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here is the problem , you may find . as you make more and more money from your business your lifetyle usually gets better and better .
i started life in a nyc housing project with nothing and i devoted my life to making sure i never went back .
so as my income grew and as i made more and more investing our lifestyle improved along with it.
well now that i retired 2 weeks ago at 62 our lifestyle is based somewhere around the amount of money we were earning .
well now what happens is even though i have saved multiple 7 figures it will take 3 to 4% of that a year inflation adjusted to preserve our lifestyle as it is .
so the point is while you may save a lot , hopefully your lifestyle will improve too along with that success and eventually if your portfolio has to generate that level of income , you run a very very high risk of failure trying to draw more than 2% a tear inflation adjusted from all that money.
to me dying with two much money left unspent is poor planning too .
I doubt that I'm going to start spending like crazy, I honestly could do that now, I'm sitting on hundreds of thousands in terms of "liquid assets" and over $160,000 in credit lines.
I'm in Clinton Township, MI which is a Suburb area, but the cost of living over here is pretty great. If you guys live in NYC, your cost of living is about double (maybe even triple) the amount it is over here.
My quality of life is good too. All of my entertainment, eating out (on cheat days only), entertaining women, etc. is all within budget.
Not having kids is going to be a SIGNIFICANT cost saver. Not getting married will too because my Generation is less likely to stay married, and divorces can be significant financial setbacks.
it isn't about amounts you have . it is only about what percentage of your savings you will need to draw and inflation adjust . we have no kids to support anymore either , they are grown and out of the equation .
the rules and safe withdrawal amounts don't change because you have more or less in savings . they are all based on your own amount and what it will take to generate that income eventually .
if you manage to save only 1/2 or 1/3 of what you could have had in your accumulation stage because you didn't use growth vehicles you will need to draw a higher percentage from savings to generate the same income as someone who grew that money they made from their business while you didn't.
the fact you need to draw a higher percentage of draw to get the same income means without equity's when you retire you will be limited to a very low income draw . about 2% is about the max to stay bullet-proof. that is 1/2 the income a 40% equity portfolio has been able to draw over every rolling 30 year period in history including those who retired in the great depression , the world wars and the high inflation n 70's .
if 2% works for you great you are good to go but at this stage you don't know that . .
Apparently for JT, no growth of of savings is necessary for a comfortable retirement. Good for him. For many people, that isn't enough. Mere savings through the working years with little to no growth above inflation will not cut it. For him, way to go, Dude. Stay safe and static. For most of the others, the tried and true method is the best choice for a safe and comfortable retirement. There is no argument here, merely difference of opinion. At least JT knows the outcome and lost opportunity of staying in "safe", fixed income vehicles.
I doubt that I'm going to start spending like crazy, I honestly could do that now, I'm sitting on hundreds of thousands in terms of "liquid assets" and over $160,000 in credit lines.
I'm in Clinton Township, MI which is a Suburb area, but the cost of living over here is pretty great. If you guys live in NYC, your cost of living is about double (maybe even triple) the amount it is over here.
My quality of life is good too. All of my entertainment, eating out (on cheat days only), entertaining women, etc. is all within budget.
Not having kids is going to be a SIGNIFICANT cost saver. Not getting married will too because my Generation is less likely to stay married, and divorces can be significant financial setbacks.
if you manage to save only 1/2 or 1/3 of what you could have had in your accumulation stage because you didn't use growth vehicles you will need to draw a higher percentage from savings to generate the same income as someone who grew that money they made from their business while you didn't.
Quote:
Originally Posted by 1insider
Apparently for JT, no growth of of savings is necessary for a comfortable retirement. Good for him. For many people, that isn't enough. Mere savings through the working years with little to no growth above inflation will not cut it. For him, way to go, Dude. Stay safe and static. For most of the others, the tried and true method is the best choice for a safe and comfortable retirement. There is no argument here, merely difference of opinion. At least JT knows the outcome and lost opportunity of staying in "safe", fixed income vehicles.
Did you guys not see my rant in the last thread about Stock Market investors presenting the Stock Market as a "guaranteed" return vehicle? You guys are doing it right here. I know you didn't specifically say the word "guarantee" (as Low Expectations pointed out before) but you are PRESENTING it like a "guarantee".
When you are trying to "sell" a person on moving money out of Annuities or CDs into Stocks, STOP saying they will LOSE if they don't do it. You don't know that because Stocks are not a guarantee. Just mention that they have an "opportunity" to make more growth on their money over time. I don't care if you go back 100 years or not, nobody knows what the Stock Market will do going forward and you guys confirmed nobody can issue out any guarantees on the Stock Market. So STOP presenting it like a guaranteed "shoe-in" to make more than CDs and Annuities, please.
I firmly realize that I have the "opportunity" to make more than 3% for the next 32 years, which is why I'm looking more into this.
Just trying to give you guys some pointers okay? Maybe you have family members who are like me (conservative investors) and you are trying to help them make more money on their money. I'm telling you, if you come to them like you guys are coming to me, they won't move.
Quote:
Originally Posted by Lowexpectations
What's your annual income?
