Dockside Chat - How much money do you need in order to retire?

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RussH
03-31-2012, 05:54 PM
I'm curious to see how much money you guys think is enough to allow you to retire. I have about 12 more years to work and save money so I'm not looking to retire any time soon. We met with a retirement planner and he told us we need to significantly increase our savings if I am to retire @ 62. In my opinion I think we would need about $700K to retire.

I have a friend that retired @ 62 and he had $367K in his 401K, still paying house payments and his equity line of credit is around $25K. For me $367K doesn't seem like enough. Another friend is 64 and he said he needs $1 million to feel comfortable enough to retire. I know it depends on how you want to live so for the sake of argument let's just say we will live more conservatively.

For me the sooner I can retire the better, people in my family don't tend to live very long. Mom died @40, dad died @ 62. I don't have the same lifestyle that they did, lots of smoking and drinking. They both were alcoholics and drank every day. My mom was a chain smoker and died of lung cancer.

How much do you guys think you need to retire comfortably?


Russ


yarcraft91
03-31-2012, 06:08 PM
For starters, do you have a pension plan at work? Have you calculated the monthly payment? Have you reviewed your monthly Social Security benefit? What do you expect your monthly spending will be in retirement? Do you have long-term care and life insurance? Do you need to leave something for heirs? You are far enough from retirement, some of these numbers are only estimates, but it's an important start to answering your question.

Just so you know where I'm going with this, subtract your annual income from pension, SS, etc. from your expected annual spending. Your savings need to be 25-33 times that difference, so you can withdraw 3-4%/year to maintain your spending level. Not perfect, but it gives you a decent guess.

bamaboy473
03-31-2012, 06:26 PM
Here are a few wild thoughts on a REAL number of dollars that you need.........

a. If your nest egg is in the bank, you are making 1/10 of one percent on the money.

b. If your egg is in the stock market/ AKA investment account, call it.....2%??

c. If your money is in investment property, it can be up to 20% return


If you have $700,000 in the bank, that would equate to about about $70/month in cash.

If you have a 401K portfolio that's.....average.......then it would become $1400/month

If you have rental property, then it could be $10,000/month......before R&M and other expenses that property rentals have, including lost rent for vacant properties.


triplenet
03-31-2012, 06:33 PM
Since 1900 the avg DJIA return was 9% +/-....... and where do you get 20% ROI from real estate?

Come on man :-0 )

aiian
03-31-2012, 06:35 PM
I'm a solid 25-30 years away from that glorious day w/ a little over 60k set aside but those numbers (300-700k) seem a little low to me. Right now we're saving around 18% and I'm not really happy about that number.

I guess in theory we won't spend nearly as much money after retirement but I don't want to sit around and watch the grass grow.

Our dream is to get a Nordhavn 47 (who knows what else will be around in 2040) and ride that beast up and down every coast we can find :thumbsup:

yarcraft91
03-31-2012, 06:42 PM
I guess in theory we won't spend nearly as much money after retirement but I don't want to sit around and watch the grass grow.

That may be the theory, but don't count on it the first few years of retirement. I'm spending more in retirement than the last few years I worked- I have more time to drive around, time to buy boat/fishing gear, make home and vehicle improvements/upgrades, etc..

ladyjane
03-31-2012, 06:44 PM
Here are a few wild thoughts on a REAL number of dollars that you need.........

a. If your nest egg is in the bank, you are making 1/10 of one percent on the money.

b. If your egg is in the stock market/ AKA investment account, call it.....2%??

c. If your money is in investment property, it can be up to 20% return


If you have $700,000 in the bank, that would equate to about about $70/month in cash.

If you have a 401K portfolio that's.....average.......then it would become $1400/month

If you have rental property, then it could be $10,000/month......before R&M and other expenses that property rentals have, including lost rent for vacant properties.
I can say that in the market on the right investments up towards 10% but not for newbees:trout:

triplenet
03-31-2012, 06:45 PM
Our dream is to get a Nordhavn 47 (who knows what else will be around in 2040) and ride that beast up and down every coast we can find :thumbsup:

The 47 is a bit cramped - you should get the 55 :grin:

Better save around 4M - you are gonna need it .. :thumbsup:

notgottaboatyet
03-31-2012, 06:47 PM
I'm thinking 2 million in real estate without debt in the house I want and I'll start thinking about retirement. Went to a friends house on Charleston harbor that we feel in love with and my wife has agreed to my plan to get there.

1 mill to play with and 1 to live off of.

Shif
03-31-2012, 06:49 PM
If you want to live the lifestyle you do now then you will need at least the same income you have now. You can deduct mortgages that will be paid off and other misc. expenses. If you want to live a lesser lifestyle than you do now then you may need a little less. 60k a year income may be enough for some 250k income/year may not be enough for others. The important thing is that you are thinking about it and trying to plan for the future.
Believe me, not many do enough planning.

kevnhl25
03-31-2012, 06:51 PM
about 12 yrs ago at age 38 I figured by the time I retired at age 58 I would need 120k per yr and no mortgage to live an active lifestyle.
GOLF fish/boat travel winter in Fla return to Mass for summer. Since then I have had 2 back surgeries
so no golf My wife passed away so now I`m planning for just me. Oil/gas, food and medical has skyrocketed beyond what I could have imagined. Now I`m hoping that 120k will stll allow me to retire
but its going to take alot more work now to get there and it may not happen at 58.

thermasystems
03-31-2012, 06:56 PM
Too broad of a question.

If you have no house payment, no car payment, no boat payment, no credit cards.

How much do you need?

That should be the question.

If you have 10,000 a month in bills. you obviously need a crapload more than if you only have the necessary living expenses.

So...... when you retire, in what condition do you see your debt load?

bamaboy473
03-31-2012, 06:58 PM
Since 1900 the avg DJIA return was 9% +/-....... and where do you get 20% ROI from real estate?

Come on man :-0 )

Agreed on your question, because you and I have different approaches, perhaps. Find a great real estate deal that you can improve to rentable condition, and those returns are entirely possible.

My last foreclosure purchase was for $36K, added $8K into the house, and have a lease for $1100/month.

That isn't normal, but it is real life. :thumbsup:


Thinking about it, though, a few tri plexes earn around 15%, so for a hands-off type of owner, perhaps 10% would be a more realistic goal? Hands-on types can get north of 15%, IMO.

aiian
03-31-2012, 07:01 PM
My grandfather did well in real estate but I always thought he was a bit of a slumlord.

I don't know where you're from but I can't imaging a $40k property being in the best area with the greatest tenants.

Am I wrong?

Ray Zor
03-31-2012, 07:01 PM
completely debt free w/1Million in the bank/assets(not my own home but real estate investments) would be a starting target for me.
I should be able to collect 2k/mo pension and whatever is left from social security (if any).
If I were single/no kids I would probably do a reverse mortgage as well and try to leave this world penniless.

wdkerek
03-31-2012, 07:08 PM
leave this world penniless................ not a bad plan my friend

Back-in-Black
03-31-2012, 07:12 PM
RussH, I'm about the same age as you and looking to retire in maybe 15 yrs... maybe 20 - depends how I fell when I get there LOL. My goal is ~$2 mil in retirement accts, but I probably won't get quite there. I'm going at it 2 ways. Slamming cash into retirement accts and have probably averaged around 10-12% over the last 20 yrs on that. (made a killing on the rebound off the recession and the market crash in '08) I'm also going the route Bamaboy is talking about. Rental real estate. Have 3 rental properties now, 2 of them paid off in another 3 yrs and will be kicking off ~$2k /month which I will reinvest in more rental houses. Hope to have close to 10 houses paid off or mostly paid off when I do retire. Hopefully they will be kicking in close to $10k a month for retirement and I should be able able to reach ~$1.5 mil in the retirement accts by then too. Cool thing about the rental deal is that it really doesn't take all that much work to keep 'em rented out and if you ever get tired of it, just sell the houses that you paid for with other peoples' money. 10 houses @ $150k each = another $1.5 mil to have a great retirement with.

thermasystems
03-31-2012, 07:15 PM
My grandfather did well in real estate but I always thought he was a bit of a slumlord.

I don't know where you're from but I can't imaging a $40k property being in the best area with the greatest tenants.

Am I wrong?

Yes.

I have a friend that has several houses in the 35-45,000 range. All newer homes, good areas.

I have bought NEW, NEVER LIVED IN, 1600 sq ft 3/2 houses with a pool on 1/2 an acre in a predominantly white area for 55,000.

Also bought 3/2/2 on each side duplexes for 50-55,000.

It is all in how and where you look.

bamaboy473
03-31-2012, 07:22 PM
My grandfather did well in real estate but I always thought he was a bit of a slumlord.

I don't know where you're from but I can't imaging a $40k property being in the best area with the greatest tenants.

Am I wrong?

You aren't wrong. The flip side of that question is that people are people, and those that can pay $3500/month might just as well leave a house destroyed when they are finally evicted.

My rentals are lower middle class people. They have to work for a living, and they aren't (all) on some government program that allows people to stiff landlords while they move to other digs.

I keep their properties clean and working, and expect rent before the 5th. It's a job for me, though...I work one day a week in order to maintain my retirement income. It isn't a free ride at all.

dlevitt
03-31-2012, 07:29 PM
It's all about your expected lifestyle. The calculation really is pretty simple if you can figure out how much income you will need. I've always advised that there are 2 things in this world that make money - People and money. If you currently have earnings and that stops upon retirement, you need to replace a portion of that income, all of the income and depending on the lifestyle you envision possibly more. Since your calculations will be in todays dollars, you need to adjust your income goal for inflation. You may want to base this calculation on 2% or so.

From there, you should divide the amount of desired income by a "reasonable" after tax rate of return. For example, if you are targeting an income of $80,000 and assume a 4% A/T return (you should be conservative in your projections), you would need $2 million saved.

This assumes that you will be living on interest and not touching principal, which gives you an additional financial cushion incase inflation rates go higher than assumed or your investments underperform. Obviously, if you have other sources of income, such as social security, pension, etc., you should make adjustments.

MYTraveler
03-31-2012, 07:48 PM
First, you don't need to plan on living on your income -- its OK to use principal. It would take a long time to run out of principal if you withdraw 8 - 10% a year. And once you get into your mid-80's, your desire and ability to enjoy expensive stuff will diminish. (Although health care costs will probably go up, and you will probably have to travel to some foreign country to get decent health care.)

More importantly, if you aren't happy working, get a different job. I know I will not be happier after retirement, and I dread the day that our kids are out of the house and my wife insists that I slow down.

RussH
03-31-2012, 07:52 PM
For starters, do you have a pension plan at work? Have you calculated the monthly payment? Have you reviewed your monthly Social Security benefit? What do you expect your monthly spending will be in retirement? Do you have long-term care and life insurance? Do you need to leave something for heirs? You are far enough from retirement, some of these numbers are only estimates, but it's an important start to answering your question.

Just so you know where I'm going with this, subtract your annual income from pension, SS, etc. from your expected annual spending. Your savings need to be 25-33 times that difference, so you can withdraw 3-4%/year to maintain your spending level. Not perfect, but it gives you a decent guess.

Yes I have pension plan, it should pay me $1,500/month.

Yes I have calculated my SS benefit.

I don't have long term care set up because I don't need it now.

We don't need to leave money to anyone but obviously we will for my daughter (only child).

Ticks me off that I can only put 3% into my 401K plan because of my income, which I think is total BS. It shouldn't matter what anyone else in the company makes, I should be able to pay 15% into my 401K. I don't really understand why it works that way.

Russ

kevincook
03-31-2012, 07:57 PM
Since 1900 the avg DJIA return was 9% +/-.......
Come on man :-0 )

The only problem is that the S&P 500 is actually lower than it was in 2000, that is twelve years of lost potential gains. This is a huge problem for anyone relying on a 401k for their retirement.

Eyeball
03-31-2012, 08:02 PM
How much do you guys think you need to retire comfortably?




Russ, you are thinking in the past, it doesn't work that way anymore.

Eyeball
03-31-2012, 08:04 PM
Ticks me off that I can only put 3% into my 401K plan because of my income, which I think is total BS.



You can save as much as you want for your retirement. Perhaps only 3% is tax deferred, but that shouldn't stop you from saving (or whatever you are doing).

MYTraveler
03-31-2012, 08:17 PM
Reminds me of a joke.

