I have questions about money. LOL. I know nothing.

[lemoncupcake]

Are you paying anything to retirement/pension before your take home pay?


I agree that you can afford to take a reasonable vacation from your existing funds, but I do think you need to model out with a financial planner what your money will look like if you’re literally only adding $300 to any savings (retirement or non retirement) for the foreseeable future.

[sugarbear]

Apr 26, 2021 21:03:55 GMT -5 Roc A Bee said:

I’d 100% take a vacation.

Who are these people who think those with $700k saved and think you can’t afford a vacation? I’m so confused!

I totally appreciate this! Because the online calculators are all telling me that I "barely" have enough. 

[sugarbear]

Apr 26, 2021 22:33:44 GMT -5 dr.girlfriend said:

sugarbear , It's late, so sorry if this isn't super-coherent, but I would break this into three parts:

1. Am I where I should be for retirement now, and how much of that was due to the inheritance making up the gap?

2. What do I want to do over the next summer, even if it's a short-term loss in funds?

3. Is my budget sustainable going forward?

I think #1 and #3 are the biggest issues for me. If you made it to age 44 and only saved about $100k for retirement on your own, and the rest is due to splitting assets in the divorce or the inheritance (these are just examples, I don't know your full story), I worry that retirement is not "built in" to your budget, including the affordability of your mortgage and your extra cash going forward. Second, I worry that home is not affordable on your salary, although the rental income might help.

I think right now you're probably just getting your bearings, and it's okay if you are operating in the red for a little while during this adjustment period. But, in a few months, I would definitely come back to this board with more specific budget figures and see if we can help you figure out your single-parent budget.

100%
This is my concern. I have always known that I would inherit *some* money but did not know how much. I earn enough to cover my bills and that is it. There isn't much left at the end of the month -- certainly I could cut back on discretionary spending, but even in my budget, that's only about $150 per month. I definitely cannot afford my mortgage on my own, but could cover it for a couple months with cash savings. I'm close to the university and won't have difficulty finding a renter, but still, your concern is absolutely valid.

If I sold my house, I would probably get $1.1m for it and would need to spend $900k to get something similar. We could move further out of the city but I'm not sure the savings would be worth it. I am not opposed to considering it, though -- depending on where their dad ends up with his girlfriend.

What other $$ I'll get in the future is an unknown. Truly, could be $200k, could be $2m. A lot, frankly, depends on saving our family company through the pandemic. So far, so good. This is why, on top of my paltry teacher's salary, I haven't been overly concerned with retirement, but I'm now realizing that I need to look a little closer and cannot rely on the success of the company.

[wildrice]

Apr 27, 2021 11:45:00 GMT -5 sugarbear said:

Apr 26, 2021 21:03:55 GMT -5 Roc A Bee said:

I’d 100% take a vacation.

Who are these people who think those with $700k saved and think you can’t afford a vacation? I’m so confused!

I totally appreciate this! Because the online calculators are all telling me that I "barely" have enough. 

If you barely have enough, I'm completely fucked and I still plan to take at least 1-2 vacations every year 

To be honest, sometimes I think we're all screwed and should probably just enjoy our lives now since no matter what most of us do, we aren't going to have a lot of money in retirement. That's if the planet hasn't burned and we haven't all died of one of the future pandemics, at least. I'm half kidding but also not completely. I don't know what life will look like when I'm in my 60s or 70s, but it's possible I won't even be around to find out. I can't wait until then to do the things I want to do. I don't think you should either. 

(I'm obviously not a financial advisor, lol.)

[sugarbear]

wildrice, I know. There is a large part of me that just wants to say, eff it. We aren't guaranteed tomorrow so let's live it up. 6 months ago, I had nothing in the bank and just a faint hope that our company would a) survive and b) thrive enough that I can rely on it for retirement. I also had a spouse  . A lot has changed and it's going to take me awhile to get my bearings.

[Roc A Bee]

I’m also coming off a week of my FIL in ICU and nearly dying- and he’s not out of it yet. He’s 69 and not yet retired. So spend the money, go on vacation. You’ll still have lots of cash saved.

