been threads about retirement and I just like to poll how much saving would be adequate for one to retire to *live a life comfortably but not expensive*?


That is a very relative term.


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## Grumpy365 (Oct 21, 2010)

Rubberback said:


> I wouldn't rely on SS. Gov. is broke.


We live in a country whose currency is backed by nothing but faith (most is not backed by paper, it just exist in theory).

So, the government is never broke.


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## Johnny9 (Sep 7, 2005)

Our wonderful President Obama wants to take all savings away except for $1M. Men and women who have saved for 30-50 years would loose, Isn't he just a great President and a Leader. ?


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## Rubberback (Sep 9, 2008)

Grumpy365 said:


> We live in a country whose currency is backed by nothing but faith (most is not backed by paper, it just exist in theory).
> 
> So, the government is never broke.


Thats good because even the gov admits that we are 17 trillion dollars in debt. Excuse me not we but they.
I hear ya! Then it could be a theory that when I become 62 they will send me a check. I have faith but it is not with our gov.


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## Hollywood1053 (May 15, 2009)

juan said:


> Our wonderful President Obama wants to take all savings away except for $1M. Men and women who have saved for 30-50 years would loose, Isn't he just a great President and a Leader. ?


Where did you hear this?


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## w_r_ranch (Jan 14, 2005)

$1.25M/person. And no debt.


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## poppadawg (Aug 10, 2007)

I have read several studies that have used 4% as a the majic percentage. As in, you should be able to live off 4% of retirement saving in order to not run out of money. So 1 miilion =40k/yr. No way in hell I could live off of 40k/year without a massive change in lifestyle. 2 million? I dont know, but its a lot. Looks like I will be working for a long time


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## davis300 (Jun 27, 2006)

TranTheMan said:


> Assuming you would retire in 20 years or at 59 year-old, then $40K/yr today dollars would be $72K/yr with a moderate 3% inflation rate. You may need a total of $1,806,000.


Great advice Sir...inflation is definitely the forgotten factor. Good news for me is we are debt free including the house and save/invest 30% of our 2 incomes. I certainly don't bank on SS to be around in 20 years or factor in my wife's teacher retirement. I try and talk to every younger person I can and tell them to start saving now!

Sent from my iPhone using Tapatalk


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## redexpress (Apr 5, 2010)

Get on the SS website, create your account, and see what they have for your contributions and future payments. If you have a wife ,get her to do the same.


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## bayrunner (Sep 26, 2004)

Except for collecting rent and doing maintenance I retired about a year ago. In 7 years my house will be paid off and we can travel more. I haven't worked FOR anybody in about 10 years.


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## Spinky (Aug 11, 2005)

TranTheMan said:


> Assuming you would retire in 20 years or at 59 year-old, then $40K/yr today dollars would be $72K/yr with a moderate 3% inflation rate. You may need a total of $1,806,000.





w_r_ranch said:


> $1.25M/person. And no debt.


Both of those are kinda in the same ballpark and I think that's pretty close.
Another consideration is your asset allocation. I think sometimes people get too conservative as they get older. Yes, you want to reduce volatility, but you need some part of it growing to hedge against inflation.
AND- you guys that have worked for one company forever, make sure your 401k or whatever isn't just full of that company's stock versus being spread out over different categories. A definite disaster possibly waiting to happen.

This is a great thread and goes along with the suggestion of a "Retirement Board" thrown out earlier. I'm just now kicking the tires on selling my practice and putting things in a different gear after 33years. :brew2:


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## Pocketfisherman (May 30, 2005)

1.5 Million in the bank is the minimum IMHO. The gov't statistics do a real good job of hiding inflation with regards to food, utilities, and fuel.


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## Bustin Chops (Feb 3, 2008)

Sorry, but realistically most people dont have and never will have 1 million dollars in the bank and they are still going to retire. Thats a fact.


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## BretE (Jan 24, 2008)

Pocketfisherman said:


> 1.5 Million in the bank is the minimum IMHO. The gov't statistics do a real good job of hiding inflation with regards to food, utilities, and fuel.


How many of you current retirees have $1.5 mil in the bank? I'm betting very few.....too many factors to put a hard number on what a comfortable retirement is for everyone......current/future expenses, expected lifestyle, medical condition, etc....


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## Duke (Dec 27, 2007)

You may wish to add your health into all of this as I had a game plan but health issues made me retire at 66 and planned on working to 70. If you live into your 90's you will need more. I do believe had I been able to work 4 more years we would be OK. It's the unexpected that gets ya.


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## Tortuga (May 21, 2004)

Duke said:


> You may wish to add your health into all of this as well. *It's the unexpected that gets ya.[*/QUOTE]
> 
> *BINGO, Duke !!!!!!!
> *


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## JFolm (Apr 22, 2012)

Bustin Chops said:


> Sorry, but realistically most people dont have and never will have 1 million dollars in the bank and they are still going to retire. Thats a fact.


Those type of people don't open threads like these.


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## BretE (Jan 24, 2008)

Tortuga said:


> Duke said:
> 
> 
> > You may wish to add your health into all of this as well. *It's the unexpected that gets ya.[*/QUOTE]
> ...


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## Lagunaroy (Dec 30, 2013)

Plan for a comfortable retirement for YOU. The biggest thing I can say is protect what you have. Check into liability umbrella policies, cheap in my opinion. One car wreck can mess everything up.

6 months prior to retirement, buy a new vehicle, cash! Now take your wife on vacation, add the costs up, it will open your eyes.

No plan lasts more than 30 seconds after you pull that retirement trigger. As posted before health and unexpected things will be an issue.

I think Ranch was half right on his $ estimate, but lifestyles are different for everyone.


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## Tortuga (May 21, 2004)

BretE said:


> Tortuga said:
> 
> 
> > Hey, I included medical condition!........
> ...


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## BretE (Jan 24, 2008)

Tortuga said:


> BretE said:
> 
> 
> > No offense, Bret...in 'unexpected' I wuz including health, accidents, natural disasters, kids moving back home, nursing home care, and probably a couple of dozen other 'surprises' fate can send yore way...
> ...


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## Spinky (Aug 11, 2005)

Tortuga said:


> BretE said:
> 
> 
> > No offense, Bret...in 'unexpected' I wuz including health, accidents, natural disasters, kids moving back home, nursing home care, and probably a couple of dozen other 'surprises' fate can send yore way...
> ...


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## mas360 (Nov 21, 2006)

BretE said:


> How many of you current retirees have $1.5 mil in the bank? I'm betting very few.....too many factors to put a hard number on what a comfortable retirement is for everyone......current/future expenses, expected lifestyle, medical condition, etc....


I did a poll with this question within the circle of friends, relatives, co-workers and out of some 20 persons only one said she expected to squirrel away 1 million bucks when she retired. This was done about five years ago.


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## BretE (Jan 24, 2008)

mas360 said:


> I did a poll with this question within the circle of friends, relatives, co-workers and out of some 20 persons only one said she expected to squirrel away 1 million bucks when she retired. This was done about five years ago.


I have quite a few friends that have retired in the last 5-7 years and I'm fairly certain very few if any had $1 mil in cash on hand. They do have pensions and substantial 401K's but not a mil cash. I have yet to hear any of them say they wish they'd stayed. So far, everyone of them have advised me to GO. I don't get my financial advice from friends.....but I do listen......


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## w_r_ranch (Jan 14, 2005)

Lagunaroy said:


> I think Ranch was half right on his $ estimate, but lifestyles are different for everyone.


Half right??? If a normal person is debt free & can't live good on $80K + S.S., they should just shoot themselves.

Most people live beyond their means like 'tomorrow' would never come. When they hit retirement age, reality sets in & they realize they're screwed. If a working couple invested just $5K/yr over the course of their 35-40 yrs working careers, they would end up with about $2M.

As a young couple, we lived within our means. We did not buy new or expensive new vehicles every few years, nor did we live in big houses. We always treated our investment money like it was another bill. We made our investment deposits first, then paid our monthly bills & lived on the remainder. No it wasn't fun all the time, but we decided from the start that we would not be 'poor' in our retirement years & we did what what was necessary.


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## Rubberback (Sep 9, 2008)

Spinky said:


> Tortuga said:
> 
> 
> > Speaking of that, how many have long term care insurance? My biggest fear is the stroke, severe disability from accident, etc. That can suck your savings away FAST. If I drop over dead, that's pretty low overhead...
> ...


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## BretE (Jan 24, 2008)

w_r_ranch said:


> Half right??? If a normal person is debt free & can't live good on $80K + S.S., they should just shoot themselves.
> 
> Most people live beyond their means like 'tomorrow' would never come. When they hit retirement age, reality sets in & they realize they're screwed. If a working couple invested just $5K/yr over the course of their 35-40 yrs working careers, they would end up with about $2M.
> 
> As a young couple, we lived within our means. We did not buy new or expensive new vehicles every few years, nor did we live in big houses. We always treated our investment money like it was another bill. We made our investment deposits first, then paid our monthly bills & lived on the remainder. No it wasn't fun all the time, but we decided from the start that we would not be 'poor' in our retirement years & we did what what was necessary.


How'd you get $2mil outta $5K @ 40 years. Not saying it can't be done but I'd say that is pretty optimistic...


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## waterwolf (Mar 6, 2005)

*.?*



juan said:


> Our wonderful President Obama wants to take all savings away except for $1M. Men and women who have saved for 30-50 years would loose, Isn't he just a great President and a Leader. ?


Didn't he bump it up to 5 mil...? 1 mil was his thinking.

Federal Estate and Gift Tax Exemption Now $5,430,000.00
Beginning in 2014 the Estate and Gift Tax exemption for all citizens is 5,430,000.00 dollars. In addition, a surviving spouse can also include the unused portion of their deceased spouse exemption. The new law makes the exemption â€œportableâ€ between spouses. For example, if the first spouse to die uses only $2 million dollars of their exemption the surviving spouse will be able to exclude $8,860,000.00 million dollars of her estate from Federal Estate and Gift Tax.


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## Rubberback (Sep 9, 2008)

waterwolf said:


> Didn't he bump it up to 5 mil...? 1 mil was his thinking.
> 
> Federal Estate and Gift Tax Exemption Now $5,430,000.00
> Beginning in 2014 the Estate and Gift Tax exemption for all citizens is 5,430,000.00 dollars. In addition, a surviving spouse can also include the unused portion of their deceased spouse exemption. The new law makes the exemption â€œportableâ€ between spouses. For example, if the first spouse to die uses only $2 million dollars of their exemption the surviving spouse will be able to exclude $8,860,000.00 million dollars of her estate from Federal Estate and Gift Tax.


Most people that have any money at all have saved all their life. Then they retire & the gov. steals it from them.


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## Johnny9 (Sep 7, 2005)

Rubberback said:


> Most people that have any money at all have saved all their life. Then they retire & the gov. steals it from them.


Exactly and gives it to a bunch of illegal people with free schooling, health and welfare. Just sucks for the working people.


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## w_r_ranch (Jan 14, 2005)

BretE said:


> How'd you get $2mil outta $5K @ 40 years. Not saying it can't be done but I'd say that is pretty optimistic...


Maybe, I didn't word it clearly... The input is $5K/individual for a total of $10K. Here is the snapshots, one at 7% & one at 10% (most of us 'baby boomers' did better than 10%):


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## Rubberback (Sep 9, 2008)

juan said:


> Exactly and gives it to a bunch of illegal people with free schooling, health and welfare. Just sucks for the working people.


Problem is your to old to work & wore out. Then they just keep sticking the knife in deeper. Then your broke & they won't help you after you have giving them every thing you've worked for all your life for. They then take everything you have your land etc. because your unable to make any more money. Its nuts.


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## Shady Walls (Feb 20, 2014)

*Retire*



Bustin Chops said:


> Sorry, but realistically most people dont have and never will have 1 million dollars in the bank and they are still going to retire. Thats a fact.


X2 I retired haven't even touched my 401k, between pension and my wife's s.s. And I start collecting SS in June, money hasen't been a problem. First pay off everything you own at least a year before you retire. Going to buy a new truck this fall and still won't touchmy 401k. I spend most of my money on gas. Don't live above your means, stop trying to keep up with the Jones. Am going to use some 401k money this summer, going to Alaska. Life short- enjoy it...


