I’m surprised the calculators say you’re fucked. The rule of thumb I always heard was 1x income in your early 30s and 2x by 40.
We’re behind on retirement (DH is dragging us down! I started saving years before he did) but I’m way more worried about my parents. I think they have less in their 401k at age 64 than I have in my own, at about half their age.
I saw 1x by 30, 2x by 35 and 3x by 40. I don't think we're getting to 3x by 40 unless the stock market continues to go bananas.
But the actual calculators that have you plug in your age, current income, amount saved already, etc. have us running out of money anywhere from our early 80s to late 90s depending on whether we include social security, the rate of return, etc. I will say that they generally assume needing around 75% of your income in retirement, which seems sort of high to me (our house would be paid off if we stay where we are, we won't be saving for retirement anymore, etc.) But on the other hand, I'd like to be able to travel and stuff and health care might be $$$ so that's probably not a bad assumption.
I guess all we can do is save what we can and try and hope for the best. I'm not going to forgo all vacations and fun stuff in the short term to save every last penny, that's for sure.
I mean, I don't really stress about it day to day, but I honestly don't know how realistic it is to expect to retire at 65. I have to imagine we'll both continue to work well into our 70s. I'm just hoping at that point that we have enough saved that we can supplement our income with jobs that are a little more relaxed.
DH is pursuing a doctoral degree and hopes to be on a tenure-track professorship a few years from now. If that ends up working out, I think we'll be ok because he will happily teach into his 70s.
But, in general, no, I'm not sure that we'll be ok.
Not freaking out, just pissed that I cashed out 9 years of it when I changed states, and now I'm basically in year 13 of a 22 year career. I could have only like 8 years left and plenty of time to start a second gig. Now I'll be in education til I die.
What I AM freaking out about is that I feel completely and utterly stuck in education now. I can't walk away from what is in my PERA.
eta: I also grew up poor, my family is still poor, no one is retired except MIL, so the concept of even doing this is completely foreign to me.
I feel kinda sorta OK, but not confident. We are on track with what we "should" be saving, but I worry about unexpected healthcare costs for us or for our parents that could end up tanking us. Also having had my 401k balance decimated by stock market crashes more than once, I think I will be perpetually worried about it. I don't like relying on the stock market for my basic survival in retirement.
Post by somersault72 on Dec 6, 2017 14:36:39 GMT -5
I don't worry about it on a daily basis, but I'm "worried" in that I don't really feel like I'm going to be able to retire. I have a 401K but it doesn't even have 1x my salary yet and I'm almost 37. I keep hoping to bump up my contribution, but there's always something else going on. I had to take a 3ish year break in contributing after my divorce. Good times.
I'm honestly not sure. I've been maxing my SIMPLE IRA (which is a lower contribution limit so easier to do than maxing a 401k). MH does not max his 457b, but he saves 10%, and will have a pretty good pension if he spends 11 more years (9 down) working for the state. I feel like we'll eventually be ok, we might just be older than we'd like when we get to that point. We're 35/38 and have more than one year, less than two years total comp saved at this point. We're halfway done paying our SLs, and a couple years into our first kid's daycare bills. Even when we finish though, we'll have kid activities and college to pay for. I don't have high hopes we'll have tons of cash freed up anytime in the foreseeable future.
The part that freaks me out when I think about it too long is the odds that I won't be ABLE to work long enough. My mom died of cancer at 59 after a 6 year battle. My dad was also dx'ed with cancer when he was 52. That doesn't bode well for my ability to work until 65+. Aside from genetic testing and good preventative care, I don't know what else to do.
According to what "THEY" say, assuming everything continues going according to plan (health, steady employment, stock market continues to be stable-ish), we should be okay.
I'm more concerned about college for my kids. DS1 is 12 and DS2 is 7. By the time they reach college age, "THEY" say we should have $130,000 saved for DS1 and $170,000 saved for DS2 to cover college costs. These estimates are for four years of undergrad at a in-state public university. We're prioritizing retirement savings because "you can take a loan out for college; you can't for retirement," and saving what we can for college. There's no way we'll have enough, though. The current plan is to save some now, kids will have jobs to contribute, kids will hopefully get some scholarships, and we'll work to have lowered monthly expenses while they are in college so we can cash flow what we can. Then loans, of course.
My college tuition was the equivalent of buying a car. Theirs will be the equivalent of buying a house.
Nope. Freaking out has yet to actually put money in my pocket. We both have a Roth IRA that we contribute to. It's not a lot, but it's something and it's growing. We also have two 529 accounts that we contribute to (OH NOES! Saving for college!) for both of our kids. Again, not a ton but it's growing.
Honestly, the future, while important, has been the least of my worries what with our current debt burden and wanting to get rid of it as fast as possible.
