retirement, what's your magic number?

[DawnM]

We will be ok. We won't be in the millions, but we have been saving 16% for about 19 years and have about 20 years left to save.

 

[punkin]

I don't know what our number is. I suppose it should be around $2M. I don't think we will hit it with 2 girls to send to college. On the other hand, In 6 years, when younger DD goes to college, I am planning to sell my house and downsize to a nice 2 BR apt. Considering the equity currently in our house, even after the market collapse, we should be OK. DH will also have a small pension in addition to our savings, which should also help.

 

[abmitch01]

I hope with the boomers aging, that more small homes and condos get built. I could see myself downsizing but my area seems saturated with big McMansions and not much in the way of condos or small ranches.

 

[wdwfan16]

I hope with the boomers aging, that more small homes and condos get built. I could see myself downsizing but my area seems saturated with big McMansions and not much in the way of condos or small ranches.

There will be a market for converting McMansions into multi-family dwelling.

 

[Virgderon]

Our goal is 1 million, but will likely be between 500 and 700k. We have taken some huge financial hits the last 8 years or so. We will have no mortgage, and I know we can live simply because we already are. I'm concerned, but realistically know that we can't get to the million mark in 15 years.

Our secondary goal is to retire with no debt at all, not even car loans. This I know we can do.

 

[tinker&belle]

Does anyone know of a good calculator to figure how much you will need? We are hoping to have the house paid for in 10-12 years. (We will be 39-41.) Both DDs will go to college in 16-18 years respectively. I would like to know we are on track for retirement.

We are going back and forth on putting more money into retirement vs paying the house off sooner. Paying the house off seems more secure to me because we can live in it or sell it and downsize. DR says to get to 15% retirement. If we do this we pay the house off in 12 years rather than 10, but we have a lot more money at age 62. I just really want the mortgage off my back a few years before the girls go away to school to be able to pay for college.

 

[BillSears]

Mine is probably around $150,000, maybe $200,000.

But I'm a Federal Employee covered under the old CSRS system. I'll actually be able to retire with a slight bump in my budget. It'll be a cut in pay but I'll have just paid off my mortgage when I retire and the cut in pay is less then my mortgage payment. So in the end I'll have about the same amount of money to spend on fun stuff. My number quoted above isn't needed for retirement and instead will just be used for emergencies.

 

[crisi]

$3-6M. Ideally $6M, but we would be comfortable with $3M.

We will also work until medicare moves in. I figure by the time we retire - we are in our early 40s - $3M will not be adequate to retire early and get health insurance for early retirement.

 

[sophie832]

I honestly have no idea how much is in my retirement right now, but I know I am contributing the maximum matchable amount, 5%. That's in my County retirement account (I work for the govt.)...we also have a 401k-sort of account, and I'm contributing to that, too. I'm 30 now, with 5 years in...I can retire at 61 if I buy back 5 years now. I can roll over the $ in my 401k to do the buy back, and I'm seriously thinking about it. Then I'll get 80% of my income at 61, plus whatever I have saved, plus we (DH and I) get lifetime medical benefits. I don't get Social Security, but DH will.

I guess I don't know what my magic # is, but I'm hoping that if I have a house that's paid off, whatever I do have saved, plus the lifetime medical, will be enough.

*I'm editing to note that the lifetime medical benefit is not guaranteed...someday (before I retire) it could get taken away. At this point, though, our retirement group pays 100% of the medical insurance premiums once I hit 25 years of service. If I don't get lifetime medical, I guess then I'll have to do Medicare once I hit that age.

 

[MrsPete]

Hoping for some social security..

Oh, I feel sure we'll get Social Security because no politician's going to be the one to get rid of it, BUT I suspect it'll receive a double whammie of inflation and eventually means testing . . . and I think our Social Security will either pay something small (like the water bill) or will be about enough for one dinner out each month. People who are counting on LIVING ON IT will be in dire straits.

I wish we got it in our 20s but I am so glad we did not wait until we were in our 50s to think of it. It might have been too late.

The choice of whether to get it young or wait is something of a double-edged sword. If you get it young, you'll enjoy lower premiums but will pay for more years. If you wait, you'll pay more each year but will pay for fewer years. And like any insurance, it's a risk. You can't know whether you're choosing right.

There will be a market for converting McMansions into multi-family dwelling.

That sounds very realistic!

 

[wdwfan16]

The choice of whether to get it young or wait is something of a double-edged sword. If you get it young, you'll enjoy lower premiums but will pay for more years. If you wait, you'll pay more each year but will pay for fewer years. And like any insurance, it's a risk. You can't know whether you're choosing right.