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## Rubberback (Sep 9, 2008)

Shady Walls said:


> X2 I retired haven't even touched my 401k, between pension and my wife's s.s. And I start collecting SS in June, money hasen't been a problem. First pay off everything you own at least a year before you retire. Going to buy a new truck this fall and still won't touchmy 401k. I spend most of my money on gas. Don't live above your means, stop trying to keep up with the Jones. Am going to use some 401k money this summer, going to Alaska. Life short- enjoy it...


Most of my money on gas. LMAO.


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## Shady Walls (Feb 20, 2014)

Brett I invested in RHCP where Dow matches it since they offered it to us. Health insurance runs $335.00 a month and what I had in there and they still match it , so the RHCP investment pays for the premiums, it should last till I'm 90. Looking at them investment returns on here said at 7% an 10% for 40 years you will have millions, true that but what about them years when it's 2% or less, like it has been in earlier years.


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## BretE (Jan 24, 2008)

w_r_ranch said:


> Maybe, I didn't word it clearly... The input is $5K/individual for a total of $10K. Here is the snapshots, one at 7% & one at 10% (most of us 'baby boomers' did better than 10%):


I see what you're saying but realistically 30 years ago $5K per year was probably better than 20%-30% of most of ours salary. I seriously doubt many households could afford that percentage of savings. Sounds good now, not so good back then...


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## Bustin Chops (Feb 3, 2008)

A lot of people cant save 10k per year. Dont tell me they didn't try. They make 40 or 50 k a year and raise three or four good kids and try there damnedest to get them through college and they did a darn good job. I lived a few years payday to payday while the kids were young. Some of you sound like you were born with a silver spoon in your mouth.


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## w_r_ranch (Jan 14, 2005)

BretE said:


> I see what you're saying but realistically 30 years ago $5K per year was probably better than 20%-30% of most of ours salary. I seriously doubt many households could afford that percentage of savings. Sounds good now, not so good back then...


OK, figure out what 15% of your income was since you started working (we don't want to know your particulars just do it for yourself). If you also had the opportunity to enroll in a company stock purchase, did you take advantage of it (up to 10% most places)??? Many do if a plan is offered...



Bustin Chops said:


> A lot of people cant save 10k per year. They make 40 or 50 k a year. Dont tell me they didn't try. Some of you sound like you were born with a silver spoon in your mouth.


Bull. 15% of 50K is $7500, even with only one person working. Do you want me to work that number for you (it will still be more than $1M)???

As far as your comment about being "born with a silver spoon in your mouth"... if that was true, we would have had new cares all along and/or retired early.

The point is *anybody* can save if they put their mind to it to, no matter how modest their means. Don't forget, some of our parents made $40-50 a week, made house payments, paid their bills & still managed to save along the way. Some even managed to send their kids to college.


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## BullyARed (Jun 19, 2010)

w_r_ranch said:


> Half right??? If a normal person is debt free & can't live good on $80K + S.S., they should just shoot themselves.
> 
> Most people live beyond their means like 'tomorrow' would never come. When they hit retirement age, reality sets in & they realize they're screwed. If a working couple invested just $5K/yr over the course of their 35-40 yrs working careers, they would end up with about $2M.
> 
> As a young couple, we lived within our means. We did not buy new or expensive new vehicles every few years, nor did we live in big houses. We always treated our investment money like it was another bill. We made our investment deposits first, then paid our monthly bills & lived on the remainder. No it wasn't fun all the time, but we decided from the start that we would not be 'poor' in our retirement years & we did what what was necessary.


Yep. The sad thing is many don't even have $50K in saving! So, many will depend on SS and gov.


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## Dbinlc (Jan 11, 2015)

I met with my fanatical advisor a couple of weeks ago just to make sure we are still on the same page and mentioned a possible retirement in 3-5 years. He advised me to use 7.2% when figuring projections as long as I was comfortable with a moderate exposure to the market. Of course he mentioned there will be those down years and those up years.


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## w_r_ranch (Jan 14, 2005)

BullyARed said:


> Yep. The sad thing is many don't even have $50K in saving! So, many will depend on SS and gov.


That's very true. And what's funny is they got new vehicles & the latest smart phone with a data plan. Misplaced priorities IMO.


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## Troutman123 (Mar 21, 2007)

*Please read*

My posting below in other retirement thread for my experience on this subject
Regards
Matt


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## pknight6 (Nov 8, 2014)

BretE said:


> I see what you're saying but realistically 30 years ago $5K per year was probably better than 20%-30% of most of ours salary. I seriously doubt many households could afford that percentage of savings. Sounds good now, not so good back then...


Amen. 30 years ago I had two small kids and the wife was a stay at home mom. I was lucky to save enough to get the company match in my 401K.


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## BullyARed (Jun 19, 2010)

w_r_ranch said:


> Maybe, I didn't word it clearly... The input is $5K/individual for a total of $10K. Here is the snapshots, one at 7% & one at 10% (most of us 'baby boomers' did better than 10%):


The power of compound interest! That's how banks make ton of money.


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## BretE (Jan 24, 2008)

w_r_ranch said:


> OK, figure out what 15% of your income was since you started working (we don't want to know your particulars just do it for yourself). If you also had the opportunity to enroll in a company stock purchase, did you take advantage of it (up to 10% most places)??? Many do if a plan is offered
> 
> I've been in our plan for my entire career, well over 10% and 15-20% the last few years. Unfortunately I moved into a less aggressive fund a couple of years back and missed out on the last few years of growth. I didn't feel comfortable staying aggressive as I knew I was retiring. I'm ok but nowhere near $2 mil. I don't think mine is compounding.....


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## JDubya (Sep 26, 2012)

What's best to invest in for a long term retirement plan. I'm at my first year at my job...where I plan on retiring from. We have a retirement plan that I enrolled in, after 8 years they match 2.25 to my 1. But I'm wanting to invest in a second account as well.


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## BretE (Jan 24, 2008)

JDubya said:


> What's best to invest in for a long term retirement plan. I'm at my first year at my job...where I plan on retiring from. We have a retirement plan that I enrolled in, after 8 years they match 2.25 to my 1. But I'm wanting to invest in a second account as well.


Be aggressive as you can early on. The long term history of the stock market proves you'll make more in the long run......

Bear in mind, I'm no professional.....


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## JDubya (Sep 26, 2012)

Everything on 2cool is professional and has to be true :cheers:


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## w_r_ranch (Jan 14, 2005)

BullyARed said:


> The power of compound interest! That's how banks make ton of money.


It is also how anyone with a 401K makes money as well. The key is to start early & stay with it.

Here are some calculators for everyone to play with:

*Retirement contribution effects on your paycheck

401(k) savings calculator

Retirement shortfall calculator

Retirement income calculator

How do I reach my retirement goal?*


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## FishRisk (Jan 24, 2012)

Everyone's -

Savings; IRA's; 401k's; and Pensions are the last big bowls of sugar that exist for the government to get there hands on. Just know that there are countless people in DC, whose job it is to figure out how to take it from you!

Good luck to all in your retirement plans and activities...


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## BretE (Jan 24, 2008)

w_r_ranch said:


> It is also how anyone with a 401K makes money as well. The key is to start early & stay with it.
> 
> Here are some calculators for everyone to play with:
> 
> ...


Great info.....wish I would have taken the time to use these years ago. I've done well but could have done much better. With the demise of pensions(I still have at least part of mine) the only hope of ever retiring for most is maximizing now and never touch a penny until you hang it up. So many don't save the max or borrow against it......


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## JFolm (Apr 22, 2012)

BretE said:


> I've been in our plan for my entire career, well over 10% and 15-20% the last few years. Unfortunately I moved into a less aggressive fund a couple of years back and missed out on the last few years of growth. I didn't feel comfortable staying aggressive as I knew I was retiring. I'm ok but nowhere near $2 mil. I don't think mine is compounding.....


Have you dared to factor up how much cash you missed out on? That would be a tough pill to swallow.


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## mas360 (Nov 21, 2006)

w_r_ranch said:


> Half right??? If a normal person is debt free & can't live good on $80K + S.S., they should just shoot themselves.
> 
> Most people live beyond their means like 'tomorrow' would never come. When they hit retirement age, reality sets in & they realize they're screwed. If a working couple invested just $5K/yr over the course of their 35-40 yrs working careers, they would end up with about $2M.
> 
> As a young couple, we lived within our means. We did not buy new or expensive new vehicles every few years, nor did we live in big houses. We always treated our investment money like it was another bill. We made our investment deposits first, then paid our monthly bills & lived on the remainder. No it wasn't fun all the time, but we decided from the start that we would not be 'poor' in our retirement years & we did what what was necessary.


That is the ideal retirement strategy given you have:

a) a spouse who does not insist on keeping up with the Smiths

b) no divorce


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## redexpress (Apr 5, 2010)

JDubya said:


> What's best to invest in for a long term retirement plan. I'm at my first year at my job...where I plan on retiring from. We have a retirement plan that I enrolled in, after 8 years they match 2.25 to my 1. But I'm wanting to invest in a second account as well.


 If you don't feel like doing it yourself with low cost funds like Vanguard, go shopping around. Talk to several advisors. I use Ameriprise but there is a Edward D Jones on every corner. Maybe Fidelity. Find someone you think you trust, but keep your BS detector on. I wouldn't go crazy risky, but while you're young a bit of risk is OK. Something that tracks S&P 500, and then add some riskier funds.
Max out the company 401K.


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## grayson (Oct 21, 2011)

I agree - don't guess at it. The best calculator I have found (been in the business 35 years) is Firecalc and go to the section "I'm retired - how long will my savings last?"

It is simple to use and a very helpful road map for how much money you may need. Biggest risk to retirement income is inflation and not knowing how long you or your spouse will live.


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## ChuChu (Jan 23, 2010)

I rolled my 401K into an IRA and let Fidelity manage it. It was slightly aggressive. When I retired I took my retirement as a lump sum. I moved all of it to Fidelity, took a portion and set it up to live on till social security. I converted one half of it to an annuity that will pay me a set amount till the day I die, then goes to my heirs. Today, after using about 10% for personal use, I have about 25% more than I started with. Fidelity has done me right.

When I was working, the last 20 years I paid in to my 401K the max amount allowed, I always rolled pay raises into savings. 
The annuity pays the bills and buys the groceries, social security is play money. Only worry I have today is how to spend the required withdrawal when I turn 70 in a few years.


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## goatchze (Aug 1, 2006)

JDubya said:


> What's best to invest in for a long term retirement plan. I'm at my first year at my job...where I plan on retiring from. We have a retirement plan that I enrolled in, after 8 years they match 2.25 to my 1. But I'm wanting to invest in a second account as well.


If you're looking very, very long (for you 30+ years), and you want to invest in a non-tax advantaged account, it's hard to beat simple index funds like one that tracks the S&P.

Since they're not "actively managed", the fees are low. Fees can take a sizable chunk of your returns on other mutual funds. Likewise, you don't have to worry about this market segment or that market segment, or whether your investment is under performing. You put the money in, and when you move out the index fund, it's because you're getting older and want to reduce your risks by moving into bonds or other lower risk - lower return investments.

Historically, the S&P has had excellent returns as a whole. An index fund allows you to be "aggressive" in that you have a 100% position in equities, while reducing some of the risks of being over exposed to particular market segments.

That's my 02 at least.


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## Hullahopper (May 24, 2004)

Spinky said:


> Both of those are kinda in the same ballpark and I think that's pretty close.
> Another consideration is your asset allocation. I think sometimes people get too conservative as they get older. Yes, you want to reduce volatility, but you need some part of it growing to hedge against inflation.
> AND- you guys that have worked for one company forever, make sure your 401k or whatever isn't just full of that company's stock versus being spread out over different categories. A definite disaster possibly waiting to happen.
> 
> *This is a great thread and goes along with the suggestion of a "Retirement Board" thrown out earlier.* I'm just now kicking the tires on selling my practice and putting things in a different gear after 33 years. :brew2:


Yes, I thought about just starting an "Official Retirement Thread" but decided that just wouldn't work due to hijacking issues. Maybe the Mods will reconsider or maybe they will just decide to send me to band camp!


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## BretE (Jan 24, 2008)

JFolm said:


> Have you dared to factor up how much cash you missed out on? That would be a tough pill to swallow.


