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Old 09-20-2010, 12:57 PM   #21
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The big thing in our case was not having kids.

By being DINKs, we've built our net worth up to just shy of $300k. I'm 35, DW is 34.
See this is what I'm talking about. How long have you been working/saving/investing?
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Old 09-20-2010, 01:16 PM   #22
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Very lucky I was hired in 1977 29 years old, just retired from same private company two years ago,at 31 years with the company. The answer for me was ESOP,by 1985 they stopped the plan. They paid it all out by 1990 250K for me and I was just middle management. I am afraid those days are over. But if you have a company match in 401K max it out,don't over extend,keep high interest debt low,don't trust your investiment money to any FA without extreme oversite,markets may go down and keep going down past your point of solvency.
Old Mike
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Old 09-20-2010, 01:27 PM   #23
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Wife and I started working at age 26-27. Back then, our net worth was about $100K (saved from our graduate school stipends). Over the next 9 years: DINKS with 2 well-paid jobs, saving 52% of take home pay on average. A bit of luck with stock options in the last year. Now, age 36, with 7-figure net worth.
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Old 09-20-2010, 01:35 PM   #24
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Wife and I started working at age 26-27. Back then, our net worth was about $100K (saved from our graduate school stipends). Over the next 9 years: DINKS with 2 well-paid jobs, saving 52% of take home pay on average. A bit of luck with stock options in the last year. Now, age 36, with 7-figure net worth.
The money I made at grad school went to pay bills. I save around 50%. 25% IRA/401k the other in cash. I guess I'm just starting out here. It just floors me to see someone with a NW around 200-300k in their 30's. I mean I know some 30 yo with almost nothing-living pay check to paycheck. The range is just so dramatic.
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Old 09-20-2010, 02:12 PM   #25
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In a nutshell: got a degree in a well-paid field (computer science / engineering), always maxed out 401k, other retirement accounts, and saved extra in taxable accounts. No kids. Live a low-key lifestyle. Invested 80-100% in equity index funds. Bought no real estate.
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Old 09-20-2010, 02:16 PM   #26
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See this is what I'm talking about. How long have you been working/saving/investing?
We both graduated university in 1999, me as a computer programmer, her as an industrial engineer. We started saving 15% of our paychecks immediately (as per the Wealthy Barber). We've made several major money mistakes since then (buying a brand-new car, joining an "investing club"), but as a result, I've become much more involved and knowledgeable about personal finance and investing.
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Old 09-20-2010, 02:40 PM   #27
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I guess I'm just starting out here. It just floors me to see someone with a NW around 200-300k in their 30's. I mean I know some 30 yo with almost nothing-living pay check to paycheck. The range is just so dramatic.
The main thing is keeping your expenses low. I make less than you(<$50K/yr) but my total expenses are probably less than what you pay in rent alone. I take home $2400 month(after 8% in 401k). That's enough to cover my expenses for that month plus 2 more months. I only spend $800/mo or less now that I paid off my condo. I just turned 31 and i'm under your range but should reach it before I turn 33 despite my income still being under $50K/yr. For some people $200K may only be 3-4 years of expenses for me it's 20X current expenses and at least 10X expected expenses in retirement. You should shoot for 25X expenses before retiring. If your expenses are $20K/yr that's only $500K. If expenses are $50K/yr then you need $1,250,000 to retire. Keep your expenses low and don't increase them when you get a raise/promotion. Save the difference instead.
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Old 09-20-2010, 03:09 PM   #28
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Well in all fairness I haven't mentioned my NW, investments, liablities, etc. My question was how this happened:

I've run over my numbers a million times while at work and I think retiring before 45 is realistic. I would like feedback from you guys as to whether it is or not.