[sugarbear]

Oh, Roc A Bee, I'm so sorry to hear about your FIL. Sending your family strength.

[dragon's breath]

For retirement calculators, I like to mess with firecalc. Of course, garbage in = garbage out, but you can add in extra spending for old-age-care (just set more spending to start around the age you estimate you may need it), you can add SS, pensions, any money that might be there at the beginning, but go away, etc. Make sure you go through all the tabs on the top. I've messed with it to the point that even if I lost half my retirement savings today, I should still be ok, with room in the budget for fun. That was even before this year's market run up.

Fidelity has a good one as well, and you can get guest access, but only for so many days. I just remember that I liked it, when I could get to it.

[hocus2]

Apr 26, 2021 21:03:55 GMT -5 Roc A Bee said:

I’d 100% take a vacation.

Who are these people who think those with $700k saved and think you can’t afford a vacation? I’m so confused!

  I think most of that is retirement and the general thinking on this board is that retirement shouldn't fund vacations. I am certain a lot of folks use retirement to fund non-retirement things from time to time though this board is one of the most cautious group of folks when it comes to this sort of thing.

  Taking out a small percent to fund a vacation isn't likely to make that much of a difference if it is a one time thing. However the OP needs more liquid cash savings than others to cover any vacancy in her rental situation or other unexpected expenses because most of her regular earnings are already ear marked for the most part (seems like their is about $450 wiggle room each month). That is what gives me some pause though I do think a single vacation even on in the higher 4 figures isn't going to a huge difference and has some considerable mental health benefits. 





 

[spindle92]

This probably is going to get me flamed but my grandfather always said "spend your money and enjoy life because you can't take money to the grave."

Now I don't live and die by that but I do try to enjoy the now and not constantly worry about the future.

[sadlebred]

Apr 27, 2021 15:05:25 GMT -5 spindle92 said:

This probably is going to get me flamed but my grandfather always said "spend your money and enjoy life because you can't take money to the grave."

Now I don't live and die by that but I do try to enjoy the now and not constantly worry about the future.

Yep! This is why I have nice bikes & hobbies now....but also save for retirement.

Take the vacations with the kids.

[imojoebunny]

I would just look for cheap vacations, camping, house/pet sitting for friends in other cities, areas with cheap hotel rooms you can drive to, friends with vacation places. There are so many places to explore. We have had some of our best vacations in dirt cheap places my BFF and I would find when our kids were little, and we didn't have the means to go on fancy trips. My DD's pre-k teacher, DD is now 14, has long been our dog/child sitter, and he has used our mountain cabin because we know he will enjoy it and take good care of it. This summer he is keeping our two dogs for 5 weeks, and we will pay him enough to go on a nice trip before school starts. Keeping someone else's kids, especially as a teacher, for a week or so in the summer when their parents have to travel for work, could well pay for you and your kids to go on a decent vacation, if your willing, and it could be fun for your kids to have playmates. I realize this is predicated on a covid vaccine for kids or finding similarly minded families. Money is hard to save, and if you just can save what you have, keep contributing to your work retirement, and keep the duplex situation you have, you will be set for the long term. That is worth a lot of peace of mind to me, but DH and I are retired at 48, and our earlier creativity with spending and fun has paid off, but even if it didn't, we had some great trips that didn't cost a lot.

[cuadrado]

What is your mortgage interest rate? Would you save any money by refinancing?

[sugarbear]

Apr 28, 2021 6:53:13 GMT -5 cuadrado said:

What is your mortgage interest rate? Would you save any money by refinancing?

I refi-ed when I took exH off the mortgage and it's 2.75. I haven't looked lately, but I doubt I would save any money there.

[treschic]

You have plenty of money. Definitely take a vacation. Retirement is important but so
are memories with your kids.

[kershnic]

I clearly don’t go here, but I’m aghast that anyone is telling you not to go on a vacation. A real one if you want it, not just camping in the local state park if that’s not your jam.