We have about three times our salary in cash and retirement right now, but we're 51 and 53. There is no way we'll ever accumulate the mid-high 7 figures that calculators say we should have; I plan on dying younger than the calculators credit, to be honest. We weren't able to save when we were younger because I was young and stupid and XH and I had anticipated a government pension and him having a second job with a retirement plan (what a lot of career military folks banked on before TSP) and when DH and I got together I had four young kids and neither of us made bank. The kids came before retirement. I didn't even start saving until I was about 40-ish. DH had his first retirement vehicle at 30, but had law school debt and not a high income. We've been playing catch-up for about a decade now.
DH is in a position where he can put in more than the 401(k) allowance because of how his firm is set up and his position in it, plus we're now maxing out an IRA for me, with catch-up provisions and doing what we can to actually catch up. Plus he has a buy-in to the firm in six-figures that will pay out a few years after retirement that he's not considering in his calculations.
DH is worried but I think we'll be okay if we're consistently saving at our current rate (and I stop spending at mine.)
I’m surprised the calculators say you’re fucked. The rule of thumb I always heard was 1x income in your early 30s and 2x by 40.
We’re behind on retirement (DH is dragging us down! I started saving years before he did) but I’m way more worried about my parents. I think they have less in their 401k at age 64 than I have in my own, at about half their age.
I saw 1x by 30, 2x by 35 and 3x by 40. I don't think we're getting to 3x by 40 unless the stock market continues to go bananas.
But the actual calculators that have you plug in your age, current income, amount saved already, etc. have us running out of money anywhere from our early 80s to late 90s depending on whether we include social security, the rate of return, etc. I will say that they generally assume needing around 75% of your income in retirement, which seems sort of high to me (our house would be paid off if we stay where we are, we won't be saving for retirement anymore, etc.) But on the other hand, I'd like to be able to travel and stuff and health care might be $$$ so that's probably not a bad assumption.
I guess all we can do is save what we can and try and hope for the best. I'm not going to forgo all vacations and fun stuff in the short term to save every last penny, that's for sure.
Honestly, do we really need 75% of your current income in retirement? If the house is paid off, you need repairs, appliances probably once during that retirement time, maybe a new roof and furnace and taxes... does that and your travels cost 75% of what you and your SO make now? I guess that is where I wonder. I won't have 5 people to feed in our house. I won't need college funds or childcare. I won't need new clothes for work routinely, but I will have other expenses like travel and hobby expenses, oh, and more medical. Can't I live on about half what I do now?
Post by katieinthecity on Dec 6, 2017 14:58:11 GMT -5
Mildly. We are in an okay-but-not-great position currently. The idea is to put more money at it once daycare is no longer a major line item in our budget. I imagine one or both of us will probably either work PT or do gig/consulting work even after we "retire". Both to keep busy and supplement income.
For those who say they don't expect to retire, do you mean you plan on literally working until you die? I am picturing my 90-something year old grandmother and I'm just not sure how that works.
Maybe something part-time? But it seems like even then, who is going to hire an elderly person and how much can they realistically do?
I can see working into my 70s if we need to but much beyond that freaks me out just from a health perspective.
(This thread is super cheerful! Lol and wahhhhhhh)
I saw 1x by 30, 2x by 35 and 3x by 40. I don't think we're getting to 3x by 40 unless the stock market continues to go bananas.
But the actual calculators that have you plug in your age, current income, amount saved already, etc. have us running out of money anywhere from our early 80s to late 90s depending on whether we include social security, the rate of return, etc. I will say that they generally assume needing around 75% of your income in retirement, which seems sort of high to me (our house would be paid off if we stay where we are, we won't be saving for retirement anymore, etc.) But on the other hand, I'd like to be able to travel and stuff and health care might be $$$ so that's probably not a bad assumption.
I guess all we can do is save what we can and try and hope for the best. I'm not going to forgo all vacations and fun stuff in the short term to save every last penny, that's for sure.
Honestly, do we really need 75% of your current income in retirement? If the house is paid off, you need repairs, appliances probably once during that retirement time, maybe a new roof and furnace and taxes... does that and your travels cost 75% of what you and your SO make now? I guess that is where I wonder. I won't have 5 people to feed in our house. I won't need college funds or childcare. I won't need new clothes for work routinely, but I will have other expenses like travel and hobby expenses, oh, and more medical. Can't I live on about half what I do now?
Yeah, it definitely sounded high to me. If the house is paid off and we're (knocking on wood) not supporting our children, it seems like 75% would afford a pretty lavish lifestyle even assuming high health care costs.
For those who say they don't expect to retire, do you mean you plan on literally working until you die? I am picturing my 90-something year old grandmother and I'm just not sure how that works.
Maybe something part-time? But it seems like even then, who is going to hire an elderly person and how much can they realistically do?
I can see working into my 70s if we need to but much beyond that freaks me out just from a health perspective.
(This thread is super cheerful! Lol and wahhhhhhh)
There's no way my 78 year old mother and 99 year old grandmother could work. I have no idea about retirement for myself. Injuries have me worried too.
We are ahead balance-wise, but I do worry about crazy things like a significant market correction, tax code changes, or medical changes that could create a huge swing in how much we'll actually "need". I hate those retirement planning calculators because they are all just trying to be a crystal ball assuming everything is going to stay the same.