This guy, boat owner actually, was planning his retirement with his wife. He twas adamant that when he died, she was to sell all his stuff, including his boat. She was surprised and asked why. He explained that he wanted her to be happy and would expect that she would remarry, and that he was OK with that -- in fact, he sincerely wished for her happiness. He just couldn't stand the thought of some other A**h*** using his stuff. To which his wife responded, "What makes you think I am going to marry another A**H***?

finadict
03-31-2012, 10:02 PM
I've been going through all the retirement calcs myself. There are several ways to figure it out, we decided that our retirement income needed to be what our current income is less 7.5% for SS and less our 401K annual contribution. This works that our retirement income needs to be about 80% of our pre-retirement income. We also figured that we could not draw more than 5% out of our 401ks. I hope this works cause I'll retire in June.

airbrush
04-01-2012, 02:12 AM
In reality, if you plan to retire at an early age - 55 - 60 - you'll need an income equal to or greater than what you're earning when you retire. Why? Because you'll have time on you hands and, assuming your health is good, you'll be wanting to do things your time constrained life kept you from doing.

I retired at age 56 and, amongst the cruises and other "vacations" we've actually spent more money than before. Thank goodness we had enough put away to allow for it. Saying your lifestyle will slow may happen later in life, but not in your fun seeking years.

RussH
04-01-2012, 03:27 AM
Russ, you are thinking in the past, it doesn't work that way anymore.

Could you please explain your comment?

hottoddie
04-01-2012, 04:23 AM
Agreed on your question, because you and I have different approaches, perhaps. Find a great real estate deal that you can improve to rentable condition, and those returns are entirely possible.

My last foreclosure purchase was for $36K, added $8K into the house, and have a lease for $1100/month.

That isn't normal, but it is real life. :thumbsup:


Thinking about it, though, a few tri plexes earn around 15%, so for a hands-off type of owner, perhaps 10% would be a more realistic goal? Hands-on types can get north of 15%, IMO.



In my state, Mass, you wouldn't want residential RE. The tennants have more rights than you do. Hard to make a buck at it.

GulfC
04-01-2012, 04:44 AM
In my state, Mass, you wouldn't want residential RE. The tennants have more rights than you do. Hard to make a buck at it.

The right property in the right place will work anywhere. In a state such as yours, you only want solid middle to upper income property. Lower income property would be a huge mistake. But in a more landlord friendly state, lower income properties would be fine. I like solid mid range stuff that appreciates and people enjoy living in.

Get 5 solid performers, learn the ropes better than the competition and you can have a nice retirement working only as hard as you wish. There are so many options available from here it would take a week to cover.

yarcraft91
04-01-2012, 05:06 AM
Yes I have pension plan, it should pay me $1,500/month.

Yes I have calculated my SS benefit.

I don't have long term care set up because I don't need it now.

We don't need to leave money to anyone but obviously we will for my daughter (only child).

Ticks me off that I can only put 3% into my 401K plan because of my income, which I think is total BS. It shouldn't matter what anyone else in the company makes, I should be able to pay 15% into my 401K. I don't really understand why it works that way.

Russ

OK, Russ:

401k plans vary. Sounds like yours limits your tax-deferred contributions to 3% of income- that sucks. My plan allowed additional taxable contributions. Does yours? Benefit of my 401k was very low institutional fees on mutual funds and great investment choices (my company takes good care of its people). Do you fund an IRA for you and spouse every year? Have you converted IRAs to Roths?

You have a handle on the income side. You have probably figured out the spending side, too. How big does the monthly gap appear to be? Ignore inflation at this point- worry about that later.

On the long-term care thing, I passed on it because I didn't look at buying it until I was age 58. At that point, the math showed that if I could afford to buy the insurance, my finances were sound enough that I didn't need LTC insurance. Rates have become less attractive since then. So, I'm self-insured.

Boataholic
04-01-2012, 07:02 AM
It seems most retirement info that I've seen says to figure on withdrawing 4% a year in order to not run out of money. This of course is based on current life expectancies for you and spouse. You may kick off early but she could live to be 90? If you have 700K saved and it's in say 60/40 stocks/bonds then you could "safely" take out 28k per year? Add in your SS and pension to that. Perhaps you need to itemize your monthly expenses and see if that will cover everything. It really helps to be debt free in retirement!

Ray Zor
04-01-2012, 07:02 AM
Not a real estate guru by any means but if you had $1M in real estate and planned on selling as part of retirement, wouldn't you be hit with approx 30% cap appreciation taxes on this?

BACKTOTHESEA
04-01-2012, 07:29 AM
Ticks me off that I can only put 3% into my 401K plan because of my income, which I think is total BS. It shouldn't matter what anyone else in the company makes, I should be able to pay 15% into my 401K. I don't really understand why it works that way.

Russ

My guess would be that your employer matches elective 401k contributions up to the first 3% of salary. The non-salaried help likely contributes 3% to take advantage of the full match of the company, but perhaps it falls off after that. There are various non-disriminatory rules, one of which requires matching employer contributions to be made at the same rate between highly compensated employees and non-highly compensated employees. As such, the employer limits your contributions to the 3% which is the same rate that non-highly comped EE's are contributing.

A good comp plan will usually include a mix of non-qualified vehicles to make up for these type of disparities.

captbone
04-01-2012, 07:40 AM
Yes I have pension plan, it should pay me $1,500/month.

Yes I have calculated my SS benefit.

I don't have long term care set up because I don't need it now.

We don't need to leave money to anyone but obviously we will for my daughter (only child).

Ticks me off that I can only put 3% into my 401K plan because of my income, which I think is total BS. It shouldn't matter what anyone else in the company makes, I should be able to pay 15% into my 401K. I don't really understand why it works that way.

Russ

Why cant you put more then 3% into your 401k? You make $450k+ yearly?


There is a limit on the amount of elective deferrals that you can contribute to your traditional or safe harbor 401(k) plan.

The limit is $16,500 for 2011 and $17,000 for 2012.
The limit is subject to cost-of-living increases after 2012.

http://www.irs.gov/retirement/participant/article/0,,id=151786,00.html

yarcraft91
04-01-2012, 07:41 AM
Not a real estate guru by any means but if you had $1M in real estate and planned on selling as part of retirement, wouldn't you be hit with approx 30% cap appreciation taxes on this?

You'll face capital gains taxes on real estate, stocks, bonds, any other capital investment when you sell it. The rate is not as high as 30% (yet). The tax rate is currently favorable compared to the treatment of withdrawals from a 401k, which are taxed as regular income no matter how the funds were invested.

Eyeball
04-01-2012, 08:30 AM
Not a real estate guru by any means but if you had $1M in real estate and planned on selling as part of retirement, wouldn't you be hit with approx 30% cap appreciation taxes on this?


What if the real estate is in a retirement trust? ;) Only pay taxes on what is taken out of the trust.

JoeyM
04-01-2012, 08:35 AM
my financial planner does all the calculations and tells me i need something like 9-12 mil! i'm always like WTF! really?

i dont think that is true though. i may live crazy right now, but i would be perfectly happy to live much more modestly when i'm older.


.

triplenet
04-01-2012, 08:41 AM
Not a real estate guru by any means but if you had $1M in real estate and planned on selling as part of retirement, wouldn't you be hit with approx 30% cap appreciation taxes on this?

Long term gain is 15% currently.... But why sell - you hold and rent = approx 7% net ... forget all the claims of 20% - you would need to be a slumlord and thats just a PITA

my financial planner does all the calculations and tells me i need something like 9-12 mil! i'm always like WTF! really


.

No kidding..... I think 5M in "cash" and I would be able to squeak by --- but no longer buy toys.... Just travel, eat, drink, enjoy.... :grin:

notgottaboatyet
04-01-2012, 09:09 AM
Long term gain is 15% currently.... But why sell - you hold and rent = approx 7% net ... forget all the claims of 20% - you would need to be a slumlord and thats just a PITA



No kidding..... I think 5M in "cash" and I would be able to squeak by --- but no longer buy toys.... Just travel, eat, drink, enjoy.... :grin:

I know my 2M mark is going to be when I quit my day job and focus on real estate. Which would be like retiring compared to my current work schedule. I'm guessing atleast 20 years investing heavily and not touching the roi just reinvest heading toward commercial. If I meet my mark I'll be 41:grin:

LMychajluk
04-01-2012, 09:18 AM
IMO, even $700k isn't much for retirement, unless you're health isn't that great and you don't plan on living past 75.

I'm only 41, in relatively good health, and plan to retire around 69-70. I'm dumping all I can into the 401k, and hoping that the "Rule of 7" applies (double savings every 7 years). If it does, I'm in good shape w/ over $4.5M in my retirement account at that time. With that in my Nest Egg, if I continue to spend ~100% of what my current income is after retirement, I won't be able to touch the principle (in other words, I'm just living off the interest). That should let me do whatever I want until I'm dead, and leave something to whoever I want to (no kids yet that I know of...). If I do better than expected, I can plan to retire earlier.

Play around w/ a couple of retirement calculators. Here's a couple to start with:
http://www.bloomberg.com/personal-finance/calculators/retirement/
http://www.schwab.com/public/schwab/investing/investment_help/retirement_planning/retirement_calculator

Mac53
04-01-2012, 09:19 AM
My PLAN is easy: At retirement,

1) No debt at all except everyday living expenses, autos paid off
2) $600,000 CASH on hand
3) $10,000 monthly income from all sources

If we can't live under that scenario then shame on us!

triplenet
04-01-2012, 09:23 AM
Between my home on Lake Como and the Italian mistress - I figure its gonna take 500k a year ...

http://www.wayfaring.info/wp-content/uploads/2008/11/lake_como_italy.jpg

http://supportyourlocalgunfighter.com/wp-content/uploads/Sabina-Began.jpg

DavenFla
04-01-2012, 09:28 AM
For me... I need no less than I live on right now,100% of current income. I may actually need more:o once I get started with retirement.

yarcraft91
04-01-2012, 09:50 AM
Between my home on Lake Como and the Italian mistress - I figure its gonna take 500k a year ...

http://www.wayfaring.info/wp-content/uploads/2008/11/lake_como_italy.jpg

http://supportyourlocalgunfighter.com/wp-content/uploads/Sabina-Began.jpg

Money well spent! Hey!!! :thumbsup: Watch that thumb!!

thermasystems
04-01-2012, 09:50 AM
My PLAN is easy: At retirement,

1) No debt at all except everyday living expenses, autos paid off
2) $600,000 CASH on hand
3) $10,000 monthly income from all sources

If we can't live under that scenario then shame on us!

:thumbsup:

Even if you didn;t have the 600 cash, and made say 15k a month from all sources.

The key is no overhead.

With no overhead, if you break down your monthly expenses, it is probably lower than you think.

You will probably be able to save a decent portion of the 10,000 a month if you do it that way.

LMychajluk
04-01-2012, 10:06 AM
Oh, BTW.... My IRA is a ROTH, so once I start drawing on it, I'm not paying any income taxes on that income. So, I'll basically be paying taxes on my SS only. For standard IRAs and other savings, consider that you may have to pay income tax on that, and who knows what that rate is going to be by the time we retire...

08087
04-01-2012, 11:47 AM
All answers given are subject to the economy being stabil, we could all find ourselfs in the poor house fast if things go south.

Eyeball
04-01-2012, 12:11 PM
Could you please explain your comment?


If/when you are serious about your retirement you will need to come up to speed on global economics and where it is headed ... and trends.

What do you get from the chart below?

Green is the SP 500
Red is the breadth of stock being sold by the companies' own employees.

http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012/03/Insider%20Selling.jpg


Russ, when you look at that chart, what does it tell you? You should be seeing that people are dumping the stock of the company they work for in record numbers the likes of which have never been seen before. These are folks that 'know' the company, know the product, know the market for that product ... And they aren't willing to risk the stock market.

It should also tell you the average 'joe' is not in the market, is sitting on the sidelines. So, who is 'in'? Institutional investors. And they are spinning the hype about the market making a come back. It hasn't, but they need you to believe it to get the average 'joes' to invest in the market, to drive up stocks, then the institutional investors will bail, leaving the joes holding the loses. Another transfer of wealth. What did Morgan Stanley's research have to say about this as recently as March 30, 2012:


The recent divergence between the GDP arithmetic and labor demand is unusual - but not unheard of. Most importantly, this combination implies a significant slowdown in productivity, which is somewhat troublesome, given the sub-par productivity performance that was already evident in 2011. A continuation of these trends would imply a significant deterioration in corporate profitability at some point in the not too distant future.

http://www.morganstanley.com/views/gef/



What I get from that is if you are not in the market, don't get into it. If you are in it, you may want to consider getting out.

