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Old 09-23-2014, 05:46 PM   #21
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Thanks for the information. Yeah, I feel like I am late to the game. I was looking at all the 529, but NJ does not give any tax break so was thinking of going with out of state with low fees and performing well.So difficult to choose.I will tackle one thing at a time.But so much to do, don’t want to drive the wife crazy.
There is a $1500 scholarship for the first year if child goes to NJ college.
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Old 09-23-2014, 06:11 PM   #22
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I hope the snowball is fast.I feel like time just goes by so fast.I am trying to keep it simple, but this sounds difficult when you say find some index funds to match your ratio! I will pick it up with reading the forums and books I ordered.What 529 plan did you go with?Thanks.
The lazy portfolio or couch potato portfolio are pretty simple.

For example - if you wanted a 60/40 asset allocation - 60% equities, 40% fixed income. You could go super simple with 60% of your investments in a total stock market index fund, and 40% of your investments in a total bond market index fund. That's about as simple as you get.

Another option that's even simpler - Vanguard's Wellington or Wellesley funds. They are relatively low cost, not quite as cheap as index funds - but still cheap... and they do the asset allocation for you.

Link to some sample portfolios.
Lazy Portfolios - Couch Potato Portfolios - AssetBuilder Inc., Registered Investment Advisor

I think the 529 we have is for Nevada. Mind you we live in CA - but since there is no break for investing in the less-than-wonderful CA plan - we are in the Nevada plan.
https://personal.vanguard.com/us/wha...529?Link=facet
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Family from NJ trying to start planning for retirement… a little behind the ball
Old 09-24-2014, 07:23 AM   #23
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Family from NJ trying to start planning for retirement… a little behind the ball

How is your spouse to all of this. I suspect she is a big part of the spending issue. Is she on board? Are you both really and truly ready to change lifestyle ? It's pretty tough to change your attitude about money when you are already in your mid 30s... Not impossible but maybe 1 in 5 actually succeed in making all the changes necessary to get on a path to financial independence. If you are accustomed to keeping up with the neighbors it will be really difficult to not care about the neighbors starting Monday morning. That's what you have to do.

My bet is slow or no progress when you check back in 12 months from now. Not being negative but given a half lifetime of spending it's really gonna be hard to change from being profligate to miserly, unless you grew up poor and money was tight and you know how to live that lifestyle again for a decade or so to "catch up"


I calculated that you have approximate net worth today of ....zero. (I gave you about 25k credit for the type of cars you probably drive). That's better than being negative but you can't live long on zero.

Guard those pensions with your life.









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Old 09-24-2014, 08:20 AM   #24
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How is your spouse to all of this. I suspect she is a big part of the spending issue. Is she on board? Are you both really and truly ready to change lifestyle ? It's pretty tough to change your attitude about money when you are already in your mid 30s... Not impossible but maybe 1 in 5 actually succeed in making all the changes necessary to get on a path to financial independence. If you are accustomed to keeping up with the neighbors it will be really difficult to not care about the neighbors starting Monday morning. That's what you have to do.

My bet is slow or no progress when you check back in 12 months from now. Not being negative but given a half lifetime of spending it's really gonna be hard to change from being profligate to miserly, unless you grew up poor and money was tight and you know how to live that lifestyle again for a decade or so to "catch up"


I calculated that you have approximate net worth today of ....zero. (I gave you about 25k credit for the type of cars you probably drive). That's better than being negative but you can't live long on zero.

Guard those pensions with your life.









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I'm hoping that the OP's wife is on the same page. It's also not as dire as you paint it. They have ($100k + $45k) debt and ($250+$75+$40+$6k) in assets. To me, that adds up to more than zero with my math... They've paid off a big chunk of their house and have not debt besides the house and student loans.

Lets not deflate the guy before he tries. Lets encourage him. I agree that the wife needs to be on board... but I disagree that it's a lost cause. In some households the wife is actually the driver of the budget cuts.
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Old 09-24-2014, 08:23 AM   #25
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I calculated that you have approximate net worth today of ....zero. (I gave you about 25k credit for the type of cars you probably drive). That's better than being negative but you can't live long on zero.

Guard those pensions with your life.









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His net worth is 226K. You didn't include the value of his home. I think he is doing very well for a guy with two pensions.
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Family from NJ trying to start planning for retirement… a little behind the ball
Old 09-24-2014, 08:37 AM   #26
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Family from NJ trying to start planning for retirement… a little behind the ball

Yes. Fair points as I didn't count the primary residence. And he can't get to his pensions for another probably 20 years. Could sell the house and pay rent to eat of course but I doubt it would cash flow. "Early" retirement not highly likely. Retirement at 65 yes but who the heck wants to do that on an ER board !!

Family age 34 /33 should have 3x-4x their annual income saved. That would be 600k. He has pension but no detail on the value of it today or in the future. Nor how secure his job is for the next 20 ...let alone his wife's job.

Age 33 wife. Means baby 2 comes within the next 3 - 4 years. Then full time mommy-work likely to follow ?

