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ksmithFingers crossed I have one, the Slavic fatalist in me says, but besides that...
Received two books in the mail yesterday: HOW TO RETIRE ON LESS THAN YOU THINK and HOW TO LIVE WELL ON LESS THAN YOU THINK. Forgot the author's name, but iirc, he is now living well in Lawrence KS after having left the NYC rat race for a slower pace/lower cost of living/dream job. He's happy, and he wants to spread it around.
Read the books pretty much bing-bing, which means I was able to catch all the overlaps. The author favors moving from expensive areas of the country to less expensive areas, and offers links to various sites that allow you to calculate costs of living. He also has useful info about health insurance, taxes, and whatnot. The trick is to move to a less expensive part of the country that doesn't tax the hell out of your retirement income and offers health care/insurance that won't break you. Since some areas of the country offer one or two of these, but not all three, trade-offs need to be made and things get tricky. This may seem obvious, but sometimes it isn't...especially if you're settled in an area and loathe to leave family/friends and whatnot.
He offered shorter term suggestions as well, the old 'take your lunch to work and invest the money you save' which I have to say sounds a little unrealistic. My cafeteria lunch is subsidized, I get the sorts of veggies/salads/fish that I need to eat more of instead of the PB&J I'd no doubt wind up bringing, and the comment that you could take the money you don't spend on lunch, invest it at 6%, and at the end of 5, 10, 15 years...
Find me an account that offers 6% that isn't a mutual fund with a minimum investment requirement or an IRA that will tie up your money for years. I'm sure there are people who do this, and they can laugh at me right now if they wish, but sometimes you reach the point where you sit back and go wait a minute...
And I say that even though I may start bringing in a box of higher quality oatmeal and making it myself in the office microwave because the stuff they sell downstairs is like wallpaper paste by the time I get to it. That'll save $10 or so a week on breakfast, or about $480 a year which if invested in a CD paying 5%...
He also suggests scaling back to one vehicle, which I doubt I will do because it's so damned handy to have the truck. Makes a good argument for buying newer used vehicles or buying new and holding on for 10 years or until repair bills reach a certain point. Recommended high-quality secondhand shops and ebay and such for nicer things--I try to do this because I like to avoid paying full retail whenever possible. Made other recommendations I might try because I am not always the smartest person when it comes to short-term spending. One tends to fritter.
Some news that did surprise me was that he felt that the investment counselor standard of telling people that they need to be able to replace 75-80% of their income in order to retire was incorrect. He feels its mainly a ploy to get people to sign on with investment counselors and brokerage houses. I confess I've done that, but all it's costing me at this point is a $40/yr custodial fee for a Roth IRA, so I don't really mind. I like getting a second opinion, and I trust these guys.
Anyway, the author feels that it's not the gross you need to replace, but the take home. With some reservations, I think he has a point. The only reason I'm even considering bailing in 3 years is because I'm looking to replace 50-55% of my gross, not 75-80%. If I have to work, fine, but I would like it to be at something else.
The point of this ramble is that I think I may still be on track to retire in three years--barring a market freefall of Black Monday proportions--and the thought makes me happy. I have also worked out how much I would need to set aside in order to make up for the money I wouldn't be putting into the 401(k) should the dream...or even the semi-dream...contract ever drop in my lap, and I think I could make it. In other words, gentle reader, I think things are going ok. Knock wood and all that. Just give me good health, and I think I can handle the rest.
And, to be honest, the fact that I pretty much did it on my own makes me feel pretty good.
Received two books in the mail yesterday: HOW TO RETIRE ON LESS THAN YOU THINK and HOW TO LIVE WELL ON LESS THAN YOU THINK. Forgot the author's name, but iirc, he is now living well in Lawrence KS after having left the NYC rat race for a slower pace/lower cost of living/dream job. He's happy, and he wants to spread it around.
Read the books pretty much bing-bing, which means I was able to catch all the overlaps. The author favors moving from expensive areas of the country to less expensive areas, and offers links to various sites that allow you to calculate costs of living. He also has useful info about health insurance, taxes, and whatnot. The trick is to move to a less expensive part of the country that doesn't tax the hell out of your retirement income and offers health care/insurance that won't break you. Since some areas of the country offer one or two of these, but not all three, trade-offs need to be made and things get tricky. This may seem obvious, but sometimes it isn't...especially if you're settled in an area and loathe to leave family/friends and whatnot.
He offered shorter term suggestions as well, the old 'take your lunch to work and invest the money you save' which I have to say sounds a little unrealistic. My cafeteria lunch is subsidized, I get the sorts of veggies/salads/fish that I need to eat more of instead of the PB&J I'd no doubt wind up bringing, and the comment that you could take the money you don't spend on lunch, invest it at 6%, and at the end of 5, 10, 15 years...