Couple hundred K but I could have lost that and more had it gone the other way. First time in 26 years I'd pulled it. Further proof.....never, ever think you can guess the market. Put as much as you can afford in, and then some! And let it ride.....


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## BullyARed (Jun 19, 2010)

w_r_ranch said:


> It is also how anyone with a 401K makes money as well. The key is to start early & stay with it.
> 
> Here are some calculators for everyone to play with:
> 
> ...


Very useful links. Green to you. Thanks.

==


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## inventurous (May 30, 2009)

For those thinking of going with an advisor, it is often suggested to pick one that is compensated via % of assets instead of commission, as it lessens the conflict of interest (wanting to sell you investments based on what THEY will make, as opposed to what's best for you).


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## Its Catchy (Apr 10, 2014)

There is lots of good advice on here. I have found that if you save a minimum of 10% of your income and do not live like a fool you will be OK in retirement.

I don't care if you do 401K, Rental properties, Roth's whatever. 

Just save a minimum of 10%.


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## Spec-Rig.006 (Nov 2, 2007)

BullyARed said:


> There have been threads about retirement and I just like to poll how much saving would be adequate for one to retire to live a life comfortably but not expensive?


_*Bare min.*_, in savings you should be working with:

1x your salary at 35 yrs. old
3x your salary at 45 yrs. old
5x your salary at 55 yrs. old
8x your salary at 67 yrs. old

401K's, IRA's, stocks, municipal tax-free bonds, UVL's - after that should collect an average of at least 7% ...


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## grman (Jul 2, 2010)

First and most important rule is PAY YOURSELF FIRST!!

401Ks have an advantage because of employer matching - who does not like free money!

I built my nest egg by myself through 401K and IRAs for me and my wife. But several years ago I moved everything to a Advisor. Main reason was to have everything managed better than I was doing - I managed active accounts, but I had several from years ago that I just let them ride. Not that was a bad thing, those accounts were things like fidelity and Vanguard large cap funds. 2nd reason to have a trusted advisor - simple to invest - but very little is written about withdrawal methods.

I see a lot of numbers thrown around here. Most retirees live on much less that that. Remember - even the calculators are controlled by investment managers - it is in their interest to get you to invest as much as possible with them. They want you to panic. One thing that I can say - I don't know a retiree that has lived at the same level that they did in their working life. I don't consider that a bad thing.

This board is full of people talking about their F350 lifted King Ranches, 70mph SCBs, 36 ft Contenders, Coast homes, Deer ranches, Simms underwear etc.. A lot of that needs to be let go of to stand any chance at a HAPPY retirement.


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## Stumpgrinder (Feb 18, 2006)

grman said:


> First and most important rule is PAY YOURSELF FIRST!!
> 
> 401Ks have an advantage because of employer matching - who does not like free money!
> 
> ...


 Lots of truth here. Personally, I think I'd part with a lot of luxuries like the Simms drawers for the nicety of taking a fungo bat to my alarm clock and walking away " Like a Boss"


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## Steven H (Jan 15, 2006)

I read some of these responses last night. I am with a financial adviser and when he helped us come up with our "#" he asked if we wanted it figured with and without SS and I said both. He then asked if i thought SS would be around when I retired ( I am 42) I said no, like everyone else. He says he feels it will be around in some form or another, but it is too political to just not give everyone anything for all that they paid in all their life which made sense to me. How long has the US govt been operating in the red? BTW, our # is $1.8 million, that is with house pd off and $3500 a month to live on roughly, living to the age of 82, Yah, they ask how long do you think you will live.

I recall Grandpa selling off land and asking why, he said " I did not think I was going to live this long" he died last summer at 92.

Please correct me for those who are drawing right now, max SS benefit is $2500 per month correct? And that is taxed correct?


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## Hullahopper (May 24, 2004)

Lot's of solid thoughts developed on this thread. When I hang it up in a couple of years it will not be 100% but hopefully in stages. I don't honestly think I could handle retirement "cold turkey" style. I would go nuts doing honey do's all day long! 

I could still do appraisal review work both from my home or office when I felt like it to help supplement our incomes for a while. Maybe at least make enough each month to offset health insurance payments for a while.


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## acoastalbender (Jul 16, 2011)

Steven H said:


> I read some of these responses last night. I am with a financial adviser and when he helped us come up with our "#" he asked if we wanted it figured with and without SS and I said both. He then asked if i thought SS would be around when I retired ( I am 42) I said no, like everyone else. He says he feels it will be around in some form or another, but it is too political to just not give everyone anything for all that they paid in all their life which made sense to me. How long has the US govt been operating in the red? BTW, our # is $1.8 million, that is with house pd off and $3500 a month to live on roughly, living to the age of 82, Yah, they ask how long do you think you will live.
> 
> I recall Grandpa selling off land and asking why, he said " I did not think I was going to live this long" he died last summer at 92.
> 
> Please correct me for those who are drawing right now, max SS benefit is $2500 per month correct? And that is taxed correct?


That don't look like enough.....not for "tomorrow"....taxes, home, car,(boat...:biggrin health insurance, utilities, food, etc........


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## goatchze (Aug 1, 2006)

Steven H said:


> I read some of these responses last night. I am with a financial adviser and when he helped us come up with our "#" he asked if we wanted it figured with and without SS and I said both. He then asked if i thought SS would be around when I retired ( I am 42) I said no, like everyone else. He says he feels it will be around in some form or another, but it is too political to just not give everyone anything for all that they paid in all their life which made sense to me. How long has the US govt been operating in the red? BTW, our # is $1.8 million, that is with house pd off and $3500 a month to live on roughly, living to the age of 82, Yah, they ask how long do you think you will live.
> 
> I recall Grandpa selling off land and asking why, he said " I did not think I was going to live this long" he died last summer at 92.
> 
> Please correct me for those who are drawing right now, max SS benefit is $2500 per month correct? And that is taxed correct?


When making our plan about 10 years ago, we made a couple of assumptions:

1. We would want to have 80% of our pre-retirement income replaced with retirement income
2. We assumed we would live into our mid-nineties
3. Social Security may or may no be around

We figured everything with and without SS. Our goal was to just make it if SS was gone, but have a very safe and comfortable retirement if it were around.

My opinion is that it will be around, but the benefits will be greatly curtailed by the time I retire (and the tax ceiling will get increased to something like 300k). Most likely, if you have saved well for retirement, they'll cut some of _your_ benefits so that they can keep the program solvent for _other people_. That's my working assumption at least, as this is the typical operating mantra of the government.


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## w_r_ranch (Jan 14, 2005)

JDubya said:


> What's best to invest in for a long term retirement plan. I'm at my first year at my job...where I plan on retiring from. We have a retirement plan that I enrolled in, after 8 years they match 2.25 to my 1. But I'm wanting to invest in a second account as well.


I'm 'old school' & followed the traditional 'asset allocation by age' strategy. The 'old school' rule of thumb is that you should subtract your age from 100 & that's the percentage of your portfolio that you should keep in stocks. For example, you're 27, you should keep 73% of your portfolio in stocks & the rest in bonds. Remember to adjust/balance the allocations yearly.

If I was in your shoes & following this 'rule', I would probably break the 73% stock portion down as follows:

Large or Mid Cap. Index: 39%
Small Cap. Index: 17%
Foreign Stock Index: 17%

As for the bond portion, I would personally avoid any fund containing government bonds & stick with an intermediate term, investment-grade Index fund.


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## txjustin (Jun 3, 2009)

Great thread! I'm currently saving 11-20% annually depending on my year.


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## fangard (Apr 18, 2008)

If you do work with an investment advisor, I encourage you to negotiate your fees, especially if they are independent or at a smaller firm.


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## DCAVA (Aug 5, 2013)

I just changed my 401k investments from a Black Rock deal that wasn't gaining much over the last couple of years to a moderate aggressive model. Hoping for a much better return moving forward. 

I just checked my SS projected amts. if I [email protected] 69 years of age it is projected to be $2609 monthly and @ 70 years of age $3322 monthly. Having said that, I will secure retirement monies with out relying on SS. It 'SS' better be around when I retire after all I have put into it!! That money will be icing on top.....


Great thread BTW to the OP!


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## Its Catchy (Apr 10, 2014)

There are a few big assumptions that everyone needs to think about. One being SS. Personally I think it will be around. Too many people have paid into it for it to "vanish". I think it is also safe to say that it will not make it in it's current state. In the future you will have to wait longer in life to recieve benefits and they won't be as large. There is just not enough money in the system. Plan not to have it and you can't lose. However, realistically probably 1/2 of the current benefit.

Secondly, inflation. I do not see a scenario where our current spending and printing spree does not come back to bite us. The best plan against inflation that I can think of is to "own" things.


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## cwbycrshr (May 23, 2013)

BretE said:


> Couple hundred K but I could have lost that and more had it gone the other way. First time in 26 years I'd pulled it. Further proof.....never, ever think you can guess the market. Put as much as you can afford in, and then some! And let it ride.....


There is an old saying about sticking with what you know. I have never been comfortable with putting large chunks of money on the table and hoping the people that ultimately control it do there jobs in excess. I'm not a fan of letting other people control my quality of life.

The one thing I, as a modest man of modest means, I can say about this thread is, look into Real Estate. Texas has historically had a strong economy and in most cases, with a lot of due diligence, you can find a 1.2% monthly return on investment, minimum.

For example: 
$1M invested in several properties around the state
$1,000,000 * .012 = $12K/Month in income.

Isn't that better than $40K/year?


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## bowmansdad (Nov 29, 2011)

As we get older, please figure in medical bills and premiums along with property taxes on your holdings. This is dead money that becomes a large part of your expenses when you are on a fixed income. As far as a # to shoot for, it's a moving target because in a perfect retirement there would be no surprise expenditures but stuff happens!


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## jtbailey (Apr 29, 2012)

*Retirement and saving.... What is that :question::question::question:*


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## grayson (Oct 21, 2011)

BretE said:


> Couple hundred K but I could have lost that and more had it gone the other way. First time in 26 years I'd pulled it. Further proof.....never, ever think you can guess the market. Put as much as you can afford in, and then some! And let it ride.....


you are exactly right. Nobody but nobody knows which way the market will go. If you were invested in 2008-9 your funds dropped 40% or more. Takes some time to make that back up especially if you are near retirement and using the money.

The number one risk of retirement is relying on stock market returns and get unlucky have a market correction during your first few years of taking money out for living expenses. The combination of a bad market while withdrawing money early in your retirement is something that is a double whammy and can years to recover from (if ever). That is why have an appropriate blend of stock, bonds, and cash during retirement is critical.


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## houtxfisher (Sep 12, 2006)

cwbycrshr said:


> There is an old saying about sticking with what you know. I have never been comfortable with putting large chunks of money on the table and hoping the people that ultimately control it do there jobs in excess. I'm not a fan of letting other people control my quality of life.
> 
> The one thing I, as a modest man of modest means, I can say about this thread is, look into Real Estate. Texas has historically had a strong economy and in most cases, with a lot of due diligence, you can find a 1.2% monthly return on investment, *minimum*.
> 
> ...


I have more real estate than the average person, and I am suspicious of these returns. That is about what we gross, but if you factor in maintenance, repairs, taxes, insurance & vacancies our returns are closer to 8% (not including appreciation). Obviously I like real estate, but 14-15% returns are not the norm unless it carries a lot of risk, IMO.


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## Its Catchy (Apr 10, 2014)

houtxfisher said:


> I have more real estate than the average person, and I am suspicious of these returns. That is about what we gross, but if you factor in maintenance, repairs, taxes, insurance & vacancies our returns are closer to 8% (not including appreciation). Obviously I like real estate, but 14-15% returns are not the norm unless it carries a lot of risk, IMO.


I have done a little real estate myself and I am very suspicious of the returns as well. 8% is a more realistic number and even that can be difficult. My biggest issue with real estate is the tax liability, it just eats up to much of the profits.


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## ChuChu (Jan 23, 2010)

I started SS at age 62, and four years later I have "withdrawn" 80% of what I paid in. Another 14 months and I will have drawn all I paid in over the 48 years I worked and paid in.


