Am I as far behind as I feel?

[mistershankly]

Quote:

Originally Posted by Mulligan I did everything backwards. I borrowed money to retire early and have contributed more money to my Roth in the past 9 years I have been retired than I did when I was working

Any details on what/how you did this, and what was the path that led you to borrowing? Was there a particular opportunity that arose or did you choose to maintain a mortgage, etc while investing aggressively in the market (and into retirement)?

[Mulligan]

Quote:

Originally Posted by mistershankly Any details on what/how you did this, and what was the path that led you to borrowing? Was there a particular opportunity that arose or did you choose to maintain a mortgage, etc while investing aggressively in the market (and into retirement)?

Machine it was just an odd set of circumstances. Due to the fact WEP slashes my SS, I was able to buy 4 social security service years onto my pension so I could retire early, as in my 40s. It was abit under a 100k to buy them. Good ol US Bank made a mistake and offered me a 0.99% credit card cash advance for duration of payment (no time limit), so I maxed it and made them pay for that dumb offer. So I borrowed about a third of that money on my CC and was still paying it off in retirement.
Im really just a cash flow guy, not a wealthy person. But cash flow is very good. Im pretty low maintenance person, but I only spend about 60% -65% of my monthly pension and its Cola’d. I didnt really have a lot of money when I retired compared to others here and certainly not enough for an early retirement at any age, maybe 70, lol. But it grows monthly and the day I die will probably be the most money I have ever had.
I still have 20 years or so to go on my mortgage and pay full rack rate individual health insurance from crappy exchange (dont take meds or get sick, so deductible doesnt hurt me). Mortgage payment which includes all escrows is only $750. Rural fly over country homes are cheaper, lol.

[Oakster]

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Originally Posted by Machine99 This is something I've been trying to figure out. So many variables. I know this is not the home we will retire in. I've been reading about paying cash vs mortgage and keeping money invested. Then I wonder is social security will even exist in 13 years.... I'm probably over worrying. I'll just stick with trying to save as much as possible for now...

I like the idea of having the plan. Estimate what you are going to need to have annually when you retire and create a plan to get there. The problem with not knowing is that you can get paralyzed by trying to analyze stuff without enough data. Its hard to save a lot to make a difference when you have debt, want a new house etc. With a good plan, you can know if you should knock out your debt and save little for the next year or two and then really crank it up, or what the next step may be.

[Perryinva]

Good stuff here. If $450k saved by 47 is behind, then either you have some lofty goals or I was WAY behind at 47. We have 2 pensions so that makes a difference but dang, don’t beat yourself over that! I had half that at 47 and could retire today at 60 if that was my goal.

[COcheesehead]

I just looked back at when I was 47. I had $1,335,000 put away. Today I have over 4x that. Signs of a good stock market, continued aggressive saving, rising RE values.
No pensions other than SS.

[kgtest]

If I were you I would plan to payoff Credit card debt within a year, and your mortgage before you retire.


Even at 7% avg returns on your current balance at 60 you would have almost $1million.


If you use 3% SWR that kick out 1,000,000 *.03 = $30k/yr for 30yrs.
If you use 4% SWR which is not as conservative, than $40k/yr for 30yrs.


Of course your COL should go down slightly after you quit working, most in the forum here have said this, with some stating medical or travel was more than they expected.



If you own a home, at some point you will downsize and can capture some equity minus LTCG.



So ask yourself, even if you had no home, and didn't travel, without any SSA, could you survive on $3,333 /month? My grandma lives on far less at 88yrs old and has for quite some time.


Anything more is a raise, which means you can blow more dough. So if you take SSA at 62, or 65 or whenever that is a raise.

[kgtest]

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Originally Posted by COcheesehead I just looked back at when I was 47. I had $1,335,000 put away. Today I have over 4x that. Signs of a good stock market, continued aggressive saving, rising RE values. No pensions other than SS.

How many years have passed since you were 47? I hear if you aren't taking withdrawals, you can expect your folio to double about every 5years on a conservative guesstimate.


If that is the case roughly 10years have passed?

[COcheesehead]

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Originally Posted by kgtest How many years have passed since you were 47? I hear if you aren't taking withdrawals, you can expect your folio to double about every 5years on a conservative guesstimate. If that is the case roughly 10years have passed?

I am 55 now. Keep in mind that includes savings, not just market returns.

[FreeBear]

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Originally Posted by brucethebroker Yep. But remember that the USA is filled with unemployed/underemployed former 6 figure earners who were "downsized" in their 50's, then never able to come close to that income when re-hired (if re-hired). Age discrimination is alive and well. Plan on your current income until age 50, then have a plan B and C ready (downsize your home?? One auto?? Add a PT job??) on the ready. It has happened to a number of us here....

Probably some of the best non-obvious career advice I have heard. I figured this out for myself only 5 years into my profession because my employer started offshoring. Between increasing chaos and general miserly added to my limited shelf life inspired me to near double my savings rate. I FIRE'd 15 years later. Having big savings and being willing to adapt will make all the difference and give you reasonable choices. I have been sounding a similar warning to young folks starting careers today.

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Originally Posted by Dtail Big +1 especially depending on how "young" your industry is. I took a package but was eventually going to be laid off just due to my age and comp. No one in my office was over 60 years old.

I w*rked in electronic tech. I was looking long in the tooth in my 40's. The 60 year olds were long gone and the 50 somethings were following them. Actually, this was a great gift since the ugliness compelled me to FIRE on my schedule and get on with the rest of my life instead of waiting the to decide for me.

[FreeBear]

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Originally Posted by Mdlerth But you must resist the temptation to raid your retirement to fund the BNE (The Big Nonrecurring Expense). However you do it, you need to keep your RE kitty out of reach. Add a line item to your budget for BNE accruals, build an emergency fund, lock up your IRA statement in a safe... whatever you do, just make sure you leave the long term savings alone so they can grow.

Yep, an emergency fund to "budget" for the "unknown unknowns". Agreed that we must make spending beyond the budget as inconvenient as possible.

Tons of good stuff on this tread. Will use many ideas to help some young friends who are just starting to get their career bearings. Must get to them before a life of max consumption takes hold.

[Clone]

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Originally Posted by FreeBear Yep, an emergency fund to "budget" for the "unknown unknowns".

I remember one of the 'fraternity brother' managers stopping by my desk. I think he was trying to share his visionary wisdom with me. He asked 'What is your plan for dealing with any unforeseen failure modes? What steps have you taken to eliminate those failure modes?' I thought about if for a moment, then responded 'I have designed those failure modes out of the system. If you have identified other unforeseen failure modes, please bring them to my attention and we can work on them.'

An emergency fund is an excellent way to be prepared for the unforeseen. And if the unforeseen never happens, then you are even better prepared to take advantage of previously unforeseen opportunities!