Savings %

[quikag]

slow99, what about tapping principal in retirement? Life expectancy? Your calculations are missing some significant variables.

[Hobie]

slow99, what about tapping principal in retirement? Life expectancy? Your calculations are missing some significant variables.

Have you seen the posts on this board? He's not each board member's personal CFP. Chillax homey, (overly?) broad overview.

[347Mike]

I don't know the percentage. I throw chunks at it every check along with my 401k. A certain percentage doesn't bother me. I have other things such as investments that pad my savings. One month it could be 10% the next it could be 60%.

I plan on retiring young, hopefully no later than 50.

x2 on what Jody and the guy who mentioned increases in your pay should go to savings. Just about everytime I get a promotion or raise I put that towards savings or 401k (mostly 401k).

x2 on most people don't know how or even know what it takes to save or retire. I have mixed feelings when I tell people that their retired parents have a million, more, or close to it and they look at me like I have no idea what I am talking about or don't believe it.

[Big A]

wow

edit: I have a little under 2 years salary saved, but holy fuck I can't imagine saving 30k a year at my current rate. (which took me close to 7 years to save)

That $60k a year for retirement is relative on your lifestyle as well though. Retirees that did any planning would likely be debt free and own their home, so to be spending $5k a month would take a little extravagance. If that's what they want to do with it though, that's their perogative, and the fruits of planning and working hard earlier in life.

[sc281]

Sound advice. Couple other good posts in here as well. I've edited my post...wasn't my objective to come across like a douche - but an unintended consequence.

.

Lol. I didn't notice any doucheness in your post. Yours is always sound advice or an example of what to do.

[roliath]

That $60k a year for retirement is relative on your lifestyle as well though. Retirees that did any planning would likely be debt free and own their home, so to be spending $5k a month would take a little extravagance. If that's what they want to do with it though, that's their perogative, and the fruits of planning and working hard earlier in life.

yeah I understand that, but its just I never really sat down and did any numbers.

[347Mike]

I have a hard time saving with mortgage, car and expenses. I try but i'm not as fortunate as some to be able to save 2k or more per month. If im lucky i'll probably have 3-400 left over at the end of the month, but invaribly something happens the next month to wipe it out.

You gotta make the choices of what you need and what you want. I got rid of a decently nice, new car, for an old slugish truck, just so I didn't have a huge car payment.

It all revolves around how badly you want it.

[sc281]

You gotta make the choices of what you need and what you want. I got rid of a decently nice, new car, for an old slugish truck, just so I didn't have a huge car payment.

It all revolves around how badly you want it.

This.

I am wanting another Corvette right now. Sold it when I bought my house. I am telling myself I need to wait til I can get an 06+ for under $20k before I bite.


Being responsible suuucks.

[mustangguy289]

You gotta make the choices of what you need and what you want. I got rid of a decently nice, new car, for an old slugish truck, just so I didn't have a huge car payment.

It all revolves around how badly you want it.

I have done this. Now we have a nice car and a nice truck for less that what we were paying for my brand new truck a year ago.

[sc281]

Also keep in mind people, once you are saving for your retirement, it can easily become picking between the extremes of instant gratification at the cost of long term stability, or Long term stability at the cost of instant gratification.

Both are wrong.

You don't need to hole cash away scared about retirement while eating ramen all day, and conversely, you don't need to spend money all day not worrying about tomorrow, much less retirement.

The happiest people in my experience are the ones that save for a relatively modest retirement (35-45% of peak yearly earned income adjusted for inflation) Keep in mind at retirement,your expenses should be MUCH lower than today. (Paid off house, cars, debt etc) you don't need $100k inflation adjusted /yr to live off of.

Budgeting based off of that will make an easily attainable solution in order to save for your retirement, AND take advantage of the fun stuff while you are still physically able to enjoy it. .

[lincolnboy]

800 a month. Saving go towards trips and drugs.

[ozzeran]

This.

I am wanting another Corvette right now. Sold it when I bought my house. I am telling myself I need to wait til I can get an 06+ for under $20k before I bite.


Being responsible suuucks.

Yup that's exactly why I haven't bought a new car yet.

It does suck but will pay off.

[slow99]

slow99, what about tapping principal in retirement? Life expectancy? Your calculations are missing some significant variables.

It's a model - a way to think about these things since most people don't have a clue how to begin to think about these things. You know that as n gets larger it approaches the perpetuity model. In fact, by my quick math, if all variables remained constant and you you assumed you lived 25 years after 60 instead of a perpetuity the figure comes to $4.2 million instead of the $4.8 million.

I know you are dumbing down the calculation to prove a point, but you're assuming that you aren't touching the principal once you retire. I'm not leaving my kids $5m when I croak lol.

So leave your kids zero. Ceteris paribus it comes to a $17k annual contribution to get you to the goal.

My point is that most people don't have a clue how to think about these issues and attack the problem. If I said assume you live to be 85, people would say they are going to live to be 100. Jesus, I should have put in the 150% annual return requirement assumption to accommodate the average DFWM investor, lmao.

I am simply trying to put numbers in perspective. If one person went through that exercise and said, "Fuck, my $1000 a year isn't going to get me to where I want to be," then this example served its purpose.

Have you seen the posts on this board? He's not each board member's personal CFP. Chillax homey, (overly?) broad overview.

Precisely, thank you.

[racrguy]

It's a model - a way to think about these things since most people don't have a clue how to begin to think about these things. You know that as n gets larger it approaches the perpetuity model. In fact, by my quick math, if all variables remained constant and you you assumed you lived 25 years after 60 instead of a perpetuity the figure comes to $4.2 million instead of the $4.8 million.




So leave your kids zero. Ceteris paribus it comes to a $17k annual contribution to get you to the goal.

My point is that most people don't have a clue how to think about these issues and attack the problem. If I said assume you live to be 85, people would say they are going to live to be 100. Jesus, I should have put in the 150% annual return requirement assumption to accommodate the average DFWM investor, lmao.

I am simply trying to put numbers in perspective. If one person went through that exercise and said, "Fuck, my $1000 a year isn't going to get me to where I want to be," then this example served its purpose.



Precisely, thank you.

Fuck, my $0 a year isn't going to get me where I want to be.

[Roscoe]

I think it will be not enough, regardless of what I do.

I stash 15% 401k and 20% to savings. I have other investments as well, but if I retire with $1.5M and no debt, I'm set.

I won't inherit much, if anything, so my kids can get by on the same.