Retirement Secrets

[Craig T]

Originally Posted by motion

Speaking for myself, I've chosen to spend my money (within reason), rather than horde it. So, what's that done for me? At the age of 52 (I think that's how old I am), I have very, very few things left to do in life. I've pretty much done everything there is to do, and seen everything there is to see, within reason. I have a few things left: skydive jet jump, go to space, have a good relationship with my future grandchildren. That's really about it.

^^^at 54, this is my philosophy exactly. See and experience the world while you are young and healthy, but in a balance that allows at least a comfortable, maybe not extravagant, place in retirement.

My father spent every penny he earned…avoided debt...but spent like a drunken sailor. He traveled the world, loved expensive wine, gambled, and drove nice cars all his life. Family and friends criticized him as spendthrift. At 60, he got a bad head and neck cancer. By 65 he was on a liquid Rx diet, and couldn't walk to the mailbox, let alone walk the banks of the Seine or climb the Roman Steps. Had he saved every penny in anticipation of a well traveled retirement, it would have been wasted.

My wife and I know we can not maintain our current lifestyle in retirement, but we'll sell our house and downsize dramatically. We'll have enough to enjoy our grandkids, play golf once a week, fish constantly, and spend a lot of time doing volunteer work while we're healthy. If one of our health declines, we'll have no regrets. Time for good books and gardening.

[JavaBrewer]

My wife and I are living the same plan Craig. I am 54 and my wife is 50. One kid in college and the other will be in 2 years. We won't have all that much in retirement accounts when it's all said and done but will have two homes paid for in SoCal. Our plan when older will be to rent something and use our existing properties for rental income. Hopefully. Watching my parents devolve physically and mentally I don't have high hopes for an active life beyond 75 or so. We very much focused on quality of life in our 30's and 40's with our kids along for the ride. Healthcare costs and assisted living are frightening and I am not sure how to plan for that. Foolish to disregard - I am currently shopping such a placement for my parents and well the costs are staggering. Time to perhaps hire a professional for guidance.

[gacook]

Originally Posted by motion

This is something I think about often, but just cannot figure out. How do most Americans retire comfortably? I know GD well that most American couples don't retire with 2-5mm in assets aside from their primary home. From what I gather, its more like $50K in assets average. I know a lot of you midwest guys have paid for homes that are worth sub $100K, but in most parts of the country, a decent home is a half million plus. I also see a lot of people 50+ refinancing their homes for 15-30 years. So, how do they pull it off? I have no idea what the average monthly SS payment is... $2500? That doesn't seem like it would go very far. Do people just keep working until they're 80? Where does the money come from? Kids? Inheritance?

I work for the Feds (Department of Defense). When I retire in 20 years(around 58-ish), I will have 40 years of service invested into them (I "bought" back my Army time to give me an extra 10 years). This will give me a pension that is roughly 50% of my highest 3-year pay window, so I'll be expecting somewhere in the $60-75k/year range once I retire.

On top of that, I've been investing in our version of a 401k (the TSP, as previously mentioned by someone else), and that does fairly well, so I'll have a pretty nice nest egg there, as well.

I don't believe SS will be around when I retire, so it doesn't exist in my retirement plan. IF it does exist at that point, it'll just be a slight bonus.

I really have no worries about retirement...

[speeder]

Originally Posted by gacook

I work for the Feds (Department of Defense). When I retire in 20 years(around 58-ish), I will have 40 years of service invested into them (I "bought" back my Army time to give me an extra 10 years). This will give me a pension that is roughly 50% of my highest 3-year pay window, so I'll be expecting somewhere in the $60-75k/year range once I retire.

On top of that, I've been investing in our version of a 401k (the TSP, as previously mentioned by someone else), and that does fairly well, so I'll have a pretty nice nest egg there, as well.

I don't believe SS will be around when I retire, so it doesn't exist in my retirement plan. IF it does exist at that point, it'll just be a slight bonus.

I really have no worries about retirement...

You have a good plan. High income job that you like, (that hopefully never goes away), with locked-in benefits. Stuff will be expensive in the future.

I'm thinking of investing in small town RE in the PNW or other attractive retirement places in the future. The sunbelt will be unlivable. It is now, IMO.

[gacook]

Originally Posted by sc_rufctr

Good luck Jim. At least you have your health.

My story, The divorce happened when I was 37. Fast forward 13 years and I feel I should be a lot further along than I am. Oh well. Just keep going I guess.
What else can you do?

I feel ya there. I divorced at 32...by the time my last kid turns 18 (we had 3), I will have paid half a million in child support. And that's on top of all the normal expenses that come from having kids that I still pay for, too.

[930addict]

Originally Posted by Don Ro

Whatever happened to the tradition of offspring care-taking parents in-home and holding their hands as they pass?
Or at least until their last days in a hospice?

In my grandparents case, my mom was the only child in the area and didn't have room to put them anywhere because their home was being remodeled. My mom was very upset that she couldn't have them at the house.