Find me an account that offers 6% that isn't a mutual fund with a minimum investment requirement or an IRA that will tie up your money for years. I'm sure there are people who do this, and they can laugh at me right now if they wish, but sometimes you reach the point where you sit back and go wait a minute...
And I say that even though I may start bringing in a box of higher quality oatmeal and making it myself in the office microwave because the stuff they sell downstairs is like wallpaper paste by the time I get to it. That'll save $10 or so a week on breakfast, or about $480 a year which if invested in a CD paying 5%...
He also suggests scaling back to one vehicle, which I doubt I will do because it's so damned handy to have the truck. Makes a good argument for buying newer used vehicles or buying new and holding on for 10 years or until repair bills reach a certain point. Recommended high-quality secondhand shops and ebay and such for nicer things--I try to do this because I like to avoid paying full retail whenever possible. Made other recommendations I might try because I am not always the smartest person when it comes to short-term spending. One tends to fritter.
Some news that did surprise me was that he felt that the investment counselor standard of telling people that they need to be able to replace 75-80% of their income in order to retire was incorrect. He feels its mainly a ploy to get people to sign on with investment counselors and brokerage houses. I confess I've done that, but all it's costing me at this point is a $40/yr custodial fee for a Roth IRA, so I don't really mind. I like getting a second opinion, and I trust these guys.
Anyway, the author feels that it's not the gross you need to replace, but the take home. With some reservations, I think he has a point. The only reason I'm even considering bailing in 3 years is because I'm looking to replace 50-55% of my gross, not 75-80%. If I have to work, fine, but I would like it to be at something else.
The point of this ramble is that I think I may still be on track to retire in three years--barring a market freefall of Black Monday proportions--and the thought makes me happy. I have also worked out how much I would need to set aside in order to make up for the money I wouldn't be putting into the 401(k) should the dream...or even the semi-dream...contract ever drop in my lap, and I think I could make it. In other words, gentle reader, I think things are going ok. Knock wood and all that. Just give me good health, and I think I can handle the rest.
And, to be honest, the fact that I pretty much did it on my own makes me feel pretty good.
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no subject
Date: 2005-08-03 04:20 am (UTC)Fortunately, I live far below my means and I put money in the IRA when I was in my 20s. I rolled it all over to a ROTH and paid the taxes, and am happily watching it grow tax free. 9/11 and the current doldrums aren't helping, which is why I'm about to do an analysis.
I agree, an educated opinion is useful--my financial counselor has had mostly good advice, over the years. I've done well with mutuals, not being able to watch stocks constantly.
But now I have a big problem. My health is sucking money at 33-50% of earnings, and I have no idea how the next six months will go. So I'm not expecting to be able to retire any time soon. In fact--I expect to be back in school, if the treatment gets my brain firing properly again.
So...may I suggest a little bit more of a pad than 50%? In case illness pulls a fast one on you? I'm but 49--but illness makes me feel much older, some days. And because of it, I've lost five years of writing time.
I didn't expect something to muck with my brain this much...
no subject
Date: 2005-08-03 11:42 am (UTC)I use the calculator on my company's 401(k) website to figure out savings projections. These calculations don't figure in the matching funds my company throws in, so all else being equal, the total in three years should be higher than I'm figuring. I also had the counselor guy go over my fund mix. He thought it was well-balanced--he wouldn't make any changes. He did say that it was a tad on the aggressive side, which might come back to bite me. But they're all quality funds, and seem well-behaved--they don't fly up quickly as the market goes up, but they don't plummet as quickly when the market falls, either.
Another thing I don't know is whether my company will offer any form of subsidized health insurance. Being under 50, some things aren't grandfathered in.
*Another* thing I don't know is where my company pension stands. I'm not including it in my savings projections. It should be there, but I'm not taking it for granted.
I'm not going to commit financial suicide. If things aren't right in three years, I'll stick it out longer.
no subject
Date: 2005-08-03 12:57 pm (UTC)But like I said, I won't be idiotic about it. I also figure I will have to work. I hope the work will be fiction writing, but I'm prepared to do something else if necessary.
no subject
Date: 2005-08-03 02:44 pm (UTC)I hope the new area you've transitioned into will make that possibility more enjoyable.
no subject
Date: 2005-08-03 04:46 pm (UTC)Hummm....
Date: 2005-08-03 07:41 pm (UTC)Re: Hummm....
Date: 2005-08-04 12:21 am (UTC)For me, the question is, how far can I stick my head in the gift horse's mouth?
Re: Hummm....
Date: 2005-08-04 02:09 am (UTC)I know someone who got their dream job in a work sense--but the people were a nightmare. Finally had to leave. So trade-offs happen all the time...