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Old 12-28-2017, 02:04 PM
 
Location: Denver CO
18,975 posts, read 10,040,378 times
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Quote:
Originally Posted by Lowexpectations View Post
I’m sorry but your detail of the presumptions is just lacking any detail at all. Most people retire on less because they have no choice and because most people never put the time or effort into properly planning and executing for a fully funded retirement.


Fun facts: 50% of married couples and 71% of unmarried persons receive 50% or more of their income from SS

23% of married couple and 43% of unmarried persons rely on SS for 90% or more of their income.

Average monthly benefit for a retiree is 1369.00

Without SS over 40% of seniors would be below poverty level


So do they survive? Yes they do but I don’t want to be in those statistics do you?
You are completely missing the point. I already said more money is better than less money, but that doesn't mean that most people truly need the amounts these financial service companies say is necessary for a comfortable retirement. I'm not saying to not save at all but someone who already has 170K in a 401k at age 41 isn't remotely in that category and doesn't need to be discouraged by an artificially inflated "target" goal that is - in my opinion - at least to some degree a marketing strategy designed to encourage people to put even more more into a Fidelity (or other company) financial services product so that company can make more money.

Last edited by emm74; 12-28-2017 at 02:16 PM..
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Old 12-28-2017, 02:16 PM
 
Location: Denver CO
18,975 posts, read 10,040,378 times
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Quote:
Originally Posted by JrzDefector View Post
I made a major life change several years ago by moving across the country, and ended up relying on credit cards to handle some unexpected emergencies that tapped out my savings. That got compounded when it made more financial sense to buy a house than rent, as property costs are skyrocketing in my area. It was a good idea since the house is a great investment (I got in while prices were still reasonable with a low interest rate), mortgage is far less than rent, and I have no intention of moving before retirement, but it needed more repairs than expected at first, so more debt. My job is finally paying the kind of money that will enable me to live comfortably, so the debt is the first thing I'm tackling - just put my full end-of-year bonus towards the credit card and will do the same with my tax rebate. The next bonus in a couple months will go towards a cash cushion to prevent me from turning to the credit cards.

The Fidelity projections seem like they're a bit steep to pad their AUM, exactly as you point out, and all my reading on retirement suggests that most people find they see their spending greatly reduced. I know I'm ahead of the general population in terms of retirement savings for my age cohort, but that's not reassuring. But given what is going on with taxes and so-called entitlements, I'm not sure what would make me feel confident. I know I'll have enough to get by on based on my current course, but I would like to have some idea of what to expect. I fully understand the lack of predictability in the stock market, but I'm not sure what's a reasonable retirement savings expectation at my age.

Disability insurance is something I'll be looking into as well.

Sounds like you've got a good handle on things then, and a plan in place to get the debt paid and it was likely more of a one time thing. Not that you won't have ongoing expenses as a home owner, sometimes big ticket items, but esp. with regular bonuses, you'll be able to save up a nice amount to have the cushion to pay for those things as they arise.

I agree that with the uncertainty in terms of taxes and potential changes in SS and medicare, it's very hard to feel confident because a lot of it comes from trying to predict the future. But I'm a little less skeptical than some in the thread about working until 70 - that's my target retirement age as well and of course I know things can happen that could change that but I think it's reasonable to plan based on that.

One thing you haven't specifically mentioned, although perhaps figured into your calculations, is that you'll have a paid off home by then. So even if you sell at that time and buy in your desired retirement location, you should have relatively low housing expenses. That's a big part of my planning as well, because not having to worry about rent or a mortgage obviously covers a significant percentage of my current expenses, so I don't need to save enough to cover that percentage (still allocating money for RE taxes, insurance, maintenance, any HOA of course - but all of that together is still much less than a mortgage or rent payment).

One question - when you say you'll be putting 12-15K into your 401k, does that include the match? If not, if you include that in the calculators, maybe you'll feel at least somewhat more comfortable about whether or not you are on track, at least as much as you can given the uncontrollable unknowns.
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Old 12-28-2017, 02:35 PM
 
17,615 posts, read 12,203,533 times
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Quote:
Originally Posted by emm74 View Post
You are completely missing the point. I already said more money is better than less money, but that doesn't mean that most people truly need the amounts these financial service companies say is necessary for a comfortable retirement. I'm not saying to not save at all but someone who already has 170K in a 401k at age 41 isn't remotely in that category and doesn't need to be discouraged by an artificially inflated "target" goal that is - in my opinion - at least to some degree a marketing strategy designed to encourage people to put even more more into a Fidelity (or other company) financial services product so that company can make more money.
Iím not missing the point as you simply gave generalizations and not something specific. Do you think a nest egg 20x your annual need is too much?
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Old 12-28-2017, 02:58 PM
 
Location: Fairfax County, VA
1,387 posts, read 601,424 times
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Quote:
Originally Posted by Lowexpectations View Post
If you have no assets, no spouse and no dependents you donít need term. Your friends or family donít have to pay or deal with your earthly affairs
I'd suggest talking to an attorney and doing it sooner rather than later.

