Once up on time, I was told you need one million in assets to retire, then it the number went to two, now I am told I need four million. If it is four million, I don't think I will ever retire. Fidelity says you need ten time your yearly income to retire at 67, but that doesn't seems like it is enough. How much do you all plan to save for your retirement? At what age do you plan to retire? I plan to work at least until 65 when Medicare kicks in. I hope Fidelity is right, if I really need 4 MIL, I am screwed.
10x your yearly income and it's saying you need $4 million? If you're making 400k a year then you should just cut expenses and save as much as possible. Shouldn't be hard to get there.
No four mil is from different place. Average Americans needs 67k a year, 67K multiply by inflation and 30-40 years. At 3% inflation. 30 years you need 3.2 Mil.
I'm reading this book called millennial money. It talks about the boomer generation being the dine and dash generation since they're getting the most out of retirement benefits and SS while paying the least out of everyone. The millennial will be tax harder and probably not have what boomers had in terms of retirement benefits.
I feel like I'm ****ed. I been maxing out my 401k for years and I still like I am ****ed. Maybe I won't be but man, just seems like it will be hard. I told my wife that I am willing to work until I can't no more.
Assuming 7% return and healthcare from spouse I hope to unlock "freedom" at 50 then work (and continue to save) on my own time. I should have I don't believe in inheritance. I assume anything intended as inheritance will have to be sold or spent to pay for medical bills. You die in America when you run out of money. I sure hope those Zoomers figure something out or the market 99x's or something. Anyways, I'd rather live off less than continue working for someone else w2.
I figure Ill always work. Make $200k a year and im saving 10ish percent and buying a nice house as well. However, we live pretty lavishly. Blow money on vacations/drugs/wagyu all year long. 401k thingy says ill end up with over 1 million. In addition I guess Ill save more as I get older and have over half a million in the casa. But i dont really want to retire unless I can do it in Aruba or somewhere else. Id rather just work till 65 and die.
It's not a simple answer like they make it out to be. You have to calculate what will it take to have a good living. What kind of debts will you have (will your house be paid off)? What income do you expect from your retirement nest egg? How much will the highest single SSN? I don't count married because most likely someone will die leaving the other to live with the 1. Is your 401 a ROTH or Traditional? How long do you expect to live? I usually take the parents or grandparents and add 10 years (medical breakthroughs). That's how long it has to last you. You don't want to be short but you don't want to be working when you're 70 only to die when your 71. It's really up to you to sit down and figure it out. I really doubt you'll need 4 million. Conservatively you can get 5% which is 200k without touching the egg nor SSN. Now if you're debts are high and you want to keep them high (not cash out and live in a cheaper place) then yeah maybe. But you really need to think about what you're going to need yourself because 1 size does not fit all. If you're decent with xlsx you can create a decent spreadsheet that will do the calcs for you. I've got mine pretty detailed including averaging the COLA for SSN for the past 50 years to add to the SSN income. I know you can't really plan on SSN much less the COLA but that's the level you can crank out if you want. Bottom line - don't listen to the "experts"
You need 25x your annual spend to retire. You can retire today if you can limit your annual spend to 1/25 of assets
The Number is built on the foundation of many fuzzy numbers, like inflation, investment return, etc. I think having a Number is not as important as knowing that the number is really, really big (and unobtainable to most). Most people, when they hit their 50s, pay off the house, pay for kids's college (if possible) and then do scorched earth savings until retirement. Most people actually have to retire early, either due to health or the job market. And when you retire, your pot of money is what it is. You try and live off of SS and 4% of your retirement savings per year.
Do you have a good idea of what you are currently spending for normal everyday living? Do you have a decent idea of what your retirement income (SS + Pension + IRA + etc) is projected to be? If your current spending is exceeding your projected retirement income, then you will need to make adjustments when you retire if not sooner Some things that could be subject to change to get your spending in agreement with your retirement income. * Number of automobiles and/or quality of the vehicles * Cable/satellite plan * Cell Phone Plan * Cell Phone (Apple versus Android and how often you get a new phone) * Groceries (Name brand versus House/Store brand) * Vacations * Housing
Have assets that make you a good chunk of passive income. If you have that then how much cash you have does not matter as much. You can also start your onlyfans page once you hit 65 for bonus cash on the side.
Those "rules" are only roundabout estimates and don't apply to everyone. There are couples out there whose net worth is well under $1 million that retired in their 40s because they don't live extravagantly. They're the exception, but they've done it, so it's possible. There are thousands of others who have less than $2 million that have done it. The biggest problem with making more money is that people tend to spend more money when they do, so it damn-near ends up being pointless. You need to look at how you spend money now, what you would be comfortable with when you retire, what you want to be doing, etc. to determine whether or not you can retire. You also need to know that just because you're not working doesn't mean you can't be earning income. Maybe from stocks, rental properties, hobbies, etc. If you're getting into stuff like rental properties and stocks, be prepared for crashes - how will you react when the market tanks 20-30%? Back in 2008, a lot of retirees had their money locked up in mutual funds, stocks, and ETFs, got scared when the market collapsed and sold everything. Looking back, they should've sold everything else and put more money into the market and made out like bandits. lol. Consider stuff like "where will I get health insurance and how much will it cost?" because your health will more than likely decline and it could become your biggest expenditure. Retiring early means you won't have things like Medicare to fall back on, for example. Also consider if you still have mortgage, car payments, credit card debt, etc. Several people I know don't have car payments or carry credit card debt month-to-month, and have paid off their house or are almost done paying it off. These are the types of people you need to hang around. lol. One thing is for sure : nothing beats coming to a decision and beginning executing it early in life - like in your 20's and 30's. If you wait until you're in your 50's you're probably going to have your decisions made for you by circumstances.
