New Here - Will I have to work till I'm 90?

[Amethyst]

I second Moemg's suggestion. While having a roommate is not for everybody, it is a great way to save money by splitting the cost of mortgage/rent and utility payments. I did this when I was single. Sharing an apartment, plus earning all the overtime I could scrounge, made the difference between getting by, and saving $$ for my goals. I didn't always love my roommates, nor they me, but I got along well enough with one that she was Maid of Honor at my wedding.

If you do decide to share lodgings: Be careful, and not too trusting, when looking for someone who will join you in your home. You could advertise at your church (if you are a churchgoer), at your workplace if permitted [which is how I found all my roomies], in the newspaper, or on Craigslist. Be extra-extra careful and picky with the last two options; always get, and check, references.

Take care,

Amethyst

Hi Rose , Welcome ! You have had a hel- of a few years . Take a deep breath and figure out how you can cut back so you can save like crazy . I would consider a roommate and cutting all unnecessary spending . You also need to track your spending so you actually have a grasp on how much you need . Good Luck and I hope you get to retire !

 

[sunnysideup]

Hi Rose,

Similar to the advice you have already been given: Read and learn, there is so much info out there. Save as much as you can, that is AS important as where you invest.

Regarding the annuity, you said you are getting 3% guaranteed. While it is not the choice of most people for the majority of their portfolio, if I were you I would leave it there until I figured out what I would be doing with it. It's getting you alot more than any cash fund currently gets, so you could consider it your stable fund as you start to increase your portfolio in stocks. When your portfolio is larger, it won't be such a large portion and maybe you will be happy to have it there. Again, this is not the best place for it but I wouldn't jump and make any move on it until you are confident with where you will put it.

Being a single woman is tough financially, (I was there too and understand how tight finances can be), and I applaud you for your positive attitude and resolve. Have you read any basic personal finance books? I recommend Smart women finish rich by David Bach. Ignore the "rich" part, it just is sound, basic financial advice that you may find helpful.

I wish you all the best.

 

[EvrClrx311]

Have you read any basic personal finance books? I recommend Smart women finish rich by David Bach. Ignore the "rich" part, it just is sound, basic financial advice that you may find helpful.

+1

the first financial book I read was "Smart Couples Finish Rich" also by David Bach - a graduation gift from my parents. He does a great job of getting key financial points across in an easy read. I can thank that book for laying the foundation of what became my almost obsessive draw towards maximizing savings (at least in comparison to almost all of my peers).

 

[tmm99]

I second Moemg's suggestion. While having a roommate is not for everybody, it is a great way to save money by splitting the cost of mortgage/rent and utility payments. I did this when I was single. Sharing an apartment, plus earning all the overtime I could scrounge, made the difference between getting by, and saving $$ for my goals. I didn't always love my roommates, nor they me, but I got along well enough with one that she was Maid of Honor at my wedding.

If you do decide to share lodgings: Be careful, and not too trusting, when looking for someone who will join you in your home. You could advertise at your church (if you are a churchgoer), at your workplace if permitted [which is how I found all my roomies], in the newspaper, or on Craigslist. Be extra-extra careful and picky with the last two options; always get, and check, references.

Take care,

Amethyst

I would probably get a roommate too, like Amethyst and Moemg said. I would choose one carefully. Amethyst idea sounds good to me.

 

[rescueme]

While having a roommate is not for everybody...

I tried to get one (female, age 20-30, with considerable "assets"), DW rejected the idea.

(Just to throw some humor on a very serious discussion ...)

 

[Amethyst]

One of mine actually fit that description. I saw her again recently, and the assets had, shall we say...compounded over time, but were not quite as inflated as I remembered

A.

I tried to get one (female, age 20-30, with considerable "assets"), DW rejected the idea.

(Just to throw some humor on a very serious discussion ...)

 

[CMH in CO]

Rose,

Welcome. +1 on Midpack's suggestion about your 401-K. Fidelities Freedom funds are a good fit for you for now at least while you are becoming more financially savy. You can move it into that fund by phone call or Internet. Your employer has paid a fee for your 401-K plan for the benefit of employees. Usually that comes with low fees in the fund choices for employees and the fees are clearly shown. You can also choose several levels of risk. The higher the fund year in the Freedom funds, the higher the risk. So if you want a more conservative fund, go with 2015 or 2010. You must have been sent information about your 401-K. Take advantage of what you already have easy access to.

