I'm already retired.
My strategy was the "three legged stool."
1 Social Security
2 Pension
3 Investments
.
Also made sure I had no debts.

 

I have 3 plans in place to invest enough money to retire.

-Rentals
Plan to own 8-9 units (currently at 5). We calculate that after expenses and taxes it should provide 48k a year. That number will go up with inflation since rents seem to increase with other cost.

-Stocks
Pretty self explanatory. I keep less than 20% of net worth tied up in this since its high risk since I don't posses the asset. Mostly in stocks with a higher dividend (3% or larger)

-Retail gun parts business
I sell surplus gun parts and keep a large inventory. Most of the parts appreciate in value the longer I hold them.

I don't bother with 401k since they seem low returns and my wife's employer does not match her contributions.

I also have zero faith that I will collect any SS payments by time I qualify.

I avoid debt unless it makes me money (loan to buy a rental).

 

1. Get out of debt
2. Paying 30 year mortage at 15 year rate
3. Max roth IRA x 2
4. Max tsp x 2
5. Renting out basement bedroom
6. Get a good cpa and financial advisor

I plan to retire at the latest at 48 currently 30.

 

I retired at 57. The biggest key was my lifelong frugal nature. I have paid off 6 houses in my lifetime and have always had zero credit card and consumer debt. I also saved a considerable sum in anticipation for retirement. I have a small pension, social security and investment income and 401Ks. I downsized my home and now live in a condo in FL where there is no income taxes, low property taxes, and reasonable cost of living --- for living in a vacation paradise.

The best strategy is this. Save more, spend less, don't be greedy with investments, downsize, set realistic expectations and move to a low cost state that has the elements you are looking for. If you live paycheck to paycheck, are always mired in debt, NEED the best and latest things, and you lack financial discipline, then plan to work forever. Retirement necessitates some adjustments and in some cases sacrifice but there's one thing you can never get back --- time. We only go around once, make the most of it.

One last caveat to consider. If you have needy children who rely on you, retirement will NOT be much fun. I know a few people now who are fully retired and their life consists of babysitting and taking care of someone else's financial disasters.

 

When they tested me in the 4th grade I was reading at a post college level.

So by the time I started working at 15 I had already read many books like "The millionaire next door" and was planning my retirement.

Mid 90"s.... I put $1,800 into a IRA (Roths didn't exist yet) from my first summer job.

This continued. I went to college one year, then dropped out to enlist. (9/11 happened on my boot leave)

8 years in....
I continued to save a large % of my income and live frigally.
After deployments it is typical to buy a new car with "deployment money"
I got a new car also... one worth ~ $2,200.

Lived cheap, bought toys (guns) C&R lisense, and continued to sock $ away.
Got into gold and silver cheap.

Was planning on having a paid for house by 30.

Then a buddies brother in law died suddenly in his early 30's.

Made me think... I loosened up... lived a little. (I'm glad I did)

Medically retired, went back to school.
At 28 I loosened up a bit (hit some financial goals)
Bought a nicer motorcycle, $5,000 car, and lived without a roommate for the first time.

Long story short: graduated, and was FINALLY knocking on 6 figures while working (like a dog) ~ half the year.
Primarily as a Flood insurance adjuster, but also technical consultant for movies, Safety officer and a few other things in the off season.

My goal (since Iraq... nothing like getting shot at to make you rethink your life) was to work 1/2 the year and be 'semi retired'... do what I wanted the rest of the year.

Homesteading for several years, then once established travel (I've always traveled quite a bit.... just usually on a dime and a shoestring.)

I'd found my land just before I graduated, and had the shell of a shop/storage up. (Was full timing in my Airstream as I moved around for work.)
When I wasn't working I was on my land. (Offgrid, as is my house)

And them TSHTF: my injuries worsened, and I was no longer able to work. I spent 22 months fighting the VA for surgery, a month before the surgery I was on morphine and spent 20 hours a day flat on my back.

...spinal surgery (my 4th)
Just before the surgery I applied to the VA for a temporary 100% disability rating (fuzzy math.... it's substantially more than the 80% dollar amount I was getting.)
They awarded me 100% permanent and total.

