Throughout my years on AN, I have often come across discussions about salary, quality of life, saving habits, spending habits, definitions of luxury and wealth, etc. In those threads, I frequently read posts from some members who state that they have already saved so wisely that they are pretty sure that they will be able to retire "comfortably." Others haven't gotten there yet, but feel confident that with their current financial habits, they will absolutely get there.
Knowing there is no one definition of "enough" or "comfortably," I still wonder what the general consensus is.
How much do you need in your retirement account to feel confident in a comfortable retirement, and at what age do you plan to completely retire?
Specializes in Specializes in L/D, newborn, GYN, LTC, Dialysis.
I think it's incredibly sad that today's parents are not teaching finances to their kids. So many have such an unrealistic picture of their financial lives and what to do to secure a future.
I worry there will be an entire generation of people who will either never retire, or depend on the rest of us to keep them afloat because they have zero savings.
We started saving when we had little to no disposable income. We knew we did not want to burden our kids with our needs, which as we age, become many. I told them they would have to finance their own post-secondary educations, but we would always help with basic needs like food, clothing, shelter and yes, even books. But they knew also, mounting up incredible school loans was a very poor option, too.
Finance and retirement planning should be a mandatory part of every public school curriculum seeing as parents (my generation) clearly are falling down on the job. I homeschooled mine a number of years, so we made it part of our home curriculum. Life skills were taught extensively.
Both are successful young people now. Neither has much money, but they are supporting themselves, and in the case of my daughter, going to school.
All the lack of knowledge about future financial planning really has me concerned. It's not the kids' fault; it's just not discussed honestly and realistically anymore.
Both of those locations, as well as many others, have a large number of American expats, and are much cheaper cost of living, so retirement dollars go a much longer way.
Keep inflation of the money supply in mind. I think inflation runs about 3% per year, at least.
Every time the Fed Res turns on the printing press and our government takes out an interest-bearing loan from them, the value of every dollar and coin drops. It buys less than it did before.
It's such an evil thing to not back up our money with a precious metal. It is backed instead only by air (the full faith and credit of the US government). Well what if people stop having faith in the government?
What really bites about the US borrowing from the private corporation known as the Fed Res is that our Constitution says that CONGRESS has the authority to coin money.
Don't count on having fewer costs in retirement than you do now. I think it's a fallacy to think you'll need only 75% or 80% in retirement of what you currently need. Count on needing as much if not more because of inflation, rising prices, unexpected expenses.
Do go to seminars put on by financial planners, sellers of annuities, stockbrokers, insurers, Social Sec experts, and so on. There often free, they might feed you a meal, you get some valuable information.
Specializes in Psych, Addictions, SOL (Student of Life).
Why did you get "ripped up" over your retirement plan?
I got ripped up because I mentioned that my folks left an estate worth about 1.6 million dollars but that was divided by 18 (5 kids and 13 grandkids) so about 80 grand apiece. The grandkids don't get theirs until they are 35. But us kids will get ours sometime next year.
Regarding why Happy may have gotten "ripped up," in a previous post. Even the concept of retirement savings is associated with privilege. And, while there are certainly stories of people who have changed class/income brackets from their family of origin, that is not usually the case (especially for people of color). Everything from student loan debt, home ownership, or even who you marry (college graduates of medium to high income generally marry other college graduates), is set up by the circumstances under which you were raised. Some people start out on a path to financial success, others have to fight like hell.
The whole idea of wealth building is based upon having wealth to begin with. Also, peoples standard of living varies greatly. I am a director of a department, my husband is a surgeon, and we live in a big east coast city. Our spending patterns reflect that, so our retirement needs are greater. In the era of pensions and owning your home by the age of 60, retirement was attainable for many more. Now, pensions are gone, the stock market is unstable, and people use the equity in their house like an ATM. Those who are the most protected are those that have the greatest number of income streams. All of this requires "extra" income to start with.