This is making me rethink my garage plans. My house is two story. It might be prudent to incorporate an in-law quarter into my garage plans as my parents are getting up there in age and it would be nice to be able to help them when the time comes/if needed. I'm the only child in the position to do so.

[gacook]

Originally Posted by 930addict

In my grandparents case, my mom was the only child in the area and didn't have room to put them anywhere because their home was being remodeled. My mom was very upset that she couldn't have them at the house.

This is making me rethink my garage plans. My house is two story. It might be prudent to incorporate an in-law quarter into my garage plans as my parents are getting up there in age and it would be nice to be able to help them when the time comes/if needed. I'm the only child in the position to do so.

I couldn't wait to get out of my parents' house; I'm sure as hell not letting them move into mine!

In all seriousness, we're not close. If my dad passes before my mom (step-mom, actually), she wouldn't be moving in with me--ever. She has biological kids who'd better step up to the plate there. If she passes before my dad, I'd take care of him if he needed it.

[KFC911]

Originally Posted by LakeCleElum

....It's all about a lifestyle and mindset that started with a paper route and mowing lawns when I was 12...

^^^^ This....

Planned to exit the corporate world at 50, but called it quits in '08 when my dept was outsourced instead of continuing on with HP. "Retired" at the ripe old age of 48 seven years ago, and haven't looked back or regretted it one bit. You couldn't PAY me to travel the world like Motion does for fun, and most folks would probably wonder why I do what I do and be bored to death....bottom line, I'm happier than ever and life is good. No one can answer this question but the one posing the question imo. But....it doesn't happen "for most" without planning and it's all relative to lifestyle choices etc. YMMV....

[strupgolf]

Tt

[strupgolf]

I retired a year and a half ago,. Don't wait, retire early. Life is good.

[fintstone]

Lots of folks make similar compensation but it is just divided differently. One guy works for 40 years for a bit less salary but gets a defined benefit plan. Another makes more now but has a very limited or no retirement plan. If we could have invested that small extra amount for 49 years...we would do even better that the guy with the defined benefits. Too bad most never do. It makes a good argument to take the option that forces you to make less now in favor of more later. The military is much the same. When they institute their new retirement program that cuts the retirement pay 20%, but gives some better opportunities for investing....lots of guys will come up short 30 years later.

[2porscheguy]

Originally Posted by motion

This is something I think about often, but just cannot figure out. How do most Americans retire comfortably? I know GD well that most American couples don't retire with 2-5mm in assets aside from their primary home. From what I gather, its more like $50K in assets average. I know a lot of you midwest guys have paid for homes that are worth sub $100K, but in most parts of the country, a decent home is a half million plus. I also see a lot of people 50+ refinancing their homes for 15-30 years. So, how do they pull it off? I have no idea what the average monthly SS payment is... $2500? That doesn't seem like it would go very far. Do people just keep working until they're 80? Where does the money come from? Kids? Inheritance?

Motion I think about this often as well!

I just turned 55 and I'm planning on the big R in 3 to 5 years. We have a decent nest egg put away that should hopefully keep growing. We have a decent enough home on two acres just out of town that's been mortgage free for almost 11 years. We have no debt, an OK car collection, and a vacation property in BC. BUT, outside of our annual two week vacation in Hawaii, making use of our timeshare, we haven't traveled much. I would dearly like to start traveling more when I retire. It's a well known fact that you are a very well traveled Pelican to say the least!

In short, I would like to acquire your lifestyle in 3 to 5 years. What does said lifestyle cost you per month?.....not being nosy here but just trying to plan ahead!

Cheers!

[Hugh R]

When I "retire" in a few years, I wouldn't mind driving my two year old big ass RV around the country, and also Canada. But you can easily burn $100 to $200/day in gasoline. Add in staying at an OK RV park can run $75-$100/night. That's not accounting for any maintenance. Its only got 7,200 miles on a Ford Triton V-10 engine, so regular oil changes, other fluids, etc. are important to keep it running well. You need to change out the tires every five years, regardless of wear. That's another $1,200 to $1,500, so you have an incentive to put miles on fresh tires.

So even something like RVing in retirement may sound economical, its NOT.

I can hang around the house for probably 1/10th the daily cost. And if I'm RVing, I still have to pay for the costs associated with the house (property taxes, mortgage paid off, but insurance, some minor utilities and upkeep).

Edit: I travel a lot for my work. I think I've been to 25+ countries and 20 or so states and 3 or 4 Provinces in Canada, paid for by my employer, so I've sort of gotten that bug out of me.

[2porscheguy]

I can attest to what you're saying Hugh, RVing is fun but it's not cheap!

Being self-employed and in the health care profession, all my travel is paid for by my cheap azz old grumpy boss (looking in the mirror!)! So I'm really envious of you and your travels being taken care of...that's what I want, dammitt!

So, as a result of that, the travelling part will have to come later....that's why I'm on Motion's case....to see if I could afford it down the road!

