Is retirement the most important financial responsibility?

ack

ack

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May 6, 2010
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We have been told it's Job#1 and that our kids can get loans for college but we can't get loans for retirement. Nonetheless, my wife (SWMBO) has dictated that we pay for our son's undergrad college and that's what we are doing, putting retirement on hold. I do put 10% into my 401k so it's not entirely on hold, but I would like to retire before age 140 and am not at all sure that's going to happen. Especially if the economy collapses and wipes out half our savings for several years! At that, our CFP tells us we are better off than many folk... Scary.
 
I think that living in the present first is the most important financial responsibility; retirement or not.

And even after our death; what we leave to our kids and grandchildren and friends and all people around.

* Charity is more rewarding than retirement.
 
I'm not worried, the government will take care of me!
 
It's prudent to save, but probably more prudent to enjoy your life within rational boundaries right now. If you are constantly undermining your mental condition with fears of an unknowable and uncontrollable future, you will likely not be happy in retirement, either.

On the other hand, it is dumass to outspend your resources and not save, or rely on some greater entity (government) for windfalls.

The retirement industry actually doesn't want you to retire, they hold the retirement bar very high because if you spend your assets, their commissions drop.

You can't buy back your time or your health, so if you need to retire to stay healthy on a shoestring, that is probably the better decision.

Government also doesn't want you to retire, because you stop "donating" to them and your taxes drop quite a bit when you are not in the earning category.
 
Survive the moment >>> spend it on music / audio

I put my wife through Law School & subsidize her so she can take advantage of certain situations.

WHY??? Because leaving her a large amount of money will no longer work. The few hundred people [elitists] that really control the world are making all currencies worthless.

Now you may say: "well what about their money". The elitists know what is going to happen, thus taking advantage of the situations that scalp us.

And to the people that say there is minimal inflation >>> I wonder where they are shopping, and what they are buying.

And where did the trillions of federal stimulus go??? Mostly it went to the elitists - banksters, etc. That is OUR money; stolen from us.

And why do the powerful[?] politicians of the nations not correct these problems? BECAUSE they are the >>>servants<<< of the elitists.

zz
 
It's very important, especially if your plan/goal is to retire early. However, don't let life pass you by as a result of focusing on it excessively. You need to strike a balance.
 
Retirement eligibility has now been changed. You are only eligible for retirement 3 days after death.
 
mep said:
Retirement eligibility has now been changed. You are only eligible for retirement 3 days after death.
Click to expand...

I had kind of planned on that anyway......I'll be working until "' 'lisbeth comes to get me".
 
Frank750 said:
I think this country is in big trouble! $1.5M saved to earn $40k per year in retirement? How many baby boomers do you know with $1.5M in savings?
Click to expand...

I know quite a few who were headed in that direction, or something pretty close, in 2007. If you were 20 years from retirement when the *&%^ hit the fan, or working for one of the few companies left in America who didn't abdicate their responsibility and put the entirety of their pension funds into 401ks in the 90s, then invest most or all of their matching funds in their own stock, you might be ok. If you were 10 years or less from retirement, had youre entire life savings in your house and a 401k or self-directed IRA (ie: the stock market), you took a huge hit you simply don't have time to recover from. You're in trouble. Hell, America's in trouble. The next generation of knowledge workers is going to have to compete with a bunch of educated, experienced, healthy 70-year-olds with empty nests and paid-off mortgages willing to do most of their jobs from home in 20 hours a week. The productive 20 hours. The 20 that's not wasted on politics, ass-covering meetings and general corporate bat-waxing. And the 70-year-olds who do not have the right experience or educations? Well, we as a nation are either going to decide we're ok with tens of thousands of senior citizens living in poverty because they were in the wrong place when we enabled and allowed the financial system blow a hole in the world, or we're going to help them.

Interesting times ahead.

Tim
 
Phelonious Ponk said:
I know quite a few who were headed in that direction, or something pretty close, in 2007. If you were 20 years from retirement when the *&%^ hit the fan, or working for one of the few companies left in America who didn't abdicate their responsibility and put the entirety of their pension funds into 401ks in the 90s, then invest most or all of their matching funds in their own stock, you might be ok. If you were 10 years or less from retirement, had youre entire life savings in your house and a 401k or self-directed IRA (ie: the stock market), you took a huge hit you simply don't have time to recover from. You're in trouble. Hell, America's in trouble. The next generation of knowledge workers is going to have to compete with a bunch of educated, experienced, healthy 70-year-olds with empty nests and paid-off mortgages willing to do most of their jobs from home in 20 hours a week. The productive 20 hours. The 20 that's not wasted on politics, ass-covering meetings and general corporate bat-waxing. And the 70-year-olds who do not have the right experience or educations? Well, we as a nation are either going to decide we're ok with tens of thousands of senior citizens living in poverty because they were in the wrong place when we enabled and allowed the financial system blow a hole in the world, or we're going to help them.

Interesting times ahead.

Tim
Click to expand...

some good observations - but also some highly inaccurate ones. Most people had no significant savings to begin with when the crisis hit, so they would have been flat broke at 70 irrespectively. Then there are people that took a hit when the crisis hit but got back into the market on time and fully recovered.

The people that lost their shirt are those that had (A) some financial assets when the crisis hit (B) took a big loss when they got out of the market (C) stayed out of the market for fear of getting burned again and never recovered. All and all, this demographic represents a very tiny fraction of those with insufficient assets to retire comfortably...
 
I thought the formula was $1.5M in savings that you withdrew 4% from each year to live which would be $60K per year. If you are married and your total retirement income between husband and wife is $60K a year, that doesn't sound so good to me.
 
mep said:
I thought the formula was $1.5M in savings that you withdrew 4% from each year to live which would be $60K per year. If you are married and your total retirement income between husband and wife is $60K a year, that doesn't sound so good to me.
Click to expand...

If you live frugally, you can live off $1.5mln. Without touching principle. $200K paid off home - 7 rental properties worth $150K a piece generating $1000 a month, and $250K in cash for contingencies. No jetsetting, but very comfortable living. Only wildcard is healthcare.
 
You can add 30 to 5-60k per couple per year for social security, if your wife worked long, depending on whether you take it at 62, 66 or 70 or somewhere inbetween.

Before 65, you have steep health care premiums. After 65, integrated with Medicare, the health care bite drops.

60K plus 40K(nominal SS estimate) is about 100K, maybe spendable 75-80K after taxes (no more SS withholding or Medicare withholding), maybe 5-6K for medicare and the upgraded options. With a paid off home, that is do-able, especially if you move to a cost effective location, you can live quite well. That wouldn't be coastal California, however, or the high tax, high real estate hot spots.
 
cjfrbw said:
Before 65, you have steep health care premiums. After 65, integrated with Medicare, the health care bite drops.
Click to expand...

Lot of people cannot retire early only because of insane healthcare premiums. Throw in a preexisting condition and you're screwed. To a 50 year old with spouse with preexisting medical condition with assets generating enough cash to for living expenses (that would be me), Obamacare is a God send..... Don't let this observation take the thread in a different direction though.....
 
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