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I have been thinking about saving lately, especially the catch-up contribution to the 401 K after age 50. I have about 8 to 10 years before retiring. For several years I have been putting max into my 401 K and I think what I have in there should be enough EXTRA money to enjoy life in retirement. The thing is when I do retire; I will have pension and SS that might cover about 60% of my pre-retirement income (currently, I live on 50% of my income). I have no mortgage, no kids’ education debt, no car loan, etc…The question is: should I put more money ($5,500 catch-up after age 50 limit) into my 401 k or enjoy it now? One thing is for sure, I love to travel and the extra money is a plus to my traveling. I know we don’t know what the future will be. You might be here today. You might be gone tomorrow.
Catch up, catch up, catch up. Remember it is not just how much you put in but the rate of return and your money will grow and it is often all about opportunity/trade off cost. You have 5K what are the things you could do with it and what are you giving up by doing one thing vs another. Compare that 5K spent now and gone with 5K saved/invested and what it will do for you in 15-20 years and what is most important and which can you most afford to give up by doing something else. It is a personal choice and if you do the trade off analysis you might feel better/more comfortable about whatever you decide. Have fun if you travel and save wisely if you do that.
I'd certainly make catch-up a priority but I'd also pick a special travel destination and take a serious vacation there! As you said, you may or not be here tomorrow, or may not be able to travel for some reason. At least you won't look back with a coulda, shoulda, woulda but didn't.
Thank you. I understand it is a personal choice whether to save more or less. The question is where do we stop and smell the roses. It seems to me all written articles about planning for retirement kept mentioning of having 70% to 80% of pre-retirement income. It might be harder to do both (saving more and enjoying more at the same time). I might face the same issue when I turn 62, e.g. take SS at 62 vs 67.
It seems to me all written articles about planning for retirement kept mentioning of having
70% to 80% of pre-retirement income. It might be harder to do both...
Look at ALL of the sources of income/benefit you'll have.
Everyone's situation is different; those without a solid pension will need to do more on their own.
Quote:
The question is where do we stop and smell the roses.
Those who will need to have a new Mercedes every other year vs those OK with a 5-10 yo Ford.
Thank you. I understand it is a personal choice whether to save more or less. The question is where do we stop and smell the roses. It seems to me all written articles about planning for retirement kept mentioning of having 70% to 80% of pre-retirement income. It might be harder to do both (saving more and enjoying more at the same time). I might face the same issue when I turn 62, e.g. take SS at 62 vs 67.
You will constantly have to reflect and make possible changes moving forward. It has been that way and will continue to be that way until the end. Smelling the roses yes but stopping not so sure about. Plan as best you can now and modify as needed and that is especially important with SS. You like most of us will have to save more to enjoy more.
A) As previously noted by others - Purely a personal decision. The pros and cons are uniquely your's and no one can dispute any approach you take.
B) My $0.002 opinion: To the extent that you don't seriously damage a reasonable retirement stash or income plan - TRAVEL AS MUCH AS YOU CAN --- ASAP!!!
We're finishing out our 6th year of a ten year retirement travel plan. There are trips/adventures off the list that I and/or DW would have preferred to do. However, older, creaky knees, backs, joints etc. have made many of them inadvisable. (Though there are still many delightful trips on the board or already taken. We'll run out of fun money before we exhaust the possibilities.)
Neither of us were in a position to travel pre-retirement and its become one of our principal joys since we moved into retirement mode in 2007. We're trying to beat the aging clock while we still can see the world. The physical demands of some adventures are just not within our practical capabilities as we sail through our 60s (I'm 62, DW is 65). Ten or 15 years ago it would have been a non-issue, now - the physical requirements of a proposed trip are a primary consideration.
My opinion is that to the extent fiscally sensible - go for it. I would suggest you might seriously consider creating a list of your top 25 or so destinations/adventures and do the research to prioritize it and - get started .
I'll have to second Pilgrim21784, especially since it sounds like your pension and SS will cover what you're currently lining on. We planned to travel once retired, but our current physical limitations (bad knees), will limit what we can do. It likely means travel will be more expensive (i.e., no long hikes or walking tours), which will limit the amount of travel and destinations.
I third the motion. If you can save for retirement plus travel or do things that will be more difficult when older do so. Its very individual as to what you should do now and prepare for later.For instances i my early twenty I liked to fish and hunt;so I had very nice boa6t and alot of gear. I alos had a hunting lease for deer hunting. Nowe days witht eh work involved I do still fish but mostly with younger guys that own the boats now that I tool out.Do not think your goig to hike those trails to to top of the mountain and love it like when youer younger as you get to 60 and above. If you can afford it ;go for it.
Thank you all for your reply. For sure, I am not a rich person, but am fortunate to be able to make decent money to provide and support my family. At this point in my life, I feel like I should enjoy a little more. After all, my house is paid for and the kids are done with college. As for traveling, we have been doing that both domestically and internationally as family for years (since the 90’s if I recall correctly). We have been to several countries in Europe, 5 or 6 countries in Asia, Australia, New Zealand, Caribbean islands, and about 26 states in the U.S.A (including Hawaii). My point is I would like to travel as much as I can while I’m still able and once I retire I can pick and choose which one to go back to and stay “a little longer” to experience and explore the places. Africa, South America, and the Pacific's are still on my to go list. The key here is “a little longer”. That's why I might need to save even more.
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I know we don’t know what the future will be. You might be here today. You might be gone tomorrow.
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