How much do you expect to need for retirement?

What number in your asset accounts would cause you to say, "That's Enough! I'm not working anymore"?

I just significantly decreased my 401k contributions, and this has caused me to rethink my strategy. I was putting 30% of income into it, and it was building fast. Still though, I decided that it isn't a good idea to keep sacking money away in an account that I can't touch til age 59.5, so I dialed it down to 3%. I'm thinking I can make a lot more managing my investments in other places.

What number in a liquid account would cause you to be comfortable retiring? $200k? $500k? $2m?

I think my number is somewhere around $500k liquid.

Not sure if serious. $500k ? You'd have to die young or live in poverty. Property/Taxes? Medical bills? Insurance?

4% is generally the maximum draw-down rate advised if you're on the younger end of the retirement spectrum.

How well do you figure you'd live on $20 grand many years in the future ?

DroppedByADime wrote:Not sure if serious. $500k ? You'd have to die young or live in poverty. Property/Taxes? Medical bills? Insurance?

4% is generally the maximum draw-down rate advised if you're on the younger end of the retirement spectrum.

How well do you figure you'd live on $20 grand many years in the future ?

I figure the house will be paid off, and debts will be relatively minimal. $500k and the interest earned should be more than enough, and is more than like 95% of all retirees nowadays.

Social security likely won't be there. Healthcare and long term care costs aren't going to diminish anytime soon. In my opinion unless you have 2 million plus socked away, plan on working late into your life. In addition, many of us will live past age 80 as life expectancy continues to increase. It is pretty damn depressing.

My dad retired 10 years ago at age 58 from one of the big 3. 750K then. Has more than that now. UAW benefits made it possible. My parents have lived comfortably and travel extensively. I don't see this happening 20-30 years from now.

Nucky has so much inheritance that he doesn't need to think about this.

Oh shit .... I should've known.

DroppedByADime wrote:Not sure if serious. $500k ? You'd have to die young or live in poverty. Property/Taxes? Medical bills? Insurance?

4% is generally the maximum draw-down rate advised if you're on the younger end of the retirement spectrum.

How well do you figure you'd live on $20 grand many years in the future ?

Both Fonzie and NYC District Attorney Arthur Branch tell me I'll be just fine with a reverse mortgage, so I should be good with that.

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500k is not nearly enough.  You're fooling yourself, unless it is indeed Nucky.

We have a minimum amount we agree we have to reach, but it's also possible we'll do more before it's finally retirement time.  I read recently that 2 million is the new 1 million.  I was very discouraged that many people are saying 1 million isn't enough.

I've done the math over and over and I know we could live off a million.  We live a simple life and I do expect Social Security will be there for me and the wyfe in some form.  Not counting on getting the max from SS tho.

We still have a mortgage payment, but other than that, we live debt free.  I expect to be that way in retirement, without even having a house payment.

Frank Ricard wrote:500k is not nearly enough.  You're fooling yourself, unless it is indeed Nucky.

We have a minimum amount we agree we have to reach, but it's also possible we'll do more before it's finally retirement time.  I read recently that 2 million is the new 1 million.  I was very discouraged that many people are saying 1 million isn't enough.

I've done the math over and over and I know we could live off a million.  We live a simple life and I do expect Social Security will be there for me and the wyfe in some form.  Not counting on getting the max from SS tho.

We still have a mortgage payment, but other than that, we live debt free.  I expect to be that way in retirement, without even having a house payment.

That's what I'm saying, if you are accustomed to a relatively frugal lifestyle, it won't take a whole lot. Pretty much the only thing I spend money on now is at bars, and I can't imagine this will be the case in another five or so years. In another 20 or so years when I'm retired, as long as I'm able to take 4-5 vacations per year, it's not like I'll need $5k per month to service my debts.

Marc Summers wrote:What number in your asset accounts would cause you to say, "That's Enough! I'm not working anymore"?

