Retirement

SPEEDY MCCREADY · February 15

nicknyr15 said:

SPEEDY MCCREADY said:

nicknyr15 said:

SPEEDY MCCREADY said:

The 4% retirement rule seems to make sense. I'm guessing a few here, who have responded, are familiar with it.

Allowing yourself to withdraw only 4% of your retirement fund, yearly. Allowing you to make the money last 30 years. In theory it makes sense.

Different things work for different people. I’m a big believer in income investing. Dividends create passive income that you can live off of without having to touch principle.

Yeah, we are hoping to go a long time without touching our "main retirement fund".
It's been interesting to research what people consider to be the "amount" needed in order to retire and be comfortable. Obviously it also depends in what your definition of comfortable is. I'm really hoping I don't end up in a single wide eating white castle.

Best of luck with the next chapter my man. You’ll be fine.

Thanks.
Yes, I think we will be ok.

Gern Blansten · February 15

I'm not sure that I agree that renting is better. Downsizing is definitely smart. But long term ownership and appreciation in value goes a long way vs paying rent.

Zod · February 15

Gern Blansten said:

I'm not sure that I agree that renting is better. Downsizing is definitely smart. But long term ownership and appreciation in value goes a long way vs paying rent.

Or in the cast here in Canada, rents can skyrocket. You do the math based on current rents and index for inflation, but then rent prices double. That's why I run into, in my work. People living in a rent controlled suite (here in BC you can only raise by rate of inflation, sometimes not even that). If you've lived in a place for over a decade your rent is probably half or less than half of current rents. Your building gets renovicted, or demolished for a new builting, you have to go back in the world at modern rents.

I think it's good to own a place. House, townhouse, or condo just to somewhat control your costs and insulated against skyrocketing rents.

I love this thread though, this is what I do for a living. It's even tougher here in Canada. Canada Pension Plan and OAS don't pay as much as SS in the USA. CPP replicated about 1/4th of preretirement income. So many people don't save.

The part that gets me is right now it's boomers. The people that generally for their working lives lived through the best economic times we had. Lots of boomers saved, bought a place, and will be ok. There's still a great number that didn't save at all, and it's not great.

The thing is every following generation had even less than them, as economic circumstances have gotten worse with time. Every younger generation is going to face even tougher. Especially with how much our housing is in Canada. Not much left to save.

Gern Blansten · February 15

Zod said:

Gern Blansten said:

I'm not sure that I agree that renting is better. Downsizing is definitely smart. But long term ownership and appreciation in value goes a long way vs paying rent.

Or in the cast here in Canada, rents can skyrocket. You do the math based on current rents and index for inflation, but then rent prices double. That's why I run into, in my work. People living in a rent controlled suite (here in BC you can only raise by rate of inflation, sometimes not even that). If you've lived in a place for over a decade your rent is probably half or less than half of current rents.   Your building gets renovicted, or demolished for a new builting, you have to go back in the world at modern rents.

I think it's good to own a place. House, townhouse, or condo just to somewhat control your costs and insulated against skyrocketing rents.

I love this thread though, this is what I do for a living.   It's even tougher here in Canada. Canada Pension Plan and OAS don't pay as much as SS in the USA.   CPP replicated about 1/4th of preretirement income. So many people don't save.

The part that gets me is right now it's boomers.   The people that generally for their working lives lived through the best economic times we had.    Lots of boomers saved, bought a place, and will be ok. There's still a great number that didn't save at all, and it's not great.

The thing is every following generation had even less than them, as economic circumstances have gotten worse with time. Every younger generation is going to face even tougher.   Especially with how much our housing is in Canada. Not much left to save.

yeah and in the US there will be a wave or blue collar workers that jumped on the GOP bandwagon and took down unions...leaving them with even less to retire on.

My mother in law was in a union and still got screwed by Honeywell but at least they didn't take everything from her

Get_Right · February 15

Smartest three things I have ever done. 1. Marrying my wife 2. Having said wife arrange for automatic payroll deductions for our two kids 529 education plans. 3. Having said wife arrange for automatic payroll deductions for our retirement accounts. It was probably $1,000 a month. 25 years later, kids tuition (at lease for a state school anyway) is covered, our mortgage is paid and there is a little nest egg. We may not be buying that 74 foot viking sportfishing yacht I always wanted but we are fine. The question we struggle with is where to go? We love New York and there is no way either of us can see ourselves in Florida, Myrtle Beach or Scottsdale. I vote Tokyo, but it is even more expensive than New York!

Get_Right · February 15

Oh and on pensions (not 401K, IRA, or stock options), if you leave that job, make sure to transfer that pension. Fidelity, Capital One, where ever. I have seen several colleagues lose a good chunk of a pension benefit because they ignored it when they separated from the company they worked at. Professional services, not unions.

