At what age do you hope to retire/Personal Finance and Investing Thread

[nodakfan17]

Scholarships are goofy. They say they want welll-rounded students with good grades. What they really mean is high ACT/GPA kids who participate in just enough activities to not be considered shut-ins. Edited October 29, 2018 by nodakfan17

[igor67]

I haven't really thought about a specific age, but my wife and I are now both earning pension credit. First thing to realize is how vastly superior pensions are as an investment to any other alternative. 1) Generally much lower fees. 2) The pension never needs to sacrifice returns by going conservative as retirement nears. 3) Compared to an individual saving on their own the pension can assume average lifespan, which prevents you from having to stretch your savings if you are somehow 'cursed' with an extralong life. It is unfortunate that 401Ks were so badly oversold to people. They are better than nothing of course, but to have comparable money in retirement you need to save on the order of 33% to 50% more. It would be fantastic to broaden access to pensions for people.

 

The math on Scholarship chasing is also not terribly flattering. Even if the scholarship endowments had some how managed to keep pace with the rate of tuition inflation over the last 30 years, there is still a substantially larger number of students going to college. They can certainly help, but I have a suspicion that if you just ran the numbers on merit scholarship dollars and divided by total students you would discover it is about break even with just working more (which in and of itself is a mediocre strategy to avoiding debt).

[Jimbo]

If I could pull it off, work full time until 62. Work half time (20/wk or 25 wk/yr) from 62 until 70 either through contract work or permanent part-time work. Doubt it will happen, so sometime between 62 and 65.

[logan82]

I am going to drop dead at my desk at the age of 55.

[JohnBriggs12]

I retired at 64 1/2. I factored in paying health insurance premiums from my company's coverage for 5 months out of pocket and prepared for that. It was worth it because I was off all spring and summer of 2017 and I love to play golf in addition to following Brewers.

 

I really got serious about planning when I turned 62. I had both IRA and 401 K's plans and protected my IRA savings in safer investment. Meanwhile between 2014 and 2017 my 401K took off. Still I basically knew my retirement date more than 2 years ahead of time.

 

I concur with those also in the private sector that public sector employees don't know how good they have it. My brother worked for a Federal agency and he retired at 53. Pension? What's that?

[wallus]

 

I concur with those also in the private sector that public sector employees don't know how good they have it. My brother worked for a Federal agency and he retired at 53. Pension? What's that?

 

Although I am not in the public sector anymore (Act 10), public sector employees took better benefits instead of pay increases like the private sector was getting for years. I am surprised this isn't more common knowledge as I have to tell people time and time again.

[Fear The Chorizo]

 

I concur with those also in the private sector that public sector employees don't know how good they have it. My brother worked for a Federal agency and he retired at 53. Pension? What's that?

 

Although I am not in the public sector anymore (Act 10), public sector employees took better benefits instead of pay increases like the private sector was getting for years. I am surprised this isn't more common knowledge as I have to tell people time and time again.

 

That's because private sector employment is much more volatile - salaries may range higher at the expense of retirement and medical benefits because careers in the private sector are rarely made at 1-2 companies and the private sector has adjusted by essentially ending their antiquated pension system. 401ks are personal accounts much more than company benefits, too. Teachers in particular can often settle into a lifestyle built around a position with alot of security and have a lower cost of living with a better work life balance than most in the private sector. I'm not dinging one side or the other, to each their own. However, I feel it should never be an apples to apples comparison, because it's a different lifestyle. I think most public sector employees understand that to retire "early" means sacrificing income during their prime earning years in order to maintain the retirement benefits they and others before them have earned.

 

The issue gets sticky when costs of the benefit packages outweigh funds coming in, particularly with tax dollars that are paid by everyone (including private sector stiffs who have to use their "higher" wages after medicare and social security get their take to cover their own retirements/benefits).

[MrTPlush]

Meh the pension is a tad overrated in my opinion. Federal you have to pay in 4.4% of your pay and I am not convinced I am woefully better off with the pension vs. having that in investment accounts. The lack of risk is probably what sets it apart. If you live 20+ years after retirement that pension is likely around a 9% return on your money. Not bad, but you could argue one could do better on their own.

 

The key is living long enough or having a spouse live long enough to draw a lot from it. I think people assume the pension is like it was 40+ years ago, which yes, was absolute insanity. These days it is really nice, but not near what it used to be.

 

All the benefits of public work are nice if you are someone looking forward to your retirement years and take care of yourself to have lots of post retirement years. If not the higher private sector salary would have been way better.

[reillymcshane]

I've eschewed saving as I have big windfall of Nigerian oil money that a guy randomly emailed me about many years ago. Any day now.

[FVBrewerFan]

I've eschewed saving as I have big windfall of Nigerian oil money that a guy randomly emailed me about many years ago. Any day now.

 

You sir are a sucker. My plan is financially sound. My wife buys a lottery tickets. No, not every week on the measly $5MM or $200MM jackpots. Only once every couple years when it gets to a billion. Its simple math, she will win it eventually. Retirement WHOA SOLVVD.

[GAME05]

You're both suckers. I'm counting on the government to provide me with everything I need.

[MrTPlush]

I don't get all the concern, SS should be enough. I am betting in the next 40 years the government makes a ton of sound financial/investment decisions and SS is better than ever.

