Retirement nestegg

[Hemi Rebel]

Retire? Whats that?

 

[440+6]

I'm 52 and semi retired, all I do now is manage the properties I own.
The question is a million bucks enough to retire on? maybe if your 70 or older.

 

[YY1]

I started investing (and managing my own investments) in 1999 (at age 31).
In 2002, I developed a strategy that theoretically would get me in the neighborhood of 1 mil by age 57.
Last year I was one year behind due to 2007-2008, but every year since 2008 I am doing better than ever and this year I'm only 9 months behind the target numbers.

I also have a multi pronged strategy.

I work for county level government, and a modest pension is involved.
Despite all the cheerleading, I opted NOT to switch from defined benefit to indexed investment benefit.
If politicians are trying so hard to eliminate that option, it must be good

I contribute about 25% of what I invest on my own, to a managed TSA fund (403b).
It does about half as good as I do, but some years it does pretty good.

I own a small self storage facility that I have 20K invested in, is cash flow positive (not much, but it beats negative) and will be paid off somewhat ironically, the year I turn 57.

My wife kept her house and we use it as a rental property. Again, cash flow positive (couple thou a year), and again ironically will be paid off about the same time.

The house we live in will be paid off the year I turn 58.


At age 57 I will have 30 years in my current job.
I don't plan on being there for 30 years and one day!

If my calculations are correct, I'll be able to stop contributing to the investment account, and (as stated earlier), draw somewhere between 40 and 60K a year, plus have the full rental house income, the full storage income, the pension, the 403b and social security (OK, maybe).

If any area fails, the others combined should cover enough not to hurt. Diversification=good.

Blowing my own horn a bit, I say not bad for a high school education and average (50K) income.

- - - Updated - - -

Oh, and before anyone suggests that I'm one of those overpaid government workers, I'm an IT project manager, and we just lost two people- one to a regional supermarket chain that has about 2/3 the infrastructure and the other to a hospital (40-50% of our infrastructure), and each is making close to or just over 100K doing the same job that pays 42-60K where I work!

 

[Durandal25]

Where will you be keeping the $1M? It will not last as long if it is under your matress or in some bank account drawing next to zero interest. But if it is invested and averaging, say 6% growth per year, that $1M will be making you $60K annually (8%=$80K, etc)...provided you don't tap into the initial $1M. If you could live within that means, you would have $1M+ every year until you die. Now, if you don't use what it makes in interest each year, it will continue to grow larger than the $1M you started with. Your heirs will
thank you...or plot ways to see you in an accident.

.....capital gains will kill you....40 plus percent to Obama

 

[dgraver]

I have to disagree with your 401k pessimism. I work in the 401k industry, I set up and manage 401k plans for small and large corporations as well as 403b plans for non profits. Right now, this is a highly regulated and scrutinized industry with safeguards in place to protect plan participants. Companies and organizations offering these plans have a fiduciary liability to offer a plan with low cost diverse investment selections and as of last year, all fees must be disclosed to participants, fees charged by the funds inside the plan as well as fees paid to broker administering the plan. Contrary to what you said, regulations are only going to become more strict and being put in place to protect participants from shady brokers.

The key to making money in a 401k is saving money. You can have as much investment knowledge as Warren Buffett but it wont mean anything if the money isn't there to invest. The DOL recommends saving at least 10% in your 401k, and they are right. Don't just do the minimum to get the employer match, do more. Also, set yourself up for automatic increases each year, even ifs it only a percent increase, it'll add up. Also, diversification is key, you never want to be in one fund (unless its a target date retirement fund). Work with your firms broker/plan provider on employee education. If your plan doesn't receive any employee education, ask whoever is in charge at your company to look at other providers because right now they aren't acting as a fiduciary and are liable.

I could go on and on but I'll stop. Although the gov't is corrupt in a lot of ways, blaming them for a 401ks' poor performance or saying they are going to take 401k assets is just ridiculous.

This is a really good subject.