Not popping anyone's bubble but I am still a skeptic. The savings rate is just too low for too long to be able to make a 180 degree change. It's not so much the math - he has the income and pension - it's the behavioral spender vs saver mentality that will break them.


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Old 09-24-2014, 12:27 PM   #27
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34 years! You're not late to the game! You're one of the lucky ones who came to this realization early.

You have made a great start with the books you're reading. Take your time to understand the various aspects - earning, spending, savings, investment, taxes, knowing when you have enough etc.

You sound very excited and anxious to get started. But take your time especially with your investment strategy. That requires knowledge & planning & mistakes hurt more than the delay needed to get the facts & a good plan.

All the best.
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Old 09-24-2014, 12:53 PM   #28
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Yes. Fair points as I didn't count the primary residence. And he can't get to his pensions for another probably 20 years. Could sell the house and pay rent to eat of course but I doubt it would cash flow. "Early" retirement not highly likely. Retirement at 65 yes but who the heck wants to do that on an ER board !!

Family age 34 /33 should have 3x-4x their annual income saved. That would be 600k. He has pension but no detail on the value of it today or in the future. Nor how secure his job is for the next 20 ...let alone his wife's job.

Age 33 wife. Means baby 2 comes within the next 3 - 4 years. Then full time mommy-work likely to follow ?

Not popping anyone's bubble but I am still a skeptic. The savings rate is just too low for too long to be able to make a 180 degree change. It's not so much the math - he has the income and pension - it's the behavioral spender vs saver mentality that will break them.


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It is indeed difficult to go from a spender to a saver but not impossible and as I recall a lot of people on this forum have done it. For me the best approach to keep me from spending was to always take my retirement savings up front. The percentage was basically fixed and what was left over I could do what I wanted, pay off debt, save for college, living, travel, toys. But the retirement has to come off the top. You have to feel that you never had that money, for all practical purposes it doesn't exist until you retire. You can never draw it down for emergencies, layoffs, loans, etc, because it doesn't exist. Until you retire that is.
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Old 09-24-2014, 01:32 PM   #29
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Yes. Fair points as I didn't count the primary residence. And he can't get to his pensions for another probably 20 years. Could sell the house and pay rent to eat of course but I doubt it would cash flow. "Early" retirement not highly likely. Retirement at 65 yes but who the heck wants to do that on an ER board !!

Family age 34 /33 should have 3x-4x their annual income saved. That would be 600k. He has pension but no detail on the value of it today or in the future. Nor how secure his job is for the next 20 ...let alone his wife's job.

Age 33 wife. Means baby 2 comes within the next 3 - 4 years. Then full time mommy-work likely to follow ?

Not popping anyone's bubble but I am still a skeptic. The savings rate is just too low for too long to be able to make a 180 degree change. It's not so much the math - he has the income and pension - it's the behavioral spender vs saver mentality that will break them.


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I had a similar net worth at that age, hadn't had my kids yet (but DID continue working after I had them). I retired this year at age 52. My 40's were the big shift for me. We relocated to a high COLA, but also found lots of free stuff to occupy our time (beach, etc). By changing our spending priorities, we were able to divert more to savings.

I'm not suggesting the OP's task will be super easy. But it is doable. The OP has shown some discipline already - significant portion of mortgage paid down at a relatively young age. No debt other than mortgage and student loan. There have been folks here who turned stuff around from much worth scenarios. If the OP and his wife set their mind to it, it can be done. Even if they haven't hit the arbitrary age based milestones you suggest.
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Old 09-24-2014, 01:51 PM   #30
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As you are researching college savings and 529 plans, be sure to check out SavingForCollege.com here: The Internet Guide to Funding College and Section 529 College Savings Plans. Savingforcollege.com
Joe Hurley is a very knowledgeable source of information. It looks like the NJBEST 529 College Savings Plan is well ranked - you might consider it.
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Old 09-24-2014, 07:05 PM   #31
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I agree the OP's situation is not bad at all. Many people with higher educations start slower and then pick up steam later in life. I was near a $0 net worth at 36 and in the 16 years since I divorced and was unemployed over a year. But I was determined and now I have just over $500k in assets, not including a paid off house, and a vested gov't pension like the OP. So the OP can do it if the spouse is on board with the changes. (My problem is I can't get the pension for 13 years if I left now, but if I stay here for another 8 years - - then it will be immediate)
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Old 09-24-2014, 07:28 PM   #32
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Welcome aboard sergdman. I think you're off to a good start and you've got the right attitude. Heck, when I was 34, my net worth was negative.
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Old 09-24-2014, 07:58 PM   #33
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I got started at 32, made a lot less than you combined at that time. I have three kids, all born over the last seven years (maybe that is why I don't spend much, because I have no time to do it). You should be able to save a lot more, it is a mind set to live below your means. Doesn't mean that you cant have fun, but keeping up with the Joneses can't be a priority.
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Old 09-24-2014, 08:02 PM   #34
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I make comparable to your joint income now at 39 and have thanks to budgeting, great market the last five years and lots of savings gone from $75k net worth at your age to over 10x that amount.

