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You state you are currently making $125K so you should net around $7000 per month. When you retire you think you will do just fine on $3000 per month. So try saving $4000 per month and see how that works out for you. After 9 years of savings and compounding you should have around a half million in your nest egg. That will allow you to safely withdraw around $1700 per month during retirement.
Talk to friends and neighbors regarding who they use as a Financial Planner. Meet with the individuals who are recommended to find one who is a good fit for you and your wife, then enroll in their services.
This Planner will be able to provide better and specific advice for you to meet your future goals within limits of your current situation.
And if the Planner says you need to work until age 68 it is better to hear that message now and wrap your head around the fact, than have all your assets dwindle away by age 70 because you retired at age 62.
That is correct. The only two options for matching are:
100% match up to 3% of salary per participating employee, or
2% salary match for every eligible employee, whether they contribute or not.
So apparently beginning with my new job, every FTE is promised 4%, via a mass email 4%, instead of the erstwhile 3%--but maybe the company didn't realize the limitation. I have just asked the accountant. I am afraid I maybe looking a bit greedy to the new management.
Talk to friends and neighbors regarding who they use as a Financial Planner. Meet with the individuals who are recommended to find one who is a good fit for you and your wife, then enroll in their services.
This Planner will be able to provide better and specific advice for you to meet your future goals within limits of your current situation.
And if the Planner says you need to work until age 68 it is better to hear that message now and wrap your head around the fact, than have all your assets dwindle away by age 70 because you retired at age 62.
Even 62 is late but unfortunately that's the earliest I could get my pension + SS check. As I said above, even if I stop working right now, I am going to get about $1800 in SS+Pension starting age 62. And my retirement plans are modest: Perhaps a take home of $2000/month is more than enough for my needs and wants. It may not seem 'practical' or 'smart' to others but to me, given my modest lifestyle, that take home amount is comfortable. So why should I endure the corporate work stress beyond 62? Why not take advantage of more energy at 62 to travel, for instance?
Heck, sometimes I think about selling our properties, downsizing, taking a hit on the savings/401K by putting into some annuity and retire at 57--barely 5 years from now --and live off that (or work part time) until the SS+Pension kick in at 62. By then, my SS income should rise considerably because of the contributions will be made for next 5 years.
But you are probably right: I could use a Financial Planner now that things are a bit complicated to manage for a rookie like me.
....... Perhaps a take home of $2000/month is more than enough for my needs and wants. It may not seem 'practical' or 'smart' to others but to me, given my modest lifestyle, that take home amount is comfortable. So why should I endure the corporate work stress beyond 62? Why not take advantage of more energy at 62 to travel, for instance?
........
I would advise you to check out healthcare insurance and other costs. My wife and I pay over $7000/year for Medicare supplemental and for dental insurance. On top of that Medicare deductions are taken out of our SS payments. Those add up to about $5000/year. Next my wife needs several prescription drugs. Not all of that is covered. By the time the year is over we have about $20K in out of pocket expenses. I will be reaching the point of needing a hearing aid soon. That is again several thousand dollars not covered by Medicare or insurance.
Again, if you think $2000 a month is a reasonable lifestyle, cut your expenses to that level and see how it works out for a few years. Then remember you will need much more for medical to make up for your employers policy and for your healthcare needs as you age. If you think you will just get by with Medicaid when you get sicker, I would advise you to visit an assisted living or nursing home facility that takes Medicaid. You might be just a little disappointed.
Jrkliny,
I am truly sorry for your situation. The unfairness of life is one of the major reasons I had moved away from heavenly deity many years ago. A lot of life is accidents of birth.
I think the healthcare costs will be the major concerns for me as well. However, my poor father in law who had major a bypass surgery few years ago after retirement is doing fine at age 72: He retired around 64 and had a surgery around 68 and Medicare took care of a chunk of that; the rest, he's been making payments. He's living fine on around $1300 SS checks. Every situation is different.
For me, $2000 take home will be more than comfortable unless there is a major medical condition to me or wife. We are healthy. I have zero health issues and don't take any prescriptions. She doesn't have major issues. We eat healthy. Our life has way less stress than most Americans seemingly have. So I am willing to take a chance and retire at 62 if not even earlier. And I have no intention of being on Medicaid: Never taken a dime from anyone or any govt assistance. Third World or suicide would be preferred to over the horrifying assisted living conditions you are alluding to. Que Sera, Sera.
Back to the main topic: Indeed, the new employers have realized that they can't contribute more than 3% to SIMPLE IRA and so now every employee will get instead get 1% raise. I am fine with that.
Even 62 is late but unfortunately that's the earliest I could get my pension + SS check. As I said above, even if I stop working right now, I am going to get about $1800 in SS+Pension starting age 62. And my retirement plans are modest: Perhaps a take home of $2000/month is more than enough for my needs and wants. It may not seem 'practical' or 'smart' to others but to me, given my modest lifestyle, that take home amount is comfortable. So why should I endure the corporate work stress beyond 62? Why not take advantage of more energy at 62 to travel, for instance?
Heck, sometimes I think about selling our properties, downsizing, taking a hit on the savings/401K by putting into some annuity and retire at 57--barely 5 years from now --and live off that (or work part time) until the SS+Pension kick in at 62. By then, my SS income should rise considerably because of the contributions will be made for next 5 years.
But you are probably right: I could use a Financial Planner now that things are a bit complicated to manage for a rookie like me.
Unless you love your job, I'm with you. Live a modest lifestyle and quit earlier if you can. High expense lifestyle=high stress.
I like the other poster's idea of saving 4k per month and seeing if you can live on the remaining 3k. That's a good way to test the waters and you'll save a bundle, too.
Jrkliny,
I am truly sorry for your situation.........
I think the healthcare costs will be the major concerns for me as well....... And I have no intention of being on Medicaid: Never taken a dime from anyone or any govt assistance. Third World or suicide would be preferred to over the horrifying assisted living conditions you are alluding to. ......
You don't need to feel sorry for me. First, unlike you, I had a positive career which I enjoyed, learned from and was able to make contributions to the rest of the world. It also allowed me to save money to have a comfortable retirement which includes travel, and other discretionary spending.
The medical costs I pay are nothing unusual. A good Medicare supplemental insurance can easily run $5000-$6000/year for a couple. A couple will also have over $5000/year deducted from social security to pay prescription drug coverage and the Medicare contribution. This is a just a fact of life you should be aware of. In addition you can count on increased need for healthcare as you and your wife age. If you do not have coverage or resources, you will be getting by with whatever Medicaid will provide.
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