[OldSchoolSnapper]

I will likely stay in current job/industry until kids are through college (if they go), I will be about 50 at that time. I will likely be able to stop then, but will switch to something I enjoy more, like coaching or part-time retail. I travel frequently and love that sort of thing, but without any obligation at all I get a little stir crazy. We also plan to downsize our home when kids leave high school, even though our home is already very modest, we will go to a ranch home type deal when space allows.

 

Millennials need to plan as though SS won't be there. I'm not doomsday and think it will be there, but you need to plan as if it won't be.

[MrTPlush]

Millennials need to plan as though SS won't be there. I'm not doomsday and think it will be there, but you need to plan as if it won't be.

 

Meh, it will be there. They can always print money. The entire voting population (and even <18 kids) have paid into the system. You would make the entire voting population absolutely livid. I would like to see either party try to end SS. Even mentioning it would probably kill them in the following election.

 

Of course one should never count on it because you can't live off of it...well you don't want to at least.

[OldSchoolSnapper]

Yes, I said it will be there. But I would advise against counting on it to supplement much of anything. Retirement age could very well be 75 or something 30 years from now as well. Plan as if it won't be there at all, the same way one should live a life beneath their means with the expectation that your income could be cut out from under you at any time. If you do those two things you will be very happy when you decide to kick back. At least it will be your decision and not the accounting department's.

[FVBrewerFan]

SS will be there, yes, but they will keep raising the age for the full benefit, play with the formula, etc. I think maybe the biggest change moving forward will be taxing SS income at lower and lower income levels.

 

I really don't understand why they have never let us invest at least a portion of our SS on our own. A huge amount of people would be just fine paying a much lower tax to cover others, the rest we manage on our own. Even 50/50. Let the employer's share go the general fund, and then the employee can do whatever they want with their share as long as it goes into a qualified retirement plan like an IRA.

[AZBrewCrew]

Retire?? That’s a good one. Probably when I’m cold and stiff.

 

 

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[OldSchoolSnapper]

SS will be there, yes, but they will keep raising the age for the full benefit, play with the formula, etc. I think maybe the biggest change moving forward will be taxing SS income at lower and lower income levels.

 

I really don't understand why they have never let us invest at least a portion of our SS on our own. A huge amount of people would be just fine paying a much lower tax to cover others, the rest we manage on our own. Even 50/50. Let the employer's share go the general fund, and then the employee can do whatever they want with their share as long as it goes into a qualified retirement plan like an IRA.

 

You would get too many idiots investing in penny stocks. A portion of the population is too dumb to be trusted with any amount of money so the best way to keep them barely alive is giving them a monthly allowance to buy food at the end of the life. Brutal, but true.

[FVBrewerFan]

SS will be there, yes, but they will keep raising the age for the full benefit, play with the formula, etc. I think maybe the biggest change moving forward will be taxing SS income at lower and lower income levels.

 

I really don't understand why they have never let us invest at least a portion of our SS on our own. A huge amount of people would be just fine paying a much lower tax to cover others, the rest we manage on our own. Even 50/50. Let the employer's share go the general fund, and then the employee can do whatever they want with their share as long as it goes into a qualified retirement plan like an IRA.

 

You would get too many idiots investing in penny stocks. A portion of the population is too dumb to be trusted with any amount of money so the best way to keep them barely alive is giving them a monthly allowance to buy food at the end of the life. Brutal, but true.

 

That's why 50% still goes into the general fund, as there will still be plenty of people who either are not responsible or unable to have enough for retirement.

 

Also, if that's the concern they could limit what you can invest in- similar to 401k. I don't like that personally, but I would still rather have my own account and stick it into an S&P index fund or something.

[nodakfan17]

Start at 50. Add 5 years for every kid and / or divorce.

 

That’s a realistic retirement age for most folks.

[OldSchoolSnapper]

A realistic retirement age for most folks is never if we're being factual about the word "most." Half the country can't cover a $500 emergency.

[nodakfan17]

Sadly, I’m sure that’s true.

 

You can throw all sorts of funding into financial literacy, but most people will get their money habits from their parents.

[OldSchoolSnapper]

https://www.cbsnews.com/news/most-americans-cant-afford-a-500-emergency-expense/

 

The actual numbers are frightening. I would guess most of the people on this site are either middle class or upper middle.

 

Even your figure is pretty ambitious for those in the middle class. Retiring at 60 with 2 kids is a pipe dream for most people. And you are right about the parental influence. That and political beliefs are the two most passed-on characteristics from parents to children.

[nodakfan17]

60 with 2 kids is feasible.

 

It just depends on how high you prioritize savings.

[OldSchoolSnapper]

I didn't say it wasn't feasible. It's totally feasible. 45 with 2 kids is feasible. The whole FIRE community has people doing it at 30 with kids.

 

But 60 with 2 kids for 'most folks'? Nah, that ain't happening. If you are upper middle or even middle class surrounded by mature/responsible people, your experience bias helps you lose a sense of what is reality for the common man.

 

Most people in our society are dead broke. Either diddly to fall back on, or up their eyeballs in consumer debt, or both. That's just what the picture is for 'most' folks.

 

Somebody with most types of a college degree ~ age 30 is usually making more than the median US household. I'd guess most people on this site are middle or upper middle, and have very little frame of reference for how 'most' of the country is actually living.

 

42% of America has less than $10k saved for retirement. The median retirement savings for people in their 50s is $117k. You ain't retiring at 60 with that figure saved.