Me thinks the quality of future retirements will be directly proportional to tangible property owned. Austerity is going to be uncomfortable for a lot of folks. The first incarnation of austerity is already here. You are hearing about it, but under a different presentation -- it is presented as taxing the millionaires. The revenue realized from that "tax" won't float our govt for more than a few minutes, literally. But it would be the camel getting his nose into the tent. Once austerity is up and running it is the retired govt employees that will get hit hard. Anyone with liquid assets will also be targeted -- and other assets like your 401K and IRA accounts. Remember, the 1st year the Clintons were in the white house Hillary proposed a 25% across the board confiscation of all retirement savings. In Europe, everyone that knows the reality of the failed experiment, the Euro, has liquidated their assets and reinvested their personal wealth in tangible property -- metals and real estate.

The world as a whole is changing. How money is used is changing. Sweden is now just short of being totally currency-less -- almost all monetary transactions in Switzerland are now electronic.

http://sovereign-investor.com/2012/03/19/digital-currency-use-on-the-rise-in-sweden/

If you are uncomfortable with that, the idea of your personal wealth being electronic, it is because you have a sense of the value of something tangible, in this case, the ability to hold your wealth (currency) in your hand. The financiers of Europe are taking that caution one step further and apply it to their future (call it their retirement or whatever).

Me thinks anyone depending on a savings account for their retirement, govt bonds for their retirement, stocks for their retirement, mutual funds for their retirement ... are gambling with their retirement.

There are a couple of things not lost on me, but not fully appreciated, yet, either. (1) the 'dollar' runs in a 40-year cycle. It changes an how it is used and how it is valued. We are in year 42. (2) the world as a whole wants to drop the dollar as the reserve currency. They are just 7-years behind Bill Gates. He shorted the dollar in 2005, saying the GDP to debt ratio was unsustainable. That was 7-years ago, 7-years before the debt crossed over the entire GDP. The BRIC countries (Brazil, Russia, India, China) have already come together to start a new bank with the goal of a new global reserve currency to replace the dollar. If that doesn't have anyone rethinking the value of owning precious metals ...

For the long haul, tangible property ... unless, of course, your crystal ball tell your different than my crystal ball tells me. :grin:

DavenFla
04-01-2012, 12:27 PM
All answers given are subject to the economy being stabil, we could all find ourselfs in the poor house fast if things go south.

... if was a skiff we could go for a boat ride.

I don't plan for doomsday... plan for the ups and downs... but not for a financial Armageddon.

triplenet
04-01-2012, 01:08 PM
http://images.elephantjournal.com/wp-content/uploads/2011/08/the-sky-is-falling.jpg

gingersnap
04-01-2012, 02:36 PM
My wife retired this last Friday.

We'll be fine. :thumbsup:

twentynine
04-01-2012, 03:33 PM
I hope to retire at age 60 (6 years from the day before yesterday).

Maxing out 401k contributions for the last 8 years and plan to for the next 6 years. Currently I can contribute 17,500 + 5,500 (catch-up for 50 and over).

I will have no pension upon retirement. Instead of a pension my company contributes an amount equal to 4% of my yearly gross income to my 401k. They will match up to an additional 6% of my gross income that I contribute dollar for dollar. My contribution by percent exceed the max that the company will match, but I contribute the max allowed (17.5k + 5.5k).

I have no mortgage, no car note, no boat note, ZERO debt.

If all it took was 700k, I could have went yesterday.

gingersnap
04-01-2012, 03:38 PM
I hope to retire at age 60 (6 years from the day before yesterday).

Maxing out 401k contributions for the last 8 years and plan to for the next 6 years. Currently I can contribute 17,500 + 5,500 (catch-up for 50 and over).

I will have no pension upon retirement. Instead of a pension my company contributes an amount equal to 4% of my yearly gross income to my 401k. They will match up to an additional 6% of my gross income that I contribute dollar for dollar. My contribution by percent exceed the max that the company will match, but I contribute the max allowed (17.5k + 5.5k).

I have no mortgage, no car note, no boat note, ZERO debt.

If all it took was 700k, I could have went yesterday.

You'll do fine on that 13 acres. :thumbsup:

Montauk Rocket
04-01-2012, 03:42 PM
Shit. You guys are making me nervous...

SeaNile
04-01-2012, 04:31 PM
Shit. You guys are making me nervous...

Make that two of us!

RussH
04-01-2012, 04:43 PM
No I haven't contributed into any kind of Roth IRA, or anything else for that matter. I am going to start to do that now.

The company will only allow 3% because I'm a highly compensated employee. Backtothesea explained how it works.

I don't make any where near $450K a year.

2 million dollars! Are you serious? I won't have any where near that kind of money.

seabob4
04-01-2012, 06:02 PM
What is this "retirement" word you speak of?;?;?

08087
04-01-2012, 06:13 PM
Hey my sky isn't falling but let another depression hit us just when your about to retire and see how fast you say "Shit I have to work until things turn around", let your pension plan go belly up and see if your in the crapper, it happens all the time to the other guy.

Personally I don't count on my pension or SS, if it's around when I retire it'll be play money, same as with my wife.

triumphrick
04-01-2012, 06:35 PM
[quote=JoeyM;4492533

i may live crazy right now, but i would be perfectly happy to live much more modestly when i'm older.


.[/quote]


This is how it worked out for me...as well as having a younger wife who still works, and enjoys her job...:thumbsup:

GulfC
04-01-2012, 06:45 PM
Shit. You guys are making me nervous...

Make that 3 of us. About $1500-1600/month covers the have to live bills around here.

My Turn
04-01-2012, 07:23 PM
The only problem is that the S&P 500 is actually lower than it was in 2000, that is twelve years of lost potential gains. This is a huge problem for anyone relying on a 401k for their retirement.

That is why you need a portfolio diversified across many asset classes including real estate, PMs, bonds, tips international emerging markets etc etc. Unless you can predict the future you need to be diversified and not be greedy. It is not too hard to put together a portfolio that has returned at least 7-9% over any 10, 20, 30 year period you care to back test it against. Talk to a good fee-based financial planner or do your own research on asset allocation.

Cracker
04-01-2012, 08:00 PM
Glad I have a pension... One of the main reasons I chose Govt work.... I will retire from my current job in 3.5 years at 50 but I can go whenever I want. I will continue to work at something till I am 55 maybe older. It wont take alot to let me survive...I am set to make very close to my current salary when I retire at 50 anything on top of that is just fishing and traveling money..

Back-in-Black
04-01-2012, 08:01 PM
Oh, BTW.... My IRA is a ROTH, so once I start drawing on it, I'm not paying any income taxes on that income. So, I'll basically be paying taxes on my SS only. For standard IRAs and other savings, consider that you may have to pay income tax on that, and who knows what that rate is going to be by the time we retire...


Pretty sure with a Roth you will still be paying income tax on the interest earned... just not the original principle investment.

I went both ways... Roth and Conventional.

magua
04-01-2012, 08:30 PM
If/when you are serious about your retirement you will need to come up to speed on global economics and where it is headed ... and trends.

What do you get from the chart below?

Green is the SP 500
Red is the breadth of stock being sold by the companies' own employees.

http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012/03/Insider%20Selling.jpg


Russ, when you look at that chart, what does it tell you? You should be seeing that people are dumping the stock of the company they work for in record numbers the likes of which have never been seen before. These are folks that 'know' the company, know the product, know the market for that product ... And they aren't willing to risk the stock market.

It should also tell you the average 'joe' is not in the market, is sitting on the sidelines. So, who is 'in'? Institutional investors. And they are spinning the hype about the market making a come back. It hasn't, but they need you to believe it to get the average 'joes' to invest in the market, to drive up stocks, then the institutional investors will bail, leaving the joes holding the loses. Another transfer of wealth. What did Morgan Stanley's research have to say about this as recently as March 30, 2012:


The recent divergence between the GDP arithmetic and labor demand is unusual - but not unheard of. Most importantly, this combination implies a significant slowdown in productivity, which is somewhat troublesome, given the sub-par productivity performance that was already evident in 2011. A continuation of these trends would imply a significant deterioration in corporate profitability at some point in the not too distant future.

http://www.morganstanley.com/views/gef/



What I get from that is if you are not in the market, don't get into it. If you are in it, you may want to consider getting out.

Me thinks the quality of future retirements will be directly proportional to tangible property owned. Austerity is going to be uncomfortable for a lot of folks. The first incarnation of austerity is already here. You are hearing about it, but under a different presentation -- it is presented as taxing the millionaires. The revenue realized from that "tax" won't float our govt for more than a few minutes, literally. But it would be the camel getting his nose into the tent. Once austerity is up and running it is the retired govt employees that will get hit hard. Anyone with liquid assets will also be targeted -- and other assets like your 401K and IRA accounts. Remember, the 1st year the Clintons were in the white house Hillary proposed a 25% across the board confiscation of all retirement savings. In Europe, everyone that knows the reality of the failed experiment, the Euro, has liquidated their assets and reinvested their personal wealth in tangible property -- metals and real estate.

The world as a whole is changing. How money is used is changing. Sweden is now just short of being totally currency-less -- almost all monetary transactions in Switzerland are now electronic.

http://sovereign-investor.com/2012/03/19/digital-currency-use-on-the-rise-in-sweden/

If you are uncomfortable with that, the idea of your personal wealth being electronic, it is because you have a sense of the value of something tangible, in this case, the ability to hold your wealth (currency) in your hand. The financiers of Europe are taking that caution one step further and apply it to their future (call it their retirement or whatever).

Me thinks anyone depending on a savings account for their retirement, govt bonds for their retirement, stocks for their retirement, mutual funds for their retirement ... are gambling with their retirement.

There are a couple of things not lost on me, but not fully appreciated, yet, either. (1) the 'dollar' runs in a 40-year cycle. It changes an how it is used and how it is valued. We are in year 42. (2) the world as a whole wants to drop the dollar as the reserve currency. They are just 7-years behind Bill Gates. He shorted the dollar in 2005, saying the GDP to debt ratio was unsustainable. That was 7-years ago, 7-years before the debt crossed over the entire GDP. The BRIC countries (Brazil, Russia, India, China) have already come together to start a new bank with the goal of a new global reserve currency to replace the dollar. If that doesn't have anyone rethinking the value of owning precious metals ...

For the long haul, tangible property ... unless, of course, your crystal ball tell your different than my crystal ball tells me. :grin:


sounds like a repeat of the early 90's and the buzz of that era "New World Order"

magua
04-01-2012, 08:41 PM
Hey my sky isn't falling but let another depression hit us just when your about to retire and see how fast you say "Shit I have to work until things turn around", let your pension plan go belly up and see if your in the crapper, it happens all the time to the other guy.

Personally I don't count on my pension or SS, if it's around when I retire it'll be play money, same as with my wife.

SS will be around. Because... they will "never" stop collecting it. This is probably one of the only times when you can actually use the word "never" literally.

Now how they distribute the collected stipends well that will be another discussion sometime in the not so distant future.

Eyeball
04-01-2012, 09:04 PM
Hey my sky isn't falling but let another depression hit us just when your about to retire and see how fast you say "Shit I have to work until things turn around", let your pension plan go belly up and see if your in the crapper, it happens all the time to the other guy.

Personally I don't count on my pension or SS, if it's around when I retire it'll be play money, same as with my wife.


What I was trying to impress upon Russ is that it won't be a "retirement" ... he needs to be positioning for the future.

Huge fuggin' irony with what I wrote earlier today. Tonight, on talk radio, Michael Coffman, PhD was pimping his new book, 'Plundered' -- how progressive ideology is destroying America. He said pretty much everything I wrote on the previous page. He also went into more detain about the reserve currency being created by the BLOCS countries and how China is buying as much gold as she can, and as many gold mining companies a she can get her hands on on in preparation for her currency replacing the US dollar as the new world reserve currency. He also said the fall of the American dollar is projected toward the end of this year, at the earliest. He started writing his book in 2000 -- 12-years ago.

