Moneymoney

Sat Jan 21, 2017, 10:16 AM

Retirement question for those who are retired

Hi All, I am 20 years from retirement and wanted to ask those who are retired if you could make one recommendation to me to help plan for retirement, would you? I have been with the same company for 24 years and pray I will finish up there in 20 years. I will be 65. I have a pension, retirement savings account, 403b (give 4%, employee match of 2%) and an IRA roth where I give $2200 a year towards. Thank you, Maine

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Arrow 13 replies Author Time Post
Reply Retirement question for those who are retired (Original post)
Maine Jan 2017 OP
The Center Holds Jan 2017 #1
Juan Rico Jan 2017 #2
def_con5 Jan 2017 #3
specs Jan 2017 #4
rampartb Jan 2017 #5
BuzzClik Jan 2017 #7
Slayer Jan 2017 #9
Boadicea Jan 2017 #6
Maine Jan 2017 #8
His Daughter Jan 2017 #10
Fiendish Thingy-BC Jan 2017 #11
Maine Jan 2017 #12
outside Jan 2017 #13

Response to Maine (Original post)

Sat Jan 21, 2017, 10:19 AM

1. Save much more.

You probably should be saving around 15% of your pay.

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Response to Maine (Original post)

Sat Jan 21, 2017, 10:21 AM

2. I'm not quite there yet (a year to go), but my advice is: Save, save, save.

You won't regret it.

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Response to Maine (Original post)

Sat Jan 21, 2017, 10:22 AM

3. Not retired

But this one has bitten a lot of folks I know.

Understand SS, and medicare, the rules are pretty complex and if you make a mistake it can be hard to correct. As a quick example, most likely your full retirement age is not 65.

I would sit down with a reputable expert to walk you through it.

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Response to Maine (Original post)

Sat Jan 21, 2017, 10:25 AM

4. I have only two things that has helped me greatly.

Make sure that you have your home paid for.

That one is the most important

Second would be to get an idea of what your monthly income will be during retirement and begin the process of living within that means. I blew through a lot of money trying to keep our lifestyle the same the first year, if I could go back and do it over I would in a heartbeat.

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Response to Maine (Original post)

Sat Jan 21, 2017, 10:31 AM

5. pay all debts

mortgage, car, credit cards etc.

you may know a retiree who still owes on student loans. bad plan.

plus, the money you are now saving will buy much less in 20 years.

best advice - you will be working until the day you die. pick a career (it is not too late) that is not dangerous or physically demanding. one that you like (or don't mind) doing. one that meets all your needs. google maslov's hierarchy for ideas.

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Response to rampartb (Reply #5)

Sat Jan 21, 2017, 10:38 AM

7. bingo.

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Response to rampartb (Reply #5)

Sat Jan 21, 2017, 10:46 AM

9. THIS

 

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Response to Maine (Original post)

Sat Jan 21, 2017, 10:32 AM

6. You and I are the same age.

I think for us to get the full amount, we have to retire at 67 1/2.

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Response to Maine (Original post)

Sat Jan 21, 2017, 10:44 AM

8. Thank you everyone for your guidance on this topic

I typically do not solicit advise on-line, but I needed some today to figure out potential next steps for me. This thread has been helpful and I see that I need to save more and make sure my bills are paid. Thanks!!!!

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Response to Maine (Reply #8)

Sat Jan 21, 2017, 12:20 PM

10. Pay off debt and save are the obvious ones

The next thing is to think about where you want to retire and how you want to live. Don't rush out and buy a place in FL if that is there you are headed, but start thinking about location and lifestyle.

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Response to Maine (Original post)

Sat Jan 21, 2017, 01:45 PM

11. Two to three years away for me

Sounds like you've got the foundations of a good plan in place.

Make sure your portfolio is diversified and balanced; if you can get out of high fee mutual funds and into ETF's, dividend paying preferred share index funds etc. that much the better. If you have the option find a good fee for service financial planner. It's better, IMO, to pay an advisor, who makes no commissions, a 1% viridian value fee to manage lower cost funds than it is to have a "free" advisor stuff your money into high cost funds that he gets a commission for selling to you.

While the market is likely to be volatile under Trump, you've got some time before retirement, so give some thought to your risk tolerance. My wife and I have had a moderate to moderately aggressive, diversified, balanced portfolio that has weathered the crashes of 1987, 2000 dot com bubble burst, and 2008 meltdown. Yes, our value went down in each of those events; in 2008, when the market lost 50% of its value, our portfolio dropped only 25-30%. Other than a couple of minor tweaks, we didn't reallocate our funds and crystallize our losses, and by 2009/10 we had regained our losses and our portfolio was outperforming the market.

Remember, you are at more risk of running out of money in retirement than you are losing it all in a market crash.

At this point, at your age, don't count on SS being there for you.(I hope I'm wrong) Ditto if your pension is through a for profit corporation, slightly less risky if you're a public employee, depending on the locality. I took my US pension at 55, and will take my Canadian pension and US SS in 2-3 years at 62. Altogether, we will have 6-7 sources of retirement income, and should have between 90-110% of our current income, depending on exchange rates and a few other factors. If things go as planned, we will be living rent/mortgage free, so that will be like getting a raise as well.

I strongly echo others' advice to avoid debt as much as possible.

Best of luck in your retirement planning!

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Response to Fiendish Thingy-BC (Reply #11)

Sat Jan 21, 2017, 02:30 PM

12. Great information! Thank you

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Response to Maine (Original post)

Mon Jan 23, 2017, 10:46 AM

13. Buy rental property.

You have 20 years of income from your job to pay down the loan and not only will you have income but the property will grow in value.

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Moneymoney