Quote:
Originally Posted by Lowexpectations View Post
Itís a much better starting point than current gross income
Why quibble over bad choices? What you need to cover in retirement is your actual spending in retirement. It's impossible to know that with precision in advance, but it's not hard for an informed and sensible person to estimate it. That is the proper road to go down.
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Old 12-28-2017, 03:06 PM
 
Location: Denver CO
18,975 posts, read 10,040,378 times
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Quote:
Originally Posted by Lowexpectations View Post
Iím not missing the point as you simply gave generalizations and not something specific. Do you think a nest egg 20x your annual need is too much?
I doubt any amount is "too much." However, I think most people, and particularly not the OP who will have a paid off home, do not need anything close to that, and should not be discouraged if they cannot meet unrealistic and arbitrary goals.
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Old 12-28-2017, 03:16 PM
 
Location: Texas
1,890 posts, read 1,243,823 times
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I think that you are doing most things great. I would continue to invest in the 401K up to the matching point and everything else into a Roth and regular IRA.

There is no such thing as low interest debt, only low interest savings, checking and money market accounts. Get rid of all CC balance now or asap. Only charge what you can payoff at the end of each month.

Why retire late, retire as soon as you can reasonably afford it, certainly no later than 65. If you planned wisely, even in retirement, you will still be saving some of your income. For us itís over 50% of income, this is more than we saved during our earning years.
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Old 12-28-2017, 03:17 PM
 
Location: Mount Airy, Maryland
9,411 posts, read 5,206,233 times
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One tool to use is a compound interest calculator. I plugged in your current $170,000 balance, projected your estimated $15.000/year contribution for 30 years at a very conservative rate of 3% and came up with a balance of 1.14 million. If you draw down the recommended 4% that leaves you with $45,600 annually plus SS (which I believe WILL be there for you). Of course 45 grand in 30 years will look a lot different. And that 3% is probably way low, if you earn 6% those figures obviously double

Compound Interest Calculator - Investment Calculator
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Old 12-28-2017, 03:19 PM
 
17,615 posts, read 12,203,533 times
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Quote:
Originally Posted by 17thAndK View Post
I'd suggest talking to an attorney and doing it sooner rather than later.
For what purpose?


Quote:
Why quibble over bad choices? What you need to cover in retirement is your actual spending in retirement. It's impossible to know that with precision in advance, but it's not hard for an informed and sensible person to estimate it. That is the proper road to go down.
Whoís quibbling? Itís a better process to start modeling from your current expense rather income to work towards a retirement need. Since it is an unknown as youíve agree you do have to start from somewhere. So again current expense is a better starting point to model from than the often used income
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Old 12-28-2017, 03:21 PM
 
17,615 posts, read 12,203,533 times
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Quote:
Originally Posted by emm74 View Post
I doubt any amount is "too much." However, I think most people, and particularly not the OP who will have a paid off home, do not need anything close to that, and should not be discouraged if they cannot meet unrealistic and arbitrary goals.
Well without specifics your claim of arbitrarily inflated numbers are unsupported. If you paid of your house a 20x your annual expense need would be less.
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Old 12-29-2017, 06:59 AM
 
Location: Fairfax County, VA
1,387 posts, read 601,424 times
Reputation: 2723
Quote:
Originally Posted by Lowexpectations View Post
For what purpose?
Education.

Quote:
Originally Posted by Lowexpectations View Post
Who’s quibbling?
You have been and still are.

Quote:
Originally Posted by Lowexpectations View Post
So again current expense is a better starting point to model from than the often used income
And again, a sensible person would not be using either one. Post-retirement expenses are not precisely knowable, but they are indeed foreseeable, and it is they and nothing else that a retired person will need to have covered in retirement.

Last edited by 17thAndK; 12-29-2017 at 07:14 AM..
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