I know just how it feels. I have to watch my checkbook all of the time. Maybe I should not save 60% off the top?
I'm curious. How much do most people think needs to be saved in order to retire? I'd say about 2 million is pretty safe, to retire at age 55.
I'm curious. How much do most people think needs to be saved in order to retire? I'd say about 2 million is pretty safe, to retire at age 55.
I'm curious. How much do most people think needs to be saved in order to retire? I'd say about 2 million is pretty safe, to retire at age 55.
Georgia Tech + HOPE Scholarship + Co-Op employee at Delta Air Lines = no debt and $$$ in the bank after 4 years.
It's possible.
(This was back in 2002.)
1mil would be plenty if invested right. 1mil hard cash, that is, not 1 mil minus taxes etc...
If I was to live like I make 50k (25k cash give or take) it would take 40 years to deplete that 1mil if it's just sitting in a zero interest bank account. In reality I'd invest a chunk of it and see a financial advisor to see what my best and safest options are.
I make 60-70k right now and live very comfortably. House, car, lots of toys, and no debt. Well I occasionally have money on the credit line but I try to keep that clear. I spent a lot of money in 2013 so I was starting to accumulate credit. Had nearly 3k on the credit line, but I wiped all of that recently when my company shares came in, and that spending is mostly done for the time being. (basement/server room renos) This year I want to save up more, perhaps even make a couple extra mortgage payments.
Basically if I was to let go of certain luxuries like buying lot of server stuff and downgrading my web hosting package to a really cheap VPS I could live on 50k if I had to. Could also get rid of TV service and cell, and stick with the basic internet package with landline. Maybe even sell the car (insurance and gas is at least $300/mo). When you start looking at everything you pay monthly for there are probably lot of things you can downsize or get rid of if you are willing to make sacrifices.
Georgia Tech + HOPE Scholarship + Co-Op employee at Delta Air Lines = no debt and $$$ in the bank after 4 years.
It's possible.
(This was back in 2002.)
If you can get 3% interest, that would net you $60,000 per year, which would be great. Even better if you could add some chunk of that back to your savings, but if you can retire at 55, you're going to want to live it up while you can.
Well, I make six figures, and my wife is a nurse and with her income added in we make a solid six figures... and we feel broke a lot of the time. Trying to maintain the lifestyle we both grew up with - couple of kids, middle class home in a suburb, nice yard, couple of cars, couple of pets - has become a very expensive proposition in the northeast. We chose the town we live in twelve years ago for the excellent schools, but we often feel like we made a mistake. If we had chosen a town with a lower median income then perhaps our children would have noticed how much they have, rather than constantly being confronted with people who have a lot more. I don't know. What I do know is that the middle class is getting squeezed to the breaking point in America.
Take a million and buy 10 100k condos. Rent them out. You have a steady income around 10k a month and the principal investment is appreciating.
Where can you get 3% interest that would be liquid though?If you can get 3% interest, that would net you $60,000 per year, which would be great. Even better if you could add some chunk of that back to your savings, but if you can retire at 55, you're going to want to live it up while you can.
Unfortunately it's not as simple as that. Almost sounds like a troll post, but not sure.
Around 10 years ago many thought this was their holy grail to financial freedom.
Many are holding $1MM in condos worth even as low as $100k.
I have a buddy that just wanted a place to live. Property was really upscale, tons of ammenities, tons of shopping/night lift within walking distance, promised a <90% vacancy rate, no investment properties, blah blah blah.
He paid like $250k and is stuck in a nearly empty building (there are floors with only one person and some with no one on them), a COA that can't make ends meet for repairs and a property that can't sell at even 1/5 the price he paid if he could even afford to let it go.
Investments that pay dividends?Where can you get 3% interest that would be liquid though?
If less and less people can afford to buy, then what makes you think more and more people can afford to rent?He got screwed yep. My Buddy is a basic slum lord. Has 34 low rent condos and apartments. Does well at it. It's all in what you buy. Keep in mind the rent does not go up and down with the market. He still getting the same in rent and the value will always come back. He has a vacancy rate of less than 10%. No it's not easy, but real estate is still the best investment currently and of all time.
Edit: And less and less people can afford to buy, making the rental market more and more attractive. He turned them all over to a property mangement firm a few years ago now he is really retired. They take 10%, but he does nothing now.
Investments that pay dividends?
If less and less people can afford to buy, then what makes you think more and more people can afford to rent?
The only problem is that in my scenario, I assumed that the money would be in a retirement account, so you'd have to take taxes into account when withdrawing. 1 million in the bank, on the other hand, would not require taxes be paid when withdrawing. Assuming a 30% tax rate, you'd need 1.5 million in retirement to have the equivalent of 1 million in a bank.
Where can you get 3% interest that would be liquid though?
To pay 30% overall in federal taxes on your retirement distributions, you'd have to be taking out about $450K EVERY YEAR (single...higher if MFJ). At a 3% withdrawal rate, that's $15M in the retirement account, or $10.5M in an after-tax bank account. A bit higher than your numbers, and I didn't even consider any deductions or exemptions.
I haven't bothered checking, but, are state taxes taken out as well?
Someone who can invest intelligently should be able to net 8-10 percent interest.
I'd recommend real estate, rental properties. Low risk (if you own you properties outright).
If less and less people can afford to buy, then what makes you think more and more people can afford to rent?