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## Spinky (Aug 11, 2005)

w_r_ranch said:


> I'm 'old school' & followed the traditional 'asset allocation by age' strategy. The 'old school' rule of thumb is that you should subtract your age from 100 & that's the percentage of your portfolio that you should keep in stocks. For example, you're 27, you should keep 73% of your portfolio in stocks & the rest in bonds. Remember to adjust/balance the allocations yearly.
> 
> If I was in your shoes & following this 'rule', I would probably break the 73% stock portion down as follows:
> 
> ...


That is a good rule of thumb to get you in the neighborhood, but I always tended, and still do, to fudge upward some on the stock percentage. I'm 58 now but still keep about 65% in stocks, spread over the above mentioned sectors. The rest in bonds and cash. The one time I did deviate from this was a couple of years ago, thinking it was time to shield some assets from volatility. Switched a big chunk from a S&P 500 Index to a 60/40 blended fund. :headknock
Missed out on a nice runup the last two years.
Oh, well. Still had nice gains, but left some cash on the table. Slept OK though!


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## Jungle_Jim (Nov 16, 2007)

I think the market is going to make a big correction soon. No way it should be doing as well as it is.


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## w_r_ranch (Jan 14, 2005)

Spinky said:


> Missed out on a nice runup the last two years.
> Oh, well. Still had nice gains, but left some cash on the table. Slept OK though!


And if the stock market had gone south, you'd have said "Thank God".

It's only up because of all the new money the government's printing & then giving away... when it stops, BOOM.


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## bigfishtx (Jul 17, 2007)

Buy blue chip stocks that pay good dividends, and, even if their stock value falls, you still have the dividend coming in.


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## Twitch-Twitch-Boom (Jun 24, 2011)

There are so many variables that go into retirement planning. I do know one rule which applies to _everyone._ The EARLIER you begin saving, the more the power of compounding works in your favor. Let's look at the "cost of waiting" I like to call it.

*Example*: A 2cooler is 30 years old in a career making $50,000 a year. Company matches 4% dollar for dollar which is about average. Then this guy/gal maximizes his Roth IRA of $5,500/yr. His $5,500 is 11% of what he makes pre-tax, + his 4% he puts in 401k is 15% of total income. 
He wants to retire age 62 when he is eligible for 1st social security check.

4% contribution is $2,000 a year
4% match is $2,000 a year
11% into Roth IRA all tax-free is $5,500
Total money out of his/her pocket is $7,500 
Total with company match is $9,500 for year.
Out of pocket is $625 a month, or $312.50 per paycheck.

*Scenario 1 *Invests his first dollar starting age 30 and continues for 32 more years until age 62. Making 7% average rate of return.
His estimated amount would be *$1,131,205.*

*Scenario 2.* This guy decides to wait 5 years to begin investing. He enjoys fancy boats, cars, vacations etc. He begins at age 35 contributing the EXACT same amount. 
His estimated amount would be only *$757,975*

$1,131,205 - $757,975 =*373,230 difference.*

**The guy who started at age 30 (5 years sooner) only put in $37,500 more of his money, but has $373,230 more than the guy who waited 5 years!!!!!!!*

If there is anything to take out of reading 10 pages of posts, it's that the sooner you can sock away ANY amount, be it $50.00 a month, the better off you will be. That's the power of compounding. Pay yourself 1st, increase your contribution every time you get a raise, stay invested in the market and keep buying even when the market goes down.


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## Spinky (Aug 11, 2005)

w_r_ranch said:


> And if the stock market had gone south, you'd have said "Thank God".
> 
> It's only up because of all the new money the government's printing & then giving away... when it stops, BOOM.


With memories 2008-9, that's exactly why I did it!
Like I said, may have left some money on the table but slept better. Timing the market's impossible - slow, steady and consistent over the years is the ticket...


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## Rubberback (Sep 9, 2008)

w_r_ranch said:


> And if the stock market had gone south, you'd have said "Thank God".
> 
> It's only up because of all the new money the government's printing & then giving away... when it stops, BOOM.


Ha! Ha! I wish I sold printing machines to who ever prints our money. I'm sure they have gone through quite a few these days.


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## flatscat1 (Jun 2, 2005)

Jungle_Jim said:


> I think the market is going to make a big correction soon. No way it should be doing as well as it is.


Why do you believe a crash in coming? My observations say otherwise:

Markets are in danger-bubble mode when valuations (P/E multiple, not the level of the Dow or S&P) are high. If you don't know the difference between P/E and stock market level you see on the news, you should study up on it. Companies are not currently trading at overly-high future earnings rates (prices). We are below 2008 and well below 2000 levels. We're right at historic PE norms by most measure.

Consumer sentiment at the top of a bubble is usually very high and strong. Anyone want to buy a .com stock from a tip from a cab driver? At market high levels people feel great and are buying their tech and bank stocks right and left. Not the case now I'd argue - flows into bonds exceed equities. In fact, if there is a bubble right now it may well be in bonds and not the stock market.

At bubble levels, inflation is often a problem, with high cost of capital. Not the case now, extremely accomodative global "Fed" policy, meaning that the governments are effectively forcing people to take risk (buy stocks). That isn't how bubble levels have been reached in the past. The fed won't let people earn an inflation beating rate of return sitting in cash or short-duration bonds - so people are forced into corporates and equities.....not how bubbles are formed.

At bubble levels, companies are usually fat with inventory and over-employed. They are usually leveraged up and holding little cash reserves near bubble tops. Not the case now - companies are pretty lean and mean right now, with more cash on hand than ever in history.

At bubble levels, individuals are usually the same - high credit card debt, low cash reserves, high leverage (using homes as ATM machines), etc. While things are certainly not good for many workers now, they are stabilized and likely getting a little better.

Just pointing out some observations. Do as you wish, but I'll stick with a diversified portfolio I have contributed to over a lifetime, in both up and down market cycles. Slow, steady, diversified.


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## fangard (Apr 18, 2008)

houtxfisher said:


> I have more real estate than the average person, and I am suspicious of these returns. That is about what we gross, but if you factor in maintenance, repairs, taxes, insurance & vacancies our returns are closer to 8% (not including appreciation). Obviously I like real estate, but 14-15% returns are not the norm unless it carries a lot of risk, IMO.


Think about this as well. Early on, someone posted about taking 4% of their portfolio out each year(to retain principle, I assume). If you are taking it out of your IRA/401K, that is gross as well. You have to pay taxes.


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## Spinky (Aug 11, 2005)

Twitch-Twitch-Boom said:


> There are so many variables that go into retirement planning. I do know one rule which applies to _everyone._ The EARLIER you begin saving, the more the power of compounding works in your favor. Let's look at the "cost of waiting" I like to call it.
> 
> *Example*: A 2cooler is 30 years old in a career making $50,000 a year. Company matches 4% dollar for dollar which is about average. Then this guy/gal maximizes his Roth IRA of $5,500/yr. His $5,500 is 11% of what he makes pre-tax, + his 4% he puts in 401k is 15% of total income.
> He wants to retire age 62 when he is eligible for 1st social security check.
> ...


BINGO!

And especially buy when the market goes down. If you thought stocks looked good earlier, they look even better when they're cheap. Time is your best ally.


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## Jungle_Jim (Nov 16, 2007)

flatscat1 said:


> Why do you believe a crash in coming? My observations say otherwise:
> 
> Markets are in danger-bubble mode when valuations (P/E multiple, not the level of the Dow or S&P) are high. If you don't know the difference between P/E and stock market level you see on the news, you should study up on it. Companies are not currently trading at overly-high future earnings rates (prices). We are below 2008 and well below 2000 levels. We're right at historic PE norms by most measure.
> 
> ...


It is all artificial, propped up by Quantitative Easement. I am nothing special but I can see that actual economic growth is nowhere near stock market growtrh over the same period. it is not real.


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## WGA1 (Mar 1, 2012)

I have noticed some comments stating real estate returns above 8% is not typical. That all depends on the investment. RE owned with no mortgage then yes 6-8% is typical. Leveraged RE can easily exceed 10%. Leverage is what makes RE a good investment. Without leverage then you may as well just save yourself the hassle and just contribute to IRAs or something. Risk and return tend to be somewhat proportional. Leverage = higher return = higher risk. Risk averse people should stay far away from leveraged RE.


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## BullyARed (Jun 19, 2010)

For those who are young, start saving now, for those who are above 50, try to salvage as much as you can before it's too late.


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## Its Catchy (Apr 10, 2014)

Jungle_Jim said:


> It is all artificial, propped up by Quantitative Easement. I am nothing special but I can see that actual economic growth is nowhere near stock market growtrh over the same period. it is not real.


If you do not think it is real hit the "sell" button and I promise you the money that comes is real.

The question is: Is this sustainable? IMHO it is only sustainable until the next "Savings and Loan Scandal" or "Great Recession" comes along. Then we are going to be in some pretty deep financial "Doo Doo".


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## Twitch-Twitch-Boom (Jun 24, 2011)

Twitch-Twitch-Boom said:


> There are so many variables that go into retirement planning. I do know one rule which applies to _everyone._ The EARLIER you begin saving, the more the power of compounding works in your favor. Let's look at the "cost of waiting" I like to call it.
> 
> *Example*: A 2cooler is 30 years old in a career making $50,000 a year. Company matches 4% dollar for dollar which is about average. Then this guy/gal maximizes his Roth IRA of $5,500/yr. His $5,500 is 11% of what he makes pre-tax, + his 4% he puts in 401k is 15% of total income.
> He wants to retire age 62 when he is eligible for 1st social security check.
> ...


 One thing I forgot to add, to take it one step further. For every single day this guy/gal decides to wait, it is costing them $204.50 A DAY!

$373,230/1,825 days (5 years) =$204.50 a day you are losing every day you wait to begin investing. That's real dollars!


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## andre3k (Dec 3, 2012)

I would rank taking care of your health to enjoy your retirement is just as important as retirement itself. Both of my parents didn't have the chance to enjoy all that hard earned money because they were so busy in their younger years and put their health to the side. Something to think about.


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## Mark454 (May 21, 2007)

Did your grandparents have a 401k? Did your parents have a 401k? Mine didn't and they still survived. Will I have a million in 401k? Maybe but maybe not but I will still get by some how. And it's the "some how" that makes me worry.


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## JFolm (Apr 22, 2012)

Mark454 said:


> Did your grandparents have a 401k? Did your parents have a 401k? Mine didn't and they still survived. Will I have a million in 401k? Maybe but maybe not but I will still get by some how. And it's the "some how" that makes me worry.


It's all personal perspective. Some want to do more than "get by" in their retirement.


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## grayson (Oct 21, 2011)

just to say again - the number one danger in retirement is inflation and living too long - plan accordingly

3% inflation will cause a $50,000 lifestyle to require $100,000 income in 8-10 years


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## TranTheMan (Aug 17, 2009)

Mark454 said:


> Did your grandparents have a 401k? Did your parents have a 401k? Mine didn't and they still survived. Will I have a million in 401k? Maybe but maybe not but I will still get by some how. And it's the "some how" that makes me worry.


Perhaps your parents have a pension, can now draw SS, and have medicare coverage?
Most of us now have zero for pension, SS may not be there when we get there, and not sure what would happen with the health care? That is why we are a bit preoccupied with the 401k.


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## Superman70 (Aug 13, 2014)

Im gonna work till 74 then see what happens. Hopefully the company will firw me so that i can sue for age discrimination. Then ill be set.


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## sea hunt 202 (Nov 24, 2011)

you will need to post your age and how you expect to live, and it will be much more easy to calculate.


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## houtxfisher (Sep 12, 2006)

WGA1 said:


> I have noticed some comments stating real estate returns above 8% is not typical. That all depends on the investment. RE owned with no mortgage then yes 6-8% is typical. Leveraged RE can easily exceed 10%. Leverage is what makes RE a good investment. Without leverage then you may as well just save yourself the hassle and just contribute to IRAs or something. Risk and return tend to be somewhat proportional. Leverage = higher return = higher risk. Risk averse people should stay far away from leveraged RE.


I would tend to agree with this as I am not leveraged in any of my current holdings. I have borrowed money to purchase RE in the past, but 5% interest cuts into returns as well so we paid them off asap. We had several years of 14% returns on some properties but on average, over 20 years, 8% has been a good ballpark overall.