Cass

 

[kombat]

I know it is risky, especially after the 1st year but Day Trading is one way to earn more.

Yes, of course! "Become a day trader and get rich quick," I was JUST about to suggest that!

 

[Milton]

I appreciate the willingness of board members to share their own experiences, and am glad this idea worked for someone. But you should remember that the vast majority of Day Traders lose most of their money. For most people this is a path to ruination.

Quite so.

From the sounds of her posts, it doesn't appear that Rose is financially sophisticated, and for her this strategy would probably amount to little more than 'investing' her savings in lottery tickets.

 

[EvrClrx311]

Yes, of course! "Become a day trader and get rich quick," I was JUST about to suggest that!

Piece of cake. Just hit the right button... I mean the left one.

 

[YoungSaver]

+1

the first financial book I read was "Smart Couples Finish Rich" also by David Bach - a graduation gift from my parents. He does a great job of getting key financial points across in an easy read. I can thank that book for laying the foundation of what became my almost obsessive draw towards maximizing savings (at least in comparison to almost all of my peers).

Great book, even for single people.

 

[BigNick]

The key to your retirement isn't picking the right fund, it is figuring out how to save more between now and then, either by finding a better-paying job or to trim expenses at your present salary. The key is adding money to your retirement accounts.

Absolutely. Given the past 10 years of returns, nobody should rely on any investment doing better than beating inflation during the accumulation phase. If it does, then great, you can retire 1 or 2 or 5 years earlier. But the only reliable way to accumulate money is to save it.

My chosen method was to pretend that I was subject to a payroll deduction about which I could do nothing. Every pay-day, 10% or 20% of your salary "evaporates". It's a lot easier to resist the temptation to withdraw from a retirement account, that to take it from your checking account at the ATM and spend it. Once I started, every time I got a raise, at least half of that (and by the end, it was 100% of it) went to this "deduction". Boy, would I have voted for a candidate to reduce the overall rate I was "paying" by the end!

 

[jclarksnakes]

I do not think you will have to work till you are 90 if you make some smart moves now and in the future. 3 bedrooms is a lot of living space for a single person. At some point in the future it may be too big for you to maintain anyway so why not look at financial ideas about getting rid of it now or at the very least getting a roommate to help with current expenses? EXCELLENT advice from Sarah and BigNick and others about concentrating on the savings more than on the specific investments. It looks to me like SS will be the biggest part of your retirement. The longer you wait to take it the better. Spend some time learning about benefits available for ex-spouses. it will probably work out best for you to take the ex-spouse benefit at age 66 and then take your own enhanced benefit at age 70. If you get enough saved over the next decade you very well may be able to retire at normal retirement age of 66.

 

[sheehs1]

I do not think you will have to work till you are 90 if you make some smart moves now and in the future. 3 bedrooms is a lot of living space for a single person. At some point in the future it may be too big for you to maintain anyway so why not look at financial ideas about getting rid of it now or at the very least getting a roommate to help with current expenses? EXCELLENT advice from Sarah and BigNick and others about concentrating on the savings more than on the specific investments. It looks to me like SS will be the biggest part of your retirement. The longer you wait to take it the better. Spend some time learning about benefits available for ex-spouses. it will probably work out best for you to take the ex-spouse benefit at age 66 and then take your own enhanced benefit at age 70. If you get enough saved over the next decade you very well may be able to retire at normal retirement age of 66.

I was thinking along these same lines because I would be concerned about your current level of savings.

You have a mortgage debt on your house of $104,000 so while you say you have no other debt, you do have debt. You also have "costs" for that home. Have you considered how much it costs you to keep your house each year? I bet you would be surprised.

Add up your costs (home insurance, property tax, maintenance costs) and see what that is. I bet it is around $2,000 or more a year. That's over $20,000 more dollars in 10 years.

If you are struggling to save $150 month in your 401 K, think about how you might feel to save the total of your housing costs each year for the next 10 plus years with compounded growth on top of your current 401K contribution. It adds up over time.

You also don't mention how much equity you have in your home. If you sold, you could pull this out and save it as well. (with any luck in this market anyway).

Yes you will have to rent something but you will not have the overhead costs of home ownership. You may be subject to rent increases but you have the freedom to move if that happens.

Just some thoughts.