I tad off topic, and a touch political, but definitely inline with the query of this thread and the suggestion to be looking to the future. Things are changing, the whole idea of "retirement" is being redefined right under our feet.

http://www.americaplundered.com/

Eyeball
04-01-2012, 09:13 PM
SS will be around. Because... they will "never" stop collecting it.



You don't understand. All of the money collected for SS accounts ... ALL of it has already been spent by Congress. There is nothing there, nothing left. We (the US) literally borrow the money we need to pay current SS obligations every month. At some point the cost to those that are still working to support the govt pensions and SS obligations of those that are retired becomes too much of a burden and the absolute need for austerity manifests. Those on govt pension will have their pension payment size cut. Those receiving SS payments will see the payment size cut. Those not eligible to collect SS for some year down the road will be told not to depend on it being there.

fijon
04-01-2012, 09:31 PM
leave this world penniless................ not a bad plan my friend

I've yet to read the next four pages, so I apologize for being redundant but we will all leave this world penny less.:)

fijon
04-01-2012, 09:41 PM
Glad I have a pension... One of the main reasons I chose Govt work.... I will retire from my current job in 3.5 years at 50 but I can go whenever I want. I will continue to work at something till I am 55 maybe older. It wont take alot to let me survive...I am set to make very close to my current salary when I retire at 50 anything on top of that is just fishing and traveling money..

Smart move. Just thank the rest of us.:(

Eyeball
04-01-2012, 10:35 PM
Glad I have a pension... One of the main reasons I chose Govt work.... I will retire from my current job in 3.5 years at 50 but I can go whenever I want...I am set to make very close to my current salary when I retire at 50 anything on top of that is just fishing and traveling money.



Did you put this money away for yourself ... or do you have (now unrealistic) expectations that someone else is going to fund this lush retirement of yours, and if so ,who? ;?

One word ... austerity. I think California is now looking at almost $1-trillion of unfunded govt retirement benefits. Where is that money going to come from? ;? It's not just Calif ... it is the same everywhere -- promise the govt employee unions whatever, and delay funding the retirement portion.

To fund all of the unfunded, guaranteed retirements of federal, state, and local government employees and Soc Sec is a burden of just over $513,000.00 per household. In other words, it ain't gonna happen. Govt pensions alone are a $27,000.00+ liability for every household. Again, it ain't gonna happen.

Again, thinking about "retirement" is yesterday. Today, you need to be thinking about how YOU are going to provide for your future. Now, about that job driving a Walmart golf cart around the parking lot ... :grin:

strikerthree
04-02-2012, 02:23 AM
Between my pension, 401k, stock dividends, and the income from a partnered business we should be ok even without the business we'd be ok, SS would just be a bonus if it's still around

GulfC
04-02-2012, 03:06 AM
This is an interesting thread with nearly everyone's perception of retirement. While living here in retiree mecca, I've observed nearly all the young retirees (say under 60'ish) are still working in some manner. They've simply retired from the main job of 30-40 years, have that income and are continuing on in another line of work.

I'm actually right on the cusps of leaving the daily grind of over 30 years but have no plans to stop working all together. In fact, the main reason I'll leave will simply to be to work on my own where I can make my own schedule.

yarcraft91
04-02-2012, 04:41 AM
Pretty sure with a Roth you will still be paying income tax on the interest earned... just not the original principle investment.

I went both ways... Roth and Conventional.

Roth withdrawals are not taxed. Period. Otherwise, they would be no different than a conventional IRA funded with after-tax contributions.

yarcraft91
04-02-2012, 04:50 AM
Did you put this money away for yourself ... or do you have (now unrealistic) expectations that someone else is going to fund this lush retirement of yours, and if so ,who? ;?

One word ... austerity. I think California is now looking at almost $1-trillion of unfunded govt retirement benefits. Where is that money going to come from? ;? It's not just Calif ... it is the same everywhere -- promise the govt employee unions whatever, and delay funding the retirement portion.

To fund all of the unfunded, guaranteed retirements of federal, state, and local government employees and Soc Sec is a burden of just over $513,000.00 per household. In other words, it ain't gonna happen. Govt pensions alone are a $27,000.00+ liability for every household. Again, it ain't gonna happen.

Again, thinking about "retirement" is yesterday. Today, you need to be thinking about how YOU are going to provide for your future. Now, about that job driving a Walmart golf cart around the parking lot ... :grin:

Nonsense. There may be some bumps in the road, but I expect all, or almost all, the pension obligations will be met. Stop worrying about that.

The thing to worry about is that inflation may reduce the buying power of those not-indexed-for-inflation pension payments by 50%-75%. If you weren't working during the inflationary period of the 1970's (think 14-15%/year), you might not imagine how fast that can happen and how badly retirees can be hurt by it.

At the rate money has been created under the past few administrations, we must expect inflation will come- no matter what Bernanke and the other talking heads tell us. We have already seen their ability to predict the economy. Inflation fueled by reckless government spending and money creation, is just another way we are taxed.

cross21114
04-02-2012, 05:18 AM
Here are some facts for 2011 for my mother who we had in assisted living (she passed away this February). Expenditures $146k(does not include income taxes or any other expenditures which were not living expenses), SS receipts $33k. Fortunately, my father left her well provided for so she lived a quality lifestyle for 14 years after his death until her end.
I certainly do not want to go out the way she did but don't know if I'll be able to do anything about it when I get like that.
This is, I think, the fundamental problem - how do you stop spending money just to stay alive. Turns out to be pretty philisophical. I'd like to be able to leave something for my grandkids as I am really concerned about the future the way things are going.

Cracker
04-02-2012, 05:27 AM
Smart move. Just thank the rest of us.:(

Actually I contributed about 25 percent of my pension myself and trust me, it is much like the military, in so far as it has not been easy work...

hblac
04-02-2012, 06:14 AM
Roth withdrawals are not taxed. Period. Otherwise, they would be no different than a conventional IRA funded with after-tax contributions.

Your principle investment in a Roth is after-tax BUT You will have to pay taxes on any gains your investment earned at your regular tax rate which I assume will be lower once retired.

My Turn
04-02-2012, 06:15 AM
I chuckle when I hear people say SS will run out of money.

SS and the USA will never run out of money. It can not happen. What will continue to happen is the systemic theft from the american people via inflation that essentially began in 1913 with the birth of the fed and the IRS (yup, both in the same year). If you are anywhere near retirement you will get every penny promised you unless they change the law to means test it. Trouble is, every year the buying power of those pennies erodes. Our dollar has lost 90 some percent of its purchasing power since the birth of the fed and the handing over of our banking system to the banking families. read this: http://www.jekyllislandhistory.com/federalreserve.shtml

This is the key factor that stands in the way of extended prosperity.

Anther thing I get a kick out of is the knee jerk reaction to insider selling. The WSJ has published insider buying and selling data each week since forever. The data has been lopsided toward selling forever. The reason is that most of those shares are never "bought" by those insiders on the open market, they are options and outright gifts as bonuses to execs.

My Turn
04-02-2012, 06:17 AM
Your principle investment in a Roth is after-tax BUT You will have to pay taxes on any gains your investment earned at your regular tax rate which I assume will be lower once retired.

Incorrect. Under current law all withdrawls from Roth IRA are tax free. If you withdraw the money, invest the withdrawls, make interest, dividends or CGs on that money withdrawn then those earnings are taxable, but there is no reason to do that since I believe there are no RMDs for roths.

yarcraft91
04-02-2012, 06:20 AM
Your principle investment in a Roth is after-tax BUT You will have to pay taxes on any gains your investment earned at your regular tax rate which I assume will be lower once retired.

No. Roth withdrawals are not subject to income tax. It does not matter how much you earned within the Roth. The tax treatment you describe applies to conventional IRAs funded by after-tax contributions.

My Turn is correct- Roths also do not have Required Minimum Distributions. You can turn the entire Roth over to your heirs, no matter how long you live. Inheriting a Roth is a much better deal than inheriting a conventional IRA, because both are subject to estate tax, but only the IRA is subject to income tax on withdrawals..

jrolin1
04-02-2012, 06:22 AM
Your principle investment in a Roth is after-tax BUT You will have to pay taxes on any gains your investment earned at your regular tax rate which I assume will be lower once retired.

Hmm..

"In contrast to the 401k plan, the Roth plan requires post-tax contributions, but allows for tax free growth and distribution, provided the contributions have been invested for at least 5 years and the account owner has reached age 59 and a half. The amounts of income that can be invested in a Roth IRA are significantly more limited than those to a 401(k) are. For 2008, individuals are limited to contributing no more than $5,000 to a Roth IRA, if under age 50, and $6,000, if age 50 or older."

http://en.wikipedia.org/wiki/Roth_401%28k%29

yarcraft91
04-02-2012, 06:29 AM
Hmm..

"In contrast to the 401k plan, the Roth plan requires post-tax contributions, but allows for tax free growth and distribution, provided the contributions have been invested for at least 5 years and the account owner has reached age 59 and a half. The amounts of income that can be invested in a Roth IRA are significantly more limited than those to a 401(k) are. For 2008, individuals are limited to contributing no more than $5,000 to a Roth IRA, if under age 50, and $6,000, if age 50 or older."

http://en.wikipedia.org/wiki/Roth_401%28k%29

In 2010, I converted my entire IRA balance to a Roth. I'll pay the taxes in 2011 and 2012. With zero IRA balance, I can make future contributions to the IRA (my income prevents direct Roth contributions), but then immediately convert the IRA funds to a Roth with no further tax consequences. So, there is a way around the upper income limit on Roth contributions.

LMychajluk
04-02-2012, 06:40 AM
Hmm..

"In contrast to the 401k plan, the Roth plan requires post-tax contributions, but allows for tax free growth and distribution, provided the contributions have been invested for at least 5 years and the account owner has reached age 59 and a half. The amounts of income that can be invested in a Roth IRA are significantly more limited than those to a 401(k) are. For 2008, individuals are limited to contributing no more than $5,000 to a Roth IRA, if under age 50, and $6,000, if age 50 or older."

http://en.wikipedia.org/wiki/Roth_401%28k%29

Keep reading...

For example, normal Roth IRA contributions are limited to $5,000 ($6000 if age 50 or order); whereas, up to $17,000 could be contributed to a Roth 401(k) account, provided no other elective deferrals were taken for the tax year (no traditional 401(k) deferrals taken).


Roth IRA <> Roth 401k, but both contributions are post-tax, and do not incur any income taxes on the interest or the distributions provided all the other requirements are met (59 1/2yo, etc...). Unlike Roth IRAs, there is an RMD for Roth 401k's starting at age 70 1/2.

Kamper
04-02-2012, 06:56 AM
It's going to vary depending on how much the person/family expect to spend. The guy that retired at 62 may have bought a house 25 years ago for less than 1/4 of what it's worth now. If it's been refinanced without drawing out equity their current payment could be less than what a current buyer would pay in interest for an identical property.

A well managed mutual fund averages about 10% over time so you might think you need to invest 10 times your desired income.There will be downturns though where you might get far less and actually lose value in your principle.

Also, when you get to the point you are actually ready to retire many advisers suggest you switch to stable investments like T-Bill funds that have a low but almost guaranteed return. These are typically paying 3%. When or if to make the change-over depends on your toleraance for risk. If the market is up that's a better time but if it goes down, you may need to work a while longer to recover or for the market to brng up your investment value again.

There are too many variables to get effective advice here. You should speak with a financial adviser or at least read a few books on the subject. Avoid any scheme that implies miracle returns.

And that's all I think I know about that.

Good luck!

jrolin1
04-02-2012, 08:20 AM
In 2010, I converted my entire IRA balance to a Roth. I'll pay the taxes in 2011 and 2012. With zero IRA balance, I can make future contributions to the IRA (my income prevents direct Roth contributions), but then immediately convert the IRA funds to a Roth with no further tax consequences. So, there is a way around the upper income limit on Roth contributions.

Cool, I did not know that. My post was just to point out (as others already had- I must type slow) that Roth distributions are not taxed even for earning from the investments.

yarcraft91
04-02-2012, 08:49 AM
Cool, I did not know that. My post was just to point out (as others already had- I must type slow) that Roth distributions are not taxed even for earning from the investments.

The IRA conversion to Roth IRA option is a provision not so many people know about and it may not be there for long, but I'm using it while I can. It helped to fully convert my existing IRAs to Roth IRA during a big financial downturn- minimized the taxes on the conversion. Now, all subsequent conversions are tax-free. :)

Eyeball
04-02-2012, 09:36 AM
Nonsense. There may be some bumps in the road, but I expect all, or almost all, the pension obligations will be met. Stop worrying about that.