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## madbayrunner (Oct 25, 2013)

what is "having everything paid off"? the house? that's a very small part of a familys expenses. you still have insurance, taxes, maintenance, utilities, medical, gas, food, clothes, travel, entertainment, licenses, fees, a new boat, car payment,. you don't retire and somehow your car lasts 20 years. if it's a couple then you've got two mouths to feed. if we live an average of 20 years after official retirement, that 240 months at $5 or $6k a month overhead. I'm sure SS will be around for a while, but I would not count on it. that's over a million bucks needed to live your life. IMHO


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## madbayrunner (Oct 25, 2013)

Jungle_Jim said:


> It is all artificial, propped up by Quantitative Easement. I am nothing special but I can see that actual economic growth is nowhere near stock market growtrh over the same period. it is not real.


 I always get confused with those big words like "Quanatator Easements"
sounds like a **** Toll Road.

now Quantitative Easing tends to roll up big debt

just my 2cents


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## Hevy Dee (May 26, 2004)

*Retirement advice for the younger folks*

One of the best pieces of retirement advice came from my Dad as we were starting a family 25 years ago. It was simple. "Do not have a bunch of kids, replace yourself and your wife and then get neutered." He had 9 kids with 3 wife's. I followed his advice and so far so good.


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## Its Catchy (Apr 10, 2014)

houtxfisher said:


> I would tend to agree with this as I am not leveraged in any of my current holdings. I have borrowed money to purchase RE in the past, but 5% interest cuts into returns as well so we paid them off asap.  We had several years of 14% returns on some properties but on average, over 20 years, 8% has been a good ballpark overall.


You can certainly make more than 8% in RE. Even 20+%. I just think an 8% return is a more long term realistic number. Having bought and sold quite a few properties I personally prefer the long term average and ease of returns in the stock market to that of RE.

No worthless tenants, no painting, no flooring, no broke down A/C units to worry about. RE is certainly a good way to build wealth, it's just not for everyone and I personally prefer the ease of the stock market to that of RE.

With that being said I am currently looking for a rental property to get a little more "diversified" and as a hedge against inflation.


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## houtxfisher (Sep 12, 2006)

Its Catchy said:


> You can certainly make more than 8% in RE. Even 20+%.


Agreed, but the same is true of the stock market -- it's just not the long term average. We both seem to have the same outlook on RE, I only threw my .02 in the thread to dispel any myth that RE had some magic returns. Most double digit RE returns that people cite are either A) not true B) not over a long period of time.


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## Hullahopper (May 24, 2004)

Dollar cost averaging in mutual funds over the past 25 years has worked well for us. My financial advisor is a guy with Ameriprise who has done well for us. Rental properties work well with some people, more so with jack of all trades/fix it yourself types with a lot of time on their hands which I am not.


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## Its Catchy (Apr 10, 2014)

Not that RE is a bad investment but historically speaking the Stock Market has outperformed real estate. And you have less headaches.


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## WGA1 (Mar 1, 2012)

RE returns can be kept high if you turn the properties over more frequently but then that is more work. Holding properties over a long period of time is really diminishing returns which brings you back down to the 6-10% area. Holding properties for only a few years and turning them and buying newer, and better, and bigger properties seems to be the way to keep RE returns high. Problem is that is more work and most people have full time jobs and families and hobbies so the standard IRAs and 401ks are more practical. The beauty of RE though is you don't have to retire and then live on less and hope you die before you run out of money. You can keep growing your RE investments after you retire and constantly keep making more. To me RE makes more sense but the responsibilities of day to day life get in the way so the more hands off approach to investing is for most people.


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## grayson (Oct 21, 2011)

http://time.com/money/3727708/retirement-longevity-plan/?xid=yahoo_money


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## WGA1 (Mar 1, 2012)

> Not that RE is a bad investment but historically speaking the Stock Market has outperformed real estate. And you have less headaches


 The problem with that statistic is it is comparing stocks to home ownership not leveraged RE. RE is all about leverage. A home owned by an owner occupant is nothing more than a forced savings account that earns the rate of inflation because appreciation is nothing more than inflation typically. Stocks are less headaches though.


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## Blk Jck 224 (Oct 16, 2009)

grayson said:


> http://time.com/money/3727708/retirement-longevity-plan/?xid=yahoo_money


 The average lifespan is 82 years...I wouldn't really bother planning for anything much longer than that...


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## grayson (Oct 21, 2011)

Blk Jck 224 said:


> The average lifespan is 82 years...I wouldn't really bother planning for anything much longer than that...


True but that also means there is a 50% chance of living past age 82. Life expectancy will continue to increase over the next 10-30 years.

I have also told clients that those older folks greeting people at the door at Wal Mart are not there because they want to be - they are there because they have to be. Saving for retirement is critical and unfortunately the younger folks in our country will not have pensions to fall back on. Companies have and are doing away with them.


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## Jungle_Jim (Nov 16, 2007)

Its Catchy said:


> If you do not think it is real hit the "sell" button and I promise you the money that comes is real.
> 
> The question is: Is this sustainable? IMHO it is only sustainable until the next "Savings and Loan Scandal" or "Great Recession" comes along. Then we are going to be in some pretty deep financial "Doo Doo".


I sold, I am out of the market. It is at record highs, that is when you should sell. After it corrects buy in again....


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## fangard (Apr 18, 2008)

Its Catchy said:


> Not that RE is a bad investment but historically speaking the Stock Market has outperformed real estate. And you have less headaches.


Is that a buy and hold statistic, or does that take into consideration cash flow as well. I doubt it.


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## Blk Jck 224 (Oct 16, 2009)

grayson said:


> True but that also means there is a 50% chance of living past age 82.
> 
> Yeah...With many of them living happily in a nursing home with a tube threaded into their stomachs because they are unable to eat, haven't remembered who the hail they were for years, & have someone making minimum wage changing their diaper as they pizz & chit all over themselves. But don't worry about having $ for that...The skilled nursing facility keeps cashing their Social Security check each month.


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## Jungle_Jim (Nov 16, 2007)

Is the government going after your 401k?

http://www.wealthdaily.com/articles/will-the-government-take-your-401k/5016

http://www.forbes.com/sites/helaine...-federal-government-are-not-taking-your-401k/

http://www.rushlimbaugh.com/daily/2012/11/29/democrats_are_after_your_401_k


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## ATE_UP_FISHERMAN (Jun 25, 2004)

Looks like My wife will be working a long time..:rotfl:


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## Its Catchy (Apr 10, 2014)

fangard said:


> Is that a buy and hold statistic, or does that take into consideration cash flow as well. I doubt it.


Long story short. I am not sure about several things. Cash flow from real estate and dividends from stocks. Both factors change the metric considerably.

My retirement plan is to own at least one rental and to have as much as I possibly can in 401K's and IRA's. I'm not counting on SS but it will be a bonus.


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## RedXCross (Aug 7, 2005)

Sure will **** off a hundred million folks, might lead to a big party!



Jungle_Jim said:


> Is the government going after your 401k?
> 
> http://www.wealthdaily.com/articles/will-the-government-take-your-401k/5016
> 
> ...


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## Its Catchy (Apr 10, 2014)

Jungle_Jim said:


> Is the government going after your 401k?
> 
> http://www.wealthdaily.com/articles/will-the-government-take-your-401k/5016
> 
> ...


No, But fear sells in talk radio and so called cable news channels. You can always count on a politician to do anything and everything it takes to get re-elected. Not many votes are going to come in for anyone in support of stealing our retirement.

But if they "confiscate" your 401K they can confiscate your rental property, gold coins just about anything of value.

While not out of the realm of possibility I do my best to prepare for the realistic most likely scenario's.


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## Jungle_Jim (Nov 16, 2007)

Its Catchy said:


> No, But fear sells in talk radio and so called cable news channels. You can always count on a politician to do anything and everything it takes to get re-elected. Not many votes are going to come in for anyone in support of stealing our retirement.
> 
> But if they "confiscate" your 401K they can confiscate your rental property, gold coins just about anything of value.
> 
> While not out of the realm of possibility I do my best to prepare for the realistic most likely scenario's.


You seem pretty confident. The government confiscated gold once before. They confiscate property all the time. I agree it can be fear mongering, but the government is looking at ways to get at all the money. Did you read the articles?


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## JFolm (Apr 22, 2012)

Blk Jck 224 said:


> The average lifespan is 82 years...I wouldn't really bother planning for anything much longer than that...


I believe this statistic includes infant mortalities and abnormal deaths (tragic, unexpected).


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## Its Catchy (Apr 10, 2014)

Jungle_Jim said:


> You seem pretty confident. The government confiscated gold once before. They confiscate property all the time. I agree it can be fear mongering, but the government is looking at ways to get at all the money. Did you read the articles?


Yes I did read the articles, which is exactly why they were written. To get people to read them. I do not think they are grounded in reality.

With that being said it remains within the realm of the possible. But I try to focus on the things I can prepare for not what I can't. Outside of hording gold coins in a hole in my backyard or moving to Costa Rica how do you prepare for a government takeover of everyones wealth?


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## Jungle_Jim (Nov 16, 2007)

Its Catchy said:


> Yes I did read the articles, which is exactly why they were written. To get people to read them. I do not think they are grounded in reality.
> 
> With that being said it remains within the realm of the possible. But I try to focus on the things I can prepare for not what I can't. Outside of hording gold coins in a hole in my backyard or moving to Costa Rica how do you prepare for a government takeover of everyones wealth?


Well, one of the articles (the Forbes one) says the government is *not* trying get your 401k. As far as your question, I don't know. I think it's best to keep an eye on who may be trying to get your retirment money.


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## poppadawg (Aug 10, 2007)

Jungle_Jim said:


> Is the government going after your 401k?


You believe that?


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## Jungle_Jim (Nov 16, 2007)

poppadawg said:


> You believe that?


I didn't say that did I? They just went after 529 college savings plans so they could give free 2 year college to people. it got stopped but they tried. Do you believe they wouldn't try?

http://www.usatoday.com/story/opini...oney-middle-class-incentives-column/22314063/


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## Tortuga (May 21, 2004)

Just a thought for the younger dudes on 2cool.. Why not give a shot at opening your OWN business.. Any field that is needed by the public. Might require some education and/or experience, but you can be your own Boss and 'return on investment' is easily 100% or more per year. Look at our 2cool plumbers, electricians, tow truckers, etc. I'd bet all of them are living very well...and don't have to worry about the stock market or strikes , etc...You make your own rules and set your own times. Only real worry is competition..but that is true in anything you do... You can 'retire' if you want to when age catches up..or mebbe just pass it on to your next generation. In my case we're in the fourth generation with our little 'popcorn stand' now. You do have to keep up with changes in your business...but that is the same in everything you do anyway... May be a few years of Ramen and vienna sausage in the beginning...but with hard work the rewards could astound you. Bill Gates started in his garage with a bunch of assorted junk.... All it takes is a little nerve...and ambition.

Just .02...


edit... Might steer clear of the 'food' business..from what I hear. LOL


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## BullyARed (Jun 19, 2010)

andre3k said:


> I would rank taking care of your health to enjoy your retirement is just as important as retirement itself. Both of my parents didn't have the chance to enjoy all that hard earned money because they were so busy in their younger years and put their health to the side. Something to think about.


Yep. Definitely. There are four investments: Your Faith, your family, your health, and then your money.


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## GSMAN (May 22, 2004)

*Chicken or the egg?*

My first question is how much do I want to spend in retirement or how much do I need is a better question. Will my house be paid off, do I have medical insurance from my company, do I have a pension, will I still have kids in college? These are just a few questions that need to be answered before you come up with your number. People who have pensions will not have to rely as much on their 401ks as those who don't have pensions. A $3,500 per month pay out pension is worth about $650k in cash. And yes, I believe SS will be around for a long time. It may be a reduced benefit but I seriously doubt that an entitlement that USA workers have made contributions to will just go away. I have read studies that the SS problem could be fixed with as little as a 2% increase in the SS "tax" rate. Doesn't sound like an insurmountable hill to climb to me. Inflation is another thing that folks keep bringing up. As you age, buying consumer goods will reduce in volume. For example, old folks don't buy school clothes for kids every year, college tuition increases are not an issue, buying food staples goes down with just two folks left in the house as opposed to a house full of kids. Also, how many times do old people buy new homes after they retire? If they do they usually have equity in another house to put down so the debt is not that huge. How about vehicles? Again, I think the inflation thing is over blown for people during retirement. All of these things are a big impact to a family of four on a modest income with kids still living at home. These families are the ones that are hurt by inflation the most. I reserve the right to change my mind as I live longer to my viewpoints above. I could be wrong on all this!! By the way, I like "old" people. That is my goal in life to become one. I am just about there!


