what are you shooting for in your retirement plan?

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Ron
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Post by Ron » Sat Oct 16, 2010 9:39 am

MWCA wrote:I keep trying to get mine to retire. :lol:
I'm in the same situation :roll:

While we made plans to both retire (we're the same age) in the spring of 2007 when we turned 59, she's still working.

We talk about being financially ready on this forum, but IMHO give little thought to the emotional side of retirement.

I retired a month before "her date", but when it came time to leave, she found she was not emotionally ready. Over the last three years, she's attempted to retire twice, but still not able to when the date came.

Her next date selected is when she turns 63, in May.

Stay tuned...

- Ron

neverknow
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Post by neverknow » Sat Oct 16, 2010 9:43 am

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Last edited by neverknow on Mon Jan 17, 2011 4:20 pm, edited 1 time in total.

tim1999
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Post by tim1999 » Sat Oct 16, 2010 9:46 am

I am targeting retirement at age 55-60 with a pre-tax income of approximately $50,000/yr. in today's dollars. My house will be paid off at that time. I am just shy of age 30 right now. Every calculator I run says that I'm on target with my current amount of savings and annual contributions, even with a low single-digit annual return. I don't have a pension or anything like that.

As for social security, I am only counting on receiving approximately half of the current benefit level, and not until age 70.

letsgobobby
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Post by letsgobobby » Sat Oct 16, 2010 10:33 am

my goal is the biggest pile I can make, while still allowing me to sleep well at night.

mcblum
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events

Post by mcblum » Sat Oct 16, 2010 10:49 am

right now, I have retired from my position after Civil Service (NIH) career of 42 years. I accepted a contract position doing the same thing and am aiming for a total of fifty years. This extra time will qualify me for a small Social Security pension and and increase my 403b and other investments. I will be close to 75 when this happens. Lucky for me, I like my job and so there is no problem working longer.
Marty

Ron
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Post by Ron » Sat Oct 16, 2010 11:21 am

Since I've been retired a bit over three years and my wife may follow me within a year I guess we are on "both sides" of the question.

As for us, our plan was to retire when we were able to maintain the same lifestyle we had while working, with the income we could generate in retirement. That came about at age 59, when we both planned to retire. BTW, our "original age" from many years ago was age 66 (SS FRA). Just to comment to those that are thinking about retiring in their mid-later 60's (things change :lol: ).

For us, that was being completely debt free (as before retirement), and generating 100% of our combined pre-retirement net income.

I'm happy to say that for the period I've been retired that has been the actual situation, and I find no impact to my wife's retirement. In fact, since she is expected to be working four years beyond her original planned retirement date, we are well ahead of forecast.

As far as SS? Since we're older, we expect to collect at 100% till we pass. Even if we didn't, SS is only a small portion of our retirement income and if we did not have it at all, I see no major impact to our plan, out to age 100 (another 42 years - yes, I know we won't see it, but we're conservative planners). BTW, we plan for my wife to take SS at her FRA age of 66, and me to take it at age 70 (primarily for her benefit, assuming I pass first).

- Ron

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norookie
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Post by norookie » Sat Oct 16, 2010 11:53 am

:D I realize most posting here are savers. How can you think a annuity you've been forced to pay into unless you were Fire, Police, or a municipal employee, or a few other positions will go belly up on you after promising you Health care after 65 when most need it most and a % of your money back. This is why i view the .gov as a insurance company, amongst its other functions. ~
" Wealth usually leads to excess " Cicero 55 b.c

Ron
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Post by Ron » Sat Oct 16, 2010 12:27 pm

norookie wrote:This is why i view the .gov as a insurance company, amongst its other functions. ~
I agree with you, completely. For my disabled son (who did work and contribute to SS for many years) and is now on SSD (Social Security Disability) his income is enough to get by.

Even with his income form a sheltered workshop (along with SSD), he is considered one of the millions of "working poor". However, without SSD he would probably one of those folks you read about living under a bridge.

I know for a fact that there are others on this forum that have received benefits from the SSA as "insurance" (but I'll let them tell their own story, if they wish).

- Ron

sommerfeld
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Re: what are you shooting for in your retirement plan?

Post by sommerfeld » Sat Oct 16, 2010 12:27 pm

neverknow wrote:yet for sure, when I went and bought some yogurt last week -- they are now being sold in 6 ounce containers, when forever they were sold in 8 ounce containers.
The migration from 8-ounce to 6-ounce individual containers has been going for the past 3 or 4 years at least. I've been boycotting the 6-oz size.

I think Dannon switched in 2006 or 2007 or so. The only remaining 8-ounce yogurts I can find are at Trader Joe's.

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jeffyscott
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Post by jeffyscott » Sat Oct 16, 2010 12:41 pm

Yes, many often forget, or do not realize, that the 6.2% tax is also paying for disability insurance and for insurance benefits for survivors. They don't break out all the components of OASDI taxes, but the DI portion is .9% (X2 with employer contributions). OAS which pays for retirement pensions as well as survivor benefits is 5.3% (X2).

http://www.ssa.gov/OACT/ProgData/oasdiRates.html
press on, regardless - John C. Bogle

neverknow
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Post by neverknow » Sat Oct 16, 2010 12:45 pm

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Shireman28
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Post by Shireman28 » Mon Oct 18, 2010 8:16 am

allsop wrote:
sommerfeld wrote:
allsop wrote:
Shireman28 wrote:At age 31, I don't count on social security as I hope to have enough in retirement assets to be disqualified by some government flunky since previous generations have saddled me with government debt.