If you can rein in expenses and invest a lot, you will definitely be able to retire on your mid 50's.

My two cents.
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Old 09-25-2014, 02:40 PM   #35
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How is your spouse to all of this. I suspect she is a big part of the spending issue. Is she on board? Are you both really and truly ready to change lifestyle ? It's pretty tough to change your attitude about money when you are already in your mid 30s... Not impossible but maybe 1 in 5 actually succeed in making all the changes necessary to get on a path to financial independence. If you are accustomed to keeping up with the neighbors it will be really difficult to not care about the neighbors starting Monday morning. That's what you have to do.

My bet is slow or no progress when you check back in 12 months from now. Not being negative but given a half lifetime of spending it's really gonna be hard to change from being profligate to miserly, unless you grew up poor and money was tight and you know how to live that lifestyle again for a decade or so to "catch up"


I calculated that you have approximate net worth today of ....zero. (I gave you about 25k credit for the type of cars you probably drive). That's better than being negative but you can't live long on zero.

Guard those pensions with your life.



Thanks my friend,I know it is not an easy task, hence the plea for help here on the forums.I would love to retire early if possible, but retire comfortably at the minimum.My wife is on board. Spending is usually vacations, and big ticket items such “want” items, motorcycle and third car.Motorcycle is sold and working on selling the third car.Buying things for our daughter and going out to dinner on weekends is what we spend the most on now. Our daughter is also what made us realize that we should plan a little better. We are worried about her, and like I said before, will be helping her plan her future.I wish I had advice and guidance about planning for retirement when I was 15, then I would be way ahead.
So hopefully it will not be a slow progress as you are claiming, but I believe it will be difficult.
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Old 09-25-2014, 02:51 PM   #36
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I make comparable to your joint income now at 39 and have thanks to budgeting, great market the last five years and lots of savings gone from $75k net worth at your age to over 10x that amount.

If you can rein in expenses and invest a lot, you will definitely be able to retire on your mid 50's.

My two cents.


Congrats, yes I should have invested heavily money 5 years ago. Now the problem is what its going to do in the next 5 years. Start investing and then another crash....this is were I am scared and lost. Why I will be doing research on how to invest.
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Old 09-25-2014, 02:54 PM   #37
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I had a similar net worth at that age, hadn't had my kids yet (but DID continue working after I had them). I retired this year at age 52. My 40's were the big shift for me. We relocated to a high COLA, but also found lots of free stuff to occupy our time (beach, etc). By changing our spending priorities, we were able to divert more to savings.

I'm not suggesting the OP's task will be super easy. But it is doable. The OP has shown some discipline already - significant portion of mortgage paid down at a relatively young age. No debt other than mortgage and student loan. There have been folks here who turned stuff around from much worth scenarios. If the OP and his wife set their mind to it, it can be done. Even if they haven't hit the arbitrary age based milestones you suggest.



Thanks, spending time with my wife and daughter is what I enjoy doing now.The problem is looking for the free stuff to do.Yes we went to the beach often this year, but also had dinners at the restaurant every time we went.From now on put into the retirement fund, then go out to eat if we can.
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Old 09-25-2014, 06:51 PM   #38
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Congrats, yes I should have invested heavily money 5 years ago. Now the problem is what its going to do in the next 5 years. Start investing and then another crash....this is were I am scared and lost. Why I will be doing research on how to invest.

The first step is to start saving/investing. If you do that, then you are not spending the money.
Decide on an asset allocation and at this point I would DCA into that allocation. Invest your monthly amount into whichever asset is behind. Or if you decide to go into Wellington or another balanced fund and just invest in that fund monthly.
Just keep investing.
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Old 09-25-2014, 07:27 PM   #39
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Welcome to the forums. We cut our budget in our fifties to retire early so you are getting an earlier start than we did.

To cut our restaurant and entertainment budget we bought Entertainment books on sale. We go out for lunch with a buy one, get one free coupon and it has worked out great. We go out frequently and the cost isn't too much more than eating at home.

For entertainment our library actually has free tickets to about 30 local activities like zoos, plays, aquariums, museums and gardens. Also we bought memberships in a garden and a planetarium that belong to NARM, ASTC and AHA. Between the reciprocal museum / garden / planetarium memberships and the library cards, we get into all sorts of local and statewide attractions for free. Then of course there are the always free or low cost things to do like picnics, parks, farmer's markets, meetup groups, hobby clubs, beaches and bike trails.
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Old 09-26-2014, 08:46 AM   #40
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I don't think you're behind at all. When I was your age I was married, making less than half what you are, was in that stage of life where I felt I had to acquire everything (house, car, boat, electronics, etc) and had about $20K in the bank.

Twenty years, a second wife, and one kid later at the age of 54, I retired with seven figures in my portfolio.

You can do it and I think you are off to a great start - work on paying off your current debt, be very prudent with any additional debt you acquire, and invest as much as you can.
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