BullyARed said:


> There have been threads about retirement and I just like to poll how much saving would be adequate for one to retire to live a life comfortably but not expensive?


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## BullyARed (Jun 19, 2010)

Hevy Dee said:


> One of the best pieces of retirement advice came from my Dad as we were starting a family 25 years ago. It was simple. "Do not have a bunch of kids, replace yourself and your wife and then get neutered." He had 9 kids with 3 wife's. I followed his advice and so far so good.


But he had 9 kids and three wives more than you! Hope they all can support him.


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## grayson (Oct 21, 2011)

JFolm said:


> I believe this statistic includes infant mortalities and abnormal deaths (tragic, unexpected).


Mortality tables include all deaths from any cause. Also keep in mind they are averages and the averages include folks who smoke, obese, etc. So if a person is relatively healthy their odds of living longer are even greater


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## BullyARed (Jun 19, 2010)

Jungle_Jim said:


> You seem pretty confident. The government confiscated gold once before. They confiscate property all the time. I agree it can be fear mongering, but the government is looking at ways to get at all the money. Did you read the articles?


The last time I checked before 2008, we were the USA but are we turning into USSR!


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## Its Catchy (Apr 10, 2014)

Jungle Jim

What do you do to prepare for a government confiscation of your retirement?


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## flatscat1 (Jun 2, 2005)

Jungle_Jim said:


> I sold, I am out of the market. It is at record highs, that is when you should sell. After it corrects buy in again....


It is clear you do not understand what record highs are. The number reported on the news for the DOW or S&P does not matter, nor does it mean things are over or under priced. So yes, yesterday the Nasdaq hit 5000, a number it has not seen in 15 years, since the .com bubble. Does that mean a record high? No.

A stock price means what someone is willing to pay for the futrue earnings of a company. Price / Earnings or P/E ratio. In 2000 when the Nasdaq was last at 5000 people were paying more than 100 times the future earnings of a company in the tech sector....companies which themselves that often had no sales, assets, cash.

Today with the Nasdaq at the same level, people are paying about 21 times future earnings for the tech sector per the Wall St. Journal- about the long-term average for what stocks have traded at for many decades....and some of these companies have billions (and hundreds of billions) in cash and assets on hand.

Your logic is like saying a stock trading at $1 is a better value than one trading at $500 per share. Not necessarily, all depends on the earnings. The $1 stock could be way overvalued and the $500 a bargain.

I'm just making observations, not suggestions for anything. Science has proven a diversified portfolio, contributed to consistantly over a long period of years, outperforms trying to time the market. One's cash needs, time horizon and risk tolerance should determine their asset allocation....not some gut fealing that we're due for a correction.


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## BullyARed (Jun 19, 2010)

Its Catchy said:


> Jungle Jim
> 
> What do you do to prepare for a government confiscation of your retirement?


I guess I will be on Obamacare and welfare just to join the demcrap crowd!


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## grman (Jul 2, 2010)

1st - There are a lot of "Government out to get you" fear monglers on here. Got to consider the source. Not saying don't be conservative - but the number one thing anyone that is selling an alternative to investing in stocks will do is say that the Market will crash to zero. Gold merchants and Life Insurance advertising is loaded with such claims, and they make their ads look like real news stories. So be careful.

2nd - Not saying that government will not modify SS, but if you look at some previous bills that have failed - most time lines for modifications are like starting in 30-50 years. They are almost as worthless as the paper they are written on. Not that this is a good thing - if Congress had to move fast to avoid insolvency I doubt that they could do it. 

3rd - This is the INTERNET people!!! Why would anyone plan their retirement on the internet. Talk to a real person that has made it their business for a long time and has been successful at it. Kinda like getting medical advice on the internet - get your a^%% to a doctor.


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## BretE (Jan 24, 2008)

Jungle_Jim said:


> I sold, I am out of the market. It is at record highs, that is when you should sell. After it corrects buy in again....


I thought and did the same thing..........several years ago.............bottom line is your risk tolerance and how soon you plan on accessing your savings. IMO....


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## hockeyref999 (Aug 12, 2005)

My formula has worked for me. I retired a couple of years ago, and my "number" was 25 times my real annual expenses. That is a 4% return on my money without touching the principle.


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## BretE (Jan 24, 2008)

hockeyref999 said:


> My formula has worked for me. I retired a couple of years ago, and my "number" was 25 times my real annual expenses. That is a 4% return on my money without touching the principle.


I'm using 4% as my "number" too. From doing research this is the subscribed recommendation.....where exactly did this number come from? I have varied intangibles. Pension, 401K, land, investments, other income, etc. I'm curious where this 4% came from and how hard a number it is.....Hell, I might wanna use 5 or 6%......


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## old 37 (Nov 30, 2014)

I'm also taking 4% out but I'm lucky in that I get the maximun from SS and my wife gets half again of that so we are comfortable.


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## sweenyite (Feb 22, 2009)

A question for some of you more knowledgeable folks:
If I am exceeding the company match on my 401k,( and I also have a pension), does it make sense to contribute to a Roth IRA as well? I have been contributing 1% post tax for the last five years... I'm just wondering how much of a benefit it will be or if I should just move that % of my regular contribution over to pre-tax?


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## grayson (Oct 21, 2011)

hockeyref999 said:


> My formula has worked for me. I retired a couple of years ago, and my "number" was 25 times my real annual expenses. That is a 4% return on my money without touching the principle.


Sorry to beat a dead horse but the 4% number and not touching principle only works if there is zero inflation factored in (which obviously won't be the case). That is why using a retirement calculator that can factor in the impact of 3-4% inflation is critical to determining if you money will last or not.


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## PiratesRun (Jun 23, 2004)

flatscat1 said:


> Why do you believe a crash in coming? My observations say otherwise:
> 
> Markets are in danger-bubble mode when valuations (P/E multiple, not the level of the Dow or S&P) are high. If you don't know the difference between P/E and stock market level you see on the news, you should study up on it. Companies are not currently trading at overly-high future earnings rates (prices). We are below 2008 and well below 2000 levels. We're right at historic PE norms by most measure.
> 
> ...


Read this on ZeroHedge.com this morning.
Despite the records being set almost daily on Wall Street, (today the NASDAQ eclipsed 5,000 for the first time in almost 15 years), optimists claim that the market is not overvalued because the current S&P 500 price-to-earnings ratio, of about 19 times trailing 12 months earnings, is not too far above the historical norm of about 14. But most investors have not considered the extraordinary factors that helped push up earnings, artificially we believe, in 2014.

According to Bloomberg, in 2014 S&P 500 companies spent an estimated $565 billion (or 58% of corporate earnings) on share buybacks, a figure that is extremely high by historical standards. Money spent on buybacks is not available to purchase new plant and equipment, to fund research and development, or to spend on marketing and logistics. In that sense, buyback spending generates current earnings at the expense of future earnings. Corporate results have also been boosted by zero percent interest rates, which have allowed businesses to borrow cheaply.


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## BretE (Jan 24, 2008)

grayson said:


> Sorry to beat a dead horse but the 4% number and not touching principle only works if there is zero inflation factored in (which obviously won't be the case). That is why using a retirement calculator that can factor in the impact of 3-4% inflation is critical to determining if you money will last or not.


Oops....so much for my 5-6% theory. I still have the retirement calculator you sent me. Scared to use it. I'm afraid it will say no. Right now I have Pam convinced it's the right time for me and she's going to continue to work. Hate to screw that up.....


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## grayson (Oct 21, 2011)

BretE said:


> Oops....so much for my 5-6% theory. I still have the retirement calculator you sent me. Scared to use it. I'm afraid it will say no. Right now I have Pam convinced it's the right time for me and she's going to continue to work. Hate to screw that up.....


no kidding! keep her working while hunt and fish.

That calculator lets you plan with how much you can live on based on rates of return on your money, inflation rates, etc. So the cool thing about it is that its very simple to use and then change scenarios. I like it because it can help tell you how conservative or aggressive you need to be in your investments to meet the income goal you have. May only need to earn 4% (so you can be conservative with your investment options) or you need to earn 8% which means you must be in the market


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## flatscat1 (Jun 2, 2005)

sweenyite said:


> A question for some of you more knowledgeable folks:
> If I am exceeding the company match on my 401k,( and I also have a pension), does it make sense to contribute to a Roth IRA as well? I have been contributing 1% post tax for the last five years... I'm just wondering how much of a benefit it will be or if I should just move that % of my regular contribution over to pre-tax?


The advantage of a ROTH IRA is that it is funded with after tax dollars....so while you receive no deduction for it now, down the road when you take the money out you should owe nothing on it.....and of course you get to compound the growth keeping it invested and not taxed yearly on income. Your 401k is funded pre-tax. Roth is after tax. Savings is after tax. This can give you options later on, since you have no clue what your personal income tax rate will be in 20+ years or what our tax code will look like then. And if there is any leftover, leaving a qualified IRA (or any type) to your grandkids can be very good, since they would have to take distributions on their life expectancy (very low) and that money could compound tax deferred for a very long time potentially.

Generally, a lot of people want to have money in different tax buckets. Regular savings accounts, IRA's, Roth IRA or Roth 401k, etc. Then in the future, based on your situation and tax rates at that time, you pick the bucket from which to draw your needed money from.

The main thing is to save.


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## grayson (Oct 21, 2011)

flatscat1 said:


> The advantage of a ROTH IRA is that it is funded with after tax dollars....so while you receive no deduction for it now, down the road when you take the money out you should owe nothing on it.....and of course you get to compound the growth keeping it invested and not taxed yearly on income. Your 401k is funded pre-tax. Roth is after tax. Savings is after tax. This can give you options later on, since you have no clue what your personal income tax rate will be in 20+ years or what our tax code will look like then. And if there is any leftover, leaving a qualified IRA (or any type) to your grandkids can be very good, since they would have to take distributions on their life expectancy (very low) and that money could compound tax deferred for a very long time potentially.
> 
> Generally, a lot of people want to have money in different tax buckets. Regular savings accounts, IRA's, Roth IRA or Roth 401k, etc. Then in the future, based on your situation and tax rates at that time, you pick the bucket from which to draw your needed money from.
> 
> The main thing is to save.


yeah your last line is the most important of all. Save - I tell folks a high investment return with no taxes on zero money is still zero.


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## jesco (Jun 23, 2013)

I will be able to retire at 58 years old, with a pension of 40K/year. My ROTH IRA and other investments will add to that. I own my home, current value around 180K in a neighborhood in which property values are climbing steadily. I think I'll be in good shape to retire. Thank goodness for the PENSION!


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## Jungle_Jim (Nov 16, 2007)

Its Catchy said:


> Jungle Jim
> 
> What do you do to prepare for a government confiscation of your retirement?


I have a pension plan with my job. I retire in 22 months at age 50. 
I never said the government WAS going to confiscate anything. I am saying that the government just went after 529s and have in the past confiscated precious metals and seize property routinely.


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## Troutman123 (Mar 21, 2007)

*Many of my IRA's*

Have been and are currently managed by Fidelity up until this morning I "self managed" this morning I turned over to Fielity to take over the management for less than 1% 
Frankly was tired of the worry , gave them my goals and away we go


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## Tortuga (May 21, 2004)

Troutman123 said:


> Have been and are currently managed by Fidelity up until this morning I "self managed" *this morning I turned over to Fielity to take over the management for less than 1% *
> Frankly was tired of the worry , gave them my goals and away we go


That's what kinda bugs me.. "1%"...per year ??? x possibly 40 years for some of the younger 'investors'..?

Kinda sounds like they are gonna receive 40% of your capital...no matter whether they lead you into a loss or gain....


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## Troutman123 (Mar 21, 2007)

*Exactly but I am finished*

Can't stand the risk at this point . I know there is no guarntee but they paid to know what to do I just maybe 5 years away before need get into it (my plan)


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## ChuChu (Jan 23, 2010)

Tortuga said:


> That's what kinda bugs me.. "1%"...per year ??? x possibly 40 years for some of the younger 'investors'..?
> 
> Kinda sounds like they are gonna receive 40% of your capital...no matter whether they lead you into a loss or gain....