Long recovery, botched surgery... I'm no longer able to do even a fraction of what I was able to do a couple years before the surgery (Oct 2014)

Fortunately I've "lived small" and saved much.

I had enough $ left from hurricane Sandy to have a side of my shop turned into a house (2 story, 1k sqft "apartment")

There's a small ($301/month) mortgage on the land. House was built for cash.
If I was healthy I'd of used that money to pay off the land after another storm.

As is... I scrapped the walk in gun vault and decided to sell enough guns to pay it off instead. (Hillery did not acomidate, so I'm selling slower, being more choosey. I'd rather sell my culls rather than the "good stuff" I could easily move.

Fortunately the lifestyle practices I'd established at a young age help in the "new reality"
No other debt, low 6 figures in various retirement accounts, I live on ~1/2 my pension. I can, butcher, garden.... most of the activities I WANT to do could be considered "preps" as well as "money savers"

I've built the cash back up by living frugally to the point I can either pay off the house, borrow for a rental, or buy and build for cash.
Selling PM's and doing both is a possibility, and if there's a panic I can do both... but neither will happen before the next round of PT and I'm healthier (I was making great strides last year till the "vets choice" program ran out of money and I was left hanging in the middle of PT.) Health regressed and I've fought and should be restarting where I was Jan 2017 soon.

I figure by the time I kick the bucket I'll likely be living on 100% of my pension rather than the ~50% I do now due to inflation. (If it's still there.)

I have various speculations like cows that can offset expenses or generate income.

There's the IRA'S fir emergency funds, and once I get the first rental I plan to go back to contributing to them.
Although I have no intention of spending either rental income (once it pays for itself) or the IRA money.... life had made me a pessimist, and I firmly believe "it is better to have it and not need it, than need it and not have it."

Single and no kids at 35... it's most likely my sisters kids (assuming they have some... I'm the much older brother) will split a couple million dollars.

I get healthy enough to travel I'll spend some, but right now honestly spending an extra $1k/month would have little impact on my quality of life. (Due to how ****ty it is due to my health issues.)
-Now if I can ever ride motorcycles again....

Or return to work, even at a slow pace....

I'd be SCREWED if I hadn't lived a debt free low impact life RADICALLY different from.my peers at the beginning. And the IRA money is a VERY GOOD slush fund should it be needed that helps me sleep at night. (Although worst case scinario I could sell a gun A month for a couple decades.)

I CANNOT EMPHASIZE ENOUGH the positive impact that at a young age driving beaters, having a cheap phone, and living on a budget has had on quite literally the rest of my life.
I (fortunately) lasted long enough to get a foothold here on my land. (Although if I had had TWO MORE STORMS I'd of then been SET! Paid off place, first rental, and possibly the "forever house" I'm now not going to get built till I'm 40+)

I see many people in their 40's trying to get BACK to $0 (negative net worth) and am SO GLAD that I never started digging!

That covers most of it other than my being an adherent to "the Alpha stratigy" (free read online) I don't stock ingots of metal etc like the last little bit talks about... but the rest of it is very good.
The $50 Danner boots I'm wearing are blenm of $250 boots.
I bought 6 pair when they were cheap, thrift hard (normal example is my $300 cashmere sweater for $6) etc.

I'm currently building beehives because I can build them for 50% of what I can buy them for.
Buy meat in bulk etc.

Most of my offense (making money) has been taken away, so I upped my defense.
I'll still go out to eat etc... but it has to be WORTH spending.

Put me firmly into the "as many baskets as possible" catagory.

 

Would anyone here like to share their thoughts on how they are preparing financially for retirement?

We currently save around 60% of our gross household income. At that rate, we would be able to fund our current expenses from our investments in about 13 years.

How do you come up with a plan?

Almost any plan for retirement should include paying off your mortgage by your planned retirement date. We are very debt averse and are devoting about 30% of our gross income toward paying it off quickly, which we should do in about two years. The other 30% is going toward investments; more on that below.

What have you been doing to ensure retirement at some point?

I'm planning to be financially independent (i.e. capable of retirement, whether I actually retire or not) no later than age 55. So even if something goes very wrong with my plans, I have another ten years to work, save, and invest before I reach traditional retirement age.