After reading this, my first thought is, don't you people have pensions?
My husband retires with roughly $3600 a month, I get 50% of this as survivors benefits if he dies first. My own pension and government pension will be roughly $2300 a month. The house is paid for, no debt. We both have registered retirement savings accounts, not huge but enough to let us travel each winter.
I guess being in a nation with high taxes and universal healthcare isn't that bad at the end years of life
Most of us are Americans and defined benefit pensions are becoming a thing in the past in the U.S.
To answer, OP, I plan on jumping ship at 50. Yes. 50.
Most people think I am living in a dreamland, but it can be done. I have been contributing to a retirement plan for almost seven years and became vested in a government retirement plan at age 25.
Since 24, I have maxed out my Roth IRA (2015, 16, 17 and 18). I maxed out my 403b for the first time last year and am on track to do it again this year. I also contribute to a 457 and still contribute to my government pension. And I also have an HSA (maxing it out) and a RMA through the government.
Unlike most people, I graduated college debt free. I have no credit card debt ( pay in full every month). No mortgage. My auto loan (which is three months old) started at 15k in February....it is now at 4500ish.
I also have no children. Besides saving early and not getting into debt, the best way to gain wealth is to delay child bearing years. I am 26, almost 27 and every dollar I save now is worth investing far more now than in my thirties and beyond. I plan on having kids someday but I couldn't do what I am doing now with them. I hope to have them in the next three years and by then I hope to have about 4x gross saved for retirement. Right now I am slightly under 2x.
Most Americans don't have to income or inclination to save for the future, but when the time comes, they will be in a world of hurt.
Age 62. "early" (not really) Soc.Sec, and start drawing my State Pension. NO I don't have much in it; but I vested and then worked a few years beyond that.
I am no longer with the State.
BUT: Have a husband , who has 3 401K -type retirements, I have two very small of my own 401K, and have been informed by my parents that I share their estate someday. We will be fine.
I plan on working to the SS Salary cap each year starting age 62. But it will NOT be in nursing.
For my investment plan, I come from a middle class family and my husband and I have the worst luck in real estate. We've had a 2nd house for the last 11 years. Thought we could sell it when we moved and that was not the case. The area the house is in has never recovered from the real estate crash, and it's still underwater in the mortgage. It sat on the market for an entire year from 2016-2017. Renters trash it and it costs around 4000 in repairs every time a renter moves out.
So how are we affording the 500/paycheck for stocks? Overtime. A single overtime gives us enough to do that. We have 2 house payments, 2 car payments, 2 student loans...but we buy within our means. We pay my son's private school tuition in full, and we are so used to doing with so little that it's fine. As a stay at home mom we only had 1 income and made it work. We didn't have new(er) cars then, but they were on their last leg when I became a nurse. We have an allowance every 2 weeks, a roof over our heads, and food on the table. Fingers crossed the second house sells this year. We do with less because it's worth it right now.
SmilingBluEyes
20,964 Posts
I think it's incredibly sad that today's parents are not teaching finances to their kids. So many have such an unrealistic picture of their financial lives and what to do to secure a future.
I worry there will be an entire generation of people who will either never retire, or depend on the rest of us to keep them afloat because they have zero savings.
We started saving when we had little to no disposable income. We knew we did not want to burden our kids with our needs, which as we age, become many. I told them they would have to finance their own post-secondary educations, but we would always help with basic needs like food, clothing, shelter and yes, even books. But they knew also, mounting up incredible school loans was a very poor option, too.
Finance and retirement planning should be a mandatory part of every public school curriculum seeing as parents (my generation) clearly are falling down on the job. I homeschooled mine a number of years, so we made it part of our home curriculum. Life skills were taught extensively.
Both are successful young people now. Neither has much money, but they are supporting themselves, and in the case of my daughter, going to school.
All the lack of knowledge about future financial planning really has me concerned. It's not the kids' fault; it's just not discussed honestly and realistically anymore.