Anyone start saving late and still retire early?

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JD2775
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Anyone start saving late and still retire early?

Post by JD2775 »

For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
stoptothink
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Re: Anyone start saving late and still retire early?

Post by stoptothink »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Had almost nothing at 30 - I saved, but most of it went to putting ex-wife through school and then divorce - 8yrs later could pretty realistically retire before I hit 45 (wife #2 would be 40). Wife and I enjoy our current careers so I don't suspect we'd actually retire <50. Not a super high-earner (at least for this board), but 50%+ savings rate + bull market + low household expenditures has provided us options. Man I wish I would not have paid ex's undergrad debt and cash-flowed dental school, but I've recovered.
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ReformedSpender
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Re: Anyone start saving late and still retire early?

Post by ReformedSpender »

I think the consensus you’ll see from responses is that 30’s is not “late”
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ThankYouJack
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Re: Anyone start saving late and still retire early?

Post by ThankYouJack »

I don't think there's a secret. I think it's just trying to get your savings rate as high as possible and hoping for great returns. Pretty much comes down to those two things.
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watchnerd
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Re: Anyone start saving late and still retire early?

Post by watchnerd »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
I started contributing to a 401k when I was in my late 20s, but it wasn't a lot. Maybe $2500 a year.

So it was measurable, but just barely.

I didn't have the income to start maxing out 401k contributions until I got into my 30s. And there were disruptions like layoffs in 2002 and again in 2009.

My wife and I lived in an apartment in a HCOL area until we were 40 years old, when we had finally saved up enough for a big down payment and real estate prices had crashed.

But we really started plowing away the savings and investments in our mid 40s, always living below means, and since then we've been adding about $1M to our net worth every 5 years.

So, yeah, you can start late. We currently save 130% of our yearly living expenses and have no debts.

We could retire now if we want, but we're both enjoying our work / life balance. We'll both turn 50 in the next 6 months and the current plan is to still work till 52-55, as long as we're enjoying ourselves and our health holds up.

Work gives us a sense of purpose and self-esteem that I'm afraid I might miss if I retired too soon.
Last edited by watchnerd on Sat Dec 21, 2019 8:25 pm, edited 1 time in total.
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michaeljc70
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Re: Anyone start saving late and still retire early?

Post by michaeljc70 »

There is no "secret". It is investing smart (low cost index funds, diversified, staying the course) and saving as much as you can as early as you can.

I retired in my upper 40s and that was starting saving around age 23, but I took more than 10 years off work (total, dispersed). So I only really worked 16 years (cumulative- spread over 26 years). I did not really make big bucks, but lived relatively modestly. My investments were also impacted by buying a house in my mid 20s. So, I would say it is possible. Obviously it depends on your savings rate and how much you need to retire. There is not much info in the OP. If you retire at 60 you may only need to cover 5 years of expense before SS/Medicare if your expenses aren't high.
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Re: Anyone start saving late and still retire early?

Post by livesoft »

I contributed the max allowed to a 401(k) for just 20 years from age 37 to 57 though I went part-time at age 50. The company match was nothing special. The 401(k) reached 7-figures. So I guess I started late and retired early. It is all about expenses, so if you put 50% or more of your income into your 401(k), then you will be living well below your means and won't need much money when you retire.

So work both sides: Don't spend any money and save a lot of money.
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climber2020
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Re: Anyone start saving late and still retire early?

Post by climber2020 »

I didn't get out of school/training until my late 20s and it took me until around age 32 to get to a net worth of zero. In my late 30s now and will probably hit my number within the next 3 to 5 years depending on market returns.

Not much of a secret; it's just math. I make good money, though significantly less than the average person in my profession (by choice, as I work fewer hours than most), and I've consistently saved and invested 60 to 70% of my after tax income. Living in a low cost of living area and not wanting kids makes it a lot easier.
retire57
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Re: Anyone start saving late and still retire early?

Post by retire57 »

Started saving specifically for retirement at age 33 upon discovering the benefits of tax-deferred savings. We pretty much plowed 20-25% of our modest incomes into buy- and-hold index funds with AAs of 80/20 to 70/30.

Agreeing on our financial goals, avoiding debt, and not having kids helped tremendously.

Hubby retired at 62 and me at 57. Not sure if that's early retirement, but we won the game despite the significant 2000 and 2008 downturns. So - no, it is definitely not too late, provided you are disciplined, consistent, and willing to stay the course. 8-)
OnTrack2020
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Re: Anyone start saving late and still retire early?