When we got ours we saw what the premiums were if we were our age or 10 years older. When we multiplied them both by the number of years until we were IIRC 85 the total paid in was exactly the same. We have a flat rate premium so ours is the same today as the day we started and when we are 80.

 

[punkin]

Oh, I feel sure we'll get Social Security because no politician's going to be the one to get rid of it, BUT I suspect it'll receive a double whammie of inflation and eventually means testing . . . and I think our Social Security will either pay something small (like the water bill) or will be about enough for one dinner out each month. People who are counting on LIVING ON IT will be in dire straits.

I think that those who need to live on it, will have it, but those who saved will probably get the one dinner out per month amount. Of course those who have to actually live on it, while they may be getting more from the government, will be pretty tight in the budget.

 

[dvcgirl]

I think that those who need to live on it, will have it, but those who saved will probably get the one dinner out per month amount. Of course those who have to actually live on it, while they may be getting more from the government, will be pretty tight in the budget.

Social Security will always be around, but for anyone under 50, it won't be what we expected. Still, the SS issue is relatively easy to fix. Medicare is another story.

Then again, there are going to be an awful lot of disillusioned Americans in the not-too-distant future.

 

[brerrabbit]

The vast majority of the folks on this board blow away the American average and all I can say is gret job guys. The reality is a lot of folks are going to have big problems when they want to retire. I am 51 and DW and I have about $800k that includes pieces here and there. Five fully vested pension plans, plus a 401k. We are still in the spend phase with a DD still in college (2.5 more years) and still helping a college graduate son a little. My company contributes 10% of my pay into 401 with out any match and I have a pension plan as well. Wife works for a school district and has Teachers retirement.

SS may contribute some but that amount goes down every time they talk about extending the retirement age.

My fears which are vey real are many. First to anyone thinking about working till your full retirement age, good luck. Jobs are going away left and right as my company (an oil major) ships jobs overseas at the drop of a hat and a lot of other companies are doing the same. The people that are losing their jobs have their 80 points (50 years old plus 30 years service equals 80 points or full retirement) but can't take it till they are 60. That means they are looking for jobs to bridge the gap to 60 and their average age is 53. Second if your pension is supported by any form of government (state, local, federal, etc.) don't think all is well. Colorado is facing a lawsuit because they decided not to give the guarenteed 3.5% yearly increase to retired state workers this year because they can't afford it. A bi partisan group of legislators at the state level agreed to the cut and crossed political lines to enact the cut and don't know how they are going to make up the shortfalls.

These state back pension plans were used to pacify state workers over the years in lew of raises. They would give increased retirement benifits without ever realizing the long term cosiquinces. One watchdog group claims that shortfalls nationwide for these state and local plans exceeds $4 trillion. The only way to generate more to fund them is increased taxes on the working, or cutting services (which translates to jobs). The future looks bleak in a lot of ways.

Again to all who have prepared for retirement, thank you! You will not burden the already overburdened system. To those who can't even think about retirement because your not sure where next months mortgage payment is coming from, bless you because I know how hard it can be you have much bigger problems to deal with.

 

[punkin]

brerrabbit, you are so right about being lucky to have a job 'till retirement age.
My MIL got laid off last year. She is 64 years old. Who's going to hire her? She can't get medicare yet. If she takes her SS, her amounts are reduced. Luckily for her, she has a domestic partner with a State pension and health insurance, so she is doing OK with unemployment and hasn't had to touch her "retirement" savings yet. There are many out there in much worse shape than she is.

 

[dvcgirl]

The vast majority of the folks on this board blow away the American average and all I can say is gret job guys. The reality is a lot of folks are going to have big problems when they want to retire. I am 51 and DW and I have about $800k that includes pieces here and there. Five fully vested pension plans, plus a 401k. We are still in the spend phase with a DD still in college (2.5 more years) and still helping a college graduate son a little. My company contributes 10% of my pay into 401 with out any match and I have a pension plan as well. Wife works for a school district and has Teachers retirement.

SS may contribute some but that amount goes down every time they talk about extending the retirement age.

My fears which are vey real are many. First to anyone thinking about working till your full retirement age, good luck. Jobs are going away left and right as my company (an oil major) ships jobs overseas at the drop of a hat and a lot of other companies are doing the same. The people that are losing their jobs have their 80 points (50 years old plus 30 years service equals 80 points or full retirement) but can't take it till they are 60. That means they are looking for jobs to bridge the gap to 60 and their average age is 53. Second if your pension is supported by any form of government (state, local, federal, etc.) don't think all is well. Colorado is facing a lawsuit because they decided not to give the guarenteed 3.5% yearly increase to retired state workers this year because they can't afford it. A bi partisan group of legislators at the state level agreed to the cut and crossed political lines to enact the cut and don't know how they are going to make up the shortfalls.