-Home paid for. Very possible that I'll downsize to a condo and pocket 50Kish
Home value about 375K conservatively but this is irrelevant as not interested in living in apartment
-Save 70K a year which includes dividends but not market return. I assume another 4% return from the market over time with my investments.
-I assume my salary will grow by 2% a year. Basically just inflationary increases if any as I don't have any interest in promotions, increased stress.
-Have 275K saved - 25% bonds and cash (mainly cash waiting to be invested) and 75% equity. Will be fully invested by end of year hopefully
-Base expenses 20 - 23K per year
-Another 10K a year for vacations, home repair and car replacement assumed
-Not married, no kids. Might get married but very likely not to have kids

So, can I do it at 45? I feel I am doing alot better than others at saving so I think this is realistic. I am aiming for around 1M to 1.5M in assets. Really not sure how much I need. Ideally I would feel safe with a SWR UNDER 3.

Maybe I should have asked directly but the question is open to whomever it applies.
Are you saying you're 32 and already have a $375K house paid for plus $275K in investments ($650K net worth assuming you have no liabilities)?

I'm confused because if you are doing this well at 32 maybe you should be giving us advice on how YOU achieved it.
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Old 09-20-2010, 03:10 PM   #29
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The money I made at grad school went to pay bills. I save around 50%. 25% IRA/401k the other in cash. I guess I'm just starting out here. It just floors me to see someone with a NW around 200-300k in their 30's. I mean I know some 30 yo with almost nothing-living pay check to paycheck. The range is just so dramatic.
Why does it floor you, since that's your net worth as you mention in post #13 above? If you could do it, why not others?

I think a lot of people in your age group have similar net worths, actually. Maybe the ones who seem to be living paycheck to paycheck are the young millionaires next door.

But congratulations on your own accomplishment!
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Old 09-20-2010, 03:39 PM   #30
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I would like to add one more item to my above post. When we got married in 1974 both made about 10K a year,came into the marriage with both cars paid for,and at the time no student loan debt. Back then in our first two years living in an apartment,we were able to save about 10K a year,by 1976 were able to afford first new house for 40K and it was brand new,by 1977 I was making 15K a year. Between 1976 and 79 had 3 kids wife did not go back to work until about 1984. Bought next new house in 1979 for 69K and still in it,don't get me wrong going for that second house at 69K was a stretch on one income,but my salary went up. Oh yea also bought a house one block from the beach in 1988,with part of my ESOP money, still own the house,generate good summer rent. It was much easier to save back then with no kids and two incomes,also have to remember my car only cost 2800 new. I judge inflation by pizza price, back in 1966 when I worked in a pizza shop just out of high school for a buck an hour a pizza cost $1.60, now a large plain in a non chain about 12 bucks,steak sandwich about .65 now about 6 bucks. Tv was free, had no internet or cable to pay for,phone cheap,gasoline was about .31/gal in 1972.
Good Luck: I really worry how the grandkids will do as well as I did,and I am just an average person.
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Old 09-20-2010, 03:52 PM   #31
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In a nutshell: got a degree in a well-paid field (computer science / engineering), always maxed out 401k, other retirement accounts, and saved extra in taxable accounts. No kids. Live a low-key lifestyle. Invested 80-100% in equity index funds. Bought no real estate.
+1. This is my formula. And we're for all intents and purposes, living on one income. I'm 27 and just crossed the $200k NW mark (excluding house). We don't count our house as an investment. We max out our 401k and IRA's plus save in taxable accounts. Graduated as an engineer and save well over 50% of my gross salary. Also paid down $42k in student loans. I ride a bike everywhere (my "hobby"), we eat out maybe 2-3 times a month (I enjoy cooking and baking), we have no cable/satellite TV and check out books from the library. Keeps things simple and straight forward. But, we do plan to add some kiddos to the mix, if they delay our retirement, so be it.

read up as REW mentioned. enjoy life. and welcome.
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Old 09-20-2010, 03:56 PM   #32
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We started saving 15% of our paychecks immediately (as per the Wealthy Barber).
You were very lucky/wise to have read Wealthy Barber early on. If I had read it in my 20s, I probably would have spent my 40s sipping margaritas, instead of wrestling the corporate demon.
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Old 09-20-2010, 04:16 PM   #33
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Are you saying you're 32 and already have a $375K house paid for plus $275K in investments ($650K net worth assuming you have no liabilities)?

