I have a MMR question!

[Deleted]

Earlier this week we got a statement from DH's 401k which said we were not on target with recommended retirement savings, which mind BLOWN because we are better off than 99% of our friends/family. Granted, we have $ in an annuity/universal life insurance which isn't represented but still. The recommendation was 3 times salary by age 40. No way we will make that. 2 times, sure, but not going to make that up in the next year for DH. Being that we are all a money savvy bunch (barring the proliferation of shopping threads!), I was curious how everyone else was doing. 

[Muddled]

I was expecting vaccines!

[pinotgrig]

Totally thought this was going to be vaccination thread. Lol

[smock]

Dec 3, 2015 9:54:33 GMT -5 Muddled said:

I was expecting vaccines!

Ha ha, me too. 

And now I'm depressed about my retirement savings. THANKS A LOT!

[Muddled]

Dec 3, 2015 9:54:59 GMT -5 smock said:

Dec 3, 2015 9:54:33 GMT -5 Muddled said:

I was expecting vaccines!

Ha ha, me too. 

And now I'm depressed about my retirement savings. THANKS A LOT!

Produce is cheap in Italy. You'll be fine.

[water*drop]

LOL, no. But we were both still in school until we were in our late 20s, I didn't actually get my first "real" job until I was in my early 30s, I'm in a low-paying field, and he's at a low-paying company. We have a lot working against us. We're working hard to make up for it now, but it's tough.

[Deleted]

LOL - vaccines would be a mmMr thread people!

[Deleted]

Where have our lives gone that we don't even think of money anymore? It's like when someone says STD and you no longer think save the date.

[humpforfree]

Ditto expecting vaccines. Lol.
We are 30 and on track. We have 1.5x now?

[kdubs923]

I'm with you... 2x? Sure. Three is a big, big push. And I feel I contribute a generous amount already, and my work match is also VERY generous. Not sure what I could change, and still be able to pay for two in daycare. And eat.

[Deleted]

Dec 3, 2015 10:00:25 GMT -5 kdubs923 said:

I'm with you... 2x? Sure. Three is a big, big push. And I feel I contribute a generous amount already, and my work match is also VERY generous. Not sure what I could change, and still be able to pay for two in daycare. And eat.

This is us. We are pretty conservative with spending but the reality of 2 in daycare (for 4 YEARS  ) has been a lot more of a reality check than 1.

[awkwardpenguin]

3x by 40 is a fairly aggressive savings goal and is generally used by people who are not counting social security at all in their projections. The Fidelity rule of thumb guidelines are 1x by 35, 2x by 40, 3x by 45, etc. We are on track to catch up by 40 for the latter but not the former.

[awkwardpenguin]

Dec 3, 2015 9:59:16 GMT -5 @republicrat said:

Where have our lives gone that we don't even think of money anymore? It's like when someone says STD and you no longer think save the date.

I think we should have Money Matters day on MMM and return to our MM roots.  For a day.  I can't think about money all the time LOL.

[Deleted]

Nope. I was in school until I was almost 29. I worked some jobs between college and law school but H was in grad school so I was supportung two of us on a low salary. Retirement savings were non existent. Then we switched and H worked while I went to law school.

H has also moved up rather quickly in his career and his retirement savings have not matched his salary increases. This is mainly because by the time we were both actually working we were also paying off all of our credit cards, saving to buy a house,paying daycare etc.

I can likely get to 2x by then. But H is looking at another promotion this year or next that will come with a large pay increase so he may not even get there.

[halfpint]

We'll be at 2x by 40, but no way 3x. And I feel like we're fairly aggressive with our retirement savings at this point. I mean, we're not projecting to buy a yacht or anything, I just want to live relatively comfortably. Maybe take our kids on a few trips.

Though...did anyone else see the studies on metformin? I'm not diabetic, but take it to help with PCOS and to boost fertility - apparently I'm living to 120! Maybe I better plan to sock a little more away!

[bcarp30]

Dec 3, 2015 10:05:31 GMT -5 awkwardpenguin said:

Dec 3, 2015 9:59:16 GMT -5 @republicrat said:

Where have our lives gone that we don't even think of money anymore? It's like when someone says STD and you no longer think save the date.

I think we should have Money Matters day on MMM and return to our MM roots.  For a day.  I can't think about money all the time LOL.

I could so use this. My DH tries to involve me in the finances and I just have no idea or care about what it all means. SKRUS did me no favors once I became an adult!

