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Old 03-07-2013, 06:29 PM   #21
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I'm curious, why are you still working on and off now? I'm assuming it's because you have something you like to do that pays but you enjoy it so much you'd do it for free......... That's a really fortunate situation.
Yes, it is a home business that started as a hobby. It is fortunate in some ways, but then again there is some truth to the saying you make your own luck. We put in a lot of hours over the years to get things to where they are today.
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Old 03-07-2013, 07:09 PM   #22
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I don't know where to start. First of all using current income to project retirement needs is irresponsible to say the least. My DW and I saved over 50% of our income in our peak years and currently live on less than that just prior to retirement. It's all about expenses in relation to income. These clowns can't grasp that there are actually people out there who do not spend every cent they make.
As far as healthcare goes -who knows. At some point you have to take a leap of faith and go for it. I'm getting closer.
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Old 03-07-2013, 07:33 PM   #23
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Doesn't anybody screen this stuff before it goes to press?

Sorry, I forgot this is the internet age where journalistic standards are tossed to the wind in order to get people to the websites.
Agree. OP's article is unclear on many points, inc whether income was gross or net (after-tax). That marginal tax rate after retirement can make HUGE difference.
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Old 03-07-2013, 08:11 PM   #24
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I was on the Schwab web site at lunch today and on a lark decided to take their "retirement quiz." My answer to the question, "how much income do you expect to need in retirement?" was 70% (which, IMHO, is high). Their answer was between 90% and 100% because studies show that many retirees, in the early years of retirement ,actually spend more than they made while working. That may be true, especially if one plans bucket list travel or whatever, but only a fool would do that without planning.
Like so many things it varies by individuals. For me, I probably wouldn't have retired if I thought I would need 90 or 100% of my final income in retirement. I needed less than 40% of my salary when I was working "and was very happy with my lifestyle" so I can't even imagine needing more than twice that in retirement.
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Old 03-07-2013, 09:46 PM   #25
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Originally Posted by GalaxyBoy View Post
I was on the Schwab web site at lunch today and on a lark decided to take their "retirement quiz." My answer to the question, "how much income do you expect to need in retirement?" was 70% (which, IMHO, is high). Their answer was between 90% and 100% because studies show that many retirees, in the early years of retirement ,actually spend more than they made while working. That may be true, especially if one plans bucket list travel or whatever, but only a fool would do that without planning.
We set aside extra for the first few years as an extra "travel budget". That's easy to add to the planning without assuming one is going to spend the larger amount every retirement year.
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Old 03-07-2013, 10:33 PM   #26
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This, on the other hand, seems odd to me (my emphasis added):

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The survey also finds that, on average, respondents plan to work until they are 67 years old and expect to live to the age of 86, suggesting that they anticipate living off their retirement savings for less than 20 years. When asked directly how many years they anticipate living off of their savings in retirement, people say 21 years, on average.
Work until 67? Yuck. And they may not expect to live past 86, but if they don't plan to do so they are at severe risk for outliving their money unless the combination of SS and any pensions they may receive are comfortably more than their expenses...
I don't have a problem with the quote. You are talking about what people should plan for while the quote is asking what they expect and anticipate. It is reasonable to expect to live to 86. In fact, that is a little over optimistic for a 67 year old.

Actuarial Life Table

It would not be reasonable to expect to live to 95 or 100. However, it would be reasonable to plan to live to 95 or 100. However, I don't see the quote as saying that people should only plan to live to 86.
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Old 03-08-2013, 03:55 AM   #27
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Methinks these writers, as usual, underestimate the amount of that income that is not spent, but rather saved for retirement. AND they conveniently forget the drop in taxes after retirement - especially with lower income.
I wonder why we don't read many news articles about retirees who have far more money in retirement than they anticipated having.
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Old 03-08-2013, 04:48 AM   #28
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I don't know where to start. First of all using current income to project retirement needs is irresponsible to say the least. My DW and I saved over 50% of our income in our peak years and currently live on less than that just prior to retirement. It's all about expenses in relation to income. These clowns can't grasp that there are actually people out there who do not spend every cent they make.
As far as healthcare goes -who knows. At some point you have to take a leap of faith and go for it. I'm getting closer.
+1

We knew to stay clear of one potential financial consultant when they did not want to take into account our living on 60% of our income as a reason why we would not need 80-90% of our income in retirement.
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No, I Don't Think So....
Old 03-08-2013, 06:22 AM   #29
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No, I Don't Think So....

I guess the financial #s make my husband and me appear to be "affluent." (Yup, those Fisher Investment reps. worked on us for at least a year, trying to get us signed up ASAP.) But we've never viewed ourselves as better off than middle class.

We easily and happily live on 60% of the pre-retirement income. But we may have some special circumstances that make it possible:

--DH has tracked monthly expenses for several years, detailing our annual expenditures in all areas (so he knew when we could retire);
--We moved to Ohio from high-cost SF Bay Area in '96, tripling our lot and sq. footage;
--Pd. off house in 2000; invested unused mortgage pmt. since then;
--Continual LBYM;
--One of us (sometimes both of us) was/were always fully funding IRA's and 401K's since '85;
--We had only one son--adopted-- who was diagnosed with a brain disorder. So far, college has not been feasible for him. If he eventually does decide to try it again, I'm hoping our savings can help.

We live in a high-tax suburb, and have yet to down-size. (I'm reluctant to move away from the 400-acre city forest behind our house.) But, in terms of the expenses of living here, we don't feel immediate pressure to move.

So, if Grandma were still alive, I'd smile and say, "You were right!" She used to say, "Pay off that house and save your money."

Plus, she taught me how to iron, sew, and mend......even can vegetables (I gave up on that one). And so much of life's goodness comes free.
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Old 03-08-2013, 06:40 AM   #30
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Originally Posted by foxfirev5 View Post
I don't know where to start. First of all using current income to project retirement needs is irresponsible to say the least. My DW and I saved over 50% of our income in our peak years and currently live on less than that just prior to retirement. It's all about expenses in relation to income. These clowns can't grasp that there are actually people out there who do not spend every cent they make.
As far as healthcare goes -who knows. At some point you have to take a leap of faith and go for it. I'm getting closer.
Same with Ms G and I, if I didn't have Quicken reports on our spending patterns over the previous 5 year we would still be asking if we could ER.
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Old 03-08-2013, 06:59 AM   #31
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So much of it varies with the individual. I'm in the middle of reading Jeff Yeager's How to Retire the Cheapskate Way and it is reassuring to know that one can retire and be happy on $1,100/month in SS income.

Not that I'd want to, and barring some catastrophic event we'll never have to, but it does mean that it can be done.
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Old 03-08-2013, 07:36 AM   #32
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Like some others here, I live on about 40% of my previous income. This is without trying to be extremely frugal although I do have frugal habits.

I wonder what these writers are going to do after the baby boom passes through. One set of articles say retirees have too much money and society needs to claw some of it back; other articles say they don't have enough and need to work and save more until 70 or death, whichever comes first.
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Old 03-08-2013, 07:38 AM   #33
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We are living on 60% of pre-retirement gross income easily.
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