Longer term, I think you need to work on both mentally and physically separating out retirement savings from e-fund from medium term fun money fund. If you were saving month to month for retirement I would say you could consider a significant chunk of this (like 100k+) as efund and/or medium term savings, as long as there is that much in accounts where you won’t take a big tax hit for early withdrawal. The fact that it sounds like you are not saving otherwise makes me pause a bit on the size of my recommendation. But whatever numbers you choose - separate. Have designated retirement money that you don’t ever touch no matter what with all the religiousity of MM. And then a separate account(s) to fund emergency house repairs and a desperately needed vacation.

[Roc A Bee]

Apr 27, 2021 13:28:40 GMT -5 sugarbear said:

Oh, Roc A Bee, I'm so sorry to hear about your FIL. Sending your family strength.

Thank you so much. He is getting better every day.

[jg183]

sometimes i tell my husband that if we dont enjoy life now what if we dont make it to retirement? Teaching through the pandemic? Go on vacation. Not a crazy one, but enjoy some time with your kids.

[redheadk]

Take your kids and go on vacation. You can afford it and a couple thousand for a vacation isn't going to make or break your retirement. It sounds like you are very careful otherwise.

My parents divorced when I was in high school. My mom used some of her inheritance to take us to Disney World once and on a cruise twice. They are some of the best family memories I have from high school and we still talk and laugh about those trips even now.

[niq]

What's the match on retirement savings going forward?

Are you okay with selling the house and moving somewhere cheaper when you get closer to retirement?

I think no matter what the answers are, I say take at least ONE vacation! Sorry about the divorce+money+house poor sitch :S.

[sugarbear]

May 1, 2021 22:45:42 GMT -5 niq said:

What's the match on retirement savings going forward?

Are you okay with selling the house and moving somewhere cheaper when you get closer to retirement?

I think no matter what the answers are, I say take at least ONE vacation! Sorry about the divorce+money+house poor sitch :S.

I don’t actually know 😬

I will absolutely sell and move into a smaller house or condo, for sure. This house is huge and great for the kids, for now. Once they go to college, I see no reason to stay.

All of those decisions were mine, and I’m relatively unscathed, so I really can’t complain.

[niq]

May 2, 2021 11:43:08 GMT -5 sugarbear said:

May 1, 2021 22:45:42 GMT -5 niq said:

What's the match on retirement savings going forward?

Are you okay with selling the house and moving somewhere cheaper when you get closer to retirement?

I think no matter what the answers are, I say take at least ONE vacation! Sorry about the divorce+money+house poor sitch :S.

I don’t actually know 😬

I will absolutely sell and move into a smaller house or condo, for sure. This house is huge and great for the kids, for now. Once they go to college, I see no reason to stay.

All of those decisions were mine, and I’m relatively unscathed, so I really can’t complain.

Yeah ... take a vacation . Though ... how does the house work? Do you have to split the profits with SBTX when you sell? Did one of you buy the other out?

The other other thing is if you think you might sub after retiring from teaching full time, it'll really help, you're fine.

[sugarbear]

May 3, 2021 12:21:10 GMT -5 niq said:

May 2, 2021 11:43:08 GMT -5 sugarbear said:

I don’t actually know 😬

I will absolutely sell and move into a smaller house or condo, for sure. This house is huge and great for the kids, for now. Once they go to college, I see no reason to stay.

All of those decisions were mine, and I’m relatively unscathed, so I really can’t complain.

Yeah ... take a vacation . Though ... how does the house work? Do you have to split the profits with SBTX when you sell? Did one of you buy the other out?

The other other thing is if you think you might sub after retiring from teaching full time, it'll really help, you're fine.

I bought him out, so the house is mine. 

I also own a company with my brother (I don't typically say what it is, online, but I think you may know? We make specialized sports equipment). The pandemic has not been kind to us, and in general I do not assume that the company will ever make me wealthy, but there is money to be had there, too. I try not to count on it.