U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Retirement
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 10-17-2014, 08:38 AM
 
Location: Woodinville
3,185 posts, read 4,051,040 times
Reputation: 6267

Advertisements

Quote:
Originally Posted by StAcKhOuSe View Post
since my plan is to semi-retire early, I want to get a good jump on it now. this is not the first retirement article I've read. although it wouldn't let me read the entire thing without signing in. I am sure it is stuff I already know anyway.

not many people my age are thinking about retirement, and I get that. student loans, minimum wage jobs, medical bills, and a lousy job market makes you prioritize. that and most my age dig the whole conspicuous consumption thing. me? I can't fathom working full-time until the age of 65 just to maintain a certain lifestyle. i would rather cut my spending now, invest aggressively, and keep working two jobs to accumulate a nest egg large enough to retire at 45. but hey, not everyone thinks like me. after all, we need frivolous spenders to stimulate the economy, right?
I'm in your age demographic too. I'm squirreling away what I can and constantly thinking about the future. A big problem I see, though, is the amount of uncertainty to our future. These are not boom times. The danger of massive inflation in the near future is prevalent. It's hard to trust the stock market after the crashes that have happened in our lifetimes. I don't think we can count on social security existing when we are of age. And even if it still does exist, the age is going to be what? 80?

And so we save and try to invest thoughtfully. But there are large forces out there that may end up being more responsible for our waning years than we give them credit for.

Personally I don't invest on my own. I contribute to a 401k as much as I can, about 5% right now (enough to max a 1%/4% match). I purchase company stock for a discount through my employer. And that's it. The rest goes to student loans that are too large and the rest of my living expenses.

I graduated college in 2009. That's a tough time to graduate. Based on how the economic world has performed since I honed my awareness of it in high school, the future is not looking bright.
Reply With Quote Quick reply to this message

 
Old 10-17-2014, 08:44 AM
 
Location: Central Massachusetts
4,800 posts, read 4,852,811 times
Reputation: 6379
Quote:
Originally Posted by StAcKhOuSe View Post
since my plan is to semi-retire early, I want to get a good jump on it now. this is not the first retirement article I've read. although it wouldn't let me read the entire thing without signing in. I am sure it is stuff I already know anyway.

not many people my age are thinking about retirement, and I get that. student loans, minimum wage jobs, medical bills, and a lousy job market makes you prioritize. that and most my age dig the whole conspicuous consumption thing. me? I can't fathom working full-time until the age of 65 just to maintain a certain lifestyle. i would rather cut my spending now, invest aggressively, and keep working two jobs to accumulate a nest egg large enough to retire at 45. but hey, not everyone thinks like me. after all, we need frivolous spenders to stimulate the economy, right?

That is a good plan. Just remember though life happens. The money you are investing now in those funds should not be touched or borrowed on. Do not under any circumstances short of a true dire emergency access those funds.

Most of my point in getting the article posted was to make people aware. My feeling is this and I know there are those here that will disagree. DCA (dollar cost averaging) in an index fund is a good thing. If it can be a Roth that is better but if you only have standard accounts that your empoyer matches in then please deposit up to where you get the max mathing then put what you can afford in any Roth accounts. Dont leave free money on the table.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 09:28 AM
 
2,079 posts, read 2,606,243 times
Reputation: 3947
Quote:
Originally Posted by Garfunkle524 View Post
I'm in your age demographic too. I'm squirreling away what I can and constantly thinking about the future. A big problem I see, though, is the amount of uncertainty to our future. These are not boom times. The danger of massive inflation in the near future is prevalent. It's hard to trust the stock market after the crashes that have happened in our lifetimes. I don't think we can count on social security existing when we are of age. And even if it still does exist, the age is going to be what? 80?

And so we save and try to invest thoughtfully. But there are large forces out there that may end up being more responsible for our waning years than we give them credit for.

Personally I don't invest on my own. I contribute to a 401k as much as I can, about 5% right now (enough to max a 1%/4% match). I purchase company stock for a discount through my employer. And that's it. The rest goes to student loans that are too large and the rest of my living expenses.