Post by OnTrack2020 »

There's no secret. You can do it by starting in your mid-30s and wrapping your work up in your early 60s or before--just make saving/investing a priority. Don't buy expensive cars, don't buy a super expensive house, don't live in a very high COL area, and keep kids' education expenses in check.
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Re: Anyone start saving late and still retire early?

Post by DetroitRick »

I sort of did. I didn't start saving big time until 34, and I retired at 50 (partially, fully by around 52). But I had sufficient emergency savings, no loans except car, no investments, solid insurance from my 20's on. I was just post-divorce, at that age 34 point.

There was some luck involved of course. Undergrad degree from good school happened to be extremely cheap then, and my grad degree was mostly employer paid - both of which are harder to duplicate today. I also had an employer that briefly offered an outrageous 401(k) match for a few years - which kick-started my retirement investments. I had a relatively high-paying job(s) from late twenties on, unusually liberal expense accounts most of that time, and a modest personal standard of living (in "medium" cost of living areas). Much of my personal recreation also just happened to be pretty low cost too (so I could really goose up my investing and savings without it ever feeling "sacrificial"). Remarried at 44, to somebody with very similar spending, saving, and investment habits - which REALLY helped too of course. So for me it was a big combination of things that ultimately made it possible. But it was possible.
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Re: Anyone start saving late and still retire early?

Post by kramer »

climber2020 wrote: Sat Dec 21, 2019 8:34 pm I didn't get out of school/training until my late 20s and it took me until around age 32 to get to a net worth of zero. In my late 30s now and will probably hit my number within the next 3 to 5 years depending on market returns.

Not much of a secret; it's just math. I make good money, though significantly less than the average person in my profession (by choice, as I work fewer hours than most), and I've consistently saved and invested 60 to 70% of my after tax income. Living in a low cost of living area and not wanting kids makes it a lot easier.
Almost the same for me ... retired at age 41 with some lucky investment returns.
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mmmodem
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Re: Anyone start saving late and still retire early?

Post by mmmodem »

It took me 8 years to graduate college. I am not a doctor. Just lazy for lack of a better word. I didn't start investing until I was 29 and even then it was just maxing Roth IRA and getting the match in a 401k.

A little over a decade later now at age 40 and we've reached thin FIRE status. This is with a family of 6 in a LCOLA. We do plan to return to Bay Area, CA so will continue to work until we can fat FIRE there. I'm expecting this to happen before I am 50. The secret is simple. Live below your means. We save nearly 100% of our expenses. That is, after taxes, we save half and spend half.
an_asker
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Re: Anyone start saving late and still retire early?

Post by an_asker »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Didn't read the rest of the replies, but I did some research recently. Went to morningstar's site and noted down the to-date (as of 11/30) returns of $1 invested in vanguard's s&p 500 fund (VFINX) on the first of the year each year since 1994. If each of those years, someone invested to the limit of the Roth IRA (which was $2000 those first few years), they would have over $300k.

Granted, not everyone puts 100% of their savings in S&P500. Granted, S&P500 cannot be expected to mirror those returns.

But note, also, that these figures are not anywhere close to the 401(k) maximums. So, if a couple had each placed maximums into 401(k) and Roth IRA and put even 60% into S&P500 index fund, they could easily have way over $1.5 million (or more) with those savings.
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watchnerd
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Re: Anyone start saving late and still retire early?

Post by watchnerd »

an_asker wrote: Sat Dec 21, 2019 9:04 pm
Didn't read the rest of the replies, but I did some research recently. Went to morningstar's site and noted down the to-date (as of 11/30) returns of $1 invested in vanguard's s&p 500 fund (VFINX) on the first of the year each year since 1994. If each of those years, someone invested to the limit of the Roth IRA (which was $2000 those first few years), they would have over $300k.

Granted, not everyone puts 100% of their savings in S&P500. Granted, S&P500 cannot be expected to mirror those returns.

But note, also, that these figures are not anywhere close to the 401(k) maximums. So, if a couple had each placed maximums into 401(k) and Roth IRA and put even 60% into S&P500 index fund, they could easily have way over $1.5 million (or more) with those savings.
Starting in 1994 was 25 years ago.

Is this an example of starting early or late?
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blahblahsunshine
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Re: Anyone start saving late and still retire early?