Do you put all your eggs in one basket…or have multiple options?

I invest primarily in indexed mutual funds that include hundreds or thousands of stocks, so I'm very diversified. I invest in both domestic and international firms. I have no faith in pensions of any kind; these have failed far too often.

What are your strategies?

All of my investments are tax-advantaged (i.e. either pay no federal income taxes when I put money in or pay none when they come out). Most of this is tax-deferred, so I'll only be taxed when I pull the money out. The biggest reason for this is because most of the 'space' I have is tax-deferred (i.e. 401k, 457). It also reduces my tax burden today (a bird in the hand...) and will let me determine which bracket I want to fall in during retirement because I'll determine what income I want and when.

 

Would anyone here like to share their thoughts on how they are preparing financially for retirement?

How do you come up with a plan?

Do a bit of reading.
moneyweek.com
mister money mustache
hl.co.uk
yahoo finance

stockopedia - do not buy any individual company shares unless you check them out
using stockopedia.

What have you been doing to ensure retirement at some point?

I've been putting in about 40% of my pay into self managed pension funds.
Also about 25% into accounts accessible now.
I am retiring at 55 - at the latest. Hopefully 52 but it depends on the stock markets.

Do you put all your eggs in one basket…or have multiple options?

Never put all your eggs in one basket. I have a number of separate pensions and the
investments are in different stock markets and asset classes.
e.g. stocks, bonds, real estate investment trusts, gold/crypto etc.

Are there things you are investigating but have not decided on yet?

At the moment I'm about 33% in cash due to being a bit spooked by stock market volatility.
Note, US stocks are overpriced compared to the CAPE ratio AKA Shiller Index.
Also, someone is threatening to start a global trade war.
Fail!
If there is a stock crash, it will last 18-24 months before hitting bottom.
Then when it has definitely turned a corner ( six month simple moving average ), it will
be a great time to invest.

What are your strategies?

If you can get good information on fund performance you can do asset class rotation.
e.g. you see which funds are doing well over the preceding 3/6 month period and you
move your money into those areas.
I don't attempt to predict the market I just follow it.

Your overall plan?

Generally invest in funds that are the best ones in each sector, that have done well in the
previous six months.
Also, you have to reduce spending to save as much as possible.

 

Diversify. Diversify. Diversify.

* We can live on one income, but both wife and I work good jobs so we can save more and also have a backup in case one of us loses a job.

* Multiple brokerage accounts with different styles of investing. Large pool in value stocks. Medium pool in growth and aggressive growth.

* Small pool in speculative activities; penny stocks, crypto, etc. The crypto has done shockingly well. We've been lucky here. No fancy analysis. I can't claim intelligent choices. Just lucky on timing. We've pulled a lot of profits out and let the rest ride.

* One rental property in a hot area. It's never been vacant. We make a tiny profit off of it. Intentionally. We keep the rent a few hundred below market to avoid any risk of vacancy. All we want to do is cover costs and repairs and let someone else pay down mortgage. We're planning on buying another within the next few years ONLY IF we find the perfect, right place. Not going to force it.

* We've refinanced our home as low as can be and gone to extra payments to accelerate mortgage pay down and save thousands, (actually tens of thousands), in interest.

* We don't really "prep." We just try to live in a prepared way. So we buy our 3 month supplies of food during sale times and just stock our pantries. So we keep our medium term storage stocked and rotate it because we eat that stuff anyway, and save a LOT of money buying sale items and stocking.

* We finance nothing but homes. Want a new car? Put the savings away and wait 10+ years, etc. until it's saved. No interest costs.

Most importantly, wife and I on same page with our financial behavior.

 

Add me to all the eggs in one basket group, it’s probably a pretty short list. Pre retirement I was 100% in cash, immediately post retirement it was moved to 100% real estate, 8 years later it’s around 3/4 RE and 1/4 PM’s, about undiversified as you can get.

 

I'm 40 and retired at age 38....

The key is to start a successful online business. ANYONE can have an online business with an investment of a few hundred bucks.

The sky is the limit just use every free online resource you can (there are many).

YouTube is a treasure trove of free advice and info.