1. The Federal Government is going to dip into 401 K funds at some time to service the enourmous Debt.
2. A million dollars will provide you with enough income if you are debt free, Move to a low cost area. if you plan to retire in California, Illinois, New Jersey, New York, Mass or Conneticuit you are dreaming. I am 57 and plan to retire at 62, will collect Social security plus my savings and will be able to retire. The question is what to do with my time to keep active mentally and Physically. I have spent at that time 40 years in the Chemical Industry which like the Industrial economy of our great Country has suffered. But the driving, difficult customers, lower profits and extreme ******* Federal Regulation is going to make me happy to leave!!!!!!!!!!!!!!!!!!! I will move to Florida and build Hemi cars for people and make enough to get by. But living in New jersey with the Blood sucking Liberals makes me want to vomit!!!!!!!!
3. Figure like others said 4 percent max with plus if any Social Security is left.
4. You will have to move your 401K in to foreign shelters to limit the new taxes coming on 401 K money. Hire an investment advisor who charges no more than 1 percent or trust your money with Vanguard Wellington Fund!

5. If the government can figure out how to control the growing debt then a more optomistic future will be possible. The debt is the unknown issue!

 

[440+6]

The key to making money in a 401k is saving money. You can have as much investment knowledge as Warren Buffett but it wont mean anything if the money isn't there to invest.

I agree, a very wise man told me a long time ago "it doesn't matter how much you make, it's how much you save that counts".

 

[MoparMitch]

I agree, a very wise man told me a long time ago "it doesn't matter how much you make, it's how much you save that counts".

I retired at age 44 after being in the Auto Parts Business as a small chain owner. Started in the business as a delivery boy and worked my way up, and finally bought out the owners. Learned a lot from those older guys,they always told me to buy the commercial building if you could. So I did and... paid for them. Sold to Carquest in 2000 and they still lease the buildings from me today. But even though I was depending upon rental income and sale of my business , I always had my own IRA accts. It just makes good sense to save!! Oh...Also I am security licensed for investment. If someone needs advise, I'd be happy to help a MOPAR brother.

 

[aldal]

Back in I think around 2006 they held hearings on Capital Hill about the possibility of the Government taking over all 401k accounts. In return for the cash you had saved up in your account the Government would give you some type of security agreement that would add a new retirement benefit to Social Security based on the amount they took over. Needless to say it did not go over very well in the hearings but from what I have read on the subject the idea is still out there as a way to pay down some of the nations debt. Just makes you wonder how secure anything will be.

 

[Moparsmitty]

Back in I think around 2006 they held hearings on Capital Hill about the possibility of the Government taking over all 401k accounts. In return for the cash you had saved up in your account the Government would give you some type of security agreement that would add a new retirement benefit to Social Security based on the amount they took over. Needless to say it did not go over very well in the hearings but from what I have read on the subject the idea is still out there as a way to pay down some of the nations debt. Just makes you wonder how secure anything will be.

Like I said earlier, there are no real guarantees. The rules of the game can change at any time, and when it comes down to it you have to be on top of your own finances and be flexible enough to change things around if that's what it takes. I expect some fairly significant changes to the tax code in the near future. I'm hoping the code will be simplified, but I'm not holding my breath. We'll see.

 

[Herr_Poopschitz]

Retire? Whats that?

A perk of being a baby boomer, it seems.

 

[aldal]

Gotta keep plugging away at it.

I thought about this thread a little more and I realized that it probably doesn't matter that much to me because my life is so pathetic that I wouldn't know what to do besides work.:sad2:

 

[Richard Cranium]

I hear you. Sometimes I think that's all I do too. Of course when you own your own business, there is never escaping work, even on weekends and vacations. I sometimes wish that I had a job that I could leave at the door at the end of each work day.

 

[wahya]

Assuming that one is going to live to a certain number of years after retirement and having enough money to last that long is fine. I'm thinking now that Mrs. Gump had it right. Life's like a box of chocolates, you never know what your gonna get.

 

[NJRR]

Ryguy- Please tell us what bank is giving 1% MONTHLY in a savings account? Who needs Wall Street? I personally think that the best place to put your money is income producing real estate. The stock market is so volatile years of growth can be wiped out when you need it. I have a mix of commercial and residential properties that will produce enough income for me to not worry about how my IRA accounts are doing (which took a beating in the crash) or hope that Social Security will still be around for me to collect on the decades of contributions.