Otherwise, I'll just keeping maxing out what tax-advantaged accounts I can and pay off the house, and try to keep expectations low.
I'm curious as to why you think you think you can not count on SS in the future while tax-advantaged investing will still be tax-advantaged when you retire in 30 years?
Your statement does not follow from what he wrote. He didn't say anything about expecting tax-advantaged accounts to remain tax-advantaged.

I'm putting money into tax-advantaged accounts because it's what we have now and because it reduces my taxes now. I don't assume the tax laws won't change going forward.
I suppose I'm guilty of putting words into his mouth.

On the other hand it is not often I read that those that does not count on SS in the future also write that they do not count on the tax laws to remain unchanged.
You make excellent points. I max-out my Simple IRA (small business 401K) to avoid taxes this year. I also though max-out my Roth, which means I am assuming tax policy won't change on Roths. This is hypocritical. This also causes me to agonize over rolling over a smaller IRA into a Roth this year as well as I'm not sure if I should count on the Roths not getting raided. The truth is I assume that the government changing Roths, which are explicitly designed to be tax-free upon withdrawal, would be politically difficult for even the most die-hard wealth redistributor.

However, I think that it would be much easier for politicians to change social security to morph into a working poor, middle class retirement fund and disability structure 20 years from now and throw out anyone my age with over "X" in income or "X" in accumulated tax-advantaged retirement savings.

I hope I'm wrong and some young Hispanic-led population boom will allow my wife and I to get full social security benefits without a wealth check.

Shireman28
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Post by Shireman28 » Mon Oct 18, 2010 8:20 am

jeffyscott wrote:
Shireman28 wrote:At age 31, I don't count on social security as I hope to have enough in retirement assets to be disqualified by some government flunky since previous generations have saddled me with government debt.
Previous generations, eh? Seems to me that a lot of that debt was built up in just the last 10 years and they are projecting to add $1 trillion+ per year for many years to come now.

Ah yes...just over 1/2 of the debt was added since 2000:

http://www.treasurydirect.gov/govt/repo ... histo5.htm
Good point Jeffy, now point out all of the < 30 year old Washington politicians that voted for this from my age bracket.

aida2003
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Post by aida2003 » Tue Oct 19, 2010 12:59 pm

rrosenkoetter wrote:
rai wrote:I don't understand why people are saying save 25x of earnings. shouldn't it be 25x spending?
This is exactly right...

This is why one can retire on a million dollars and live very well... People here say "That only generates $40k a year! No way I could live on $40k a year! I make $100k today!"

But take away a house payment, take away having to save 15% of your income, lower your taxes, and suddenly you realize $40k gives you the EXACT same life you enjoy today.
I suppose I must be very arithmetically challenged here because I'm missing something. Shouldn't your today's spending be adjusted for inflation when projecting 25x spending in Y years?

Let's say a couple spends $40K net today which already includes their entertainment-travel budget, but excludes health-dental insurance premiums since they're paid with pre-tax $ through an employer.
Is $1Mln really all we need to save for our retirement, not including med. insurance? What about adjusting for "Y years" from today until the actual retirement?

Today I skimmed a pamphlet from TRowePrice and it was daunting what their numbers say. I'll just retype it here.
THE POWER OF PERCENTAGES (by TRowePrice)
Three 30y.o. investors earning a $50K salary end up with radically different incomes when they reach age 65 - and for the 30 years they may spend in retirement - depending on their savings rates (Assuming a 3% annual pay increase & an avg annual return of 8%).
Their goal should be to replace 50% of their preretirement income which will be $140,693 at age 65. Below we see the income their investments provide in the 1st year of retirement.

Investor 1 contributes 5%. Savings at age 65 is $679,634. Income from investments: $27,185 that replaces 19.3% of preretirement income.

Investor 2 contributes 10%. Savings at age 65 is $1,359,269. Income from investments: $54,371 that replaces 38.6% of preretirement income.

Investor 3 contributes 15%. Savings at age 65 is $2,038,903. Income from investments: $81,556 that replaces 58% of preretirement income.
I've used the above example because I'm trying to understand whether the financial industry is trying to scare me witless or are today's savers (including myself) are delusional being stuck on that 1 million dollars.....???

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HomerJ
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Post by HomerJ » Tue Oct 19, 2010 1:04 pm

aida2003 wrote:
rrosenkoetter wrote:
rai wrote:I don't understand why people are saying save 25x of earnings. shouldn't it be 25x spending?
This is exactly right...

This is why one can retire on a million dollars and live very well... People here say "That only generates $40k a year! No way I could live on $40k a year! I make $100k today!"

But take away a house payment, take away having to save 15% of your income, lower your taxes, and suddenly you realize $40k gives you the EXACT same life you enjoy today.
I suppose I must be very arithmetically challenged here because I'm missing something. Shouldn't your today's spending be adjusted for inflation when projecting 25x spending in Y years?
Yes, you are correct.

But it's still true that our EXPENSES are what matters, not our INCOME.

And with a paid off house, and no need to save anymore, everyone's expenses are a lot lower than their income.

But yes, inflation should be taken into account.

traumamoma
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what are you looking for??

Post by traumamoma » Tue Oct 19, 2010 4:42 pm

2.5 million, debt free. SS at 62. almost there. wudda been there if 2008 hadnt happened, but keep chippin away at it. should be there soon with any cooperation at all from the stock market. Kicker is health insurance if you get out early. Good luck to all, Peter

14thMed
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Post by 14thMed » Tue Oct 19, 2010 7:33 pm

I thought it was when I hit the 1m mark but..

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