I am on a fixed (and not large) retired income BUT my budget includes investing in gold, silver and often firearms/ammo each month.

The beauty of prepping is that guns, ammo, gold and silver seem to hold much if their original value over time....

And food is something you will end up buying anyway...So why not store it?

 

https://www.google.com/url?sa=t&sou...=2ahUKEwiVw5DF8dbZAhVh44MKHYbLD2AQFjAXegQICBAB&usg=AOvVaw1G6X0Wb_NSJeSfAvs4Gyi8

Alpha stratigy. Free read.

 

Trying to constantly improve my relationship with my wife and support her business ventures in addition to all the normal saving, being frugal, doing side work stuff.

 

yes, please pay off your mortgage before retiring.

I'm trying to help an older (early 70s) relative who only has about $2000/month in income.

they would be in fine shape for retirement were it not for their mortgage/HELOC sucking up nearly half of their income every month (no chance of it being paid off before they die)

 

I shudder when I hear of people in their 60s taking out 30 year mortgages.

Retirement has two angles: maximizing your assets/income and minimizing your expenses.

 

Have your library get you the book “Early Retirement Extreme”, sample at:
https://www.scribd.com/doc/156367201/Early-Retirement-Extreme

Check the related discussion forum:
http://forum.earlyretirementextreme.com/index.php?sid=fc2910e3947af308e2a353274ae96f69

And perhaps:

https://www.early-retirement.org/fo...rg/forums/register.php?a=act&u=32170&i=ecb04505289a2adf1b9d3ddbc265939d077afe5a

I used to visit these retirement forums frequently, up until the wife and I were both retired.

 

I'm about 5 years from being eligible for a government retirement (30 years). I'll get a small pension, Social Security once I turn 62, and have a TSP account (401K).

Still have a mortgage, credit card debt, and car payment until October - at which point both vehicles will be paid in full. And I have one child (15) who has a disability. So I expect to work past my eligibility date - but not for the government. My work is very stressful, so I think retirement from my current job will prolong my life.

So my plan is to take my retirement when offered, and then go work for myself as a tax preparer. I will wait until 62 or later if possible to take Social Security. Starting in November I'll put the missing car payment towards paying the credit cards off. I believe I'll be able to pay the mortgage and any remaining credit debt with an inheritance which I expect in the next couple of years. I also will likely receive another inheritance farther in the future and possibly two. One of those could be enough to buy two houses.

We have set up a trust for my son, which is going to be funded with life insurance and with our estate. I have some whole life policies which will continue after I retire. And I also have a lot of term insurance in case I don't live at least another 15 years.

I also plan to invest in real estate properties as a way to establish some other streams of income for retirement and to fund my son as he lives on after my wife and I are gone. The tax business will be to stay active and keep us afloat without having to draw on savings, and to help fund some travel and recreation for us during the slow parts of the year.

 

For the overwhelming majority of people under 50, retirement is not going to happen. If you haven't looked at your social security statement carefully, do so. The fine print says the retirement age is now 67, not 65. The sorts of rolling defaults against social security and medicare exemplified by that change will continue until you are stripped of all your benefits.

It won't be an overt default, just little administrative tweaks where one hand takes away what the other gives.

Social security you can plan for, but there's no way you are going to be able to self fund medical care once you get to that age.

 

1. 401k savings, pre tax
2. IRA savings post tax
3. Rentals to generate passive income
4. Cash savings
5. Hard asset investments
6. Planning to be debt free before retirement
7. Sheltered investments (whole life, trusts ect.)

I'm hoping for social security but I'm fairly certain it's not going to happen for me.

 

Ha, currently sitting on cash, gold and silver and waiting for the stock market collapse - which seems to have started this morning.
#maga !