Post by blahblahsunshine »

We are going to do it here in the near term (right at 50). I was just barely out of school by 30 so didn't have any 401ks to speak of until after that. For us, it was really a matter of a lucky draw in terms of schooling and opportunity (tech) and having the disposition to save a lot of our income. We are just efficient not cheap. One thing I believe that helps us is we don't watch TV or see ads very frequently so don't pine for things we don't have.
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Re: Anyone start saving late and still retire early?

Post by Barcelonasteve »

When I was 36 in 2002, my and my wife’s net worth was probably -$140,000 (mortgage and student loans) with combined incomes of $65,000 that climbed slowly to about $140,000 until a couple of years ago when my wife started receiving a pension, but continued working. I’m about 15 months from retiring just before I turn 55 (originally, it was to be 57, but I purchased time toward my pension to chop off 1 1/2 years), which is only possible because I’ll have a pension as I lacked the foresight and discipline to plan for something that seemed to be light years away. We aren’t as well off as we wanted be, but we would rather retire now and make do with what we have, so it’s a combination of ability and willingness to live with less.
joylesshusband
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Re: Anyone start saving late and still retire early?

Post by joylesshusband »

Pretty feasible.

Started saving at the age of 40 (having freshly moved to the US of A 2 years earlier with a wife and 2 little kids).
Retired right after my 59th birthday in 2018.

The secret is in controlling spending, living within one's means, expanding skills, earning well, investing diligently, not panicking with market fluctuations, and constantly learning. Staying healthy helps as well.
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Re: Anyone start saving late and still retire early?

Post by flyingaway »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
I started my formal work at 34 with a debt of several thousand medical bill, and could retired at 55. But we have two persons in a family with two professional level salary at a low cost of living area. We saved aggressively, and the stock market helped.

It also depends on your life style, how much you need to spend each year.
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Re: Anyone start saving late and still retire early?

Post by shess »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Even if people start saving at 21, most of them can't save all that much in absolute terms for awhile. Peak earning years are generally considered to be in the 40's or 50's, and I'd think those wouldn't necessarily be correlated with your tendency to save money. If you retire early, your savings in the last year pre-retirement will probably equal two or three years you missed in your 20's, even including growth, so most likely you're just looking at a few more years.
7eight9
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Re: Anyone start saving late and still retire early?

Post by 7eight9 »

Got married at 36. Our combined net worth was maybe $10K. 18 years later net worth of app. $1.6M. Mostly through savings. 20/80 stock/bond ratio. Pretty much ready to retire. I'm doing some consulting these days but not really worth the bother. My wife still is working to get to 40 quarters of Social Security (finish early next year). Certainly possible. It really depends on your savings rate and annual expenses. Keep the first high and the second low and it shouldn't be a problem.
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Re: Anyone start saving late and still retire early?

Post by H-Town »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
There is really one principal: live below your means. The lesser you spend, the more you save. I save $1 or more for every dollar spent. As my career progresses, I keep our life style relatively the same so I'm able to save 2-3 times the expense. Stay away from bigger house (more than you need) and new cars with fancy techs and safety features. Consider public schools and state public universities for your kids. Live a healthy lifestyle to prevent expensive healthcare expenses.
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Re: Anyone start saving late and still retire early?

Post by smectym »

We didn’t have 2 nickels to rub together at age 40, but financially independent before 60; key factors were high paying biglaw jobs and riding the RE bubble, selling at propitious times, through luck not skill. Investing strategy quite conservative, with the portfolios within 401(k) at around 40/60, plus a lot of savings bonds (bought before the current restrictive purchase limits), CD’s, and other stable value instruments.
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beyou
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Re: Anyone start saving late and still retire early?

Post by beyou »

I was lucky to find my career early on, but initially income was low and had no assets coming out of college. As income grew, focus was in paying off student and car loans, then eventually my mortgage.

So do you consider paying off debt over investing “starting late” ? If so then I started investing late, but in my mind I started financial planning early.

In my 50s now and feel at or near FI (retirement to me was never the goal, FI was). After that work is optional, but for the moment I prefer to keep working.

So to me the question should be about financial planning early and FI still early.
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watchnerd
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Re: Anyone start saving late and still retire early?

Post by watchnerd »

beyou wrote: Sun Dec 22, 2019 1:02 am
In my 50s now and feel at or near FI (retirement to me was never the goal, FI was). After that work is optional, but for the moment I prefer to keep working.
I'm with you on the FI vs RE.