The thing to worry about is that inflation may reduce the buying power of those not-indexed-for-inflation pension payments by 50%-75%.

At the rate money has been created under the past few administrations, we must expect inflation will come- no matter what Bernanke and the other talking heads tell us.



It is not nonsense, and it is front and center, an issue that is growing increasingly more difficult to ignore. When austerity is laid down on govt retirements, indexing for inflation will be meaningless.

You are 100% spot on about inflation eroding the purchasing power of a retirement check. There is only one way out of the fiscal mess we got ourselves into, and that is to turn on the printing presses. QE, part 3, should start anytime now.

We have a unique disadvantage in that 2 out of every 3 dollars are in circulation outside of the US. When a replacement world reserve currency is put in place (a few out, at least) those dollars are going to come home. Can you image post-WW1 Germany, a loaf of bread costing $500. Today, in Zimbabwe it takes a wheelbarrow full of cash to buy a loaf of bread. That is the default for the US unless the rest of the world is kind enough to keep holding onto the worthless US dollar.

http://goldnews.bullionvault.com/files/Infl8.png



Again, thinking of a "retirement" is yesterday. You should be thinking of how you will fund your future.

kevincook
04-02-2012, 09:56 AM
Your principle investment in a Roth is after-tax BUT You will have to pay taxes on any gains your investment earned at your regular tax rate which I assume will be lower once retired.

That isn't correct. Everything you withdraw is tax free....that is the whole point of a Roth.

Kevin

yarcraft91
04-02-2012, 03:19 PM
It is not nonsense, and it is front and center, an issue that is growing increasingly more difficult to ignore. When austerity is laid down on govt retirements, indexing for inflation will be meaningless.

Ok, so "nonsense" may be too strong a word. Here's what I was thinking.

That $95,000/year non-indexed pension some employee is due to receive will be easy to pay if the gov't has so thoroughly inflated our currency that $5,000 won't even buy a dinner out for you and the missus.

As to people with inflation-indexed pensions, I expect them to get screwed, too. I notice the people who calculate inflation seem to ignore some fairly common purchases, like energy and food- today. Who knows how they will choose to calculate inflation in the future?

Government can inflate its way out of their current financial crisis, by turning their crisis into everyone else's. Inflation is an insidious tax- one of the scariest we face. As you point out, it is not really under our control anymore.

LMychajluk
04-02-2012, 05:03 PM
The hedge to inflation is gold (and silver).

The way I heard it explained once was:

Around 1960, a silver dime would buy a loaf of bread. An once of gold would buy a very nice suit.

Today,with inflation, the equivalent amount of silver in that 1960s dime would buy a loaf of bread. An once of gold would still buy a very nice suit.

The value of goods hasn't changed, just the value of the currency.

If the gov't starts outlawing the ownership of gold and silver (again), watch out....

cudacat
04-03-2012, 06:34 AM
I am retiring in 25 days.:thumbsup:

I am 56 yrs old. My wife is retired and she is 54 yrs old. We have $1Mil in investments (a lot of annuities) and I will have retirement through defined benefit pension. I am figuring on $120K per month. Other than one car payment, I don't owe any money. I have land valued at about $1 mil, that I want to make sure I leave close to that much cash for my two kids, if one wants to buy out the other ones half of the land when we are gone. I will let you know if a year if $120K is enough. No offshore boat on that salary.

RussH
04-03-2012, 06:39 AM
I am retiring in 25 days.:thumbsup:

I am 56 yrs old. My wife is retired and she is 54 yrs old. We have $1Mil in investments (a lot of annuities) and I will have retirement through defined benefit pension. I am figuring on $120K per month. Other than one car payment, I don't owe any money. I have land valued at about $1 mil, that I want to make sure I leave close to that much cash for my two kids, if one wants to buy out the other ones half of the land when we are gone. I will let you know if a year if $120K is enough. No offshore boat on that salary.

Congrats on your retirement at such a young age. You will need a lot of retirement money to last you since you are so young. I know I won't be able to retire until I'm at least 62. You obviously planned very well and must have started very early saving money.

Russ

thermasystems
04-03-2012, 06:43 AM
Make that 3 of us. About $1500-1600/month covers the have to live bills around here.

:thumbsup::thumbsup:

My Turn
04-03-2012, 07:50 AM
I am retiring in 25 days.:thumbsup:

I am 56 yrs old. My wife is retired and she is 54 yrs old. We have $1Mil in investments (a lot of annuities) and I will have retirement through defined benefit pension. I am figuring on $120K per month. Other than one car payment, I don't owe any money. I have land valued at about $1 mil, that I want to make sure I leave close to that much cash for my two kids, if one wants to buy out the other ones half of the land when we are gone. I will let you know if a year if $120K is enough. No offshore boat on that salary.

Big question is, will you be able to squeak by on $120,000 per month?:)

cycler
04-03-2012, 12:04 PM
Re: how much is necessary, I was under the impression that 80% of your current income, providing there is no outstanding debt involved, was the amount necessary. Of course everyone makes different levels of income and so on, but, I always heard that the 80% was the minimum to consider. One of my co-workers is 71 yrs old and he says the most common conversations he has with his peers, who are retired are rising medical costs (co-pays) and did not save enough.

Gator56
04-03-2012, 12:21 PM
Just have a bunch of kids and live in free housing and get a check for each kid plus food stamps every month and you never have to work all you have to be is fertile enough to get pregnant.

cudacat
04-03-2012, 12:58 PM
I am retiring in 25 days.:thumbsup:

I am 56 yrs old. My wife is retired and she is 54 yrs old. We have $1Mil in investments (a lot of annuities) and I will have retirement through defined benefit pension. I am figuring on $120K per month. Other than one car payment, I don't owe any money. I have land valued at about $1 mil, that I want to make sure I leave close to that much cash for my two kids, if one wants to buy out the other ones half of the land when we are gone. I will let you know if a year if $120K is enough. No offshore boat on that salary.

Sorry - let me correct - $120,000 a year - not a month. $10K per month. If I could make $120,000 per month, I would already be retired.:thumbsup:

edale99
04-03-2012, 01:01 PM
$2million with no debt would do it for me. Not depending on any pension being there or social security.

RussH
04-03-2012, 02:55 PM
Just have a bunch of kids and live in free housing and get a check for each kid plus food stamps every month and you never have to work all you have to be is fertile enough to get pregnant.

Ain't that the stinking truth! :mad:

It amazes me that some people can get free education, free rent, free food, and free hospitalization, while the rest of us working people have to pay for all of these things PLUS save for retirement. What a f'ed up government we have.

cedarholm
04-03-2012, 03:00 PM
Ain't that the stinking truth! :mad:

It amazes me that some people can get free education, free rent, free food, and free hospitalization, while the rest of us working people have to pay for all of these things PLUS save for retirement. What a f'ed up government we have.

Doesn't seem 'fair' does it?

Screw the death panels, let's set up some 'Work panels'.

LI Sound Grunt
04-03-2012, 03:12 PM
I was able to comfortably retire at age 53 ten years ago and gave up an easy 6 figure job and everyone said I was nuts. But the only part I regretted was after a few years I got bored and finally got a retirement job and am now totally happy as ever. So here are a few thoughts to consider.

Almost all retirees I know work part time or more in jobs they love. Many jsut to keep busy. If you do not have a hobby or other interests to keep you busy you will go nuts.

Ahere are often unplanned for expenses. If you have all that free time you may travel more or take up other more expensive interests and hobbies.

Your estimated social security assumes you work until full retirement age - and although there is no penalty per se for retiring early but you may end up having low or no income years averaged into your basis an dwill likely get less than those estimated statements state.

Good Luck - have fun!

DavenFla
04-03-2012, 05:00 PM
Just have a bunch of kids and live in free housing and get a check for each kid plus food stamps every month and you never have to work all you have to be is fertile enough to get pregnant.

Gator... I know this is popular belief but do you actually "know" someone like that?

I taught a "how to live after divorce" and if the "fathers" actually had the balls to do what a man should do,that is; provide for the children they help create, then most of your "personal observations" would go away.

... just sayin'

Eyeball
04-03-2012, 05:36 PM
From the Future Tense blog. It is the last line that got my attention! It is exactly what I have been talking about when posting to this thread ... it isn't about retirement, it is about securing the funding for your future. If you are depending on a retirement from a source other than your own saved wealth, you are dependent on a Ponzi scheme ... and all indications are no Ponzi scheme is going to survive what is coming down the road.


http://4.bp.blogspot.com/-JSZ14MORsjo/T3uMKhXmfqI/AAAAAAAAB_4/25uyAlD06zo/s1600/%28%29+Old+Vs.+Youth+1.jpg


http://3.bp.blogspot.com/-qzrSaFZvvoU/T3uMEzEP2BI/AAAAAAAAB_w/G2zTnzg6Hck/s1600/%28%29+Old+vs.+Youth+2.jpg


http://2.bp.blogspot.com/-6liBpWDSG9M/T3uL_lk1mrI/AAAAAAAAB_o/QXO6Olu6B4o/s400/%28%29+Old+Vs.+Youth+3.jpg


The boomers are ready for a retirement funded by the younger working generation who want no part of that funding. Something will soon have to give.


http://www.ftense.com/

magua
04-03-2012, 06:00 PM
It's going to vary depending on how much the person/family expect to spend. The guy that retired at 62 may have bought a house 25 years ago for less than 1/4 of what it's worth now. If it's been refinanced without drawing out equity their current payment could be less than what a current buyer would pay in interest for an identical property.

A well managed mutual fund averages about 10% over time so you might think you need to invest 10 times your desired income.There will be downturns though where you might get far less and actually lose value in your principle.

Also, when you get to the point you are actually ready to retire many advisers suggest you switch to stable investments like T-Bill funds that have a low but almost guaranteed return. These are typically paying 3%. When or if to make the change-over depends on your toleraance for risk. If the market is up that's a better time but if it goes down, you may need to work a while longer to recover or for the market to brng up your investment value again.

There are too many variables to get effective advice here. You should speak with a financial adviser or at least read a few books on the subject. Avoid any scheme that implies miracle returns.

And that's all I think I know about that.

Good luck!

If my financial planner or anyone lobbying to help in investment decisions said "A well managed mutual fund averages about 10% over time so you might think you need to invest 10 times your desired income."

No warmups,no jumping jacks,no wasting anymore time I am running not walking away.

magua
04-03-2012, 06:05 PM
The IRA conversion to Roth IRA option is a provision not so many people know about and it may not be there for long, but I'm using it while I can. It helped to fully convert my existing IRAs to Roth IRA during a big financial downturn- minimized the taxes on the conversion. Now, all subsequent conversions are tax-free. :)

They had it in the 90's a way better deal than 2010.

You were allowed 5 years to amoritize the taxes paid on the conversion.

Actually you are far better of waiting until another 2008 debacle.

In a perfect world your 500k 401k goes to 200k or less you convert the "shares" in those funds (do not liquidate) and pay far less tax on the conversion that way. The market rebounds as it does always and you have a sizeable sum of tax free greenbacks in your porfolio.

GulfC
04-03-2012, 06:13 PM
Gator... I know this is popular belief but do you actually "know" someone like that?

I taught a "how to live after divorce" and if the "fathers" actually had the balls to do what a man should do,that is; provide for the children they help create, then most of your "personal observations" would go away.

... just sayin'

It's done via supposed "earned income" Dave. By not calling it welfare politicians are able to dole it out without observance or recognition by the general population.

Poppin cork
04-05-2012, 05:39 AM
I am 32 years old and I am contributing 10% a year to my 401k with a 3% match. Starting next year my tax refund and half of my next raise will go to a Roth IRA. In three years I plan on being debt free contributing 20% to retirement. I don't expect I will ever see much from social security. It will be a bonus.

Unfortunately being in construction my salary is not what it used to be. But with a turn in the economy coming someday. Hopefully I will be able to up my savings to more than 20% while buying a house with a fifteen year mortgage instead of a thirty. When that house is paid off it will be rented out and I will buy another on a fifteen year note. I love new boats and trucks but I like not having debt even more.