 

To plan for the retirement you need to look at what debts and taxes you are going to pay in retirement. Think about taxes in this way. Historically, we are in one of the lowest period of taxation in history. Social security is going to have to face major revisions by the year 2035, and around that time is going to be the first time in the county's history that there are going be more people over the age 65 than under 5 years old. So in order to fix just that problem going to have raise taxes/cut benefits. Currently with SS there is a tax involved if you go over a provisional income level (PI). So investing heavily in your 401(k) is going to hit that PI because of required minimum distributions. So a way to get around this is to invest in tax-exempt assets. So think a Roth IRA, Whole life Cash value, Municipal bonds, etc. Taking money out of these assets will not go against your PI and not cause a heavy tax burden in retirement. Also, every married couple's standard deduction is 24k per year. So match that your withdrawal or other tax income. This way you don't have to pay taxes in retirement. By all means you need to eliminate any and ALL debt before you retire. Its entirely possible to have 80 to 100k in retirement and pay 0 money in income taxes.

 

To plan for the retirement you need to look at what debts and taxes you are going to pay in retirement. Think about taxes in this way. Historically, we are in one of the lowest period of taxation in history. Social security is going to have to face major revisions by the year 2035, and around that time is going to be the first time in the county's history that there are going be more people over the age 65 than under 5 years old. So in order to fix just that problem going to have raise taxes/cut benefits.

That's not guaranteed. It's possible that benefits could just be reduced by 20-25%. Another option, a more plausible one IMO, is that the 'full retirement age' could be raised significantly. When SS started, the full retirement age was the same as the overall life expectancy; many never reached the age, and not many were on SS for long.

Currently with SS there is a tax involved if you go over a provisional income level (PI). So investing heavily in your 401(k) is going to hit that PI because of required minimum distributions. So a way to get around this is to invest in tax-exempt assets. So think a Roth IRA, Whole life Cash value, Municipal bonds, etc. Taking money out of these assets will not go against your PI and not cause a heavy tax burden in retirement. Also, every married couple's standard deduction is 24k per year. So match that your withdrawal or other tax income. This way you don't have to pay taxes in retirement. By all means you need to eliminate any and ALL debt before you retire. Its entirely possible to have 80 to 100k in retirement and pay 0 money in income taxes.

Whole life, barring a few exceptions, is a terrible 'investment'. Keep insurance and investments separate.

Otherwise, you're idea is pretty good, though paying zero income tax in retirement is not necessary or even ideal. If you'll be in a lower income tax bracket in retirement than now, 401k and traditional IRAs (tax-deferred) will come out ahead of the Roth, and this is certainly true of nearly all of today's retirees.

Also, it takes around $600,000 of tax-deferred assets to produce that $24k of tax-free income for a married filing jointly couple every year, so a good chunk of that tax-deferred money will never be taxed.

 

I plan on working longer than many on this thread. Unless I am able to amass a sizable amount of retirement funds that would allow me to maintain my current lifestyle I am not willing to retire just to retire.

On top of that, a decent amount of people that I know that went all-out to retire early ended up missing a lot of "life" and then ended up dying within a couple of years after retirement. Obviously anecdotal but I do not want to completely deprive myself of the now in exchange for a possible future. Not only that, but talk to some of those older people who are retired. Many of them suffer from significant health issues that stop them from doing what they would really like to do "someday".

Ok, on to the strategy:

-Roths IRAs for both of us
-403B minimum contribution for matching funds (I think a measly $600/yr)
-Wife's pension
-Hammer higher interest debt with extra funds (some student loans running at 6.8%)
-At some point when more of our debt is paid off I will start allocating funds to buy a rental home. In my opinion the most stable and enduring store of wealth. If you look at just about any "wealthy" person they own real estate or own a company that owns equipment/real estate/etc.

 

I'm retired so I can speak with some authority on the subject.

If you are young, invest 10% of your weekly/monthly income in a mutual fund that tracks the S&P 500. By the time you retire, you will be a multi-millionaire. (Of course, that's assuming you start investing early enough and the world hasn't self-destructed by retirement time.)

Buy your own home, don't rent.

When you marry your choice of husband/wife should be decided from an investment perspective first, and love, lust, beauty, compatibility, religion, and politics second. In other words, don't marry a loser just because he/she is sexy! If he/she does not qualify as a great investment in your present and future happiness find someone else who does.

The other things to consider are having adequate health insurance and no debt when you retire.

 

Buy your own home, don't rent.