[heygrey]

No. Honestly I don't know what were going go do in retirement. We're in that spot where we can't pay off our student loans, save for a down payment in a hcol area, pay for 1 (let alone 2+) in daycare, and put away the recommended amount for retirement. We are quite conservative with our money and budget well, but there isn't enough to go around for everything you're *supposed* to do. Thus far, retirement has taken a backseat to student loans, then daycare, then I decided to go back to school which set is back about a year financially. It should be a good move in the long run, but it hurts right now.

[thebreakfastclub]

I am at x3 and am 39.

Some things that helped were going to a cheaper college, keeping cars 10+ years, and only having one in daycare.

[ssmjlm]

DH is a little over 2x at 42, but not 3. I've got about 1.5x at 33, but I just had a big promotion last year that put me back behind.

DH plans to work until probably 62/65 since I can't retire until 57 without a penalty even though I'll have 30 years of service at 53.

[Velar Fricative]

No. I have a high salary right now and there is no way in hell I'll hit 3x that in 6.5 years. I won't need anywhere near my current salary in retirement annually, so I'm okay with being "behind" in this respect.

2x is probable though.

[rbp]

No, because H got his first real job at age 33.

I will personally have more than 3x my own salary in retirement savings by age 40, but that's mostly because my salary makes up 20% of our HHI so H's salary subsidizes my savings habit. LOL

[fortnightlily]

At 33, I have 1.3x saved. I don't feel like doing the math to extrapolate that to 40.

At 45, DH has 2.2x saved. His salary is less than mine, and he started late on saving for retirement and has been aggressively catching up.

If we decide to have another kid (looking unlikely) we would both probably have to reduce our contributions.

[oswin]

We're at 1x at 28, plus 0.5x in non-retirement accounts. But I don't use the save based on income model, I use 25x expenses as the mark to hit for financial independence in retirement. I like to take into account how different our expenses will be in retirement: no mortgage, no daycare/school/college spending, etc. We're on track for early financial independence.

[AmyRI]

I currently have 0.75x my annual salary in my retirement account at age 30. (Didn't start contributing until I was 25 thanks to grad school, so I feel pretty good about this amount despite being behind.) I put in 13% and get 5% matched, so it grows by 18% of my salary annually. Going to assume 5% annual return on investment and a 2% annual raise. Given that, the retirement calculator says I will make it almost exactly.

I am surprised I would make it even close... of course I might not if the stock market sucks or if we have to cut back savings to afford kid #3 that's on the way, but we have what I believe is a very workable budget without having to cut that.

DH is only a year away from that milestone and I'm almost certain he'll make it. He has a bunch of accounts all over the place and hasn't added up the total, so I'm not exactly sure. (This does in fact drive me crazy, but our retirement accounts are separate so I try not to bug him about it.)

[aspentosh]

I think it's aggressive, but I'm not counting on SS so it's the marker I go by.

We're different than most because we both contributed to retirement savings until I quit, so our current amount is almost 3x H's salary (he's 34 and I'm 31). So we will definitely hit that marker.

[Deleted]

I think so. I'm not sure about the formula because our income is so variable. But I think we are doing all right when it comes to saving.

[felicity]

I tend to think those kind of blanket statements to have x percentage or whatever saved/spent on certain things are silly, and the only reason they do it is because they want to give "expert" advice on what to do. Each family's budget is different, and it depends completely on how much you will spend in retirement, not how much you make now. It's assuming people spend more because they make more, which just isn't necessarily true.

What they really need to do is have people put in their current budget, figure out how to adjust that for inflation and increased medical expenses at the age they want to retire, and make sure it's enough to get people through their expected lifespan (and I'm sure I'm missing some things, but you get the point). But, I suspect that would be a lot harder for the experts to come up with, and most people don't know what they spend anyway, so this wouldn't generate much interest or clicks

[ktw]

I don't really know how to answer this. Because of raises/promotions and job changes, our combined income is much higher now than it was when we started working 10 years ago (good problem to have, I know). At 31 and 32, we have 2x our gross original salaries (that we made at 22 & 23 when we entered the workforce) already in retirement savings. But, we "only" have .86x 1 year's current gross salary. I don't know that we'll get to 3x our current salaries by age 40.

[cincodemayo]

Unfortunately, no. We still have student loans and we have not always been the smartest with our savings. We are on track to have 1x our current combined salary by about age 33, so it is feasible to get to 2x by 40, but honestly not likely if I get raises.

2015 was a good year for us savings wise and we maxed out a Roth. 2016 we are adjusting to 2 in daycare, going on a Disney trip, and renovating our floors so it won't be so great. I'm ok with this.

[mlt]

MH will have 3x by 40 but he makes a lot less than I do. No way will I have that. I'll be lucky to have 2x by 40. At 30 I'm still not at 1x. Thanks student loans. Those take priority.

Now I feel stressed.