I just significantly decreased my 401k contributions, and this has caused me to rethink my strategy. I was putting 30% of income into it, and it was building fast. Still though, I decided that it isn't a good idea to keep sacking money away in an account that I can't touch til age 59.5, so I dialed it down to 3%. I'm thinking I can make a lot more managing my investments in other places.

What number in a liquid account would cause you to be comfortable retiring? $200k? $500k? $2m?

I think my number is somewhere around $500k liquid.

You can earn money playing World of Warcraft?

Marc Summers wrote:

That's what I'm saying, if you are accustomed to a relatively frugal lifestyle, it won't take a whole lot. Pretty much the only thing I spend money on now is at bars, and I can't imagine this will be the case in another five or so years. In another 20 or so years when I'm retired, as long as I'm able to take 4-5 vacations per year, it's not like I'll need $5k per month to service my debts.

Keep dreaming.  You can't be serious.  Define 'vacation'.  You'll end up spending 15-20% more than what you think.  It's so predictable we just put it in the vacation plan budget.  No matter how frugal you think you might be, it'll cost more than what you think to live the lifestyle you're accustomed to.

We plan on taking vacations too - by vacations we mean traveling several times to Europe and hopefully, many times back to the Caribbean, not to mention what we plan to do in traveling within the States.  If by vacation you mean spending a week at Higgins Lake 4 or 5 times a year, well you might be able to afford doing that, but it'll still end up taking more money than what you think.

Frank Ricard wrote:

Keep dreaming.  You can't be serious.  Define 'vacation'.  You'll end up spending 15-20% more than what you think.  It's so predictable we just put it in the vacation plan budget.  No matter how frugal you think you might be, it'll cost more than what you think to live the lifestyle you're accustomed to.

We plan on taking vacations too - by vacations we mean traveling several times to Europe and hopefully, many times back to the Caribbean, not to mention what we plan to do in traveling within the States.  If by vacation you mean spending a week at Higgins Lake 4 or 5 times a year, well you might be able to afford doing that, but it'll still end up taking more money than what you think.

.

I mean like taking some winter trips each year to Florida/Arizona/Costa Rica, and then at least one big Summer trip each year to either Europe or Asia. You don't have to spend much money at all while traveling. Rent a beach bungalow for $800 for two weeks with friends, and eat cheap food and drink $2 beers. Should be able to take a non European trip for $1200 total for two weeks, which is well within any budget.

Why exactly do you spend so much money? I don't plan on buying $250 tickets to Disneyworld while retired.....

I plan on drinking and smoking giant solids on the beach with a big fat smile on my face.

So OP makes <=~45k and was living on <=~30k gross? Smells like bullshit.

Heat Miser wrote:So OP makes <=~45k and was living on <=~30k gross? Smells like bullshit.

I make a lot more than $45k, but could see myself quitting in the not too distant future.

DroppedByADime wrote:Not sure if serious. $500k ? You'd have to die young or live in poverty. Property/Taxes? Medical bills? Insurance?

4% is generally the maximum draw-down rate advised if you're on the younger end of the retirement spectrum.

How well do you figure you'd live on $20 grand many years in the future ?

Dropper--you got all that property. I can't imagine you need more cash than that.

Marc Summers wrote:

Heat Miser wrote:So OP makes <=~45k and was living on <=~30k gross? Smells like bullshit.

I make a lot more than $45k, but could see myself quitting in the not too distant future.

Then you're a liar because you can't make more than ~45k and contribute ~30% to a 401k because there is a limit on how much you can contribute.

Wanna come clean?

Heat Miser wrote:

Then you're a liar because you can't make more than ~45k and contribute ~30% to a 401k because there is a limit on how much you can contribute.

Wanna come clean?

You can put an annual max of $17,500 into it. However, until I hit that maximum, there is 30% of income going into it.

My hope is that my apartments pay my retirement. The 401k and the pension will simply add some petty cash to the mix.