And a big shoutout to Snakeoil..... I agree 110%.... NEW JERSEY SUCKS (yeah, born and raised there so I can say it !!) LOL

You could live off of a million dollars for your whole life.... Think about it. If you put that into a low interest savings account (lets say 1% monthly) you will be making $10,000 just from interest alone per month. I plan on retiring at ripe age of 50 haha. Solar panels, no debt, a savings account since I was 16 that won't be touched until retirement, etc. Are all going to help out a lot. Make sure you have enough to mess around with your toys as well, you won't want to retire and sit around all day. That's how you end up with dementia.

 

[64BEL]

I hear you. Sometimes I think that's all I do too. Of course when you own your own business, there is never escaping work, even on weekends and vacations. I sometimes wish that I had a job that I could leave at the door at the end of each work day.

While not a business owner, I am in management, and I can relate, RC. But the good outweighs the bad, for the most part. To me, being a decision maker is worth the off hours calls (most of the time).

 

[RichR]

I know im real late on the Kerry. I was always of the mind set that you can never have enough put aside. I was a union plumber / steamfitter. in NY State. great pay packages. large annuity @ a stable 3% and 2 pension, 1 local 1 national. Im 48. I broke my back at work at 41. and can not return to work in any capacity. in order not to loose my home, cars and all I have come to love. I ended on using the annuity ALL UP & take the smaller national pension t supplement the amount I get from SSD, Work comp. I have $4000 a month income and im still sucking wind. I will gain another 1000 a month at 62. I a still fighting with comp to get 100% disability up from 75 % and if I loose. in 7yrs I will loose 1,200 a month from cap limits at 75% perm disability. 100% would pay until death. My point to all this is, you never know when everything is going to go south on you. You must plan to save every Penny you can. because there are some things your not going to rebound from. whether I 1Mill or higher you have to add in the unexpected. Rich

 

[Moparsr2fast]

Agreed. All we can do is save to the best of our ability, and hope life doesn't bite us in the behind...

 

[Sonny Black]

I have to disagree with your 401k pessimism. I work in the 401k industry, I set up and manage 401k plans for small and large corporations as well as 403b plans for non profits. Right now, this is a highly regulated and scrutinized industry with safeguards in place to protect plan participants. Companies and organizations offering these plans have a fiduciary liability to offer a plan with low cost diverse investment selections and as of last year, all fees must be disclosed to participants, fees charged by the funds inside the plan as well as fees paid to broker administering the plan. Contrary to what you said, regulations are only going to become more strict and being put in place to protect participants from shady brokers.

The key to making money in a 401k is saving money. You can have as much investment knowledge as Warren Buffett but it wont mean anything if the money isn't there to invest. The DOL recommends saving at least 10% in your 401k, and they are right. Don't just do the minimum to get the employer match, do more. Also, set yourself up for automatic increases each year, even ifs it only a percent increase, it'll add up. Also, diversification is key, you never want to be in one fund (unless its a target date retirement fund). Work with your firms broker/plan provider on employee education. If your plan doesn't receive any employee education, ask whoever is in charge at your company to look at other providers because right now they aren't acting as a fiduciary and are liable.

I could go on and on but I'll stop. Although the gov't is corrupt in a lot of ways, blaming them for a 401ks' poor performance or saying they are going to take 401k assets is just ridiculous.

I remember when I started my IRA.....they "never will tax, nor mess with it"....too many years ago to remember! when I started mine!..............the rest is history and taxable!
also 4% per year?....when the market was up 40% last year?...shame on 4%..

JMVHO

 

[themechanic]

Don't forget to factor in divorce. Nobody plans on it. But it happens. We all probably know someone who has an ex who took half of their nest egg. So, if you're married, keep her happy, Gents.

 

[Richard Cranium]

Don't forget to factor in divorce. Nobody plans on it. But it happens. We all probably know someone who has an ex who took half of their nest egg. So, if you're married, keep her happy, Gents.

One of my employees is going to be seperated very soon & when I see how his wife has been treating him all these years, it sure makes me thankful how well Submit and I get along. I'm always make her laugh & she always makes me smile.


[video=youtube;TTka_QW1FL0]http://www.youtube.com/watch?v=TTka_QW1FL0[/video]