DavenFla
04-05-2012, 06:47 AM
I am 32 years old and I am contributing 10% a year to my 401k with a 3% match. Starting next year my tax refund and half of my next raise will go to a Roth IRA. In three years I plan on being debt free contributing 20% to retirement. I don't expect I will ever see much from social security. It will be a bonus.

Unfortunately being in construction my salary is not what it used to be. But with a turn in the economy coming someday. Hopefully I will be able to up my savings to more than 20% while buying a house with a fifteen year mortgage instead of a thirty. When that house is paid off it will be rented out and I will buy another on a fifteen year note. I love new boats and trucks but I like not having debt even more.

Good economic plan... but don't forget you'll need recreational therapy :grin:along the way. Don't miss out on what life has to offer, while planning for the future. Buy that boat and truck...if you have to, just buy the used one that fit the budget.

I have a friend who had a "plan", executed to perfection, life was gonna be fun now ... and that plan changed... had a stroke. :(

Remember Perfection Produces Procrastination

Cracker
04-05-2012, 08:21 AM
Good economic plan... but don't forget you'll need recreational therapy :grin:along the way. Don't miss out on what life has to offer, while planning for the future. Buy that boat and truck...if you have to, just buy the used one that fit the budget.

I have a friend who had a "plan", executed to perfection, life was gonna be fun now ... and that plan changed... had a stroke. :(

Remember Perfection Produces Procrastination

There is a lot of truth to that...My wife's first husband died very young...While it is good to be smart about the future, dont forget about the present and live your life.. We contribute toward retirement but we also live for today and enjoy ourselves..:thumbsup:

Poppin cork
04-05-2012, 08:31 AM
Good economic plan... but don't forget you'll need recreational therapy :grin:along the way. Don't miss out on what life has to offer, while planning for the future. Buy that boat and truck...if you have to, just buy the used one that fit the budget.

I have a friend who had a "plan", executed to perfection, life was gonna be fun now ... and that plan changed... had a stroke. :(

Remember Perfection Produces Procrastination

I just bought a airboat, have the truck and my dad has a bay boat that I use most weekends in the summer. I just make priorities. I brown bag my lunch to work so that I can fish on the weekends. Still have my share of fun just make sure I have my priorities set.

Eyeball
04-05-2012, 08:40 AM
Also, when you get to the point you are actually ready to retire many advisers suggest you switch to stable investments like T-Bill funds that have a low but almost guaranteed return. These are typically paying 3%.



Please correct me if I am wrong, but isn't that 3% the 2007 pre-crash rate? I think today's 1-year t-bill is closer to 0.2%. There is a line of thought that suggests 6-mo and less t-bills are a good place to park your money instead of leaving it in a bank. Banks or t-bills ... you aren't going to get a return on either these days. Money is t-bills is safe than money in the bank.

DavenFla
04-05-2012, 10:55 AM
I would add... there is also a high risk if your to "careful", you can run out of money. You must diverisfy, including stock and real estate. At todays rates, T-bills, CD's etc. = money under the matress... although I prefer mason jars in the back yard.:grin:

Stable, proven returns in the form of dividends from good companies are much better than T bills.

Eyeball
04-05-2012, 12:18 PM
Stable, proven returns in the form of dividends from good companies are much better than T bills.



T-bills can offer a safer (than a bank) form of liquidity that allows for prompt action when the time is right, e.g. we are about to come into a phenomenal invest opportunity in residential real estate.

When it happens (note the lack of an "if") it will happen overnight. You will wake up to a 'bank holiday' and limited withdrawls after that. All eyes are on Germany and April 30th (25-days away).

Consider:

Consorting With The Other Side - Fortune broke an interesting story on a private lunch that Bernanke had with some key bankers. Here’s a bit:

FORTUNE -- After completing a series of public lectures in Washington, D.C. last week, Federal Reserve Chairman Ben Bernanke quietly slipped into New York City for a private luncheon on Friday with Wall Street executives.

Fortune has learned that attendees included Jamie Dimon (J.P. Morgan), Bob Diamond (Barclays), Brady Dougan (Credit Suisse), Larry Fink (Blackrock), Gerald Hassell (Bank of New York Mellon), Glenn Hutchins (Silver Lake), Colm Kelleher (Morgan Stanley), Brian Moynihan (Bank of America), Steve Schwarzman (Blackstone Group) and David Vinar (Goldman Sachs).

Sources say Bernanke spoke at length about monetary policy, in an apparent effort to persuade attendees that they needed to take a more active role in helping to deal with the European debt crisis. He spent virtually no time discussing regulation, although that mantle got taken up by both Dimon (domestic regulation) and Schwarzman (global regulation).

http://finance.fortune.cnn.com/2012/04/04/exclusive-bernanke-breaks-bread-with-top-bankers/?iid=SF_F_LN

triplenet
04-05-2012, 12:23 PM
we are about to come into a phenomenal invest opportunity in residential real estate.[/URL]

OMFG - I cant believe you actually said this - Are you off your meds again brother :grin:


http://cdn1.newsone.com/files/2010/03/buck_wheat.jpeg

magua
04-05-2012, 03:54 PM
OMFG - I cant believe you actually said this - Are you off your meds again brother :grin:


http://cdn1.newsone.com/files/2010/03/buck_wheat.jpeg

you could look at that from a couple of different angles.

1. you currently are over leveraged in real estate

2. your currently diversified away from real estate and can re - balance

the latter of course would be the opportunity investors would be looking for

RussH
04-05-2012, 04:19 PM
Dang, I never knew I could possibly learn this much when I started this thread! Amazing amount of info, some conflicting, but educational none-the-less.

Thanks guys!


Russ

DavenFla
04-05-2012, 04:22 PM
T-bills can offer a safer (than a bank) form of liquidity that allows for prompt action when the time is right, e.g. we are about to come into a phenomenal invest opportunity in residential real estate.

When it happens (note the lack of an "if") it will happen overnight. You will wake up to a 'bank holiday' and limited withdrawls after that. All eyes are on Germany and April 30th (25-days away).



;?

triplenet
04-05-2012, 04:27 PM
you could look at that from a couple of different angles.

1. you currently are over leveraged in real estate

2. your currently diversified away from real estate and can re - balance

the latter of course would be the opportunity investors would be looking for

I was just messing with him :)...

I am a huge proponent of residential real estate... There are some serious bargains if you do your due diligence....

10 years from now people will be seriously disappointed they didnt buy between 2009-2013 .
I hope ;)

magua
04-05-2012, 05:37 PM
I was just messing with him :)...

I am a huge proponent of residential real estate... There are some serious bargains if you do your due diligence....

10 years from now people will be seriously disappointed they didnt buy between 2009-2013 .
I hope ;)

I could buy into the 10 year ROI. Most who bought closer to 2013 will have more margin imo.

What happens to the real estate market post 2012 - no more short sales will be the wildcard.

Schmaltz~Herring
04-05-2012, 05:43 PM
If O'bama gets to screw us for another 4 years, I'll need a bazillion dollars or at least a megamillions winner.

lobstercatcher
04-05-2012, 05:53 PM
Some occupations don't allow saving for retirement... the challenge saving for mandated health insurance is tough enough.

Eyeball
04-05-2012, 05:53 PM
OMFG - I cant believe you actually said this - Are you off your meds again brother :grin:


http://cdn1.newsone.com/files/2010/03/buck_wheat.jpeg



Oh, sweet Jersus, yeah, I forget to take 'em ... again. Was it that obvious. :( :grin::grin:

Eyeball
04-05-2012, 06:19 PM
If O'bama gets to screw us for another 4 years, I'll need a bazillion dollars or at least a megamillions winner.


Unfortunately, for what I believe we have coming at us in the very near future, I don't get a sense of confidence from either Obama or Romney. Neither presents their self as a 'leader' -- the kind of leader we will require to lead us through the financial crisis we will be facing.

What we need is someone 'the people' have confidence in as a 'leader'. It does not have to be someone with business experience, and it does not have to be someone with previous political experience.

triplenet
04-06-2012, 04:41 AM
I

What happens to the real estate market post 2012 - no more short sales will be the wildcard.

IMHO short sales will continue for a few more years but be less of a factor as the overall RE market stabilizes...

Wildcard is this alleged "shadow inventory" which I have been hearing about it for 3 years and still dont see anything ;?

But back on topic - Paying down your primary residence is a great way of forced saving and wealth building ... :thumbsup:

DavenFla
04-06-2012, 05:33 AM
Unfortunately, for what I believe we have coming at us in the very near future, I don't get a sense of confidence from either Obama or Romney. Neither presents their self as a 'leader' -- the kind of leader we will require to lead us through the financial crisis we will be facing.

What we need is someone 'the people' have confidence in as a 'leader'. It does not have to be someone with business experience, and it does not have to be someone with previous political experience.

Leadership... that is, a true leader will always seem as a paradox to most. Humble confidence that manifests as service to others. They will focus on the process and keep the end in mind, while being inclusive, without compromising integrity.

jaerco
04-06-2012, 07:02 AM
I'm not exactly sure how much I'll need to fully retire, but wife and I are planning to go part-time and semi retire now (age 31 and 39). Going to enjoy every minute, max out retirement accounts, rest of money goes to paying off house, student loans and vacations. Life is too short to not enjoy it.

My Turn
04-06-2012, 08:35 AM
If you are serious about figuring out the answer to the original question of this post you either need to manage your investments yourself or hire an advisor.

Either way you must do a lot of self education to understand how to maximize returns and minimize risks. IF you go the advisor route you really need to educate yourself to understand that the vast majority of them are comissioned salesmen who will slowly fleece you of your returns via brokerage fees and comissions. Insurance companies are the worst offenders.

Fee based (either fixed or hourly based) are the only type of advisors/managers you should consider working with IMO.
Learning about asset allocation and the best investments (at the lowest cost) to satisfy your allocation is key. You won't learn this from a thread on a boating forum. You might get some insights on where to look to begin your self education. Read some books about portfolio theory and asset allocation, do lots of internet searches, read articles, and decide for yourself. One of the many web sites I like is financialsense.com.

Diversification across uncorrelated asset classes is key. One problem with this is that since the 2008 crash correlations of asset classes has been historically high and increasing. One theory is that this is primarily due to flash trading.

There are some lone voices in the wilderness that make a solid case for putting a large chunk of your portfolio in tips. Here is one paper that is a little technical:
http://www.advisorperspectives.com/newsletters09/The_Retirement_Portfolio_Showdown-Jeremy_Siegel_vs_Zvi_Bodie.php

Here is another perspective on fixed income and an intersting historical perspective on the equity risk premium:
http://www.indexuniverse.com/publications/journalofindexes/joi-articles/5710-bonds-why-bother.html

Whatever you do, educate yourself and design your own financial plan or work with a non-comissioned advisor and turn off the financial garbage advice on tv (and the internet). Wht I mean by this is anything related to "trading" which is really code for gambling. If you want to be a gambler go ahead, just understand that the house always wins.

Striper In
04-06-2012, 08:50 AM
The way it is now...I'll have about 750K when I walk, was hoping for alot more but things didn't work out...

But I'll live within our means and hope to survive and work part time somewhere!


What I want to do is move to the Villages and sell Viagra...:grin:

oceandansar
04-06-2012, 10:57 AM
The way it is now...I'll have about 750K when I walk, was hoping for alot more but things didn't work out...

But I'll live within our means and hope to survive and work part time somewhere!


What I want to do is move to the Villages and sell Viagra...:grin:

:rofl::rofl::rofl: :thumbsup:

Eyeball
04-06-2012, 12:14 PM
Either way you must do a lot of self education to understand how to maximize returns and minimize risks. IF you go the advisor route you really need to educate yourself to understand that the vast majority of them are comissioned salesmen who will slowly fleece you of your returns via brokerage fees and comissions. Insurance companies are the worst offenders.

Whatever you do, educate yourself and design your own financial plan or work with a non-comissioned advisor and turn off the financial garbage advice on tv (and the internet). Wht I mean by this is anything related to "trading" which is really code for gambling. If you want to be a gambler go ahead, just understand that the house always wins.



:thumbsup: Good stuff there. :thumbsup:


Also note the bulk of investment advisers area schooled in pre-2007 Lehmann collapse strategies. Those strategies are not working today, hence the overwhelming bulk of flat returns. I read that no investment manager will dare venture more than 15% off course of where everyone else is. That is why they all go up and down together.

