How old are you and how much do you have saved for retirement?

[Exterous]

So someone who saves 20% of their income, gives 10% to charity, pays 17% in taxes and has a mortgage costing 15% of their income (which will be paid off before retirement) doesn't need the 80% of pre-retirement income that most calculators say you need. In fact they could probably live it up big time on 60% of their income.

:thumbsup: I think taxes and savings contributions are things commonly overlooked as well as how much a mortgage payment eats into your income. People think see their spending on 80k a year and think 'Man - I don't have enough to retire and still get 80k from my savings'. What they don't realize is 80k pre-retirement with mortgage could easily = 50k post retirement no mortgage. Just for a reference - For the 4% SWR it results in a reduction of 'required' retirement from $2M down to $1.2M

I think the problem is that most people spend way too much money. This is a more recent development, so the current pool of retirees still know how to live within their means. Once we start seeing the younger baby boomers retire, I think we're going to see a lot of sympathy pieces about low SS benefits and retirees who didn't save enough/at all living on meager rations in low rent apartments. I don't think that saving more than you need to is really a bad thing, but I will be super pissed if I die before retirement and I could have had that Ferrari.

I don't think its a recent trend. There are a plethora of articles out there about how a depressingly large number of 60-70 year olds do not really have enough to cover their retirement. I do think its getting worse though and student loan debt will not help this at all

You think SS will be around when the young people get there?

The SSA says it can pay full benefits until 2033 and 75% of benefits from there until 2086 under current laws. Do you not agree with them?

 

[MaxPayne63]

I should just have lot of kids. I know a guy with 9 other siblings. His dad is in his seventies. He makes all his 10 kids give him $1,000 each month for spending allowance. So this 70 something man lives the good life while some of his kids suffer.

Did he get the idea to do that while watching CSPAN?

 

[hans007]

I have about 1.5 times my gross annual at 32.

I don't think this is a very good measure given basic necessities cost the same for everyone. In retirement in not going to need 4x as much money or a luxury car or whatever that I have now. I'm probably far closer to retiring now than most people are at 50

 

[EMPshockwave82]

30 years old

1.1x in investment accounts
more in savings

 

[j&j]

28, just paid off all student loans and stuff less than a year ago. we make a lot and spend a lot sadly... but just really ramped up on income as of the last 1-2 years.

my salary + side business + wife income is gross around 200K. so retirement about .3.

we have a bunch of cash sitting, but also about to buy a new house, will be keeping our old house too to rent/lease.

 

[JM Aggie08]

I've not found much things to do that are fun that cost a lot money. Most everything I enjoy is either free or minimal costs. So what am I missing by not pissing away my dollars?

Different folks, different strokes. You see it as pissing away money, I see it as enjoying myself. What difference does it make if I'm still able to save a lot?

 

[overst33r]

While guides like these are OK always remember to have a 3-6 month emergency fund before you invest. Do you really want all your money in a 401K/IRA when you lose your job? Nothing is worse than having to withdraw funds a significant penalty.

You don't pay a penalty on principal.

 

[zinfamous]

34.

'bout treefiddy.

 

[xeemzor]

You don't pay a penalty on principal.

Depends on if it's post or pre tax.

 

[overst33r]

Depends on if it's post or pre tax.

So then you're just paying taxes, not a penalty right?

 

[JTsyo]

I'm 32 and have right around 1X. But I'll be eligible for a pension too that should net me about 15% my current income after retirement. House will be paid off in about 12 years, so that's about 21 years of mortgage payments that can go into retirement. Wrinkle is my will probably want to retire early, maybe in another 20 years.

 

[rh71]

35, 2x. I've had my mom manage my finances since I was in HS and I started the 401k at 22. Company matches 6%. She says I'll be a millionaire when I retire. I don't want to be a millionaire when I retire. I want it NOW while I'm not yet gray and bald.

 

[Jimzz]

So then you're just paying taxes, not a penalty right?

No; its a penalty AND you pay tax on it.

"With rare exceptions, all 401K withdrawals are taxable as ordinary income. An additional 10% early distribution penalty tax will be assessed if you have not reached at least age 59 ½ when you take your distribution."

 

[PenguinPower]

Considering how much my salary has increased over the course of the past 5 years, it's going to be difficult for me to hit 1x for awhile. 28 and .46x. At the same time, I don't have a mortgage anymore, so that will help.

 

[SearchMaster]

45, about 5x my annual salary in retirement.

But my expenses should be very low by the time I retire. My mortgage will be paid off in a couple of years (though that expense will be replaced with college expenses for the subsequent 8 years or so). If social security is still around, it will probably pay our monthly expenses but I suspect the age will be 70-72 by then and I hope to retire by 60.

I need to restart my saving for retirement soon; I put it on hold last year when I left my job for a startup. I won't let it lapse for more than a full year but we decided to wait and see how things were going to be.

 

[rh71]

I should just have lot of kids. I know a guy with 9 other siblings. His dad is in his seventies. He makes all his 10 kids give him $1,000 each month for spending allowance. So this 70 something man lives the good life while some of his kids suffer.

The kids can't do math and determine that's just highway robbery?

 

[TwiceOver]

34, not nearly enough. Took a big hit over the last few years.

 

[skimple]

I'll give you the average for me & wife together.

44 - 2.9x

 

[skimple]

I don't think its a recent trend. There are a plethora of articles out there about how a depressingly large number of 60-70 year olds do not really have enough to cover their retirement. I do think its getting worse though and student loan debt will not help this at all

Senior's have never had "enough" money. The difference is that 100 years ago, when your parents got old, they lived with you. That's how families worked. This idea that seniors should be financially independent is a recent development in society.

 

[rcpratt]

The kids can't do math and determine that's just highway robbery?

...didn't you just say that your mom still does your finances?

 

[xanis]

I'm 24, and I probably don't contribute as much as I could/should. I only contribute 3% (what my employer matches) at the moment, which isn't a hell of a lot because I don't make a ton of money. I still figure anything is better than nothing, though.

 

[goog40]

29
Over 1.5x in retirement accounts
More in non-retirement accounts

 

[ponyo]

The kids can't do math and determine that's just highway robbery?

I guess the kids just can't say no. I know some of the kids can't afford it and the other siblings help out some months. The only reason I know about it is because one of the guy is my cousin's business partner.

My sister and I give our mom spending money each month too but it's because we want to, not because we have to.

 

[Exterous]

Senior's have never had "enough" money. The difference is that 100 years ago, when your parents got old, they lived with you. That's how families worked. This idea that seniors should be financially independent is a recent development in society.

Well recent is a relative term. From what I have read financially independent retirements started becoming more mainstream in the 1950s and 60s

 

[Engineer]

No; its a penalty AND you pay tax on it.

"With rare exceptions, all 401K withdrawals are taxable as ordinary income. An additional 10% early distribution penalty tax will be assessed if you have not reached at least age 59 ½ when you take your distribution."

You can get around that in certain situations (see rule 72T).