I've got friends that make a decent $$$, with no kids and they travel all the time it seems....3-4 major vacations a year.....in fact, they're off to Italy for two weeks this Thursday! But they've admitted that they're biting off a chunk of their nest egg in the process. They've been to many places that I dream of going to but now they're really concerned about not having enough $ for retirement. Though, in his case, he's admitted that all males in his family die young.....58 is the norm for them, so I guess he may have a point, although he's in pretty good health at 54. They've just bought a puppy in hopes of keeping them close to home, grounded, spending less on travel, and building back the nest egg......after the trip to Italy, that is, of course!

Me, I'm just too cautious (AND CHEAP!) I guess so I'm holding back on the travel plans until later.

[aigel]

My RV is a truck camper on a 4x4. 20+ mpg, camping is free in every national forest, just back up to the boonies! I could live in that thing for extended periods. Not sure my wife could though, that's why she'll stay back and continue to work.

G

[biosurfer1]

I've planned well for retirement and think the SO and I will be fine, but its the big unknowns that really worry me.

My best friends mom got Alzheimer's at 52 and by 53 didn't know who any one was. The assisted living place she lived in was very expensive and at 53, she could have easily lived another 30+ years in there. I think (and he does too) that it was a miracle she passed away after only 3 more years in there. Hardest thing in the world to go see a woman who was like second mother and not have her know who you are. I can only imagine what it was like for his dad.

Like someone said before, we're all one event away from being wiped out. The best we can do is plan for the best and adapt as needed.

[gogriz91]

At the risk of thinking outside the box you could contemplate retiring overseas. I know people who have retired in the Philippines and Thailand and live well beyond what they could comparably live in the states and are quite happy.

[twobone]

I just turned 47. Wife + 2 kids. One in middle school, the other starting high school

I have a handful of strategies that have helped me get on a good track for retirement:

1 -Pay myself first. I look after the family finances. I religiously put an average of $25K away a year into the stock market. $750 every bi-weekly from my pay check and $5K annually into the kids education fund. I take the long view.....the dips in cash flow are addressed with a small line of credit, which gets paid back on a regular basis out of cash flow.....but I never miss putting the cash into the market

2 - Be cheap and let the family know you are cheap. Focus on cash flow, cut those monthly bills as much as possible. I think that for many people when the cash flow balance tips too far in the negative they give up and just embrace the devil of debt and give up on retirement planning. You have to break even on average AFTER paying yourself first.
I don't have an ipad....sure I'd like one, and I'm sure my 2 kids and my wife would like one too.....but creating an environment where frivolous spending is unwelcome helps. That being said, you have to spend on important things like family trips, adventures and making good memories. I drive a lexus RX400h...its a used 07' and cost me $10K. I own an 05' turbo mazda roadster. That cost me $12K. You can enjoy the good things in life...just be smart about it. My wife drives a new Mini (OK, I let my guard down on that one ).

3 - Invest in large dividend paying stocks (Banks, utilities, health care, etc.) Do it yourself and don't jump ship when things look shaky. Since mid 08' I've averaged 10~12% compounded annually by keeping it simple. Save, invest, hold (repeat).

My plan is to retire early. It will be weird still having a kid in high school and not working....but I need to stop working eventually for my own sanity.

[recycled sixtie]

Originally Posted by twobone

I just turned 47. Wife + 2 kids. One in middle school, the other starting high school

I have a handful of strategies that have helped me get on a good track for retirement:

1 -Pay myself first. I look after the family finances. I religiously put an average of $25K away a year into the stock market. $750 every bi-weekly from my pay check and $5K annually into the kids education fund. I take the long view.....the dips in cash flow are addressed with a small line of credit, which gets paid back on a regular basis out of cash flow.....but I never miss putting the cash into the market

2 - Be cheap and let the family know you are cheap. Focus on cash flow, cut those monthly bills as much as possible. I think that for many people when the cash flow balance tips too far in the negative they give up and just embrace the devil of debt and give up on retirement planning. You have to break even on average AFTER paying yourself first.
I don't have an ipad....sure I'd like one, and I'm sure my 2 kids and my wife would like one too.....but creating an environment where frivolous spending is unwelcome helps. That being said, you have to spend on important things like family trips, adventures and making good memories. I drive a lexus RX400h...its a used 07' and cost me $10K. I own an 05' turbo mazda roadster. That cost me $12K. You can enjoy the good things in life...just be smart about it. My wife drives a new Mini (OK, I let my guard down on that one ).

3 - Invest in large dividend paying stocks (Banks, utilities, health care, etc.) Do it yourself and don't jump ship when things look shaky. Since mid 08' I've averaged 10~12% compounded annually by keeping it simple. Save, invest, hold (repeat).

My plan is to retire early. It will be weird still having a kid in high school and not working....but I need to stop working eventually for my own sanity.

You have some good points.

I have some stock and mutual funds. The mutual funds are mostly in stocks and have far outperformed the individual stocks that I have bought. However that said my daughter in her 20's has her money in term deposits and savings account with the bank. I am going to buy her $500 worth of Starbucks shares for Xmas unbeknownst to her.

Guy

[BE911SC]