I graduated college in 2009. That's a tough time to graduate. Based on how the economic world has performed since I honed my awareness of it in high school, the future is not looking bright.
inflation is my biggest worry too. the stupid guv'mint insists that inflation is under control, without taking into account the cost of food, shelter, transportation, medical, & education. virtually everyone uses these services and yet most of these items aren't even factored into the inflation index. how does that make sense? the government is just trying to manipulate the stats. In my experience, it is best to pretend social security doesn't even exist. even with a few unexpected expenses this year, I have absolutely destroyed my student loans this year. I have less than six months left on the loans and then I will more than double my 401k contributions(currently 10%). I've already maxed out my IRA for the year. all this on top of a dental expense of $10,000. yay insurance.

since these boom times will be coming to an end, it might not necessarily be smart to invest with a "hands-off" approach. I will comprise of a system that is half-hands off, half-active. in other words, finding sector etf's that are trending higher and trading those occasionally, setting trailing stops and limit orders where necessary. say the market will average a 5% return per year going forward, but inflation is also 5%. not really gaining anything. if I can semi-actively invest, maybe I could get 11% a year, but who knows? not trying to be the wolf of wall street, but at the same time, I want a slightly more active involvement in my investing activities.

Quote:
Originally Posted by golfingduo View Post
That is a good plan. Just remember though life happens. The money you are investing now in those funds should not be touched or borrowed on. Do not under any circumstances short of a true dire emergency access those funds.
I have an emergency fund. although I call it the "oh %&$#" fund. borrowing from my nest egg is not an option

Quote:
Most of my point in getting the article posted was to make people aware. My feeling is this and I know there are those here that will disagree. DCA (dollar cost averaging) in an index fund is a good thing. If it can be a Roth that is better but if you only have standard accounts that your empoyer matches in then please deposit up to where you get the max mathing then put what you can afford in any Roth accounts. Dont leave free money on the table.
already contribute enough to get the match and then some. I have two active 401k's since I have two jobs. each of these 401ks I invest in different sectors for greater market exposure. I also invest in funds with the lowest expense ratios. I do a combo of DCA and market timing. I like to buy more on the dips when I can. rebalance yearly, blah blah blah

I started out with a roth, but I re-characterized to a traditional. I'd rather get the tax benefits now and slowly convert to roth in my later working years via the roth ira pipeline. it lessens my tax liability and mitigates the tax effect later on. when I lower my taxable income now, I can put more money in my pocket to invest now

Last edited by StAcKhOuSe; 10-17-2014 at 09:42 AM..
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 09:46 AM
 
Location: Central Massachusetts
4,800 posts, read 4,852,811 times
Reputation: 6379
Quote:
Originally Posted by StAcKhOuSe View Post
inflation is my biggest worry too. the stupid guv'mint insists that inflation is under control, without taking into account the cost of food, shelter, transportation, medical, & education. virtually everyone uses these services and yet most of these items aren't even factored into the inflation index. how does that make sense? the government is just trying to manipulate the stats. In my experience, it is best to pretend social security doesn't even exist. even with a few unexpected expenses this year, I have absolutely destroyed my student loans this year. I have less than six months left on the loans and then I will more than double my 401k contributions(currently 10%). I've already maxed out my IRA for the year. all this on top of a dental expense of $10,000. yay insurance.

since these boom times will be coming to an end, it might not necessarily be smart to invest with a "hands-off" approach. I will comprise of a system that is half-hands off, half-active. in other words, finding sector etf's that are trending higher and trading those occasionally, setting trailing stops and limit orders where necessary. say the market will average a 5% return per year going forward, but inflation is also 5%. not really gaining anything. if I can semi-actively invest, maybe I could get 11% a year, but who knows?



I have an emergency fund. although I call it the "oh %&$#" fund. borrowing from my nest egg is not an option



already contribute enough to get the match and then some. I have two active 401k's since I have two jobs. each of these 401ks I invest in different sectors for greater market exposure. I also invest in funds with the lowest expense ratios. I do a combo of DCA and market timing. I like to buy more on the dips when I can. rebalance yearly, blah blah blah

I started out with a roth, but I re-characterized to a traditional. I'd rather get the tax benefits now and slowly convert to roth in my later working years via the roth ira pipeline. it lessens my tax liability and mitigates the tax effect later on. when I lower my taxable income now, I can put more money in my pocket to invest now
you are a smart one. I will say though and this is where a few people disagree with me. I believe that # of shares and value have equal weight. There are those here that think income and value are the key. If you are DCA as you do with a 401k and never sell shares until you retire. Compounding increases the number of shares. Value is important too but the value only needs to be up when you go to reallocate shares to keep the balance.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 09:57 AM
 
Location: Woodinville
3,185 posts, read 4,051,040 times
Reputation: 6267
Quote:
Originally Posted by golfingduo View Post
Compounding increases the number of shares. Value is important too but the value only needs to be up when you go to reallocate shares to keep the balance.
Compounding is an extremely powerful force and it's extremely important. Compounding in the early years of investing is what makes your gains so great down the road. Unfortunately 2014 gains were wiped out last week in a super-volatile market.