If work is still fulfilling, why RE even if you can?

I think Suzy Orman has a lecture about why she thinks RE is dumb, even after you achieve FI.
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Re: Anyone start saving late and still retire early?

Post by catdude »

My story is similar to what other folks have stated here. I didn't start saving till I was 40, but after 15 years of saving like mad, I was able to retire. The keys for me were: (1) saving 35-40% of my income; (2) getting a pension; (3) getting health insurance coverage thru my ex-employer (I pay 30% of the premium); (4) living in a modest townhouse; and (5) not having kids. I realize I'm a lucky dog to have the pension and the health care, those things are hard to come by nowadays.
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JoeRetire
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Re: Anyone start saving late and still retire early?

Post by JoeRetire »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Sure.

Paid very little attention to saving before 30. Two kids, a house, etc - all got in the way.
Semi retired at 60, fully retired at 62.

There is no secret.

Always lived beneath our means. Saved some while spending a lot on normal growing family. Didn't try to keep up with the Joneses. Didn't overspend on housing. Didn't take expensive vacations. Kept a 30 year mortgage and no other debt. Worked very hard. Got lucky enough to be good at work in a lucrative domain. Paid for the kids' college without going into debt. Saved a lot while becoming empty nesters.

No pension. Waiting until 70 to start social security benefits.

It's really not that hard, if it's what you want.
Last edited by JoeRetire on Sun Dec 22, 2019 2:53 pm, edited 1 time in total.
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SQRT
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Re: Anyone start saving late and still retire early?

Post by SQRT »

It was a little different for me. Negative net worth at 42 when I separated from my first wife. Really no significant saving up to that point. My career took off and I saved most of the extra comp (options and RSU’s). Retired at 56 with a very well funded retirement. That was 13 years ago. Really worked out well. Was very lucky.
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Re: Anyone start saving late and still retire early?

Post by mtmingus »

JoeRetire wrote: Sun Dec 22, 2019 6:02 am
JD2775 wrote: Sat Dec 21, 2019 7:57 pm late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old
Sure.

Paid very little attention to saving before 30. Two kids, a house, etc - all got in the way.
Semi retired at 60, fully retired at 62.

There is no secret.

Always lived beneath our means. Saved some while spending a lot on normal growing family. Didn't try to keep up with the Joneses. Didn't overspend on housing. Didn't take expensive vacations. Kept a 30 year mortgage and no other debt. Worked very hard. Got lucky enough to be good at work in a lucrative domain. Paid for the kids' college without going into debt. Saved a lot while becoming empty nesters.

It's really not that hard, if it's what you want.
Very similar story here, with additional info:
Wife stay-home most of the years and visits her families overseas every two years (cost about $5k each time).
Two private colleges paid.
Plan to retire between 60 and 62.
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JoeRetire
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Re: Anyone start saving late and still retire early?

Post by JoeRetire »

mtmingus wrote: Sun Dec 22, 2019 6:36 am
JoeRetire wrote: Sun Dec 22, 2019 6:02 am
JD2775 wrote: Sat Dec 21, 2019 7:57 pm late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old
Sure.

Paid very little attention to saving before 30. Two kids, a house, etc - all got in the way.
Semi retired at 60, fully retired at 62.

There is no secret.

Always lived beneath our means. Saved some while spending a lot on normal growing family. Didn't try to keep up with the Joneses. Didn't overspend on housing. Didn't take expensive vacations. Kept a 30 year mortgage and no other debt. Worked very hard. Got lucky enough to be good at work in a lucrative domain. Paid for the kids' college without going into debt. Saved a lot while becoming empty nesters.

It's really not that hard, if it's what you want.
Very similar story here, with additional info:
Wife stay-home most of the years and visits her families overseas every two years (cost about $5k each time).
Two private colleges paid.
Plan to retire between 60 and 62.
Yup. My wife was out of the workforce for 8 years, and then worked "mothers hours" while the kids were in school. After than she worked a 4 day week.
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gmc4h232
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Re: Anyone start saving late and still retire early?

Post by gmc4h232 »

I think you need to rephrase your question like this and you will have your answer:

Is it possible to retire after working for less than 35 years?

Answer - yes.
mtmingus
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Re: Anyone start saving late and still retire early?

Post by mtmingus »

According to one source,

The median living retiree left work at 62 years old, and the most common age to retire was 62 years old.

For bogleheads community, these numbers are likely lower.
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Re: Anyone start saving late and still retire early?