SPEEDY MCCREADY · February 15

Get_Right said:

Smartest three things I have ever done. 1. Marrying my wife 2. Having said wife arrange for automatic payroll deductions for our two kids 529 education plans. 3. Having said wife arrange for automatic payroll deductions for our retirement accounts. It was probably $1,000 a month. 25 years later, kids tuition (at lease for a state school anyway) is covered, our mortgage is paid and there is a little nest egg. We may not be buying that 74 foot viking sportfishing yacht I always wanted but we are fine. The question we struggle with is where to go? We love New York and there is no way either of us can see ourselves in Florida, Myrtle Beach or Scottsdale. I vote Tokyo, but it is even more expensive than New York!

No yacht for me
No bass boat
But I have decided that once a month I'm going to go on a charter, and catch some bass.
That's the best I can do.

Get_Right · February 15

SPEEDY MCCREADY said:

Get_Right said:

Smartest three things I have ever done. 1. Marrying my wife 2. Having said wife arrange for automatic payroll deductions for our two kids 529 education plans. 3. Having said wife arrange for automatic payroll deductions for our retirement accounts. It was probably $1,000 a month. 25 years later, kids tuition (at lease for a state school anyway) is covered, our mortgage is paid and there is a little nest egg. We may not be buying that 74 foot viking sportfishing yacht I always wanted but we are fine. The question we struggle with is where to go? We love New York and there is no way either of us can see ourselves in Florida, Myrtle Beach or Scottsdale. I vote Tokyo, but it is even more expensive than New York!

No yacht for me
No bass boat
But I have decided that once a month I'm going to go on a charter, and catch some bass.
That's the best I can do.

Cheaper than a round of golf in some states. Go to the Bahamas and try some bonefish. My favorite fishing.

SPEEDY MCCREADY · February 15

Get_Right said:

SPEEDY MCCREADY said:

Get_Right said:

Smartest three things I have ever done. 1. Marrying my wife 2. Having said wife arrange for automatic payroll deductions for our two kids 529 education plans. 3. Having said wife arrange for automatic payroll deductions for our retirement accounts. It was probably $1,000 a month. 25 years later, kids tuition (at lease for a state school anyway) is covered, our mortgage is paid and there is a little nest egg. We may not be buying that 74 foot viking sportfishing yacht I always wanted but we are fine. The question we struggle with is where to go? We love New York and there is no way either of us can see ourselves in Florida, Myrtle Beach or Scottsdale. I vote Tokyo, but it is even more expensive than New York!

No yacht for me
No bass boat
But I have decided that once a month I'm going to go on a charter, and catch some bass.
That's the best I can do.

Cheaper than a round of golf in some states. Go to the Bahamas and try some bonefish. My favorite fishing.

Will do!

Bentleyspop · February 15

I've been "retired" longer than I worked at my "adult" job.
Luckily, I had some good advice from family members, including one who wrote for the Journal for 20 years. I also got a tad lucky with tech stocks in the 90s.
I have worked for the past 20 + years at jobs I enjoy. Living off those paychecks while investments have grown.
I've been relatively conservative with my investments over the years and have no complaints.
However, now I live in Colorado, again, where real estate and the cost of living is more than a lot of states, but life is so much more fun. I'm not buying a place but choosing to rent because I don't want the responsibility or the cost of home ownership. So now I spend more than i used to but am way happier than when cost of living was less.
A very positive trade-off for me. Plus I have no one to leave my money to so I plan to spend it.

Many many people have their own opinions on this. The one that matters in the long run is your own.

HughFreakingDillon · February 15

I have a defined benefit pension with a job I've been at nearly 30 years. my wife's work does RSP matching, and she maxes out every year. whatever we have extra depends, sorry for the crassness, how long our parents live. we both have both our folks still. hers are nearing 90, mine are mid 70's. if they live long enough to drain it, that's best case (as long as it's quality).

I haven't decided when I'll retire. My financial planner tells me I can as early as 57 (7 years from now). I might work longer, or I might not and just get a part time job working security at concerts. Our kids educations are paid for, through the generosity of my parents ($100 a month for each kid RESP since they were born). But I doubt I'll retire if either one is still living here. And considering my youngest is in grade 10, could be a while yet.

mickeyrat · February 16

https://www.threads.net/@dividendology_yt/post/DGGYsFlxGow?xmt=AQGzRNIV6Gk0Tu-iI2AfQZhuEiUL-HBo1iZYEIH6E6T4DA

dudeman · February 16

Having someone to leave an inheritance for changed our retirement plans. Pretty much have to actively save money and invest if you want to be comfortable and live to an average age. I have a friend who says that retirement is an impossibility unless you have 10 million in accounts. That seems excessive to me but that varies by where you live and how you define "comfortable".

