Did Anyone Retire with "Only" .75M$ Saved?

[NXR7]

Ummm... If I could get 25%/yr return, I would invest a whole lot more than $25K. I would go borrow money up to my eyebrow to invest.

Our first mortgage was 10.5% because interest rates were through the roof. So were prices. CD's were paying around 17% or so, I think. A 25%/yr return today is great but maybe not if inflation rockets.

Ray

 

[almost there]

Depends on other assets.
I did, but have another $3800 a month coming in.
With SS still 5 yrs away.

Depends on your situation.

 

[IrishMoss]

You folks really need to add the lump sum of social security expected to your total portfolio to get to one total portfolio number.

If you determine you only have $700K for retirement but oh yeah, there's another $700K that will be coming in over the course of 20 years when you start taking SS benefits, and that will be another $35K/year, you're *not* just retiring on $700K. Rather, you are actually retiring on something between $1.2M to $1.3M to start (assuming net present value computation added to existing portfolio investments). That's a huge difference than "just" $700K.

Social Security and pensions are guaranteed income. IF you will get them count them as part of your total portfolio. You can do an NPV (net present value) calculation to get the 2019 lump-sum value of social security and/or pension to add to your existing portfolio total for an accurate total.

 

[almost there]

Never banked on SS. Or a pension. Never did.
Will be nice, and believe it will happen.
Just never put it into the plan.
Helped me in the long run.

 

[Old Microbiologist]

We did it but also have 4 pensions that amount to $6k a month. Living expenses are less than $2k a month. We retired to Hungary where the cost of living is low and medical is excellent and cheap. It is so cheap I rejected to keep paying for Medicare to keep my military Tricare so that is gone and I don't regret the decision. Our cash expenses for medical is less than that Part B premium. We have a fantastic house with swimming pool and travel a lot. We have expensive hobbies including a yacht and still it is not a problem and we haven't touched our 401k's at all. $450k is in equities in a brokerage account which my SWMBO dabbles as a Day Trader when she is in the mood and has a daily goal of $700. For what I can never figure out but she does well and it all stays in the equity account. She grew our reserves (401k's and brokerage account) more than $300k since we retired 9 years ago so now it is over a million. All of our 401k's were rolled over into equity accounts on Scottrade which is now TD America and we handle those ourselves. Now we are into the mandatory withdrawal age so just move it into the equity account at a rate which based on taxes is minimal for the lowest taxes. We pay cash for everything and have zero debt. We also have no property taxes which is one big reason we moved here.

 

[Elizrogers]

I retired last year with only $200k in my 401k. Living on social security and trying to take only about 10k/yr out for annual expenses like auto & home, taxes etc. This year will take 13k, as had some unexpected home maintenance pop up. I still have a mortgage and an old car, so you all are way ahead of me. But since you already live below your means it should be easy for you to manage. My big adjustment has been not buying anything I wanted whether needed or not and having to shop around for best prices on utilities, insurance etc. But I'm doing fine. I made a trip from Texas to Oregon for my 50th high school reunion. The biggest expense there was boarding 3 cats for a week.. And shorter trips to Arkansas.

I say if you're no longer looking forward to going into work everyday, all day, retire. You should be fine. If you start to worry too much after the first year, you can always get something part-time or short-term to bring in a little extra. Your house is paid off, so should you outlive your money (not likely), you can always reverse mortgage your house for a few hundred thousand to keep you going. So, there's a Plan B in case of worst case scenario. So, go for it.

 

[ckelly78z]

A BIG equation factor for this question is where you residence is located. We have a rural 10 acre farm in NW Ohio...which has a very low COL, and has been paid off for 5 years now, and i'm only 54. We don't live near a large metro area with all of it's entertainment temptations, or HCOL. We are also very happy cooking good meals at home, and while camping with friends, and family.

Another BIG factor is your sense of satisfaction. I have had the same job for 30 years, the same house for 25 years, and the same lovely DW for 31. This stability allows me to concentrate on other things rather than chasing expensive dreams.

