Ain't that the GD truth!

I started saving pretty young compared to my fellow gen-x'ers and the first $100,000 seemed like it took FOREVER. I watch my money closely which I know some people say you shouldn't do but I like to, and that first couple years it would just creep up. 10 year down the road now and I put in more, but the compounding nature of the beast far, FAR out weighs anything I'm putting in now.

Of course, GE (one of my larger holdings) announcing yesterday they are selling GE Capital and giving $50 billion back to shareholders, thus causing a ~10% jump doesn't hurt!

I ***** about paying $25 for shoes now. :) But I will spend $100 on a torque wrench I may never use. :)

I'm in Canada so no worries about medical bills or medications. :)

Family history says I will only make low 80's and take a few years off that for my job history. I figure I only have to worry about cash till I'm 75, after that it won't matter. I have a group insurance policy that pays enough to plant me and the kid gets a new truck.

My FIL passed yesterday. He was 82. Alzheimer's. Two years from diagnosis to plant food. No one escapes. Laugh. Reduce your stress levels. Be happy.

You sound pretty well grounded and you've got a good philosophy going.

Absolutely. In the beginning it's about the company matching for 401k, and while that's never something to balk at, the compounding is the key. When I was younger I cashed out a couple of 401ks. I could kick myself for that, but what's done is done. I'm going like gangbusters now. I'm just bummed that I missed the compounding.

I think life insurance "investment" is prob the worst financial mistake many people make. It makes huge money for the people that sell it.

Do yourself a favor and look at all the fine print of the policy and vette it with somebody else besides the guy selling it to you.

My parents had several rental properties in the 80's and 90's which worked out very well for them. I am interested, but in the current market where I live (same town as Mom and dad) I feel like the Mortgage payment/Market rent disparity is huge and it would be tough to break even. I would have to go to a surrounding community, maybe an hour plus away to make this work I would think.


Yes my financial planner has been after me to dump it, which I probably will soon.

Last year, people at my company left over $27M on the table simply by not taking our 8% 401k match. Imagine what that would be worth on 30 years?

Wow, 8% is crazy to pass up. It's free money!

I wish I could find the exact numbers, but I read a study once about the effects of compounding interest over time and they took two people over a 30 year time frame starting in 1980. Person A started saving $10,000/year for 10 years invested in a market fund, then stopped completely. Person B waited 10 years then started putting $15,000/year in the same market fund for the next 20 years. After 30 years, Person A still had more money even though they invested less over half as many years.

Here's the comparison but it uses $5k per year as the investment:

http://forums.pelicanparts.com/uploa...1428805277.jpg

It came from here: http://www.darwinsfinance.com/start-investing-today-amazing/

An insurance statistic for most of the developed world.

95% Of us will be dead or broke at 65!

4% Well off

1% Rich.

My Dad retired at 44....Never had close to a million dollars...Knows how to invest and is smart with money...never worried. I will be fine if I can emulate him somewhat!

Most people are completely clueless about investing, compounding and 401K match. That's like getting an 8% raise every year (generally 3 times as much as most standard raises).

Most of my friends want new Harley Davidsons, and new pickup trucks, and honestly believe they will never be able to retire because of all the money they spend right now on toys. I guess there is something to be said for enjoying your money now, and living in the lap of luxury, but when they do stop working at 70 years old, they won't have 2 nickles to rub together....so sad.

Everyone here posting about the benefits of Compounding needs to look at their mortgage and realize how paying down your principal allows you to benefit both ways.........I used to kick this around all night over beer with college room-mates.......We vowed to pay of our mortgages in 5 years of less when out of school.....I was the only one that drank the Kool-aid......

I have mixed feelings about that. I'm not convinced a house is an asset... Some financial planners view it as a liability. Taxes, repairs and maintenance costs are liabilities that continue even if it's paid off.

I got serious about my retirement planning when I was 40. I had money in my 401k and a IRA, but I was just putting in enough to get the company match. I was putting in a lot of hours at the time and knew I didn't want to be working like that for the next 65 years. I was an engineer/construction manager for a large highway and bridge company. We had jobs going night and day and so did our competitors.

So I made up a spreadsheet and talked it over with the wife. Our plan was to be able to retire when I hit 55. We figure we didn't have to retire, but it would still be nice to not have to worry about it. We were both making good money for where we lived, Missouri, so we basically maintained our standard of living that we had that was good. We invested the majority of our raises and bonus money going forward. We had married right out of college and had our kids when we were young, twins, and paid for both of their college educations. Both got jobs and moved out while we were still in our 40's so that helped.