I'm confused because if you are doing this well at 32 maybe you should be giving us advice on how YOU achieved it.
Sorry guys, that wasn't my post. Another member posted that in another thread (accountingsucks is his handle). That's the post that really floored me in that someone that young could have that much. Here is the title of that thread:Realistic to retire before 45 given my info

Again sorry for the confusion.
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Old 09-20-2010, 04:22 PM   #34
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DH and I are 40 and 38 and our net worth is $1.4 million. Get a good paying job, LBYM and pay yourself first. I am currently on my one year Maternity Leave with 3 months to go before I have to return to work (still not sure if I'm going too however but it's nice to have the option to stay home with the kids).

I don't think having two kids (ages 4 and 9 months) has delayed retirement at all. Before the kids, we traveled and ate out at fancy restaurants. The amount of money we're saving every month by eating at home more often and by taking vacations within an 8 hour drive of our home pays for the kids .
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Old 09-20-2010, 04:26 PM   #35
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If someone gets married to a worker with a good job and they have a good job themselves, then it is possible to live as cheaply as one and invest the entire salary of one of the workers. If you invest $50K for 10 years, you have half a million if there are no gains and no losses. Kids don't cost that much in the first 10 years, so they are not a real factor in getting to $500K, but you can stop birth control after you get to $500K and still have kids.
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Old 09-20-2010, 04:28 PM   #36
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Todd, I would suggest you stick with ETFs and the like except for a small portion of your portfolio. If you clearly outperform for a few years, then expand what you manage in individual securities. But its not an easy job and you are competing with a lot of talented, hard-boiled investment professionals plus your own demons.
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Old 09-20-2010, 04:32 PM   #37
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Sorry guys, that wasn't my post. Another member posted that in another thread (accountingsucks is his handle). That's the post that really floored me in that someone that young could have that much. Here is the title of that thread:Realistic to retire before 45 given my info

Again sorry for the confusion.
Ah, that clears it up. You can put tags before and after any material you want to appear highlighted as a quote (delete the extra space after/before the brackets).

[ quote ] to begin the highlighting
[ /quote ] to end it.
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Old 09-20-2010, 04:44 PM   #38
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1. No kids.
2. No debts.
3. LBYM.
4. Cashed in valuable company stock worth $300k.
5. Found and bought into a high-yield (not junk) bond fund when its NAV was underpriced and its yield has been very good.
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Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

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Old 09-20-2010, 06:41 PM   #39
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I never payed more than $700 a month rent living in Chicago, maxed out my Roth, contributed to match for 401k even when money was tight, and max it out when I can. I have never had to buy a car - I rent one if I need, ride public transportation and cabs, and spend a lot of time walking/riding a bus or train. I've never paid for cable (but I pay for high-speed internet). I eat very well at home (and spend a lot on good ingredients, and shop for good wine under ~$10 when bought as a case - use the internet and magazines) and have become a fairly good cook (makes for great dates too, especially after a long day out sailing). I probably only eat dinner out once or twice a month, and don't buy my lunch more than once or twice a week. I bought a lightly used treadmill and weight set for my place, but still belong to a martial arts school that I suspend in the summer when I'm too busy. When dating, I found that women who liked to do things were more interesting than those who wanted to buy things anyway, and it's not a bad filter to start with. Plus, because I'm sailing, doing martial arts, etc, with my time, I have tended to only meet the active ones - partial self selection for fit and active people. There is more, but a lot of it is just structure of your life. I'm lazy, so I set my life up so that I'm not in the position of having to always resist temptation, or work against people around me. I set it up so that just following through with things I enjoy pushes me to where I want to go when I step back and plan for it.
If I were 25 years younger.....
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Old 09-20-2010, 06:46 PM   #40
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Ah, that clears it up. You can put tags before and after any material you want to appear highlighted as a quote (delete the extra space after/before the brackets).

[ quote ] to begin the highlighting
[ /quote ] to end it.
Yeah I get that now. i just copied and pasted the link. I didn't know the hyperlink would follow.

Thanks again to everyone for their input.
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