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I am single, 42, and have some, but not much, money in retirement funds (about $50K). I am in an uncertain place in terms of career and location, and I have some money in savings (about $40K) but anticipate needing it if/when I change careers and/or move. I live simply and well below my means. I have done the online retirement calculators and find the results to be completely overwhelming. Even with my frugal spending habits, I apparently need close to $1 million to retire. There is no way that is going to happen. What do people do - work until they die? Are there retirement communities that have lower rent? I have a very reasonable mortgage that I could definitely have paid off by the time I retire, but the thought of retiring where I live now is crushingly depressing. I want to move, but when looking at the reality of my financial future, I feel stuck.
What do people do? Just save what you can? I have no kids, no debt (except for mortgage). It seems like I am missing something to be in what feels like such a desperate situation.
just save what you can . retirements seem to level out like water to whatever you have . it may not be in a place you really wanted or a lifestyle you really like but things will some how work out . they always do .
Yep, you're pretty much done if you only have $90k in liquidity at age 42 as far as getting to $1M on your own by age 65 if you're not making 6 figure income. Probably the best thing you can do is find a spouse in an equal or better financial position to yours and work together. Two can live almost as cheaply as one.
All you can do is keep doing what you are (LBYM). And don't forget that what ever you manage to save by retirement age will (I assume) be augmented by SS. So the picture may ot be as bad as you think.
Imagine that you were 42, married with 3 teenagers who will be starting college within a few years and a stay at home wife.
For somebody in that situation I have just a few words: You can't get there from here.
The middle class is done. To save enough money for college costs of about $35K per year per kid ($420K), retirement funds of $1M and be able to buy the requisite house ($350K) cars ($30K each), and medical co-pays and premiums you need to make about $200K per year.
Your best bet is to live frugally and invest well.
You don't say what calculators you've used but some by financial planner sites are a bit geared toward getting you to keep investing more and more to meet a "goal". Try several to get a range...and remember that your social security goes up quite a lot the more years you work and the longer you wait to start collecting.
The most important thing is not to give up! Save as much as you can NOW while there is a longer time for it to compound. It's doubtful you can save too much. But set something up now that automatically takes money out from each check - hopefully your workplace has a 401(k) that will do at least a partial match so don't "leave that money on the table". A savings account will NOT give you the kind of return you need to grow your money. Start looking into a "balanced" (mix of bonds and stocks) index fund with a low expense ratio. Good luck!
you can use firecalc which is just based on actual time frames and looks at how many times already doing what you want to do with your own numbers and allocations would have failed in the past .
there are no spins to it , same with fidelity's retirement planner . it is strictly looking at the worst case scenario's to date and how your ideas would have survived if not those events but that math repeated . fidelity takes it a step further and tries to find even worse hypothetical combinations that could have happened , can happen but didn't for an extra margin of safety ..
key words are it uses your ideas and your amounts.
working until 70 can be the equal of having another 600-800k in savings because of all the things it accomplishes .
whether you can or want to is a different issue .
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Most industries that aren't menial service jobs won't keep/hire 65+ people.
I'm fortunate as an Engineer that when the economy is decent to good there are lots o 65-75 year old workers still making in the low 6 figures AND getting heath benefits.
if you think it is hard at 65 to work and get a job try it at 80 when you have to
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