Marc Summers wrote:

Heat Miser wrote:

Then you're a liar because you can't make more than ~45k and contribute ~30% to a 401k because there is a limit on how much you can contribute.

Wanna come clean?

You can put an annual max of $17,500 into it. However, until I hit that maximum, there is 30% of income going into it.

If you're hitting the max prior to year end and your employer offers a match you're doing it wrong.

You have too much dipshit to even dream about retirement.

Walmart greeter in your 80s dude.

Your math, your logic. None of it adds to a kernel of corn in Mac level dump.

DroppedByADime wrote:You have too much dipshit to even dream about retirement.

Walmart greeter in your 80s dude.

Your math, your logic. None of it adds to a kernel of corn in Mac level dump.

English please.

I save as much as I can.  I'm in my late 30s and my goal is somewhere between 1 - 1.5 million in today's dollars.  That will be more than enough, I may call it quits before that.  There will still be some form of SS.   Don't let the politicians scare you.  

Also, most of the retirement advice that we read comes from where?  Investment companies.  All of these articles are written with a purpose.  Take the 4% rule.  That assumes you never touch your principal.  While that's great and all, why the hell not?   If I save up $1mil and can live off $40k/yr than so be it.  I'm not going to live in squalor so my family can inherit a huge sum of cash.  

Finally, I know many retirees and not one of them is a millionaire.  Some have pensions some don't.  While $1mil isn't what it once was, it's still a lot of money.   More than most will ever see.

Edit: let me clarify that I don't think $40k would be living in squalor.  Just making a point that I'm using my principal.

No. 4% drawn down accounts for living 25 years. Guess what? The market goes down about as often as up. Duh

Sapping the principal ? Sure. Do it. You run the risk of running dry in half the time.

Young , dumb, full of cum and no cash. Market will go up ten percent every year.

Sure kiddos. Good luck.

By your math I can retire now, lol. I know I need 3 liquid after two homes. 5 if I hang it up pre 62

Ps. Your vague Q doesn't say where you ( would ) live. MI ? Lol.

You need a second home

Different strokes. What works for me wouldn't work for you.

The stock market has averaged 7% gains since 1900. Past history doesn't predict the future but I choose to believe 5% gains aren't too far fetched. I know it's not linear and there will be ups and downs.

Good luck on your savings goal. 2 homes plus $3mil is impressive. More than I would ever need.

I know a lawyer who retired and only had $650,000.00. However he put that money in dividend paying stock funds. Those finds paid him between 5000 and 6000 per month. E never touched the principal. He also go another 2000 on ssr. He lived fairy well but struggled at times. I think you need 1.5 to 2 million to live comfortably. I've also looked into passive income. You need rental income to supplement things. I one outright two pieces of income generating property, one commercial and one a condo. Just my thoughts.

Agreed as to passive income. I bought. A four plex in Austin when I turned 40. Spent every liquid dime I had at the time.
Did a 15 year mtg

That sweet mother will produce milk in my 60s to the tune of $7500

The correct answer, obviously, is 'zilly chedda'.

Probably $9500 by the time I pay it off. It's my only debt. Sweet little piece of debt.

Recent grads flock and wait list. I have to upgrade two more of the four while paying $375/mo for management fees.

Always occupied. Appreciates every day.

It's like a little candy stick that grows and grows. I don't eat candy in life nor real estate

I love the sweetness that always reminds me that the blanch's of the world are abundant. Sweet sweet rent hits my account by the fifth.

I pay the majority then to principal. Candy land.

DroppedByADime wrote:Probably $9500 by the time I pay it off. It's my only debt. Sweet little piece of debt.

Recent grads flock and wait list. I have to upgrade two more of the four while paying $375/mo for management fees.

Always occupied. Appreciates every day.

It's like a little candy stick that grows and grows. I don't eat candy in life nor real estate

I love the sweetness that always reminds me that the blanch's of the world are abundant. Sweet sweet rent hits my account by the fifth.