In addition to reading how little money people have in savings is pretty sad and shocking. I also remember reading a few years ago that the average American (person or household, can't remember which) has $30k in credit card debt. I imagine that really puts a damper on being able to save money.

cutz · February 16

SPEEDY MCCREADY said:

Anyone have thoughts on annuities? Yay or nay?

Anyone?

Halifax2TheMax · February 16

cutz said:

SPEEDY MCCREADY said:

Anyone have thoughts on annuities? Yay or nay?

Anyone?

Would recommend against unless whatever amount you can commit can stay there for a long time and you have no interest in moving it to something more profitable if interest rates change or another potentially lucrative investment opportunity presents itself. If you’re okay parking it and forgetting about it other than the check it generates, go for it.

Zod · February 16

dudeman said:

Having someone to leave an inheritance for changed our retirement plans. Pretty much have to actively save money and invest if you want to be comfortable and live to an average age. I have a friend who says that retirement is an impossibility unless you have 10 million in accounts. That seems excessive to me but that varies by where you live and how you define "comfortable".

In addition to reading how little money people have in savings is pretty sad and shocking. I also remember reading a few years ago that the average American (person or household, can't remember which) has $30k in credit card debt. I imagine that really puts a damper on being able to save money.

It's crazy. I know it'd different now, but 20 years ago when I finished university, I struggled to find real work, and was working in a produce warehouse making barely above min. wage. I still managed to save.. not much.. but enough I could deal with life if my car broke kind of thing. It was absolutely against my beliefs to borrow just to keep the day to day going. You do that, it's a hole you can't ever did yourself out of.

I was a bit slow at life. I waited 4 years after high school to go to university.. struggled to find work when I graduated, wait a bit long to move somewhere else.. figured it out, moved back, saved up for down payment, and now have done a solid job with saving, and hopefully our little home is paid off several years from now

It was such small things in life that helped me learned a little financial literacy. First was the concept of compounding, which I think I was taught in grade 11 math. The 2nd was 1st year Economics class at University where they talked about life cycle stages, and how by 40s/50s those are supposed to be your peak earning years. It was like a blueprint. 20's you start out, 30's you figure it out, 40's/50s you should have a house, earn the highest incomes you'll earned, and start amassing assets. I'm like that makes sense, and away I went..

They really do need to teach financially literacy in high school.

cincybearcat · February 16

dudeman said:

Having someone to leave an inheritance for changed our retirement plans. Pretty much have to actively save money and invest if you want to be comfortable and live to an average age. I have a friend who says that retirement is an impossibility unless you have 10 million in accounts. That seems excessive to me but that varies by where you live and how you define "comfortable".

In addition to reading how little money people have in savings is pretty sad and shocking. I also remember reading a few years ago that the average American (person or household, can't remember which) has $30k in credit card debt. I imagine that really puts a damper on being able to save money.

$10million is pretty excessive for sure.

I wonder what model and lifestyle.

HughFreakingDillon · February 16

The benchmark used to be $1m. Inflation hasn’t increased that tenfold, but it obviously is higher.

dudeman · February 16

cincybearcat said:

dudeman said:

Having someone to leave an inheritance for changed our retirement plans. Pretty much have to actively save money and invest if you want to be comfortable and live to an average age. I have a friend who says that retirement is an impossibility unless you have 10 million in accounts. That seems excessive to me but that varies by where you live and how you define "comfortable".

In addition to reading how little money people have in savings is pretty sad and shocking. I also remember reading a few years ago that the average American (person or household, can't remember which) has $30k in credit card debt. I imagine that really puts a damper on being able to save money.

$10million is pretty excessive for sure.

I wonder what model and lifestyle.

That's how I feel about it, too. He's one of those guys who likes nice things and likes to travel so that figure might be appropriate for him. For my lifestyle and habits, that would be more than enough.

I guess the point is to try to decide how and where you want to live and determine how much it will cost per year. Factor for significant medical expenses and inflation, how much (if any) you want to leave for your survivors and figure 30 years is a reasonable amount of time to live after retiring.

All in, I imagine that would be a pretty staggering number. Definitely variable to the individual and situation, though

Get_Right · February 16

If you plan to live 20-25 years after retirement, take your current after tax income and multiply. That is what you will need to maintain your current lifestyle. There are plenty of people 65+ with $500K in the bank and living just fine without having to work. Heck there are people that survive on social security. Make a plan and stick to it. The earlier the better.

Retirement

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