Post by abner kravitz »

I retired at 58 and my net worth was less than $50K at age 40. Reasons were that earnings increased nicely, I saved about 80% of income, and the great recession came at an opportune time for me - my earnings peaked around 2007 and I was buying equities like crazy and kept buying them.
Last edited by abner kravitz on Sun Dec 22, 2019 9:13 am, edited 1 time in total.
RubyTuesday
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Re: Anyone start saving late and still retire early?

Post by RubyTuesday »

Many high income professionals with extensive education requirements prior to high earning years (e.g. MDs) start saving “late” and can easily retire “early” if they save and live beneath their means.

And truth be told, most vocations that provide enough earnings to save while living beneath your means will allow for a modest early retirement.

Also, some entrepreneurs pour everything into their businesses, delaying saving. At some point, if lucky, they hopefully convert that very risky, non-diversified, illiquid asset into cash. They too have to learn to save and live beneath their means.

Can you spot the common denominator?
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Hillview
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Re: Anyone start saving late and still retire early?

Post by Hillview »

yes -- I had no money and no job in 2001 and had SPENT all my 401k savings (30 years old). I am now near 50 and in pretty good shape. Plan to keep working for another 8 years and then see what happens.
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Re: Anyone start saving late and still retire early?

Post by smitcat »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
"I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44."
What does retire mean to you? One alternative plan...
- find something you like to do that can earn your income
- do not sacrifice in your earlier years
- live when young but save for later
- adjust hours of 'work' when it suits you
- 'retire' when it suits you
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Cheez-It Guy
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Re: Anyone start saving late and still retire early?

Post by Cheez-It Guy »

Yes.

It's a factor of savings rate and expenses.

If you make a decent wage, control spending, and save aggressively, and experience non-catastrophic market returns, it should be quite feasible to retire within 15 years starting from zero net worth (also means not in heavy debt to start). Especially true if you have dual income.

https://networthify.com/calculator/earl ... awalRate=4
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Watty
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Re: Anyone start saving late and still retire early?

Post by Watty »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

When I was 30 I did not have any retirement savings but I did have a paid off car that was only a few years old and I also had a 10% down payment on my first home so my net worth was not that bad.

In retrospect I did something that was sort of dumb in that when I bought my first house I put virtually all money money into it so in today's dollars I probably had well less than a thousand dollars left after the closing costs.

One of the reasons that I remember I had so little was the weekend before I moved my TV made a loud "snap" sound which was the power supply going out. It was older and not worth fixing and it was over six months until I could afford to buy a replacement. I also has a tiny 3 inch black and white TV that I could use if I really wanted to watch something.

I still managed to retire just before I turned 59 and I was able to pay for my kid to go to a state university.
JD2775 wrote: Sat Dec 21, 2019 7:57 pm Just want to hear from others who have actually done it (or are planning to) and what is their secret!
It is important to remember that the investing environment was a lot different back then

1) When I was in my 30's 401k accounts were almost nonexistent and for a long time only few big blue chip companies had them. I did not get access to a 401k until the late 1990's when I was in my early 40s.

2) The contribution limit for IRAs was only $2,000, for a non-working spouse it was only $250. The dollar was worth more back then but that still was not a lot.

3) Interest rates and inflation had just come down from double digits. I got lucky and the mortage rates dipped just before I locked the rate and I thought I had gotten lucky to get a 9.75% rate since rates had been much higher just a few years before.

For reference I was a computer programmer so I always had good pay but it was never anything spectacular like you hear about now. In current dollars I never made over $100K and when we had a kid my wife was mostly a stay at home mom and only did some part time work.

As to what I did;

1) In my 20's I lived in the Bay Area which has always be expensive. When I wanted to buy my first house the only type of house that I could have afforded there would have been small and dumpy. I moved to a cost of living area where housing cost maybe a fifth of what it did in the Bay Area. The area also had a much higher quality of life. That was one of the best decisions I ever made.

2) Going through my 30s I got married and we had a kid so I did not really save a lot with all the other expenses. We never had much debt other than the mortage and we saved up a comfortable amount in the bank but we did really have any retirement savings to speak of except for a traditional pension plan but I only had a few years service in it so it was not worth much.

3) I have never carried any credit card balances. The only times I paid any any credit card fees or interest where two or three times when a credit card bill was misplaced and I paid it a week or two late. I can only remember one time when I intentionally carried a balance when I needed to spread some large expense over two months. I do charge most things to get at least a 2% rebate.

