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Old 04-01-2016, 01:20 PM
 
Location: Myrtle Creek, Oregon
12,293 posts, read 12,533,436 times
Reputation: 19526

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Just put 10% of your income in a variety of investments, realizing that periods of inflation eat principal and periods of low inflation eat interest. Try to be cash heavy during crashes, because the time to buy assets is when everyone else is jumping out of windows. Never sell at the bottom, because that kills your chance of recovery. If your job lets you stay in one location, buy a house and plan to pay for it, but if you have to move a lot stick with rent. No mortgage at retirement is a huge asset, but a house is a loser if you are forced to sell within 10 years of purchase, or are forced to sell during an downturn.

Do not borrow money to speculate. This includes speculating in real estate. If you want to speculate, and you should, use your own money with the realization that it is high risk and you could lose much of it. Don't get greedy. Set firm sell points before you buy. If you feel that there is more money to be made, take your profit and dive back in with some of it, but never double down. That's a recipe for losing your money.

Get married once and stay married. Divorce has ruined more financial plans than any other single factor.

Over a 30 or 40 year working life, you will end up with a fairly comfortable retirement.
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Old 04-01-2016, 01:25 PM
 
Location: Myrtle Creek, Oregon
12,293 posts, read 12,533,436 times
Reputation: 19526
Quote:
Originally Posted by mathjak107 View Post
my dental bills last year were 12k for me for 4 implants and 6k for my wife , that is without insurrance costs . this year we are at 7500 or so as that 12k last year does not include the devices that goes in the implant .

30k is easy depending how thinks lay out . . this year marilyn needs a hearing aid too and we both need to get new glasses
Go to Costco for hearing aids and eyeglasses. You will save $thousands.
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Old 04-01-2016, 01:35 PM
 
Location: Myrtle Creek, Oregon
12,293 posts, read 12,533,436 times
Reputation: 19526
Quote:
Originally Posted by animalcrazy View Post
I felt the same way you did about having enough for retirement when I was in my 20's and just starting out. All I can tell you is that it helps if you have a like minded partner that is willing to be conservative with money. You live on one salary and invest the other.

That strategy worked for us and we were debt free very early on in the marriage. My husband has a nice pension, which unfortunately probably won't be there for you and we invested the maximum into his deferred comp as well. That money is our hedge against inflation and will pay us about 2k a month for 20 years. If I remember right we were paying about 1800 a month into it it until he retired. Nothing was more important to us then maxing out that contribution and we took advantage of the catch up clause. Pensions, deferred comp, 401k's etc are easy money and can pay more then other investments. If you're fortunate enough to be offered anything like that then take full advantage of it.

I was frightened by the fact that social security would not be available for me so we never planned on having to depend on it. My husband's pension disqualifies him from drawing any social security. He never paid into it long enough to qualify anyway.

My advice to you would be to buy a two flat or something similar. Live in one unit and have the tenants pay for part of the mortgage. If you can bite the bullet and be frugal enough to pay it off as soon as possible then you have more disposable income to invest. Hire a financial planner to help you with that.

There are ways to achieve goals if you have the vision, and are willing to sacrifice and work hard and I do mean work hard for them. The younger you start the better. Can you take 1% of what you make and invest it monthly into a mutual fund?
Nice work, if you can get it. My wife and I did that. She paid the mortgage, taxes, insurance and all, I put most of my pay into retirement savings. For 20 years I lived on $800 or $900 a month take-home, and out of that I bought groceries and paid for my commuting expenses. We had health insurance through my work.

A stable marriage between two productive adults is the easiest fast track to a comfortable retirement.
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Old 04-01-2016, 02:35 PM
 
Location: Shawnee-on-Delaware, PA
3,909 posts, read 3,592,855 times
Reputation: 7188
Quote:
Originally Posted by Serious Conversation View Post
I just don't see how most Millennials have a prayer of getting even somewhat close to that.