It's a range because we are paid a significant amount on performance. Over the last 5 years it's averaged $73k a year. I estimate that over the next 6 years this will go much higher though or at least stay within the same average range.
I don' t see the word guaranteed returns any where. I do see the words odds as in odds greatly in your favor just because they never have not been higher 15 to 20 years later the same as the sun rises .
Could it fail to happen ? Sure but if you were to bet on it not happening on a regular basis odds are you would be wrong as well as quite poor from your bets.
I don' t see the word guaranteed returns any where. I do see the words odds as in odds greatly in your favor just because they never have not been higher 15 to 20 years later the same as the sun rises .
Could it fail to happen ? Sure but if you were to bet on it not happening on a regular basis odds are you would be wrong as well as quite poor from your bets.
MathJak, you don't know that I'm going to be poor. If I keep putting away $7,500 a year for the next 32 years at just a 3.5% annual return, that grows to $468,000. This plus monies already attained, invested for the next 32 years ON TOP of Social Security. All of that gives me $1 million or more to play with.
That's not poor.
I understand you guys are trying to sell Stock Market investing, but you are going about it the wrong way. Just say this:
You have an opportunity to make a lot more than 3% per year with Stocks, yes, you could lose, but there are hedges against the market risk that can make things more "predictable".
Stop telling the guy he will live in a poor house if he doesn't invest in Stocks, stop telling the guy that he's "missing out", stop telling the guy that he's currently losing a ton of money by not investing in Stocks (when he just showed you his expenses are going down not up), stop saying these things man.
Maybe I should become a Financial Adviser? Lol, I swear I bet a lot of those guys cold call people with money jammed in CDs/Annuities and "sell" Stocks to them just how you guys are doing on this Forum, and they wonder why nobody is moving any money over.
It's a range because we are paid a significant amount on performance. Over the last 5 years it's averaged $73k a year. I estimate that over the next 6 years this will go much higher though or at least stay within the same average range.
Explain how you've accumulated hundreds of thousands in liquid assets on 366k in gross? Maybe you could teach us a thing or two but that seems difficult
MathJak, you don't know that I'm going to be poor. If I keep putting away $7,500 a year for the next 32 years at just a 3.5% annual return, that grows to $468,000. This plus monies already attained, invested for the next 32 years ON TOP of Social Security. All of that gives me $1 million or more to play with.
That's not poor.
I understand you guys are trying to sell Stock Market investing, but you are going about it the wrong way. Just say this:
You have an opportunity to make a lot more than 3% per year with Stocks, yes, you could lose, but there are hedges against the market risk that can make things more "predictable".
Stop telling the guy he will live in a poor house if he doesn't invest in Stocks, stop telling the guy that he's "missing out", stop telling the guy that he's currently losing a ton of money by not investing in Stocks (when he just showed you his expenses are going down not up), stop saying these things man.
Maybe I should become a Financial Adviser? Lol, I swear I bet a lot of those guys cold call people with money jammed in CDs/Annuities and "sell" Stocks to them just how you guys are doing on this Forum, and they wonder why nobody is moving any money over.
1 million dollars with no market investments can be counted on to generate 20k inflation adjusted in retirement with a high degree of success.
If that is your idea of a successful retirement from saving for 32 years good luck. Throw in social security and you have a combined income that still will be taxed as well as we are talking 32 years from now.
Good luck , you may want to own a shopping cart.
While you are learning about stock markets i suggest you learn about retirement planning and safe withdrawal rates
Last edited by mathjak107; 08-17-2015 at 06:28 PM..
Explain how you've accumulated hundreds of thousands in liquid assets on 366k in gross? Maybe you could teach us a thing or two but that seems difficult
By saving money and living below your means. My "liquid" assets are over $100k, my total assets are a lot larger though due to business contracts and fixed income portfolios. I scrolled back and noticed I did say "hundreds of thousands in liquid assets" which would imply I would have over $200k in liquid assets, that was a typo. My credit limit is over $160k as I have pointed out before in other threads on credit cards.
Quote:
Originally Posted by mathjak107
1 million dollars with no market investments can be counted on to generate 20k inflation adjusted in retirement with a high degree of success.
If that is your idea of a successful retirement from saving for 32 years good luck. Throw in social security and you have a combined income that still will be taxed as well as we are talking 32 years from now.
Good luck , you may want to own a shopping cart.
While you are learning about stock markets i suggest you learn about retirement planning and safe withdrawal rates
If I was retiring today at age 65 and had $1 million to play with (retirement accounts and Social Security), I would be more than good with the way I manage my money. I understand that you might need way more than that, but understand your expenses are most likely 2.5 times larger than mine. If I had a $1 million today at age 65, and COULDN'T retire comfortably, I would be an idiot in terms of budgets.
And again MathJak, I don't know how many times I have to keep pointing this out to you, but you are still presenting the Stock Market as a "guaranteed shoe-in way" to make more money. Do you realize that you are doing this? I'm not sure you realize you are doing it. Just about every one of you that respond to me are doing this and I don't think you realize it.
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