4) About the time I turned 40 the company discontinued the pension plan, my vested balance was about a years pay. They replaced the pension plan with a 401k where they would give a maximum 3% match if you made a 6% contribution. I can't remember what I started out with but it was at least the 6% to get the match.

5) I committed to myself to increase my 401k contributions by half of any future pay raises even if it was just an inflation adjustment. This was painless and I pretty well stuck with that until I was contributing 20% of my pay(including the 3% match) to the 401k. In addition to saving a lot this also helped me not have lifestyle creep. This also meant that I was making significant 401k contribution during the dot com but and the financial crisis stock market lows.

6) My first house was not a "starter" house and even though it was not anything fancy or a McMansion there was never any need to move to a more expensive house. In my late 40s I did a corporate relocation to a less expensive area where I bought a similar house that cost about 10% less. By then my mortage payment was little more than a large car payment.

It helps that I live in a low cost of living area and have very low property taxes but retirement budget is about $60K a year. With a paid off house that is plenty for an above average retirement middle class lifestyle here. With two Social Security checks we should get around $40K a year so we will only need to fund the other $20K a year once we are both getting Social Security. That is a very doable amount. Once I got to the point where I could fund the gap between retirement starting Social Security I went on and retired.

If long term care is ever needed out home equity will be our safety net. Being in a low cost of living area helps though since long term care is also less expensive here.
an_asker
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Re: Anyone start saving late and still retire early?

Post by an_asker »

watchnerd wrote: Sat Dec 21, 2019 9:39 pm
an_asker wrote: Sat Dec 21, 2019 9:04 pm
Didn't read the rest of the replies, but I did some research recently. Went to morningstar's site and noted down the to-date (as of 11/30) returns of $1 invested in vanguard's s&p 500 fund (VFINX) on the first of the year each year since 1994. If each of those years, someone invested to the limit of the Roth IRA (which was $2000 those first few years), they would have over $300k.

Granted, not everyone puts 100% of their savings in S&P500. Granted, S&P500 cannot be expected to mirror those returns.

But note, also, that these figures are not anywhere close to the 401(k) maximums. So, if a couple had each placed maximums into 401(k) and Roth IRA and put even 60% into S&P500 index fund, they could easily have way over $1.5 million (or more) with those savings.
Starting in 1994 was 25 years ago.

Is this an example of starting early or late?
Let me quote OP - I'll let you answer your own question :-)
For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
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JD2775
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Re: Anyone start saving late and still retire early?

Post by JD2775 »

Great replies everyone, thank you! I purposely left out more details to my specific situation because I didn't want this thread to be about me necessarily, more to hear from others on how they went about their journey. Very interesting replies, thank you!
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MrBobcat
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Re: Anyone start saving late and still retire early?

Post by MrBobcat »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Yeah, it should be possible. We had 3 little kids, my wife was a stay at home mom and I made $36K/year and had less than $10k saved when I was 30. Now we're 53, Mrs works full time (for a salary), all 3 kids are through college and on their own (last one 4.5 years ago) and I'm at my peak earning years and still living like we make $36k/year and saving the rest. We'll see what happens between now and 60, but we should be able to retire if we want to (don't want to right now).
MathWizard
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Re: Anyone start saving late and still retire early?

Post by MathWizard »

I will be retiring in a year or so, 62 or 63.

Negative net worth at 31. Household income over $100K only for the last 3 years. MCOL area.

Yes, it can be done, but most house and car maintenance was DIY,
never owned a new car, kept them well set $100K miles. Lived frugally.
StoopieHippo
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Re: Anyone start saving late and still retire early?

Post by StoopieHippo »

My husband is 41 and it wasn't until last year that I finally talked him into saving for retirement (I'm 34 now, the conversation was about retiring early, but he'd have to save aggressively). Combined we make ~$280k and we will be saving around $99k/yr in order to have ~$1.4ish million in 10ish yrs. And then we'll retire outside the US.
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corn18
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Re: Anyone start saving late and still retire early?

Post by corn18 »

We had no savings and zero net worth in 2013 at age 47. Expect to retire in 2022 at age 56 with a net worth of $2M. We spent a long time living above our means and accumulating debt vs. saving. Got a clue and a very high paying job and turned that around by spending a lot less and saving a boatload.
Consistently sets low goals and fails to achieve them.
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CyclingDuo
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Re: Anyone start saving late and still retire early?