P.S. Like some others have said, I also would see what you can do to cancel that annuity. You may have to wait past the time frame for surrender charges or perhaps you take the guy that sold it to you to task because quite honestly from what you have written "having access to your money" should have been more important that locking that principle up for life...at this point. At least that is how I would have been thinking. You didn't have enough liquid assets for him to advise you in this manner. What if you had an emergency? You could really make a stink about this if you wanted to.
When did you buy it?

 

[vttlarry]

Rose, welcome to this forum and kudos for weathering the storm(s). Life can be not so nice at times, but we have to just keep trying. Beats the alternative.

I joined this forum about 9 months ago when I retired. I have been married to my second wife almost 24 years, so I have an understanding of breakups, although I was younger then.

I have read all of the posts and here are some of my comments:

1. You do seem to want someone to tell you what to do, which of course, none of us can. Advice, counsel, sharing of stories, yes. In the end you must decide. That being said, right now I would say the greater importance should be on saving what you can (including investments) and lesser importance on where you put it. Putting it in one fund targeted to your time horizon makes as much sense as any. And try not to get down when your account loses money: as long as you have a time horizon to work with (and you have at least 9 years), look at it this way: when the market goes down, you are buying more shares in your investments. Eventually, that means you make up the loss and then some.

2. It would likely be costly to get out of your annuity, and 3% is not all that bad, especially if you consider that as a more conservative "fixed income" portion of your portfolio. $160 a month, when added to $1200 a month, plus what you will be able to withdraw from your investments, well, it all adds up.

3. You are putting 11% in your investments (plus your employer match). That aint earth shattering, but it isnt bad either.

4. There are lots of suggestions on how you can cut expenses: rent, take on roommates, etc. You are the best judge of what you want and what you can tolerate.

Bottom line is, be comfortable with whatever you choose. You do not have enough funds, like millions of Americans, to make a killing in whatever investments you do choose. Be comforted in knowing that you are putting money away each month, it is growing, and really, what else can you do.

I look forward to hearing your comments as time goes on. Good luck.

Larry

 

[Rose3408]

Thank you

Hello Sheehs1 & Vttlarry and thank you for posting a reply. In regards to some of your questions, you are correct, my mortgage balance is $104k and home assessment having gone down another $25k this year is appraised at around $160k, so their is equity.

NOW would NOT be the time to sell given the market. However, you are correct 3 bedrooms for myself is more than I need, and when the market changes I plan on changing too, and selling. I just love my home, as do many others in the neighborhood, and I have several people waiting should I ever sell, but I want to wait as am not ready yet.

As mentioned earlier, I contribute 11% of my income into my 401k at work which equals to $338 a month + the $122 my employer matches, which means I am contributing $460 a month to 401k. I also make sure to put in at least $200 a month into a savings account for liquid assets. I opened up an IRA with Fidelity when I rolled over an old 401k. I put those funds into the Fidelity 2020 funds.

If I manage to SAVE LIKE MAD and focus on continually contributing into my 401k without looking at the statements and fearing the worse, and also contribute into the IRA, hopefully, I should be fine.

I just wish SS would tell me what my "expected" monthly payment would be if I choose to go with 50% of my ex's SS. The said, until I actually file they cannot share that information. Why not? If would certainly help in planning accordingly.

I know someone posted I am not a financial stable investor (which I thought was quite rude) but in any event he/she needs to remember that is the reason I came to this forum to get advise and learn from those more knowledgeable. I'll admit I am not the sharpest pencil in the pocket protector, but I am willing to learn, and although I started late in life in saving and investing, I am moving forward and applying what I learn from everyone.

 

[bltkmt]

Rose:

I am pretty sure you misinterpreted that poster's sentiment. I believe he/she was reacting to another poster's suggestion about day trading which is a very risky financial strategy and would not seem appropriate for someone in your situation. We all become more knowledgeable and "sophisticated" by doing the research and reading these boards.

 

[pb4uski]

.....I just wish SS would tell me what my "expected" monthly payment would be if I choose to go with 50% of my ex's SS. The said, until I actually file they cannot share that information. Why not? If would certainly help in planning accordingly.

I agree that this is silly. Could your ex provide such information to you? Just make sure that he understands that what you get doesn't affect what he gets in any way as many people don't understand that. Another alternative would be to get a rough estimate using the SSA website and estimating what he earns and then take 50% of it.

 

[EvrClrx311]

I know someone posted I am not a financial stable investor (which I thought was quite rude) but in any event he/she needs to remember that is the reason I came to this forum to get advise and learn from those more knowledgeable.