That one percent is repaid by the higher return they give you. I pay Fidelity .75 % of my balance on the money they manage. I have a 39% higher balance now than when it started in 2009. That does not include me withdrawing about $120,000 over the last six years. I think that .75% is a good investment.


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## BATWING (May 9, 2008)

We all worry about Govt risk and with the day an age of rouge politicians pushing executive orders that get approved by judges to do just about anything to force the public. Scary stuff.. There has been many talks already to start grabbing from the trillions in savings in the name of income equality and they are wanting retirement equality..


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## poppadawg (Aug 10, 2007)

S&P 500 index funds are very hard to beat over the long term. And a very simple way to invest. I read once upon a time that 85% of managed money does not out perform the s&p index. That was pretty impressive to me.


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## bigfishtx (Jul 17, 2007)

flatscat1 said:


> The advantage of a ROTH IRA is that it is funded with after tax dollars....so while you receive no deduction for it now, down the road when you take the money out you should owe nothing on it.....and of course you get to compound the growth keeping it invested and not taxed yearly on income. Your 401k is funded pre-tax. Roth is after tax. Savings is after tax. This can give you options later on, since you have no clue what your personal income tax rate will be in 20+ years or what our tax code will look like then. And if there is any leftover, leaving a qualified IRA (or any type) to your grandkids can be very good, since they would have to take distributions on their life expectancy (very low) and that money could compound tax deferred for a very long time potentially.
> 
> Generally, a lot of people want to have money in different tax buckets. Regular savings accounts, IRA's, Roth IRA or Roth 401k, etc. Then in the future, based on your situation and tax rates at that time, you pick the bucket from which to draw your needed money from.
> 
> The main thing is to save.


You also cannot do a Roth if your income is above a certain amount, I think it is $150,000 annually.


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## poppadawg (Aug 10, 2007)

http://seekingalpha.com/article/1524432-how-to-beat-99_9-percent-of-professional-investors

This is an excellent article on how to beat 99% of professional investors


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## H2 (Jan 11, 2005)

Blk Jck 224 said:


> grayson said:
> 
> 
> > True but that also means there is a 50% chance of living past age 82.
> ...


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## goatchze (Aug 1, 2006)

jesco said:


> I will be able to retire at 58 years old, with a pension of 40K/year. My ROTH IRA and other investments will add to that. I own my home, current value around 180K in a neighborhood in which property values are climbing steadily. I think I'll be in good shape to retire. Thank goodness for the PENSION!


Yes, thank goodness your company was wise enough to adequately fund it and the PBGC wasn't brought in.



Tortuga said:


> That's what kinda bugs me.. "1%"...per year ??? x possibly 40 years for some of the younger 'investors'..?
> 
> Kinda sounds like they are gonna receive 40% of your capital...no matter whether they lead you into a loss or gain....


That's why for young investors looking very long (like me), index funds are hard to beat. Most managed funds do not beat the market each year, and index funds have an expense ratio at or below 0.1%.


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## fangard (Apr 18, 2008)

bigfishtx said:


> You also cannot do a Roth if your income is above a certain amount, I think it is $150,000 annually.


There is a way around that now since they did away with the income limit on conversions.

Fund a non-deductible IRA each year and then convert it to a Roth. The contributions that are converted are tax free conversions. You will be taxed on any gain. Since you are doing it fairly quickly, should be nominal.


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## w_r_ranch (Jan 14, 2005)

Tortuga said:


> That's what kinda bugs me.. "1%"...per year ??? x possibly 40 years for some of the younger 'investors'..?


Yep. The only way I would agree to $1K/$100K is an ironclad guarantee that my goals would be met first & they eat any losses.

IMO, a really good CPA is way, way, way more important than any financial planner.


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## BullyARed (Jun 19, 2010)

Lots of good information from many here. Keep them coming. Withdrawing from 401K is another topic.


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## whiskey1 (May 8, 2014)

If I wanted to live on 85k a year in 2015, what would that number need to be 20 yrs from now? Lots of variables...any guesses?


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## JFolm (Apr 22, 2012)

whiskey1 said:


> If I wanted to live on 85k a year in 2015, what would that number need to be 20 yrs from now? Lots of variables...any guesses?


Find yourself an inflation calculator. Sit down before you do it though.


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## Tortuga (May 21, 2004)

JFolm said:


> Find yourself an inflation calculator. Sit down before you do it though.


$85000 with average inflation rate of 4% has the same purchasing power as *$186,245.47* 20 years later.
$ with inflation rate % after years *=* *$186,245.47*


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## BretE (Jan 24, 2008)

Tortuga said:


> $85000 with average inflation rate of 4% has the same purchasing power as *$186,245.47* 20 years later.
> $ with inflation rate % after years *=* *$186,245.47*


Guess I better live fast!......


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## whiskey1 (May 8, 2014)

Tortuga said:


> $85000 with average inflation rate of 4% has the same purchasing power as *$186,245.47* 20 years later.
> $ with inflation rate % after years *=* *$186,245.47*


Ok, so does that mean my 85k today will have the equiv purchasing power of about 38k 20 yrs from now? Did I do the math right?


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## Tortuga (May 21, 2004)

It means if you live on 85K today...in 20 years it will cost you 186K to live the same


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## whiskey1 (May 8, 2014)

Tortuga said:


> It means if you live on 85K today...in 20 years it will cost you 186K to live the same


Good thing I know how to garden and grow animals. hahaha

If I tried to live on "2015 85k" in 2035. What would that 85k turn into? See what I'm saying?


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## TranTheMan (Aug 17, 2009)

whiskey1 said:


> If I wanted to live on 85k a year in 2015, what would that number need to be 20 yrs from now? Lots of variables...any guesses?


http://www.ultimatecalculators.com/present_value_annuity_calculator.html

Assuming that you draw $85K/yr for 20 years and the investment earns 6%/yr then you would need to start out with $975,000.


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## whiskey1 (May 8, 2014)

This whole thread is making me worry. I was all comfy until i read it.


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## JFolm (Apr 22, 2012)

whiskey1 said:


> Good thing I know how to garden and grow animals. hahaha
> 
> If I tried to live on "2015 85k" in 2035. What would that 85k turn into? See what I'm saying?


He's saying that it will cost you $186k to live the same in 2035 as you lived last year.

Purchasing the same gas, groceries, different prices.


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## whiskey1 (May 8, 2014)

JFolm said:


> He's saying that it will cost you $186k to live the same in 2035 as you lived last year.
> 
> Purchasing the same gas, groceries, different prices.


Yes, but I'm looking for the inverse figure now. If I live on 85k now, what is the equivalent of 85k in 2035? My math shows me it would be the equiv of living on a 38k salary in 2015.


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## BretE (Jan 24, 2008)

This is off track a bit but one factor in my decision to retire this year is as of Dec 1st, if I retire, I'll get X amount of dollars monthly regardless of whether I work are not with my pension. It's frozen so it will not grow anymore whether I work or not. I'm basically working for less money, in my mind. I can go do something else, non shift, that hopefully I enjoy(I don't enjoy my job now) to make up the difference if need be.....


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## grayson (Oct 21, 2011)

I have done planning for 35 years and seen hundreds of retirement calculators. Best and easiest to use is free - firecalc.com - 

one other factor to consider with adding inflation into the equation - when we get to be in our 80's and 90's the income needed will diminish due to less travel and activities. So from 60's to early 80's inflation is a big factor and then in later years income needs should actually drop some 

other outside factor is nursing home cost - average nursing home stay is around 2 years and a little under 50% of us will ever use a nursing home - 

lots of stuff to plan for and there is no magic wand - hope for the best and plan for the worst


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## grayson (Oct 21, 2011)

BretE said:


> This is off track a bit but one factor in my decision to retire this year is as of Dec 1st, if I retire, I'll get X amount of dollars monthly regardless of whether I work are not with my pension. It's frozen so it will not grow anymore whether I work or not. I'm basically working for less money, in my mind. I can go do something else, non shift, that hopefully I enjoy(I don't enjoy my job now) to make up the difference if need be.....


yep - same here - when I hit 60 my pension ceased to grow - so I kept working but triggered my pension - you are a smart man


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## whiskey1 (May 8, 2014)

Ok, end of freakout. I realize now that the calculators use the 4% as standard inflation.


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## BretE (Jan 24, 2008)

grayson said:


> yep - same here - when I hit 60 my pension ceased to grow - so I kept working but triggered my pension - you are a smart man


Could you please tell Pam that....

Check your phone....I just texted you.....important stuff......


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## TranTheMan (Aug 17, 2009)

whiskey1 said:


> Yes, but I'm looking for the inverse figure now. If I live on 85k now, what is the equivalent of 85k in 2035? My math shows me it would be the equiv of living on a 38k salary in 2015.


It would be $186K if the inflation is 4% or $153K if the inflation is 3%.

if you want to withdraw $186K/year for 20 years, then you will need $2,133,000 to start, 
or at $153K/year, a measly $1,755,000. All assuming 6% interest.


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## whiskey1 (May 8, 2014)

TranTheMan said:


> It would be $186K if the inflation is 4% or $153K if the inflation is 3%.
> 
> if you want to withdraw $186K/year for 20 years, then you will need $2,133,000 to start,
> or at $153K/year, a measly $1,755,000. All assuming 6% interest.


Yep, I'm onboard with that. I'm trying to make this feel real. If you were to live on 85k 20 years from now, what salary would that feel like today?

Edit-Someone helped me with this. An 85k 'salary' in 2035 will feel like a 42k 'salary' in 2015.


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## TranTheMan (Aug 17, 2009)

whiskey1 said:


> Yep, I'm onboard with that. I'm trying to make this feel real. If you were to live on 85k 20 years from now, what salary would that feel like today?


Assuming an average of 4% inflation, then it would be like $38,800, or
at 3% inflation then it would be $47,000.


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## grayson (Oct 21, 2011)

grayson said:


> I have done planning for many years and seen hundreds of retirement calculators. Best and easiest to use is free - firecalc.com -
> 
> one other factor to consider with adding inflation into the equation - when we get to be in our 80's and 90's the income needed will diminish due to less travel and activities. So from 60's to early 80's inflation is a big factor and then in later years income needs should actually drop some
> 
> ...


 good luck


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## Its Catchy (Apr 10, 2014)

Wow! I never knew there were so many financial planners on here. Lets go back to square one. Save at least 10%. You will be OK. 

Unless you wait to long to save. Then save as much as you can.

Good Luck!


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## sweenyite (Feb 22, 2009)

bigfishtx said:


> You also cannot do a Roth if your income is above a certain amount, I think it is $150,000 annually.


Since my wife does not work, I make a little under that cap. Making too much would be a good problem to have.


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## notthatdeep (Feb 5, 2005)

Another thing to consider is that the money you are drawing out is taxed, so a million in a fund isn't exactly a million to spend....unless you have a Roth type deal. 

Another is that when you hit 70 1/2, you have required minimum distributions so you take it out and get taxed whether you want to or not.


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## Boatflounder (Mar 12, 2007)

sweenyite said:


> Since my wife does not work, I make a little under that cap. Making too much would be a good problem to have.


no it sucs not being abe to get te same deductions as everyone ese cuz you mae too muc according to someone!


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## RRbohemian (Dec 20, 2009)

Maybe it was addressed earlier in the thread but is anyone worried about the govt stepping in and taking over 401k/IRA/Roth accounts? You hear it mentioned every now and then. What would happen say if the US suffered the same fate as Greece? Would investors have to turn over their retirement funds to the govt?


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## RedXCross (Aug 7, 2005)

You would see an uprising like you have never seen! Fool around with 100 million plus peoples livelihood , I would imagine it will draw a party of epic proportion! 



RRbohemian said:


> Maybe it was addressed earlier in the thread but is anyone worried about the govt stepping in and taking over 401k/IRA/Roth accounts? You hear it mentioned every now and then. What would happen say if the US suffered the same fate as Greece? Would investors have to turn over their retirement funds to the govt?


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## bigfishtx (Jul 17, 2007)

Problem with all these math projections are they do not take into consideration the events that come along every 7-12 years that wipe out half your 401k because of equity values crashing. 
I have saved in my 401 and SEP for 30+ years and I do not have anywhere near enough to retire.