 

[pj.mask]

I don’t think we should include Social security unless you retire <10 years to payments. (Almost) everyone should get social security.

An alternative might be retire spending $30k a year.. the paradox being most who can save this sum early would likely be high compensation and tempted to work a few more years to double that amount. Those who save up to 750k later in life have probably lived a long time on low income.

 

[indiajust]

But of course! ER Eleven years ago at 45, had just over 100k in IRA, a bit more than that on the taxable side, plus house and mortgage. Exited 2015 with 220 in Roth and 400 on taxable side, house/mtg/possessions/career in rear mirror.

Unlike many here, I have no interest in real estate, paid up or not. As long as I can pay rent, I'll have a roof. No security illusion.

 

[NW-Bound]

Our first mortgage was 10.5% because interest rates were through the roof. So were prices. CD's were paying around 17% or so, I think. A 25%/yr return today is great but maybe not if inflation rockets.

Ray

My first mortgage in spring of 1980 was 14%, FHA assumable loan. There was another 0.5% mortgage insurance on top of that, if memory serves. Later in the year, the rate went up another 1 or 2% before retreating.

So, a 25% investment return would still be a pipe dream then.

And if inflation in the US ever gets to 20%, well, I will not say it cannot happen because a lot of weird unimaginable things has happened before, but if it does, I don't know what life will be like.

 

[Maidensong]

We retired with less than $500K in our IRA, but we have no debt. We live in a LCOL area. We own ten rental properties and have a very small pension, which we've been living on, and have other funds in a stock account that we tap for travel (21 day cruise to Norway booked for next month!) We've been on ACA insurance since we ran out of COBRA, but will switch to Medicare by next year. Once we start SS when the DH turns 66, we'll be able to bank a good bit of our rental income. We consider the money in the IRA gravy and won't touch it until we're forced to by the government.

A million in the stock market isn't the magic bullet when it's time to decide if you can retire. We wanted to have several streams of income--pension, rental, SS, our taxable stock account and finally, the IRA. We sleep well knowing if something happens to one stream, the others are there to fill in the gap.

 

[JJpop]

Well when you figure that probably 80 pct or more people retire with less than 750,000,it must be very doable.

 

[foxfirev5]

It's funny to me that these threads are where the "I've got a pension and SS that cover my expenses people chime in". IMHO it kind of misses the point. Humble brag perhaps?

 

[24601NoMore]

It's funny to me that these threads are where the "I've got a pension and SS that cover my expenses people chime in". IMHO it kind of misses the point. Humble brag perhaps?

I've always been surprised at the seemingly high number of people on ER.org that have a pension. I know VERY few people that do - only muni, state and Fed .gov workers, teachers (less so nowadays) and that's about it.

All I know is that pensions in my or DW's business simply don't exist - and haven't for decades (40+ years) now. Heck, at my last company they only (after I left) recently introduced a 401K match. That was IT, although they did give us a handful of RSUs - certainly nothing equivalent to most pensions in terms of total $$s.

Would be an interesting exercise to do a poll of those who have pensions vs. those who don't among the users here. But then again, maybe it's precisely the fact that having a pension allows many to ER - and those who don't have a pension aren't on this site already because they in many cases don't have the income stream (via a pension) to even THINK about ER..

 

[ERD50]

... IMHO it kind of misses the point. ...

The OP is pointless (WADR). If this was a multiple choice math test question, it would look like this:

Given the equation X + Y = Z, if the value of X is 3, what is the value of Z?

A) Z= 3
B) Z= 0
C) Not enough information is given to provide a value for Z.​

The correct answer is C, not enough information. No more can be said.

-ERD50

 

[Ed B]

It's funny to me that these threads are where the "I've got a pension and SS that cover my expenses people chime in". IMHO it kind of misses the point. Humble brag perhaps?