Then due to some unexpected events I decided to quit at 50, in 2007. I had sold some land for a very nice profit, and my boss passed away at 57 from melanoma. Things were changing at work and I had by that time enough money to not need to work.

At the time I quit I was making around 150k, and the wife was making about 100k. She worked for two more years, she is four years younger than me.

I do realize that I could have been putting 150k or so a year into investments and probably be worth a million or two more now. But I could also be dead, the last 8 years of having the time to do whatever I want is worth it to me. We regularly take trips, I like to golf so I joined the country club, I wanted to learn to fly and now I own a plane. We even moved to south west Florida so we had nicer weather during most of the year to enjoy things. We will take trips in the summer.

So plan early and save, it can be done.

I'm in the same boat....two in college and one more behind them. I've been told that you should not spend your retirement savings on college. You can borrow for college, you can't borrow for retirement.

But, I'm not (yet) following that advice. Footing the tab for the first two years for my oldest. He's planning to commission (GA Tech Engineering student), starting his junior year. My daughter and youngest son will get two years paid by papa...the rest is on them. At least that's the plan. I just struggle with letting them get into a hole before they even get started. We'll see.

That's tough. I'll be in the same boat in about 10 years with my two. My business partner is ready to retire at 55....no kids to put thru college.

I have already told my kids to plan on a state school or find scholarships. I think in this day and age affluent parents are smart to put boundaries around their college budget. A four-year college degree is basically meaningless these days....I refuse to spend $300K for my kid to get a liberal arts degree and a job at McDonalds. At least yours is in engineering, good field. Definitely begs the question is traditional college even worth it anymore? Very interesting article in Time magazine about this a couple years back. But that's a whole different thread.

Mike, I am with you on this..I'm not going to saddle my kid with college debt. My son did take out a $10K loan in his freshman year: he had to have skin in the game. He is finishing up his sophomore year and he is in good shape. He will study abroad for a year (very happy about that). My oldest, who didn't attend college, runs his own business - I don't worry about him any more: He just bought his first condo.

My best investment has been my boys.

Originally I managed mine, but now just pay a manager. It allows me to have rentals wherever I want and takes most of the pain of dealing with renters away. Farther away is better for me, especially if the earning potential is greater. Management expense, taxes, insurance, repairs, mortgage interest, travel to visit the home (hopefully in Hawaii. not Detroit), depreciation, etc. are all tax deductible, so it is difficult not to lose money on paper (depreciation is huge) and get a tax break while still approximately breaking even or making a few dollars. I am ok with not making oo much profit as my tax bracket is quite high now...and am setting myself up for retirement when it is a bit lower.

I lived in all my rentals but one (and it was a relative's home) so the entry costs were low and I know the areas very well. All are in very good areas for schools/families. If they do not increase in value one bit, I still win big when they are paid off as I have little invested. An FHA loan now only requires a 3% downpayment. Now that is leverage. For example, if you bought a $100K house for $3K down (lived in it a couple years) and only averaged a 2% inflation of the home price per year (typical)....you essentially are getting almost a 60% return which is not taxable until you sell the home. That does not even factor in the fact that the home would pay off in 15-30 years which essentially adds another $100K back. In fact, you could choose to never sell the home and pay capital gains and just collect rent after it is paid for or refinance to pull out a portion of your equity if you need a larger sum for kids college, etc..

We moved and I bought a home abot the time each of our children wee born. I kept both as a rental to help pay each of my two children's college, In the 15-17 years before they went to college, both were paid off. I told them that I would help them, but did not explain that there was a bunch of money to waste and they would have to be frugal and work some if they did not get scholarships. One kid chose not go to college and the other went too med schoool, but had scholarships all the way through. Darn, now I am stuck with the houses to help fund my retirement. The are pretty much all profit now which is taxable, but I have a few more that are losses on paper that I can write off the income against...so it works out pretty good.

I hope you have a fee-only financial planner. I made the mistake of listening to a "financial planner" who was really an investment seller. I wasted tons of money on life insurance and fees before I wised up. I went to a fee-only planner who got me on the right track for $800. I go back every three years or whenever something big happens in my life for a $500 "tune-up." In 12 years she's cost me way less than the guy who worked for "free."