Pfft, just vote for Bernie. Everything will be free and you'll make $15 an hour. Namaste.
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Old 04-01-2016, 03:14 PM
 
708 posts, read 503,673 times
Reputation: 1165
All these figures are BS. Normal person cannot save that much money. Wage grow is slow, stock market is stagnate plus you have to live. Just get a savings plan going as soon as you can. Maximize any 401K benefits your company give you. At the end of your work years, make sure you have everything paid for so you have no payments. Make sure you income
is more then monthly payments use you nest egg for any unexpected expense and medical care. That is all you do, because good luck on saving the $1.8 million, very few people can do that.
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Old 04-01-2016, 04:21 PM
 
Location: Gilbert, AZ
3,194 posts, read 1,967,999 times
Reputation: 3333
Quote:
Originally Posted by Willistonite View Post
All these figures are BS. Normal person cannot save that much money. Wage grow is slow, stock market is stagnate plus you have to live. Just get a savings plan going as soon as you can. Maximize any 401K benefits your company give you. At the end of your work years, make sure you have everything paid for so you have no payments. Make sure you income
is more then monthly payments use you nest egg for any unexpected expense and medical care. That is all you do, because good luck on saving the $1.8 million, very few people can do that.
It's not impossible at all. Keep in mind, this is $1.8M a few decades from now, not today.

Assuming 2% inflation (401k limits adjusted to inflation), one needs around a 6% ROI in order to hit the mentioned target over 30 years if they are maxing their 401k contributions ($18K/year in today's dollars). That's not a high bar for investment return.

And of course for a couple with both people and saving and getting a company match, it's much easier to hit the number. If they're getting a 50% employer match, they would each need to contribute $500/mo of their own paycheck (in today's dollars).
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Old 04-02-2016, 06:39 AM
 
Location: Mount Airy, Maryland
10,478 posts, read 5,944,584 times
Reputation: 16173
$18,000/year in retirement savings? In what world would that be affordable for most?
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Old 04-02-2016, 07:16 AM
 
71,789 posts, read 71,896,917 times
Reputation: 49345
i would end up evicted year 1
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Old 04-02-2016, 08:57 AM
 
9,222 posts, read 9,292,231 times
Reputation: 28913
Quote:
Originally Posted by Larry Caldwell View Post
Just put 10% of your income in a variety of investments, realizing that periods of inflation eat principal and periods of low inflation eat interest. Try to be cash heavy during crashes, because the time to buy assets is when everyone else is jumping out of windows. Never sell at the bottom, because that kills your chance of recovery. If your job lets you stay in one location, buy a house and plan to pay for it, but if you have to move a lot stick with rent. No mortgage at retirement is a huge asset, but a house is a loser if you are forced to sell within 10 years of purchase, or are forced to sell during an downturn.

Do not borrow money to speculate. This includes speculating in real estate. If you want to speculate, and you should, use your own money with the realization that it is high risk and you could lose much of it. Don't get greedy. Set firm sell points before you buy. If you feel that there is more money to be made, take your profit and dive back in with some of it, but never double down. That's a recipe for losing your money.

Get married once and stay married. Divorce has ruined more financial plans than any other single factor.

Over a 30 or 40 year working life, you will end up with a fairly comfortable retirement.
This is reasonable advice. However, its not going to get many people to the $1.8 milliion mark over their lifetimes.

Let me give an example. My wife put a minimum of 4% of her income into her 401K starting almost 25 years ago. The county matches that 4% with 4% of its own money. So, that's 8% minimum of her salary that went into a 401K account Actually, its more than that because 10 years ago we increased her contributions to about 10% of her own income. (with the county's match its been 14% total). We followed all the standard advice we were given. Diversified the money among many different investment options.

How much is in the account today? Alot. However, its far, far less than $1.8 million and never will be that amount.

Savings is a good thing. However, there are darn few people who are ever going to make it to anywhere near the level that is recommended. I regard these suggestions that "people need to save up to $1.8 million" as unrealistic pie in the sky type notions.

Thank goodness for social security and her defined benefit pension. It should keep us well in our senior years. I also made a few investment choices on my own that have paid off. However, that's the kind of intense effort that is required in today's world to create a good retirement. It isn't easy. Its probably beyond the ability of most people. That's what they don't tell you.
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Old 04-02-2016, 09:02 AM
 
29,809 posts, read 34,900,894 times
Reputation: 11730
Quote:
Originally Posted by DaveinMtAiry View Post
$18,000/year in retirement savings? In what world would that be affordable for most?
I started a thread on that topical
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