Rose, if you're referring to my post with the photo... that was not directed towards your financial intelligence, but rather the suggestion to day trade as a solution. Every day trader has his/her own systems, many that don't work, a few that do... what most seem to have in common is that they believe passing on their knowledge to others will suddenly make them rich... like they aspire to be.

It is dangerous to listen to anyone giving advice to buy and sell momentum driven individual securities (stocks)... no matter what investing background you and they come from.

Rose:

I am pretty sure you misinterpreted that poster's sentiment. I believe he/she was reacting to another poster's suggestion about day trading which is a very risky financial strategy and would not seem appropriate for someone in your situation. We all become more knowledgeable and "sophisticated" by doing the research and reading these boards.

+1

 

[rescueme]

I just wish SS would tell me what my "expected" monthly payment would be if I choose to go with 50% of my ex's SS. The said, until I actually file they cannot share that information. Why not? If would certainly help in planning accordingly.

You can get a "guesstimate" of his current projected benefits if you have two key bits of information - that is his SS# and the maiden name of his mother (assuming he spelled it correctly when he applied for his SS card, upon his first j*b), along with his birth date and state/location of birth, which I assume is common information.

Just plug the info into the following site:

Retirement Estimator

I'll assume you know the rules of a former spouse and the amount you can claim. Additionally, the amount shown for your ex may be slightly adjusted due to long ago military service (as mine is) since SS was not recorded for us long gone military folks, along with current/future income if he is still employed and contributing to SS.

I mentioned the spelling of his mother's maiden name. That's was a problem for me (applying for my SS card at age 16) since I knew the name but mis-spelled it on the application. A half-century later, I still have to use that mis-spelled name to get my information.

Just a note. If he has requested his info be "blocked" by the SSA, you will not be able to get the info; however I don't think a lot of folks think about this since you need more than a couple of common info data points to get access to the information.

Also, I can't blame SS for not giving you "projected" information. Too many things can change and they don't want to be liable for you making decisions on your future based upon the information they currently have.

Anyway, good luck to you.

 

[Rose3408]

Feeling silly

My sincere apologies for misinterpreting Milton's post saying "it doesn't appear that Rose is financially sophisticated, and for her this strategy would probably amount to little more than 'investing' her savings in lottery tickets." That is the problem with emails, they an so easily get misconstrued.

In any event, just looking for advice since I am by no means investment savvy. I am 50% of my 401k going into the PIMCO which I am comfortable with and the rolled over my old 401k into the Fidelity Fund 2020.

I'm just so confused now that I opened up a desperate Roth IRA, and when on earth to put my $$$. There are just too many choices. And I couldn't tell you the difference between stocks, funds, etc.

 

[Midpack]

In regards to some of your questions, you are correct, my mortgage balance is $104k and home assessment having gone down another $25k this year is appraised at around $160k, so their is equity.

NOW would NOT be the time to sell given the market. However, you are correct 3 bedrooms for myself is more than I need, and when the market changes I plan on changing too, and selling. I just love my home, as do many others in the neighborhood, and I have several people waiting should I ever sell, but I want to wait as am not ready yet.

You're not upside down on your mortgage, so if you plan to sell and buy a smaller home, now may be as good a time as any. While the value of your home may have fallen, most likely the value of your new, smaller home will also be off it's high. Interest rates are low, so you can lock in a low rate on the new mortgage too.

OTOH you can wait and hope to sell your current home for more, but your new, smaller home will most likely be more expensive then too. You may gain nothing in terms of equity by waiting, and continue to bear higher home ownership expenses (insurance, prop tax, utilities, etc.) while you wait. And interest rates may well be higher then adding to your cost, and discouraging would be buyers for your old home.

Just something to consider...

 

[Katsmeow]

While the value of your home may have fallen, most likely the value of your new, smaller home will also be off it's high.

Good point. We sold our house last year for less than we paid for it in 2006. We didn't like that very much. That said, we bought a downsized house this year and paid less for it than the sellers paid when they bought it in 2007.

Yes, we on paper lost more on our sale since it was of a more expensive house than we bought. However, the maintenance and other costs associated with the larger house we sold are much greater than with the new house so in the long run selling the big house -- even at a lower price than we liked -- will work out better for us financially than keeping it several years with all those costs and then selling and buying in a higher priced market