These state back pension plans were used to pacify state workers over the years in lew of raises. They would give increased retirement benifits without ever realizing the long term cosiquinces. One watchdog group claims that shortfalls nationwide for these state and local plans exceeds $4 trillion. The only way to generate more to fund them is increased taxes on the working, or cutting services (which translates to jobs). The future looks bleak in a lot of ways.

Again to all who have prepared for retirement, thank you! You will not burden the already overburdened system. To those who can't even think about retirement because your not sure where next months mortgage payment is coming from, bless you because I know how hard it can be you have much bigger problems to deal with.

This is a great post...

I just commented recently about what Colorado is doing, and they're not alone. The state and municipal pensions are not safe...and many will be affected by this.

What we're experiencing now is the explosion of a giant credit bubble that was 30+ years in the making. And the aftershocks of that event will be felt for many years to come.

I really think that most Americans don't get what is happening. Most think that we're just going to bounce out of this and head back to the malls. But our consumer-driven economy has hit a brick wall, and the jobs and the stock market rallies that went with it are over for quite awhile.

 

[punkin]

This is a great post...

I just commented recently about what Colorado is doing, and they're not alone. The state and municipal pensions are not safe...and many will be affected by this.

What we're experiencing now is the explosion of a giant credit bubble that was 30+ years in the making. And the aftershocks of that event will be felt for many years to come.

I really think that most Americans don't get what is happening. Most think that we're just going to bounce out of this and head back to the malls. But our consumer-driven economy has hit a brick wall, and the jobs and the stock market rallies that went with it are over for quite awhile.

Yes. As we were discussing in another thread this is not your typical cyclical recession. Though DH and I were on track with our savings prior to this, I am not sure we can do it at this point because I am expecting a deflationary period in which our investments will gain little to nothing and our real assets continue to depreciate. On the bright side (HA!), we may need a whole lot less to retire if that happens.

 

[MrsPete]

What we're experiencing now is the explosion of a giant credit bubble that was 30+ years in the making. And the aftershocks of that event will be felt for many years to come.

I really think that most Americans don't get what is happening. Most think that we're just going to bounce out of this and head back to the malls. But our consumer-driven economy has hit a brick wall, and the jobs and the stock market rallies that went with it are over for quite awhile.

Sadly, I think you're right. We can point fingers in many directions: Credit card companies who gave out unrealistic limits, Consumers who spent more than they earned, Advertisers who enticed the consumers to spend even more, Homeowners who bought more house than they could afford, Bill Clinton & Co. whose legislation made it difficult for banks to say "no" to anyone, Parents who spoiled their children so that they think they deserve more, more more . . . but regardless, it was always a house of cards and was going to fall someday.

And people keep talking about re-growing the economy -- that can't happen! Credit grew the economy artificially beyond its natural limits, and we can't sustain it at that level. Instead, we have to get back to living within our means.

 

[eliza61]

This is a great post...

I just commented recently about what Colorado is doing, and they're not alone. The state and municipal pensions are not safe...and many will be affected by this.

What we're experiencing now is the explosion of a giant credit bubble that was 30+ years in the making. And the aftershocks of that event will be felt for many years to come.

I really think that most Americans don't get what is happening. Most think that we're just going to bounce out of this and head back to the malls. But our consumer-driven economy has hit a brick wall, and the jobs and the stock market rallies that went with it are over for quite awhile.

Absolutely don't get it. Remember what you just said. For 30 years we've been living "la vida loco" on unsustainable, unreal (for lack of a better descriptions) money and growth. Folks saw the easy credit and unrealistic growth rates as some type of divine notion that this is how it will always be.

And I think also John p public bears quite a bit responsibility. as long as the party was rolling along, no one thought about what would happen when the tab came due.

Not only that we still are looking for a quick fix. I'm not going to get into my political leanings but I really don't think anyone could have fixed this mess in 4 years? Donkey, Elephant, Indian chief.

 

[Virgderon]

I'm just grateful that I have already downsized my living space and adjusted to having less money. Retirement is not going to be a shock for me.

DH and I have actually considered getting a very small condo as a home base and getting an RV of some sort and traveling in the summer to visit kids (and hopefully grandkids) and seeing some places we have never seen.

We have also considered foreign countries where there is a cheaper cost of living, but I am afraid our kids wouldn't be able to afford to come visit if the airfare is too much.