Anyone involved with, or thinking about serious investing these days needs to educate themselves on investing strategies for changing times. Investing today is absolutely nothing like investing was in 2007. And these days protecting your assets, something that was a concern in pre-Lehmann days, is now equally as important as safe investing.

Note: I recently read an in-depth evaluation if Apple. At $600/share it is way over-inflated, a bubble waiting to pop, should be closer to $300/share. Yet, 9 out of the top 10 funds, and the country of Israel, are into APPL. That means at some point a whole lot of people are going to be losing a whole lot of their investments.

KismetLRC
04-06-2012, 01:37 PM
At $600/share it is way over-inflated, a bubble waiting to pop, should be closer to $300/share. Yet, 9 out of the top 10 funds, and the country of Israel, are into APPL. That means at some point a whole lot of people are going to be losing a whole lot of their investments.

Of course, a whole lot of people have MADE a whole lot of money watching it go from $300 to $600 over the past 9 months too....

triplenet
04-06-2012, 01:45 PM
Long term hold means nothing in equities .... be nimble - make your money and move

My Turn
04-06-2012, 02:41 PM
:thumbsup: Good stuff there. :thumbsup:


Also note the bulk of investment advisers area schooled in pre-2007 Lehmann collapse strategies. Those strategies are not working today, hence the overwhelming bulk of flat returns. I read that no investment manager will dare venture more than 15% off course of where everyone else is. That is why they all go up and down together.
.

Many of these so called advisors and money managers are scared to death of not beating the averages and as a result wind up performing below the average after their bloated fees are taken out. Many closet indexers too

Bayside Bert28
04-06-2012, 03:06 PM
You don't need much money - you just need to be able to borrow a bunch. That is what our U.S. Federal Government does.

keysdiver
04-06-2012, 03:36 PM
You need to take a step back and be HONEST. What do you need. What do you want. What REALLY makes you happy.
I moved to The Keys and live on less than 1/3 of what I "needed" in NJ. Planned ahead.

Welshtrustee
04-06-2012, 03:41 PM
Leaving the world penniless or leaving money to heirs? That is an important question to answer. If the answer is penniless, 1-2 M might be enough. If you want to leave a substantial sum, I. E. near 7 figures, you'll need at least 5M. IMHO

aubv
04-06-2012, 04:16 PM
Long term hold means nothing in equities .... be nimble - make your money and move

Ha, I laugh every time I hear this.
I love the pundits who claim buy and hold is dead.

I have numerous equites that have YOI of
10-15%/year just from current dividends and ROI's of 250-700%.
I know this month I will be getting a raise as a number of companies will announce dividend increases, which will only increase my YOI.

It's more about buying right, not only price but the actual company you own.

Retirement is much more about income and debt versus some magic asset number.
If inclined, Purchasing stock of really good high quality companies that have a history of dividend increases can allow you to double your income every ten years or less. Not to mention the appreciation that will most likely accompany the stock in such companies. Starting this process well before actual retirement can yield really good results. Including a lot of downside protection and most likely much more rapid recovery in a situation like 2008.

triplenet
04-06-2012, 04:30 PM
Ha, I laugh every time I hear this.
I have numerous equites that have YOI of
10-15%/year just from dividends and ROI's of 250-700%.




You must be a real player making 700% on your money :thumbsup:

Show us how big boy :grin:

And I didnt say buy and hold is dead - I said be nimble...

eyschulman
04-06-2012, 04:32 PM
As to how much $ for retirement "different folks different stokes". As for confidence in our national leaders what was that Hitler thing all about the german public was licking his boots. Things are not simple or they are so simple we have trouble understanding them.

Schmaltz~Herring
04-06-2012, 04:45 PM
As to how much $ for retirement "different folks different stokes". As for confidence in our national leaders what was that Hitler thing all about the german public was licking his boots. Things are not simple or they are so simple we have trouble understanding them.







;? huh?

Boataholic
04-06-2012, 04:50 PM
I hope to leave this world with my last check bouncing like a basketball :) LOL

Eyeball
04-06-2012, 09:19 PM
;? huh?


I'm thinking a P.U.I. moment. ;)

falkon
04-07-2012, 07:29 PM
None. Social security will give you more then you need. I cant wait to start collecting .

DavenFla
04-08-2012, 03:28 AM
None. Social security will give you more then you need. I cant wait to start collecting .

This is a 0

Bugbuster
04-08-2012, 04:06 AM
IMO it depends on your health. If you're fortunate enough to be fully functional you'd want more money. In my case it's the water bill, light bill, and food. I find that the money I do spend is to be able to watch others have fun.............. like ammo and tannerite. I spent my life savings on drs. I haven't had to depend on the gubmint yet, except the VA which amounts to free prescriptions, but I do see it in my future.

hblac
04-08-2012, 06:46 AM
That isn't correct. Everything you withdraw is tax free....that is the whole point of a Roth.

Kevin


I hope you are right. Is that assumming you are drawing principle first? I would convert my IRA to a Roth if I could stand the taxes due in the year(s) of conversion. I can't imagine that the gov't will allow earnings from investments within the account to go untaxed for much longer. The rules can change and a bankrupt treasury will look for any source of income it can.

I'm pretty much on the same page as Eyeball. The dollars you have today won't buy nearly as much in a relatively short period of time. Big time inflation is just around the corner. Hopefully it will just be Jimmy Carter style inflation of 20% and not Argentina style hyper-inflation.

Eyeball
04-08-2012, 07:47 AM
The rules can change and a bankrupt treasury will look for any source of income it can.



This is the one variable that should have everyone concerned in these changing times.

There is another reality in all of this planning for the future ... reactor #4 at Fukushima, but that deserves its own thread.

magua
04-08-2012, 08:02 AM
Ask yourself this for me the answer is no.

If your house/cars are paid off could you retire.

My mortgage is little more than a couple mediocre car payments. Factor in taxes and it is another car payment.

Boating,Entertainment,Vacations,Utilities,Insuranc e,Taxes,Medical,Food,Gas,Cable,Phone,QVC,HSN,Gift buying... well the list goes on and does not matter pre or post retirement.

DavenFla
04-08-2012, 03:53 PM
Ask yourself this for me the answer is no.

If your house/cars are paid off could you retire.

My mortgage is little more than a couple mediocre car payments. Factor in taxes and it is another car payment.

Boating,Entertainment,Vacations,Utilities,Insuranc e,Taxes,Medical,Food,Gas,Cable,Phone,QVC,HSN,Gift buying... well the list goes on and does not matter pre or post retirement.

;?;:

triplenet
04-08-2012, 03:59 PM
BTW Guys - When you retire - dont knock renting .... No headaches, no maintenance, etc...

DavenFla
04-08-2012, 04:04 PM
BTW Guys - When you retire - dont knock renting .... No headaches, no maintenance, etc...

That ain't happening.... not knockin' it, but that ain't for me. I gotta have my boat, tractor, trucks, dogs, kids and assorted other sundries:grin:

I'm usta havin' a bit of room, can't see my self living in a place packed like sardines:)

...just sayin'

GulfC
04-08-2012, 04:43 PM
I have to smile when I see anyone suggest SS is going away; I fully understand the dilemma. And I do not count on it myself but would love to see which politician you guys think will "go there." None of em' ever will in our lifetimes. It's just is not going to happen.

triplenet
04-08-2012, 05:00 PM
That ain't happening.... not knockin' it, but that ain't for me. I gotta have my boat, tractor, trucks, dogs, kids and assorted other sundries:grin:

I'm usta havin' a bit of room, can't see my self living in a place packed like sardines:)

...just sayin'

Yes sir - for you it doesnt work.... But for me - a nice small townhouse would be perfect...

Winters in Florida/Keys and Summers in Europe renting a small flat and eating and drinking way too much......

8 years and counting :grin:

Eyeball
04-08-2012, 05:25 PM
I have to smile when I see anyone suggest SS is going away; I fully understand the dilemma. And I do not count on it myself but would love to see which politician you guys think will "go there." None of em' ever will in our lifetimes. It's just is not going to happen.


Unless you think you are going to die within the next couple of years, you will witness the demise of soc sec ... and a crap load of other local, state, and federal entitlements, including public employee retirements. ;) Yeah, things really are that bad, right now.

Tireless
04-08-2012, 05:34 PM
If you guys collect $5m dollars and put in my bank acct, I will let you know if it is enough to live comfortably.

Buoy Scout
04-08-2012, 06:14 PM
I have to smile when I see anyone suggest SS is going away; I fully understand the dilemma. And I do not count on it myself but would love to see which politician you guys think will "go there." None of em' ever will in our lifetimes. It's just is not going to happen.

My fear is that even though I've paid into social security for 40 years, since so many people have absolutely no savings, there will be a move to shift the available funds from those that have other income/investments to those who saved nothing. And as one of the people that lived below his means for his entire life in order to be comfortable in retirement, I will be penalized for doing this. And the lazy asses that spent every penny will get my SS because "I don't need it as much." That will really piss me off big time.

Kamper
04-08-2012, 06:26 PM
I hope you are right. Is that assumming you are drawing principle first? ...

With a ROTH, you pay the taxes on your income then let it sit in the account for at least 5 years. After that, the principle and interest are tax free. If you make repeated deposits they have a way or pro-rating the eligible funds.

That's how it was explained to me. You pay on the way in, or on the way out.

Picaroon
04-08-2012, 06:28 PM
Every one's retirement needs differ and depend a lot on expected lifestyle and real world needs..........I was in Middle Management with a very large company. I worked for them for 40 years. In the last 20 years I earned from $200.000 to $300,000 a year. I saved a lot in Mutual Funds and 401k's and Ira's. I own some individual stocks. I did a lot of planning thinking that I needed $150,000 to get by and not change my lifestyle. I retired 11 years ago but have been unable to live on just $150,000. So I am dipping into my saving which s

I have cut back quite a bit. I sold my boat, Bay home etc.............I sold a 7,500 sq.ft. home to avoid the vicious property taxes in Houston and downsized into a 3,800 sq.ft. home. I no longer buy new cars every other year. We no longer take the nice vacations we once did.............

Some things to consider. On a taxable income of $154,709 I paid $28,000 in income tax, property taxes of 14,000, misc taxes of 10,000 (sales, misc.)...........My son lost his IT job and I subsidize him to the tune of $25,000 a year. My sister in law lost her business as an Architect and I gave her over $30,000 last year. My brother in law was a very successful Realtor in a resort area with three offices and over 30 folks working for/with him........Her and his wife are now living with us........

I can live with all of this but not as well as I once did.

The thing that terrifies me is what will OBAMA do to us next. Will he get reelected......

SeaNile
04-08-2012, 08:35 PM
My FIL stresses daily about how much is needed. His favorite line is "tell me when I'm going to die and I can tell you how much I need." His biggest fear is healthcare costs. He is a small business owner, zero debt, house paid, cars paid, making over 100K a year (pays very little in taxes) and has about 1.3mil in the bank. Still has not tapped into his small pension nor SS. At 63 he is not sure what to do but does not feel comfortable retiring just yet.

I envy his financial position but not all the worrying he does over money.

AGENT86
04-08-2012, 11:53 PM
I'll be honest, and I'm sure many here will laugh at me, think I'm crazy, whatever. I don't care. My retirement plans have changed drastically, the old saying "simpler is better" is where my head is at. I'm over the BS of day to day rat races, my plan is perfect...for ME.

I will purchase an older live aboard, about 40 or so feet, on the cheap. All that matters is the structural condition & that it has no mold issues, etc. I don't care if one, both, how ever many motors it has are blown, missing, I don't care. I don't plan on moving it other than to have it pulled every now & then for bottom maintenance, etc. Once I locate a suitable marina, and, I already have a few scoped out that are EXACTLY what I'm looking for, I can do any work to get it running, ANY, and, at my leisure. This will be somewhere in SC or NC, and will be my winter home.

Spring, summer & Fall, I'll be in Maine. Whether in a tiny cabin on a little plot in the woods, or, in a pull behind camper, it matters not. As long as I have my boat for the lake, I'll be in heaven. I'll do a bit of traveling, mostly within the states. But, overall, that's it.

You'll find me either trolling for lake trout and/or landlocked salmon, or maybe panning for a bit of gold here & there...in the winter, I'll be fishing the salt marshes & in & around the inlets , etc., that's it, friends. I don't want a big house, or, ANY house, for that matter. Big PITA for me. I don't want a bunch of possessions, have already gotten rid of a lot.