We just lost a year's worth of compounding gains. That's a lot of money out of our pockets 20 years down the road. I'm sure there were people who were successful. Unfortunately I'm not one of them. My 401k is a Vanguard target retirement year fund. It's 90% stocks, so my balance is down for 2014. Not only is my balance lower, but my money also lost value to inflation. I know the gov't spews the "less than 3%!!!!!!!!" number but realistically, when family budgets are increasing significantly faster than that, the official number doesn't matter. At this point in history, the only way you're coming out ahead is by making 7-8%. Maybe those returns will keep up with your grocery bill increase.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 10:11 AM
 
Location: Central Massachusetts
4,800 posts, read 4,852,811 times
Reputation: 6379
Quote:
Originally Posted by Garfunkle524 View Post
Compounding is an extremely powerful force and it's extremely important. Compounding in the early years of investing is what makes your gains so great down the road. Unfortunately 2014 gains were wiped out last week in a super-volatile market.

We just lost a year's worth of compounding gains. That's a lot of money out of our pockets 20 years down the road. I'm sure there were people who were successful. Unfortunately I'm not one of them. My 401k is a Vanguard target retirement year fund. It's 90% stocks, so my balance is down for 2014. Not only is my balance lower, but my money also lost value to inflation. I know the gov't spews the "less than 3%!!!!!!!!" number but realistically, when family budgets are increasing significantly faster than that, the official number doesn't matter. At this point in history, the only way you're coming out ahead is by making 7-8%. Maybe those returns will keep up with your grocery bill increase.

Yes we have had a horrible last couple of weeks. As you said we have lost all the gains we have had Year To Date. The value has gone down it still isnt a disaster. Though you have lost value you still have gained shares. Then while the value of those shares is down buying now will make up for some of the losses we have suffered.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 10:35 AM
 
2,079 posts, read 2,606,243 times
Reputation: 3947
Quote:
Originally Posted by Garfunkle524 View Post
Compounding is an extremely powerful force and it's extremely important. Compounding in the early years of investing is what makes your gains so great down the road. Unfortunately 2014 gains were wiped out last week in a super-volatile market.

We just lost a year's worth of compounding gains. That's a lot of money out of our pockets 20 years down the road. I'm sure there were people who were successful. Unfortunately I'm not one of them. My 401k is a Vanguard target retirement year fund. It's 90% stocks, so my balance is down for 2014. Not only is my balance lower, but my money also lost value to inflation. I know the gov't spews the "less than 3%!!!!!!!!" number but realistically, when family budgets are increasing significantly faster than that, the official number doesn't matter. At this point in history, the only way you're coming out ahead is by making 7-8%. Maybe those returns will keep up with your grocery bill increase.
Quote:
Originally Posted by golfingduo View Post
Yes we have had a horrible last couple of weeks. As you said we have lost all the gains we have had Year To Date. The value has gone down it still isnt a disaster. Though you have lost value you still have gained shares. Then while the value of those shares is down buying now will make up for some of the losses we have suffered.
stocks just went on sale....time to do some shopping.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 11:38 AM
 
71,735 posts, read 71,853,273 times
Reputation: 49289
sale? they may still be over priced for much value . sale is a relative term. markets have no memory.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 12:55 PM
 
Location: Chapel Hill, N.C.
36,485 posts, read 43,804,165 times
Reputation: 47259
I think the key to retirement planning is to marry the right person at the right time ( over 30 for most), stay married and have only 1 or 2 kids if that many. Divorce and unexpected kids can wipe out the most careful retirement planning. And of course there is nothing wrong with never marrying or having kids at all. Plenty of satisfied folks in that category. Just make sure you are financially responsible for the kids you do bring into the world and don't expect society to have to pay raise 'em.
Reply With Quote Quick reply to this message
 
Old 10-17-2014, 10:33 PM
 
128 posts, read 159,822 times
Reputation: 207
Quote:
Originally Posted by biscuitmom View Post
To whom is this addressed? Has anyone in this thread suggested otherwise?
When TwoByFour described his friend's son in college, and how TwoByFour supposedly lived a superior life by going out a lot and not focusing on money, it brought to mind a broke married couple who told me not to waste my youth since I also don't go out much, focus on my side business, and invest heavily instead of spending money unnecessarily. Funny how a couple with $50k in student loans and other debts is concerned about a guy worth six-figures and already paid his bills.

It comes from a place of envy and it's always those who are broke or barely getting by. "Those rich people only care about money and must hate their lives!"

The need to go out almost every day and spend all your money in your college years, which is about a decade before a man begins to peak in desirablility to women, is rooted in psychological problems like anxiety and the same sort of dopamine addiction that drug junkies have.

It's also ironic that I date hotter girls than Mr. "Don't waste your youth's" ugly wife. Who's living it up now?
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Retirement
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top