Not a humble brag. It explains how some of us can retire with less than $2 million+. If we didn't mention the pensions, SoSec and/or real estate property revenue we would be very misleading by saying "Yes you can. I did!". The clarifications about those other revenue streams are critical to making the conversation of any value.

 

[Ed B]

I've always been surprised at the seemingly high number of people on ER.org that have a pension. I know VERY few people that do - only muni, state and Fed .gov workers, teachers (less so nowadays) and that's about it.

All I know is that pensions in my or DW's business simply don't exist - and haven't for decades (40+ years) now. Heck, at my last company they only (after I left) recently introduced a 401K match. That was IT, although they did give us a handful of RSUs - certainly nothing equivalent to most pensions in terms of total $$s.

Would be an interesting exercise to do a poll of those who have pensions vs. those who don't among the users here. But then again, maybe it's precisely the fact that having a pension allows many to ER - and those who don't have a pension aren't on this site already because they in many cases don't have the income stream (via a pension) to even THINK about ER..

I may be wrong but I THINK a survey like that was done a while back. Knowing that we rehash the same questions every 6 to 18 months I would be shock if some flavor of it doesn't exist. I will do a search and see if I can find one.

 

[24601NoMore]

I may be wrong but I THINK a survey like that was done a while back. Knowing that we rehash the same questions every 6 to 18 months I would be shock if some flavor of it doesn't exist. I will do a search and see if I can find one.

I suspect you're right..will be interesting to see the results, which I'd expect to show a very high # of ER'ers with pensions..

Unfortunately, we're in the "no pension" camp and have to slug it out in other creative ways..

 

[Ed B]

I suspect you're right..will be interesting to see the results, which I'd expect to show a very high # of ER'ers with pensions..

Unfortunately, we're in the "no pension" camp and have to slug it out in other creative ways..

Found one:

http://www.early-retirement.org/for...ension-factor-into-your-fire-plans-85562.html

 

[24601NoMore]

Found one:

http://www.early-retirement.org/for...ension-factor-into-your-fire-plans-85562.html

Thanks..so, 70+% have a pension..and 60+% say it has an impact on their ability to retire.

I'd love to know where all of these pensions are coming from. What companies are still doing pensions (and, can I apply )? Or is the 60-70+% all .GOV, Teachers and Auto workers?

 

[foxfirev5]

Not a humble brag. It explains how some of us can retire with less than $2 million+. If we didn't mention the pensions, SoSec and/or real estate property revenue we would be very misleading by saying "Yes you can. I did!". The clarifications about those other revenue streams are critical to making the conversation of any value.

IMHO $2 million + is a humble brag compared to the .750 million quoted by the OP, Just Sayin...

 

[jim584672]

I have a pension which was frozen in 2013. Private company, the new employees get no pension. It makes a substantial impact on ability to retire.

 

[Dtail]

Thanks..so, 70+% have a pension..and 60+% say it has an impact on their ability to retire.

I'd love to know where all of these pensions are coming from. What companies are still doing pensions (and, can I apply )? Or is the 60-70+% all .GOV, Teachers and Auto workers?

Well there does seem to be a decent number of current and former gov't workers on this site (besides and sometimes including some engineers).

So turning your comment around, would the 60% who say it has an impact on their ability to retire never be able to retire without the pension or just perhaps retire at normal retirement age with a lesser lifestyle.

 

[foxfirev5]

IMHO $2 million + is a humble brag compared to the .750 million quoted by the OP, Just Sayin...

Ed B - Upon reading your message I understand your point. Sorry for any misunderstanding

 

[aja8888]

I'd love to know where all of these pensions are coming from. What companies are still doing pensions (and, can I apply )? Or is the 60-70+% all .GOV, Teachers and Auto workers?

I think it's pretty evident that a high percentage of pensioners here are retired from the military, federal government, state government, teachers, and municipalities. Very few are here from private industry (like me - no pension, just SS ) or other private practices.