Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Do I Have This Right? *
Old 08-27-2004, 02:38 PM   #1
Recycles dryer sheets
 
Join Date: Jul 2004
Posts: 170
Do I Have This Right? *

If you start early enough, budget, and take sensible risk, there is no reason why anyone shouldn't be able to retire early. *

I've been running models that varies investement magnitude, frequency, time in market , rate of return, and target retirement level (e.g. $1MM)---you can achieve $1MM (non-inflation adjusted) by investing $3,000 month and 4% return in 15 years---to chase after larger returns, effectively does not reduce the time (in my opinion) to a level even remotely comparable to the cost and/or risk associated with it.

It seems to me that once you hit that $150 K mark...you are set--the POWER of compounding unleashes itself and it's a free ride to glory. *

Have I oversimplified this?

TD * :-/

"Do not subscribe to inflation...use it as an indicator to CUT your expenses...sometimes you gotta give all the bells and whistles that are offered by the market the FINGER!!"
__________________

__________________
Tommy_Dolitte is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: Do I Have This Right? *
Old 08-27-2004, 04:10 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,408
Re: Do I Have This Right? *

Nope

Simple is good - we retired with 350k in financial assets - mostly IRA basically didn't touch it - 1993 - 2003 went over 1 mil in 2000 back down 10% and back up to 950k or so this year.

Not pure - put and take into dividend stocks along the way (?10%).

But the decade was good, the general idea works, 90% of of ER stash at the start - index funds balanced 50/50 ala Ben Graham.

Some decades work better than others but the principle works. I did suffer a modest flat from 1966- 1982 - made slower progress then - but like De Gaul - ya gotta have faith.
__________________

__________________
unclemick is offline   Reply With Quote
Re: Do I Have This Right? *
Old 08-27-2004, 04:18 PM   #3
Full time employment: Posting here.
 
Join Date: Jan 2004
Posts: 844
Re: Do I Have This Right? *

>>If you start early enough, budget, and take sensible risk, there is no reason why anyone shouldn't be able to retire early.

Can't say that I agree..there is no way just "anyone" can retire early...savings $3000/month maybe easy for the upper income earners, like many of the folks here, but the median *household* income for 2003 was around $43K per year (thats household, not individual).

So if the median household income is $43K per year, thats 1/2 the people that defintely won't be able to save $3000 per month (unless somehow they can live on $7000 per year).

Don't lose your perspective on how fortunate one is to be able to do it; because clearly not everyone can.

I will concede, there are many people that *could* ER but don't think they can because of the lifestyles they have become accustomed to. (i.e. worshiping "things")
__________________
farmerEd is offline   Reply With Quote
Re: Do I Have This Right? *
Old 08-27-2004, 04:45 PM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,408
Re: Do I Have This Right? *

1966 - good salary - 8k was big bucks then - before index, IRA, 401k and all that stuff - the standard mantra I saw most - if memory serves was to put 200/mo into a 'good' mutual fund. I believe minimum wage was still 1.25/hr.

Fundamentals don't change - numbers may - but the earliest $ are still the best - the compounding effect of time works.
__________________
unclemick is offline   Reply With Quote
Re: Do I Have This Right? *
Old 08-27-2004, 05:30 PM   #5
Thinks s/he gets paid by the post
 
Join Date: Dec 2003
Posts: 1,375
Re: Do I Have This Right? *

Quote:
1966 - good salary - 8k was big bucks then - before index, IRA, 401k and all that stuff - the standard mantra I saw most - if memory serves was to put 200/mo into a 'good' mutual fund. I believe minimum wage was still 1.25/hr.

Fundamentals don't change - numbers may - but the earliest $ are still the best - the compounding effect of time works.
Unclemick:
You are the poster-boy for sticktoivness.
After l966-1982 especially.
Remember the ads in the mags put out by the insurance companies selling annuities in the early 60's? "How I retired with $400.00 a month". (It looked good for a few years).
In any case, you done good!
Regards, Jarhead
__________________
Jarhead* is offline   Reply With Quote
Re: Do I Have This Right? *
Old 08-27-2004, 06:53 PM   #6
 
Posts: n/a
Re: Do I Have This Right? *

There are plenty of real-life examples you could give to achieve $1 million. How about investng only $104 a month in the Janus fund established in 1970. It has made 14% a year on average since inception, so today you would have $1 million (before taxes). If they only had Roth IRAs back then!!!!

Or, if your grandfather had started a $9 per month savings plan for his future grandchild back in 1932 in the Eaton Vance Balanced Fund, and your dad continued the same monthly investment followed by you, today you would have over $1 million. Just think, only $9 per month!!!

__________________
  Reply With Quote
Re: Do I Have This Right? *
Old 08-27-2004, 10:57 PM   #7
Thinks s/he gets paid by the post
 
Join Date: Feb 2003
Location: Mesa
Posts: 3,588
Re: Do I Have This Right? *

Quote:
If you start early enough, budget, and take sensible risk, there is no reason why anyone shouldn't be able to retire early. *

. . .

Have I oversimplified this?
I know families that were hit with unexpected financial catastrophes early in their lives and are still trying to recover from these early debts.
__________________
sgeeeee is offline   Reply With Quote
Re: Do I Have This Right? *
Old 08-28-2004, 04:19 AM   #8
 
Posts: n/a
Re: Do I Have This Right? *

Then there are people who did everything wrong and
just got lucky. Life ain't fair.

John Galt
__________________
  Reply With Quote
Re: Do I Have This Right? *
Old 08-28-2004, 05:23 AM   #9
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,408
Re: Do I Have This Right? *

Nope

Neither is the clock. I'm thinking of doing nothing faster so I can enjoy more ER - before I get too old to enjoy it.
__________________
unclemick is offline   Reply With Quote
Re: Do I Have This Right? *
Old 08-28-2004, 06:28 PM   #10
Thinks s/he gets paid by the post
 
Join Date: Feb 2003
Location: Mesa
Posts: 3,588
Re: Do I Have This Right? *

Quote:
Then there are people who did everything wrong and
just got lucky. *Life ain't fair.

John Galt
Yeah . . . I know some of them too. :-/
__________________

__________________
sgeeeee is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 07:27 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.