Competition for Walmart Greeter jobs is going to be cutthroat!
Bkmrk
Once no longer physically/mentally able to do their work, the end probably isn't very far away anyway. They don't need to save for 35 years of comfort when they don't have much more than 5 years left.
We saved and invested substantially our whole working lives. We avoided unnecessary expenditures while those around us spent every dime they could borrow.
Financially speaking, our retirement is worry free. I just do not regret all the saving and investing in our early years.
I will be retiring in June of 2017 at the age of 55. Wife and I married young (I was 23, she was 22) and have always saved and invested, beginning before we got married. We both saved and invested believing that Social Security WILL NOT EXIST by the time we were old enough to collect it.
We've also lived well under our means. My vehicle is 13 years old. Still runs and looks great, I've no plans on getting rid of it barring an accident or major mechanical breakdown. Wife's vehicle is 9 years old. Same thing. Our modest home was paid for long ago.
We're paying CASH for our oldest son's college education (thankfully he scored an academic scholarship, so we're just paying the room and board.)
The secret to retiring at all, much less retiring at 55 like I am is really simple: Don't plan on Social Security being there when you're ready to retire, and plan accordingly. Live under your means. Use credit WISELY (that means NEVER paying monthly interest on a credit card.)
Pay CASH. Negotiate CASH DISCOUNTS. Have a valuable second "trade" and use that to barter exchanges of services with friends. Example: I fix all my friends computers, electronics and of all things do some really nice antique, furniture and wood restorations. That enables me to barter for plumbing, carpentry and other services with my friends who work in the building trades for repairs.
There are so many other things that can be done to save money and still LIVE VERY WELL that I can probably write a book on them, but if most people get started at an early age using just my advice above, they'll be so much better off when the time comes to just say "the hell with it" and decide to enjoy your life.
One last comment: Obviously, START EARLY! My youngest son saved his first $1,000 by the time he was 9 years old. We told him then if he saved up $1,000 we'd kick in the other $1,500 to open up a retirement investment account for him. He wisely chose to do that --- at 9 years old. We looked at his account just the other day and in just the last 8 years that $2,500 is just over $8,000. We calculated that by the time he's ready to retire at age 65 he'll have just over $640,000 if he does NOTHING but lets that money sit and grow. This of course does not include any 401k or Roth IRA's he'll open up for himself throughout his adult life.
That's the power of the value of money over time. Whether one uses compound interest or an average investment return rate that's powerful.
Parents, if you REALLY want your kids to be better off than you are, teach them about money early and get them started on saving & investing for their own retirement.
I guess that rental income would include rental income received. I derive about $1700 per month from 2 properties acquired cheaply and paid off quick. Depending on individual circumstances, I would advise buying such properties, do some handiman work and use the income into retirement. Often, keeping the “starter home” —even if mortgaged —is a good way to acquire at least one rental property. Looking back on it all, real estate to me is the best way to build not only retirement, but a substantial estate. I wish I had been more aggressive in this investment area.
And what of the many of us “boomers” that were forced by The Obama Recession” to dip into our 401K to pay ever-increasing household bills while unemployed?
Yet, there are clearly 100s of thousands on SS disability.
Interesting compendium of stats. Thanks for posting.
Even if you’ve been able to accumulate some retirement assets they will be subject to the corrosive effects of taxes, inflation, interest on any outstanding debts, and the occasional need to withdraw money to meet unexpected expenses.
For seniors, chasing yields can be very dangerous but there are still some companies out there with longstanding records of consistently paying reasonably good dividends. This may be a suitable way for some retirees to supplement their incomes, if they can tolerate the fluctuations inherent in stock prices.
First, lets define retirement.
I am of the opinion that retirement means having enough income so that one can cover their basic living expenses plus medical going into their advanced age. This can be accomplished by a mix of living frugally, income from pensions and from taping savings accounts, or in most cases, a mix of all three.
To that end, my plan is to pay off my current house, sell, move out and away from the city, buy a small plot of land, and build my retirement home. This will be as much as possible, an off grid, self sustaining home with a large enough green house to support food production for my wife and I. Wind and solar for power, geo-thermal for temperature regulation, HD antenna for local channels and possible K or c band satellite for entertainment and information. Since this will be paid for, this brings the monthly cost down to a few hundred dollars for taxes and maintenance.
From there, the two largest remaining expenses will be transportation and medical. For transportation, I am currently learning how to make my own bio-diesel from WVO and algae and ethanol / butanol from sugar beats. I figure chemicals and maintenance on the vehicle will add around another hundred bucks.
The biggest expense appears to be medical insurance. In 8 years, I will be able to retire from my company and as one of their benefits, I will / should be able to purchase insurance from them. This of course assumes many things but it is a reasonable assumption. Anyway, my numbers show that the cost will be in the arena of $1,500 per month.
Now, given all of the above, this is still less than my SS payment. So if we assume SS is going to continue to pay out ... then I am “ok”.
However, I do not feel comfortable with that assumption so I a working towards building a small business (specialty farm) that will provide more than the amount that SS does. I am also contributing to my company’s 401K but I am going to treat that as an emergency fund when I retire and not draw down unless needed.
So if all goes as planned my wife and I should be good and even have some extra during our retirement. Which is still a good 20 years off.
Would have been nice if he had included debt load in his charts also. Lot of older people still have mortgages.
I waited for a windfall. And I GOT IT!
They will naturally turn to politicians for help; politicians will be only to happy to confiscate the reserves of those wise enough to have saved for old age
When the time comes, we must be ready to deal with those politicians.
There were two scenarios that motivated the wife and I to save...
Care for either/both of us in an elderly care facility without our kids having to come out of pocket for the funds. It’s tough enough on the children when parents are in those facilities. I don’t want to add to the strain by forcing them to write financially crippling checks every month.
A good chunk of change left over to give the kids upon our passing.
Be nice to your kids since they will be the ones to pick out your old folks home.
Crazy statistics.... No wonder our country is so messed up....
I am so screwed.
My ‘plan’ for ‘retirement’ was to find and marry a wealthy old farmer.
Mission Accomplished. *SMIRK*
Nah, he’s more frugal than even *I* am. He wouldn’t have looked at me twice if I had any debt beyond my farm mortgage or was irresponsible with my money and had no financial plan for my future - with our without him.
Life Is Good! :)
I’ve followed Dave Ramsey for many years; it’s never too late to get your financial act together, People!
Bump
bkmk