If I should strike it big in the lottery, the only thing that would change might be location, and, a bigger chunk of land in Maine...the better to get further away from all the zombies...uh, I meant, people :grin:;) So, all in all, I won't require all that much $$, so, I'll be O.K:thumbsup:

When I die, last wishes are to be cremated & my ashes spread on a certain lake, in a certain spot...really cheap, really simple. Shed no tears, for I will have returned to whence I came. "Let it roll....":thumbsup:

Eyeball
04-10-2012, 02:00 PM
I just saw on internet news that Michigan is gifting $-millions to Detroit to keep the city afloat while it rebuilds its fiscal house. Interesting mention of a government job retirement topic I brought up here.

Detroit has 22,000 retirees collecting on their pensions.
Detroit has 11,000 employees paying into the retirement benefits of those 22,000 retirees.

As mentioned on the news, those retirees depending on their government provided retirements will be taking a cut in benefits. That's what I'm talking about. Anyone that is depending on a government sourced pension should be very worried ... and preparing for alternative means of funding your future.

Detroit also has 64 full-time employees whose only responsibility is to do the Detroit police department's payroll. If they automate the process they can reduce that number down to 4 employees. But that also means 60 less people paying into the retirements of those 22,000 retirees.

Boataholic
04-10-2012, 02:13 PM
I'll be honest, and I'm sure many here will laugh at me, think I'm crazy, whatever. I don't care. My retirement plans have changed drastically, the old saying "simpler is better" is where my head is at. I'm over the BS of day to day rat races, my plan is perfect...for ME.

I will purchase an older live aboard, about 40 or so feet, on the cheap. All that matters is the structural condition & that it has no mold issues, etc. I don't care if one, both, how ever many motors it has are blown, missing, I don't care. I don't plan on moving it other than to have it pulled every now & then for bottom maintenance, etc. Once I locate a suitable marina, and, I already have a few scoped out that are EXACTLY what I'm looking for, I can do any work to get it running, ANY, and, at my leisure. This will be somewhere in SC or NC, and will be my winter home.

Spring, summer & Fall, I'll be in Maine. Whether in a tiny cabin on a little plot in the woods, or, in a pull behind camper, it matters not. As long as I have my boat for the lake, I'll be in heaven. I'll do a bit of traveling, mostly within the states. But, overall, that's it.

You'll find me either trolling for lake trout and/or landlocked salmon, or maybe panning for a bit of gold here & there...in the winter, I'll be fishing the salt marshes & in & around the inlets , etc., that's it, friends. I don't want a big house, or, ANY house, for that matter. Big PITA for me. I don't want a bunch of possessions, have already gotten rid of a lot.

If I should strike it big in the lottery, the only thing that would change might be location, and, a bigger chunk of land in Maine...the better to get further away from all the zombies...uh, I meant, people :grin:;) So, all in all, I won't require all that much $$, so, I'll be O.K:thumbsup:

When I die, last wishes are to be cremated & my ashes spread on a certain lake, in a certain spot...really cheap, really simple. Shed no tears, for I will have returned to whence I came. "Let it roll....":thumbsup:

that sounds like one of the better plans that I've read about on here. I like your way of thinking...keep it simple! After reading the following link, I'm thinking Ecuador or Thailand doesn't sound too bad either for cheap living.

http://internationalliving.com/2011/12/the-worlds-top-retirement-havens-in-2012/

bobb
04-10-2012, 02:27 PM
I just saw on internet news that Michigan is gifting $-millions to Detroit to keep the city afloat while it rebuilds its fiscal house. Interesting mention of a government job retirement topic I brought up here.

Detroit has 22,000 retirees collecting on their pensions.
Detroit has 11,000 employees paying into the retirement benefits of those 22,000 retirees.

As mentioned on the news, those retirees depending on their government provided retirements will be taking a cut in benefits. That's what I'm talking about. Anyone that is depending on a government sourced pension should be very worried ... and preparing for alternative means of funding your future.

Detroit also has 64 full-time employees whose only responsibility is to do the Detroit police department's payroll. If they automate the process they can reduce that number down to 4 employees. But that also means 60 less people paying into the retirements of those 22,000 retirees.



I think this is the tip of the iceberg as far as government employees go... At some point, the camel's back is going to break and I think we're closer then we all realize...
The free lunch is just about over...

JoeyM
04-11-2012, 10:24 AM
my retirement plan is to never stop working.




.

cloonkeen
04-21-2012, 03:13 PM
Check this out.

http://www.usdebtclock.org/

triplenet
04-21-2012, 03:23 PM
my retirement plan is to never stop working.

.

My plan as well.... I am lucky to be in an industry where I can basically be passive and still make money .... :thumbsup:

Eyeball
04-21-2012, 04:43 PM
Occupy Oakland, the most radical of all the local Occupy groups, passed a resolution April 15 that vows to shut down all travel from Marin to San Francisco.

“If any of the unions on the Golden Gate bridge declare a strike or shutdown action on May Day, we will act in solidarity with these striking worker ...

The May Day Flier from the Golden Gate Labor Coalition calls for a protest next to the bridge that insists the Bridge District also: “don’t reduce vested retiree benefits,” “don’t reduce current employees’ benefits” and “don’t reward non-union employees with raises while breaking promises to union workers.”

http://cnsnews.com/blog/dan-gainor/occupy-promises-biggest-shut-down-city-new-york-has-ever-seen-blockade-san-fran


This is what I mean about govt employees need to be considering a plan 'B' for their retirement. Austerity is here. But so is the socialist push against it, e.g. the Occupy movement. The anti-austerity riots in Europe right now are just in the 'birth' stage here in the US. Retired govt employees won't have a choice ... they will get in line with the progressive socialist agenda in an attempt to preserve their govt retirement in total. They will fail.

F00Mustang
04-21-2012, 06:39 PM
However much you have, you will need more.

muskamoot
04-26-2012, 07:23 AM
I'm one of those retired government employees.I retired at 57 with 32 years of service as a wastewater plant superintendent.I faithfully paid 5% of the gross amount of every check into our county run and administered retirement plan.The plan is fully funded and never was pillaged or invested poorly.The result is I have $4000 a month coming in from the plan plus health care for life. Ends meet and life is good.Work at paying off all you can before retirement and also have some savings to rely on when you need something extra. My retirement plan isn't going to be offered as is to new employees and I feel no guilt over having it and using it.You adapt your spending to meet your income,if only the government would do the same.

DavenFla
04-26-2012, 09:21 AM
However much you have, you will need more.

This is true if you never learned to "live poor". I'm near retirement and I know if things go bad (financially) I would live "less". I leaned this from my parents who were of the "greatest generation" and lived through the great depression. It isn't necessarily about money or accumulated wealth... it more about playing the hand your dealt. Young people today do not understand the concept of sacrifice and doing without, it's a life skill and good to know.

So if what you say is true and you believe it... then what happens when you "run out"? Do you take someones else's stuff? or become a burden to your children? or live off the government? or just end it all? This is the very mindset that leads to socialism or the entitlement of public support.

A failure to plan is a plan for failure.


...just sayin'

beber
04-26-2012, 12:36 PM
Back of the envelope I'm predicting that I will need between $4-5 mil to retire. I'm predicting that I would need about $80k a year of today's money to live the lifestyle I would like to comfortably after retirement. However, I'm only 30 years old and have at least another 35 years until retirement.

Assuming 2.5% inflation $80,000 x 1.025^35 =~$190,000 a year x 25 years = $4.75 mil. Now of course that money will be gaining interest even after I start withdrawing from it, but realistically I will be invested in safe investments which return not much more than inflation rates anyways.

Last I looked at my 401k, I have a long ways to go.

Kamper
06-02-2012, 06:03 AM
Social Security annuties?

http://finance.yahoo.com/news/social-security--the-cheapest-annuity-in-town.html

spraynet 1
06-02-2012, 06:48 AM
Here are a few wild thoughts on a REAL number of dollars that you need.........

a. If your nest egg is in the bank, you are making 1/10 of one percent on the money.

b. If your egg is in the stock market/ AKA investment account, call it.....2%??

c. If your money is in investment property, it can be up to 20% return


If you have $700,000 in the bank, that would equate to about about $70/month in cash.

If you have a 401K portfolio that's.....average.......then it would become $1400/month

If you have rental property, then it could be $10,000/month......before R&M and other expenses that property rentals have, including lost rent for vacant properties.


Not to be a "dick" but this is exactly why the internet is the WILD WEST. Some of your estimates are not only WRONG....There LOONY!!!!!!

1. 20% on rental returns :rofl::rofl::rofl:

2. $700,000 in bank = $70 month :rofl::rofl::rofl:

3. $$$$ in bank = 1/10th of 1% :rofl::rofl::rofl:

4. Stock Market = 2% :rofl::rofl::rofl:

Lord am I praying hard......that your not an investment counselor:jk:

spraynet 1
06-02-2012, 06:52 AM
my plan as well.... I am lucky to be in an industry where i can basically be passive and still make money .... :thumbsup:


mind sharing ;?;?;?;?;?;?;?;?;?;?.

triplenet
06-02-2012, 07:24 AM
mind sharing ;?;?;?;?;?;?;?;?;?;?.


I make around 8% on my equity as a real estate investor - and in 7 years I plan to retire at age 53... I will continue to own my real estate - but be more passive in its management ....

What else would like to know :thumbsup:

Welshtrustee
06-02-2012, 07:53 AM
I make around 8% on my equity as a real estate investor - and in 7 years I plan to retire at age 53... I will continue to own my real estate - but be more passive in its management ....

What else would like to know :thumbsup:

Do you buy mostly forclosures from the master in equity sales? Once you have them, do you have a mgmt co so you don't have to field problem calls? I've thought about this as I have the liquidity to weather vacancies, etc. Just don't like the idea of fixing stuff all the time. Are you good at the eviction process? I imagine it happens more than I would expect. Thanks in advance for your advice.

GulfC
06-02-2012, 08:28 AM
I make around 8% on my equity as a real estate investor - and in 7 years I plan to retire at age 53... I will continue to own my real estate - but be more passive in its management ....

What else would like to know :thumbsup:

I'm there now at 54! But actually plan to step up RE investing in another direction after leaving the day job in a few months. That's the great thing with RE, you can do as much or as little as you wish and make those decisions at your leisure as long as you plan/buy correctly.

ol guide
06-02-2012, 09:09 AM
I receive 75 percent of the average of my highest 3 years base salary , plus 2.5 percent as an O6 in the Navy, plus income as a (non active) partner in an aeronautical engineering firm, plus income from investments and a residual from a patented/service marked process i created. As has been stated, income necessary to retire depends on the lifestyle you wish to fund. I have no complaints, and i worked my ass off to get where i am. No regrets.

notgottaboatyet
06-02-2012, 09:20 AM
I make around 8% on my equity as a real estate investor - and in 7 years I plan to retire at age 53... I will continue to own my real estate - but be more passive in its management ....

What else would like to know :thumbsup:

If you don't mind me asking...

What developments did you start out with, which were more stable both financially and maintainable, how long did it take you to quit working for someone else, what type/size RE have you bought more recently, have you done this with or without liens, will you continue to collect RE in 'retirement'?

Do I need to tell everyone how I plan to retire or can you guess?:grin:

triplenet
06-02-2012, 12:02 PM
If you don't mind me asking...

What developments did you start out with, which were more stable both financially and maintainable, how long did it take you to quit working for someone else, what type/size RE have you bought more recently, have you done this with or without liens, will you continue to collect RE in 'retirement'?

Do I need to tell everyone how I plan to retire or can you guess?:grin:

I started out in commercial real estate when I was 22.... managing/leasing shopping centers and apartment buildings ----- I didnt have a dime to my name - but started putting my savings into deals as equity.....

Real estate investing takes a long time - its not a quick wealth builder... and yes,, I plan to own real estate until I stroke out...

Just remember - if you put $1 in - you MUST get $.08 after all expenses --- and that includes everything from maintenance to filing your tax return...

If you really want to make money - find the deals and present them to investors for a "promote" fee.... Investors put up the cash/equity and you get a % of profits after the investor gets back a reasonable return on their equity ...

I made most of my money that way... at least early on :thumbsup:

tiaraboater
01-29-2013, 08:16 PM
Well I own a few apartment buildings keep 50 units to have about $25000 a month income. I want to buy a Viking sport fish as a retirement present to myself. So i'll need quite a bit.



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