I pay the majority then to principal. Candy land.

So buying real state early in a hot market is a good idea?? Wow who would have thought??

Blanch32 wrote:

So buying real state early in a hot market is a good idea??  Wow who would have thought??

My ex-neighbor thought the same thing 20 years ago. He lost an impressive 3 apartment complexes and his home in the crash. Works as a contractor/slave for a local business man. Living in a 2 bedroom 800 sq ft fixerupper now... in his 50s.

Try this. If you want to be very conservative, set rate of return at about 3-4% and inflation at 7-8%.

http://www.bankrate.com/calculators/retirement/retirement-plan-income-calculator.aspx

Meh. Live while you're young. The future is not guaranteed.

I can always pick up a job at Applebee's when I'm 60 and bitch that some idiot only tipped me $3 because I'm too old.

Giant Moose wrote:Meh. Live while you're young. The future is not guaranteed.

I can always pick up a job at Applebee's when I'm 60 and bitch that some idiot only tipped me $3 because I'm too old.

I agree with your first statement. I know of 2 incidents where people had slaved away and been frugal their entire lives, then retired with the attitude that now was the time to enjoy life. One woman was diagnosed with cancer shortly after retirement, and died within 6 months (her husband has plenty of money, but no one to share his days with). The other person bought a 2nd home in Florida, and the first winter they spent down there they were involved in a bad car accident, and is now paralyzed from the neck down.

I'm sure both of those people (and their spouses) wish that they had a few more memories of taking a vacation on spring break, or going on a 3 day weekend. Their plan was that retirement would be the fun time in their life, and even though they had the cash to make it happen, life had other plans for them.

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Rodeo Burger wrote:

I agree with your first statement.  I know of 2 incidents where people had slaved away and been frugal their entire lives, then retired with the attitude that now was the time to enjoy life.  One woman was diagnosed with cancer shortly after retirement, and died within 6 months (her husband has plenty of money, but no one to share his days with).  The other person bought a 2nd home in Florida, and the first winter they spent down there they were involved in a bad car accident, and is now paralyzed from the neck down.  

I'm sure both of those people (and their spouses) wish that they had a few more memories of taking a vacation on spring break, or going on a 3 day weekend.  Their plan was that retirement would be the fun time in their life, and even though they had the cash to make it happen, life had other plans for them.

I guess if you plan on dying early, this is fine advice. For every example you can provide similar to above, I can give you 3 of people who retired with insufficient funds, or worse yet - were never able to retire at all, due to poor planning and living in the moment.

I would rather drop dead as a multi-millionaire while leaving my retirement party than be a financial burden to my children in my old age because I didn't plan well.

I am going to win the PowerBall Wednesday...I wont have to worry about it   

Worked at a company with a guy that had a miserable job, he hated it. He had four months to go until retirement and he had a pension coming to him. Well he had a stroke and he's in a bed with locked in syndrome.

Poor guy. At times I'm tempted to do what the chief did to RP McMurphy but I don't want to go to jail.

TravelinMan wrote:

I guess if you plan on dying early, this is fine advice.  For every example you can provide similar to above, I can give you 3 of people who retired with insufficient funds, or worse yet - were never able to retire at all, due to poor planning and living in the moment.

I would rather drop dead as a multi-millionaire while leaving my retirement party than be a financial burden to my children in my old age because I didn't plan well.

The thing is, some people act like living well now, or having sufficient funds to retire are mutually exclusive. Anyone who goes to one extreme or the other is a fool IMO.

There are people fanatical about retiring wealthy, or retiring early. I know a guy whose plan was to retire at 45, and had been frugal enough to do it. The problem was that he was an insufferable prick to his wife and kids, so he was divorced a few years shy of his retirement date. I guess its just as well he'll have to work quite a bit longer, its not like he has anyone to hang out with, or any hobbies to pursue anyway.

But he won't be a burden to his kids, they want nothing to do with him.