Not freaking out. I am 40 and have saved 1 times my income, but will also get a pension. DH has done an amazing job of saving, and also will get a pension. I think combined we have about 3 times our incomes saved on top of our pensions.
For those who say they don't expect to retire, do you mean you plan on literally working until you die? I am picturing my 90-something year old grandmother and I'm just not sure how that works.
Maybe something part-time? But it seems like even then, who is going to hire an elderly person and how much can they realistically do?
I can see working into my 70s if we need to but much beyond that freaks me out just from a health perspective.
(This thread is super cheerful! Lol and wahhhhhhh)
My aunt is 79 and still works a FT, 40 hour/week job. She will be 80 in a few months. It's an office job, and she sits at a desk all day but still. She probably can't afford to retire fully, but she does have low 6 figures in retirement. My uncle (deceased) screwed her over in setting up his pension. It basically stopped as soon as he passed away ~6 years ago, whereas friends/family who worked for the same company are still receiving something from their deceased spouses because they set up theirs differently.
Oddly, I'm not. I'm mostly on track - I have about 1.66x my current salary saved and I'm 35. H literally has 2k saved and he's 35 too. Lol. So together we are behind but I do think we'll catch up. It helps a lot in my mind that he is currently not working a regular job (PhD student) and that we're not planning to have kids. So once he gets a regular job we can start saving for him aggressively, and keep on doing what we're doing with my savings. I also think that once we have our SLs paid off we can start saving their payments as retirement savings. So I anticipate a much great ability to save down the line which will help a lot. I wish we could save more now, but I'm not willing to live that frugally and it would have to be pretty frugal to save anything significantly more at the moment. He'll have a regular job by summer 2019 (hopefully, haha) so at that point hopefully we can make a change.
I do worry about it in a really broad way, but I think in reality we'll be fine. The only thing that is a huge unknown for me, I guess, is healthcare and long term health related care. Like if one of us needs to go into a home for dementia and lives for 20 years that way, we might be in trouble. I guess when it gets closer we'll look into long term care insurance, but right now I feel like so much is likely to change in the next 25-30 years before we retire that planning for that now is kind of pointless.
I guess I also worry a little because we don't own property. I feel like we're going to need to do that eventually to ensure we have a place to live in retirement that doesn't take up a giant amount of our income. Perhaps we'll move to a LCOL country at that point Who knows.
I saw 1x by 30, 2x by 35 and 3x by 40. I don't think we're getting to 3x by 40 unless the stock market continues to go bananas.
But the actual calculators that have you plug in your age, current income, amount saved already, etc. have us running out of money anywhere from our early 80s to late 90s depending on whether we include social security, the rate of return, etc. I will say that they generally assume needing around 75% of your income in retirement, which seems sort of high to me (our house would be paid off if we stay where we are, we won't be saving for retirement anymore, etc.) But on the other hand, I'd like to be able to travel and stuff and health care might be $$$ so that's probably not a bad assumption.
I guess all we can do is save what we can and try and hope for the best. I'm not going to forgo all vacations and fun stuff in the short term to save every last penny, that's for sure.
Honestly, do we really need 75% of your current income in retirement? If the house is paid off, you need repairs, appliances probably once during that retirement time, maybe a new roof and furnace and taxes... does that and your travels cost 75% of what you and your SO make now? I guess that is where I wonder. I won't have 5 people to feed in our house. I won't need college funds or childcare. I won't need new clothes for work routinely, but I will have other expenses like travel and hobby expenses, oh, and more medical. Can't I live on about half what I do now?
This.
I'm not worried, but I pay attention to it. We are 45/46, and have 3.3 times our salary, even though the calculators say we should have 4x by now.
We don't have kids, DH will have a pension, and it is a priority to have the mortgage paid off by the time we are 65 (which is when I estimate I will retire. I will retire sooner if possible, and if it's possible to have healthcare before I am medicare age.)
In talking to my aunt, who has never been married/doesn't have kids, and still managed to retire at 67 a couple of years ago, she said it costs waaaaay less to live than she expected. She worked her butt off to pay off a 15year mortgage on a small house, and because of that, she says she has no worries.
Travel is a priority for me right now while we are working and healthy. Due to genetic and my own medical history, I think I will absolutely not be able to work past 65 and that it will be difficult to travel by then. If your mortgage is paid off, and you aren't spending a lot on travel, it doesn't cost that much to live.
I’m surprised the calculators say you’re fucked. The rule of thumb I always heard was 1x income in your early 30s and 2x by 40.
We’re behind on retirement (DH is dragging us down! I started saving years before he did) but I’m way more worried about my parents. I think they have less in their 401k at age 64 than I have in my own, at about half their age.
This is another way I'm worried that the insane housing market in VHCOL/HCOL places will screw our generation. I don't expect to buy a house (barring some unexpected financial windfall), which means I don't expect to pay off a mortgage by 65 and have an inexpensive place to live during retirement. Which means my retirement calculations should also include rent. Which means I'm even further behind than I thought.