Build your own home, don't buy. :thumb:


Greg

 

I retired at age 56, 26 years ago. When I was born in 1936 male life expectancy was 56.6 years for a male, and 60.6 for a female. (As Willhhrill81 noted that Social Security was started in 1935 with an age of 65 [actually slightly higher than life expectancy]). Today life expectancy is 80 plus or minus... Because of a family history of heart disease in all males, I never thought I would live to see 60....So I took 4 years off at age 42 to fulfill my dreams of long distance sailboat cruising. (We built the boat--meant 50 hours of work week beyond both of our full time jobs) Many will not be able to do what they wanted in "retirement"--as stories in this thread affirm.

Most people under estimate their costs as they age. This is because of health care, needing more help as they age and long term nursing care. We are seeing more older people with dementia, and care for this is extremely expensive. Always assume that your mate will live longer than you--and provide for that.

My parents always lived beneath their income--as we did. We started saving at least 10% from our first jobs on. I worked away from home during summers from age 14 on. We never took funds out of retirement programs, except if we could invest it better. (For example I had a 401 with a group which was averaging about 3% return. When I left that group, I rolled it into an aggressive growth retirement fund which was self directed and achieved returns which were about 15% over 20 years.)

Never borrow against your retirement funds.
Don't assume that you can live "cheaper" in retirement--some can...many cannot.
Take SS, retirement funds as late as you can in life--(Ladder so you have more later in life)
There will be a time when you can no longer care for yourself.
Try and have a pension which gives you medical care when you retire, and a good supplement to what government health care is available when you retire.
Have no debits when you retire.
Learn to do whatever you can in maintenance, and building yourself, while young, and continue that thru life.
Never assume that the retirement, taxes, government programs will remain as they are now--they won't.
Look for the best investment opportunities--for example one of my friends was buying houses in Phoenix in 2008 at courthouse step foreclosure auctions. He was getting $250,000 houses for $60,000 and renting them back to the persons foreclosed upon for half what their payments were. He bought 8--now they are back up to the $250,000 if he wished to cash in.
Use leverage to your advantage when buying real estate, in an appreciating market.
Don't take high risks in the stock market--especially in areas where you have no expertise.

 

We're already prepared... and never to worry about money for the rest of our lives. No IRA's, no stocks, no bonds, no treasuries, no pensions, no options, no futures, no derivitaves...

...and NO debt. :thumb:

It costs practically nothing to live when you are 100% solvent.


Greg

 

Hmmmmmmmmm? I'm 100% solvent, no debt, no CC's, no house/car/MC payments, etc., but my costs per year are not zero, for example:

Property Tax = $2200
Directv = $1400
Water,sewer,garbage = $1200
Auto insurance two cars = $1600
Motorcycle insurance (for 2 HD) = $741
Health Insurance = $5,000
Food = $10,000
Gas = $3,000
Auto repairs, tires, etc = ?
Life insurance = $4,000
Flood insurance = $400
Other insurance = $800+
Federal income tax = $5,000
Gun club dues = $100
Clothing, etc = $1,000+++
And lots more that I can't put a number on right now without looking it all up.

Bottom line = If I looked everything up my total living expense per year would probably be between 40k & 50k. SO......DON'T PAY ANY ATTENTION TO ANYONE WHO SAYS YOU WON'T NEED MUCH MONEY IN RETIREMENT!

 

The big thing keeping me from retirement is health insurance. I could make it otherwise.

 

All the retirees I've known, been related to, or worked with died within five years after they retired; most within three years. Most wanted to "take it easy" like getting money from rental properties, do some traveling, grow a garden, wake up late go to bed late, spend more time with family, etc. Most were healthy and active when they retired, but got sick and fat after they retired. Several just hung out at restaurants and got fat with other retirees while they ate gravy and biscuits and drank coffee. I guess they could kick off feeling good because they had lots of cash to leave to their heirs.
I plan on working until someone runs me out of my own business at about eighty, and then if I kick it'll be in my basement weight room, after benching about four hundred pounds while listening to loud music after giving my thirty-year-old girlfriend a screwing that will have her walking bow legged for a week.
Humans didn't evolve to retire, we evolved to meet tough physical and mental challenges until we can't do it anymore; then we die we don't retire. I feel sorry for people who are living to retire because for most of them the after won't last very long.