Post by CyclingDuo »

JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Of course it is possible. Rate of savings just needs to be bumped up when starting later. Utilize the household income you have to meet the basic needs, and then map out a plan to reach your goals. You started at age 35/36 and have only been saving for 8 or 9 years. Whether or not you reach your goal by age 60 or later, a large portion of your success will be based on the amount you can contribute each year.

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We like what has been mentioned upthread of shooting for FI as the goal, rather than the RE portion as once you reach FI - you have much more flexibility for the remaining years. RMD's now don't need to start until age 72 and the IRS calls FRA for your age at 67. Based on the IRS stating you have 23 years of work ahead of you until reaching FRA, anything before that could be considered "retired early" to help you reach your FI + RE equation.

CyclingDuo
"Save like a pessimist, invest like an optimist." - Morgan Housel | "Pick a bushel, save a peck!" - Grandpa
Ron Ronnerson
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Re: Anyone start saving late and still retire early?

Post by Ron Ronnerson »

I’m a public school teacher and my wife is a stay-at-home parent. We had a negative net worth until age 32. We’re both 45 now and our net worth is in the seven figures. This is due primarily to frugality and luck (we save half our income and the markets have been generous over the past decade). My plan is to semi-retire in another 10 years or so (age 55) and fully retire at age 60 or 61. A pension along with social security should fully cover our retirement expenses.

Our approach is built around maximizing time rather than money so our focus is on keeping expenses low rather than generating income. This way, we can still meet our savings goals without the need to work long hours. I don’t tutor, teach summer school, coach, etc. as I value time a great deal.
MarkBarb
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Re: Anyone start saving late and still retire early?

Post by MarkBarb »

Married at 27 with a combined net worth South of $50k. Spouse stayed home and we raised 2 kids. Retired at 54.

Good income. Low cost of living. Good market returns. Good advice here. Lots of good fortune.
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fortfun
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Re: Anyone start saving late and still retire early?

Post by fortfun »

DW and I didn't get real serious about saving until after 40. We had a bit but not much. We've been hitting hard since then. We could retire at 51 & 53 but my pension will be about half of our retirement. No social security. Even without my pension would could retire before 60.
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thursdaysd
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Re: Anyone start saving late and still retire early?

Post by thursdaysd »

I didn't really start saving until after my first divorce at 40. I retired at 53, the day I hit 30 years with the megacorp. However, I paid my mortgage off, my pension started the day I retired, I had retiree medical benefits, and I worked as a part time contractor for three years (initially at my old job). I started spousal SS when I reached FRA, and took my own SS at 70. Unfortunately, I retired near the end of 2000, so it took a while for my portfolio to reach my target number.

I took early retirement because I had heard too many stories of people who had planned what they wanted to do when they retired and didn't make it (people who retired from my megacorp tended to either die soon, or come back to work). I wanted to travel, and I got in fifteen years of extensive travel (four RTWs, 70+ countries) before developing a form of rheumatoid arthritis. The year I spent on the couch, before finding a medication that helped, I was extremely thankful that I had retired early.
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getthatmarshmallow
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Re: Anyone start saving late and still retire early?

Post by getthatmarshmallow »

shess wrote: Sat Dec 21, 2019 11:43 pm
JD2775 wrote: Sat Dec 21, 2019 7:57 pm For sake of this question, let's say:

late saver = starting to save at > 30 years old (no measurable savings before that point)
retire early = retiring < 65 years old

I am just curious how feasible this actually is. I hope to retire by 60, and I didn't really start saving until 35/36 years old. Currently 44.

Just want to hear from others who have actually done it (or are planning to) and what is their secret!
Even if people start saving at 21, most of them can't save all that much in absolute terms for awhile. Peak earning years are generally considered to be in the 40's or 50's, and I'd think those wouldn't necessarily be correlated with your tendency to save money. If you retire early, your savings in the last year pre-retirement will probably equal two or three years you missed in your 20's, even including growth, so most likely you're just looking at a few more years.
+1. This is a really important point -- while it's of course true that starting early is great, and that someone who saves 15% consistently is going to be in good shape 40 years later -- it's certainly possible to catch up very quickly in one's 40s and 50s.

Anyhow, I started saving for retirement at 32, got aggressive about saving at 38, and with good luck and reasonable expectations, 60 is not unreasonable, although I'm in no particular rush to retire.
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