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## grayson (Oct 21, 2011)

Its Catchy said:


> Wow! I never knew there were so many financial planners on here. Lets go back to square one. Save at least 10%. You will be OK.
> 
> Unless you wait to long to save. Then save as much as you can.
> 
> Good Luck!


you are exactly right - it all starts with putting money away and leaving it alone - and a percentage is much better than a dollar amount. If you use a percentage then as salary and income go up your savings amount goes up with it


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## goatchze (Aug 1, 2006)

bigfishtx said:


> Problem with all these math projections are they do not take into consideration the events that come along every 7-12 years that wipe out half your 401k because of equity values crashing.
> I have saved in my 401 and SEP for 30+ years and I do not have anywhere near enough to retire.


That's where the rule of 100 that Ranch mentioned comes in.

If you're young and are dollar cost averaging, those events actually help you. It's why it is acceptable to have a larger equity position when you are young. I know a lot of people closer to retirement suffered in 2008/2009, but I made out like a bandit. I knew I wasn't going to need the money for 30+ years, so I made no changes to my strategy. I contributed every month, buying all the way down to the bottom, then all the way back up. It gave me a tremendous ROI.

When I'm getting closer to retirement, I plan to have less exposure to the equities market so that, if a similar correction takes place, I'll be OK.

On average, the S&P still gives great returns (over the last 100 years). But as you mentioned, there are ups and downs. That's why you take fewer risks (less equities) the closer you get to actually needing the money.


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## ChuChu (Jan 23, 2010)

I went by the best financial adviser I ever met...my Dad. He told me early on "take all the money the company gives you, save as much is allowed by law". It worked for me. We both worked for ARCO, and ARCO was well known for money give aways.


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## sea hunt 202 (Nov 24, 2011)

Ok most of the funds do not make much return but some are sure and secure. The ones that are secure are for the well to do as they can buy thousands of shares, and you will have to have quite a bit invested to retrieve a reward-being nice or minimal. But if you have the means say like a $100,000 then buy a home and rent it-the return should be aprox $1100.00 month and after taxes and insurence plus repairs this should net you about $9,000 a year. Your call


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## Troutman123 (Mar 21, 2007)

*Question without reading*

Whole thread ..... If pay someone (Fidelity to manage my IRA) those fees deduct ankle ??


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## Billphish (Apr 17, 2006)

Troutman123 said:


> Whole thread ..... If pay someone (Fidelity to manage my IRA) those fees deduct ankle ??


Log off and dial 911. You're having a stroke!


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## ralph7 (Apr 28, 2009)

Troutman123 said:


> Whole thread ..... If pay someone (Fidelity to manage my IRA) those fees deduct ankle ??


Don't be a Bogart, pass it!


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## Rubberback (Sep 9, 2008)

Billphish said:


> Log off and dial 911. You're having a stroke!


Me no savy. I speak english & spanish. Pero yo no comprende .


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## Tortuga (May 21, 2004)

"Age...68"....relatively harmless....:rotfl:


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## Garwood57 (Jul 1, 2007)

Someone mentioned it earlier, when you get close to retirement, start putting your investments in safer things and reduce the risk of stock shock and value degradation in periods like 2008. There will be market swings, just like oil price swings (my business), you can be smart and manage your $$, not timing the exact market swings but taking advantage of opportunities. I made all kind of money in 2008, i had seen the market trend heading down. When the stocks crashed, I bought in. Now I am 3 years from retirement, I have more of my $$ in safe investments, but still have a mixed portfolio, don't have all your eggs in one basket (like your company stock). Good luck.


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## Rubberback (Sep 9, 2008)

Garwood57 said:


> Someone mentioned it earlier, when you get close to retirement, start putting your investments in safer things and reduce the risk of stock shock and value degradation in periods like 2008. There will be market swings, just like oil price swings (my business), you can be smart and manage your $$, not timing the exact market swings but taking advantage of opportunities. I made all kind of money in 2008, i had seen the market trend heading down. When the stocks crashed, I bought in. Now I am 3 years from retirement, I have more of my $$ in safe investments, but still have a mixed portfolio, don't have all your eggs in one basket (like your company stock). Good luck.


Good advice.


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## TranTheMan (Aug 17, 2009)

Garwood57 said:


> Someone mentioned it earlier, when you get close to retirement, start putting your investments in safer things and reduce the risk of stock shock and value degradation in periods like 2008. ... Now I am 3 years from retirement, I have more of my $$ in safe investments, but still have a mixed portfolio, don't have all your eggs in one basket (like your company stock). Good luck.


I think if you have an account with Fidelity you can have access to "Financial Engines". http://corp.financialengines.com/.
You can use it for DIY retirement planning; it gives similar advice like above, keeps track of your all stocks, mutual funds, runs the Monte Carlo model to give you a projected future worth of your investments (similar to fireCalc recommended in this thread) to see whether it would meet your retirement goal and makes recommended changes to your portfolio based on your retirement date. It will take a bit of time to enter all the info initially and as you change or rebalance your portfolio, you would need to enter the changes accordingly. 
Of course it is DIY, so you can take its recommendations with a grain of salt. But so far, it seems to work for me ... or maybe ignorance is bliss here!


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## Johnboat (Jun 7, 2004)

*spendable income from rent property vs growth of capital in stocks*

My long gone parents could keep money in CDs with enough return to supplement their pensions and SS.

Now we don't have pensions and CDs pay squat.

I don't plan to retire for a few more years, but who knows what business downturn could make me retire early.

So my head gets stuck on my handful of small rental properties I have bought with cash the last few years. I get to keep the rent (less expenses and a reserve for maint) as income....spendable income. I get this income now and later in "retirement" And the principal or capital being the rent property itself remains untouched. I could sell one (with favorable cap gain taxation) if I needed a block of money, but the plan is to hold them at least until we are too old to mess with them.

I also have put 401K money in mutual funds for decades. They have increased with some blips along the way by virtue of growth. But they return not much in dividends. So in retirement I will have to cash them in, liquidate the capital itself for spendable income. Indeed I will be forced to take distributions every year starting at age 70.5. And the stock fund will deplete every year.

I don't regret not buying more stocks. I have pretty much maxed out my self employed 401k. What I wish I had done was started earlier in my thirties, buying rent houses with 15 year mortgages paid by the tenants, and by now I would have those too free and clear.

Is this about right or am I missing something?


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## fangard (Apr 18, 2008)

Troutman123 said:


> Whole thread ..... If pay someone (Fidelity to manage my IRA) those fees deduct ankle ??


Deductible only if the fees are paid from outside the IRA. Of course, consult your CPA/Tax Advisor, etc....

I think they are also subject to some minimum % of AGI to be able "itemize" them.


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## Hullahopper (May 24, 2004)

http://www.msn.com/en-us/money/your...-become-a-millionaire/ar-BBifTFj?ocid=UP97DHP


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## FISH ON (May 22, 2004)

Johnboat , when you get to old to make the drive to Bolivar you get to sell the beach house also. lol That is what I keep telling my kids. Yall never know when we might need some cash and sell.


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## BullyARed (Jun 19, 2010)

If you have 401K, how should you withdraw? if you work part time?


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## grman (Jul 2, 2010)

If you have 401K, how should you withdraw? if you work part time?

That is the main reason that I finally got a financial advisor. All kinds of stuff available about saving, very little on how to withdraw money. I choose an advisor with Merrill Lynch Wealth Management because my Dad had used him for 30 years.


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## TranTheMan (Aug 17, 2009)

BullyARed said:


> If you have 401K, how should you withdraw? if you work part time?


http://retireplan.about.com/od/401kplans/f/faqwithdrawal401k.htm
http://moneyover55.about.com/od/Ret...ls/a/How-To-Take-Money-Out-Of-A-401k-Plan.htm


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## w_r_ranch (Jan 14, 2005)

BullyARed said:


> If you have 401K, how should you withdraw? if you work part time?


Depends on your particular situation & tax bracket, that's why I said a good CPA is so important. He can tell you how much to draw & if needed, offer suggestions suggestions for write-offs/deductions (like it's time to buy a new tractor or do more fencing). He can also tell you what you need to do to avoid the costly AMT.

You are going to either pay taxes directly to the government or you can utilize the tax laws to your advantage. The end result is a portion of your money is still 'gone', the only difference is whether you have something of value to show for it...


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## grman (Jul 2, 2010)

A withdrawl plan is more than just how much and when to withdraw.

What investments are you goings to sell? When are you going to sell them? What are the tax effects for selling them? Lots of stuff to keep track of. Tough for an individual to have that much knowledge.

What my advisor has setup in a cash dividend account (I love high yield dividend stocks). A certain amount of my dividends go into this account. Rest are reinvested. My monthly 72T check comes out of this cash account.


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## BullyARed (Jun 19, 2010)

TranTheMan said:


> http://retireplan.about.com/od/401kplans/f/faqwithdrawal401k.htm
> http://moneyover55.about.com/od/Ret...ls/a/How-To-Take-Money-Out-Of-A-401k-Plan.htm





w_r_ranch said:


> Depends on your particular situation & tax bracket, that's why I said a good CPA is so important. He can tell you how much to draw & if needed, offer suggestions suggestions for write-offs/deductions (like it's time to buy a new tractor or do more fencing). He can also tell you what you need to do to avoid the costly AMT.
> 
> You are going to either pay taxes directly to the government or you can utilize the tax laws to your advantage. The end result is a portion of your money is still 'gone', the only difference is whether you have something of value to show for it...


Thanks. My question was intended for others as well since I think many including me not sure how to withdraw 401K to minimize tax.


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## sea hunt 202 (Nov 24, 2011)

You will want to assess your family history for illness, heart issues, current health, what you will owe at retirement, how much you have amassed, what your SS will be. Try and calculate how long you will live-i.e. family history, how well you can abstain from impulse purchases. There are so many factors you just have to consider


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## LaddH (Sep 29, 2011)

BullyARed said:


> Thanks. My question was intended for others as well since I think many including me not sure how to withdraw 401K to minimize tax.


I might be missing something but you minimize tax on your 401K withdrawals by drawing the minimum out that you are forced to withdraw by either rule or necessity.
At 70 1/2 you will have to draw a calculated minimum by the IRS or face a harsh penalty. If you are forced to withdraw by need then drawing out the smallest amount necessary will result in the least tax due.
Other than that drawing out of your 401K when you are at the lowest tax bracket possible and the withdrawal will not put you in a higher bracket would be OK. 
However- I am an electrician and not a taxman so this is for what it is worth.


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## whiskey1 (May 8, 2014)

Can a finance guy explain the process of avoiding some taxes on 401K monies? Apparently there is a loophole where folks slowly roll over money into an IRA and then it becomes tax free. Or something like that.


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## ChuChu (Jan 23, 2010)

BullyARed said:


> If you have 401K, how should you withdraw? if you work part time?


I would roll it over to a managed IRA as soon as possible.

This is where an annuity comes in handy. The one my adviser convinced me to buy pays me monthly, never decreases no matter the market, increase if the principle increases with the market.


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## Twitch-Twitch-Boom (Jun 24, 2011)

With a 401(k) (Assuming you're not still working) and with a traditional IRA, you are required to take the RMD, Required Minimum Distribution starting in the year you turn 70 1/2.

For someone that is 70 1/2, that withdrawal rate required is right around 3.8% for the 1st year. It slowly gets higher as you age.
The reason behind the RMD, is that the I.R.S has never received any taxes on that money. They require you to take it out.

Regarding the question how to take money out of the 401(k) in retirement, most people take a monthly amount and have taxes withheld from it. Sometimes 401k plans require a signature every time you do it. If you rolled it into an IRA you would have many more investment choices and won't need a signature for every distribution or systematic payment.

Remember you don't need to take money from the 401k/IRA until age 70 1/2. Once you hit that age the % is right around 3.8% in yr 1. So $1,000,000 IRA would be $38,000 you must take out of the account and pay taxes on. You can put that in a non-retirement account, you are not forced to spend it. The RMD is based upon your age, and previous year end account value.

*Remember, you can have multiple IRAs. IRA's can have many different investment products such as mutual funds, annuities, CD's, individual stocks etc. Each investment has their own pros/cons.


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