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How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 01:25 PM   #1
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How many pulling off ER w/o pension and inheritance

Seems a lot of the situations I read are people that will be getting a pension/health ins or have received an inheritance. That's all well and good, but I bet the majority of us will get neither.

I was curious to know if there are folks out there earning 100k or less without the advantages of the above mention, who can ER.

Thanks.
JD
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Re: How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 02:21 PM   #2
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Re: How many pulling off ER w/o pension and inheritance

Well, I *almost* fit.

Between us, DH and I earn about $130k. We're planning to ER without benefit of pension or inheritance -- though we will both receive very small (i.e., $500 per month total) pensions when we both hit 65, that's about 18 years after ER for me, and 15 after for him. Our ER calculations do not take those pensions into account, because that's a long way away and who knows what will happen between now and then?
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Re: How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 03:06 PM   #3
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Re: How many pulling off ER w/o pension and inheritance

Are you only interested in already retired people?

I'm NOT yet retired. But I fit 2 of your 3 requirements: No pension (no health benefits), no inheritance. My family income is a little higher than your limit though. But I will be able to pull it off in 5 years at age of 53.

I have a close friend who meets all your requirement. He's putting in the final touches for early retirement, 13 months from now. He will be 56 then.
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Re: How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 04:17 PM   #4
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Re: How many pulling off ER w/o pension and inheritance

What do you mean by pension (see how hard this can be )

I have a 'pension', or in reality a cash balance account, but it has about $80K in it right now, so I am not planning on it to give me anything of importance...

Exclude that, and I am there...
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Re: How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 04:43 PM   #5
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Re: How many pulling off ER w/o pension and inheritance

Lessee, in my case...

1) I don't make anywhere near $100 per year. With OT, I think I'll come in at around $53K this year.

2) I'll get a pension, but it'll be a whopping $349 per month when I turn 65 in the year 2035. And that's $349 in 2035 dollars, NOT $349 in today's dollars, adjusted for inflation!

3) I'll probably get an inheritance, but I'm not taking it into account when I make any retirement forecasts.

Still, I intend to retire before my 46th birthday, in 2016. Basically, it's just a combination of LYBM, starting to invest at a young age, lucking out and buying a home when I was young, and then making a nice profit when I sold it, oh, and not having any kids!
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Re: How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 05:09 PM   #6
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Re: How many pulling off ER w/o pension and inheritance

Thanks for the replies.

I was hoping to see some folks here that are in the same boat with me.

Itís a tough balance between living expenses and saving. Iím 37, married, kids, mortgage. Iím hoping to ER at 55 but I think I have a long ways to go. Without pension and health ins the amount you have to have saved skyrockets. My goal is to have 1.5 Ė 2mm in today dollars. A few more years in the market like this one would really help but we know thatís unrealistic.

I do have a question using firecalc. The Annual Spending amount, is that the amount I could retire on today and is it adjusted for inflation? If I put in 40k, in my 1st yr of retirement(2024), does it use 40k or an amount adjusted for inflation.

Thanks.





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Re: How many pulling off ER w/o pension and inheritance
Old 12-07-2006, 05:24 PM   #7
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by JohnDoe
I do have a question using firecalc. The Annual Spending amount, is that the amount I could retire on today and is it adjusted for inflation? If I put in 40k, in my 1st yr of retirement(2024), does it use 40k or an amount adjusted for inflation.

Thanks.
an amount adjusted for inflation
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 01:00 AM   #8
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by JohnDoe
Thanks for the replies.

Itís a tough balance between living expenses and saving. Iím 37, married, kids, mortgage. Iím hoping to ER at 55 but I think I have a long ways to go. Without pension and health ins the amount you have to have saved skyrockets. My goal is to have 1.5 Ė 2mm in today dollars.
I'm in kinda the same boat target wise, but at 43 I'm a little bit further down the path. Have you been contributing to a 401k for some time? 55 is still a pretty goodly ways out from 37. For me my balance has really grown substantially from 37 to 43, I'll have to look it up when I'm on the other computer where my spreadsheet is.

I wouldn't get discouraged by reading these posts by folks that are saving 50% of their salary - us mere mortals with kids and mortgages can make it to retirement too, I think.

Care to share any info about where you are on the path, i.e. have a decent 401k balance, or getting a late start and have nothing, are way in debt, ....

Also you might map out on a spreadsheet what your mortgage will be at age 55 - maybe with that going away around then and the $$$ for your kids pop-tarts and fruit-snacks dropping, it will be easier than it seems right now.

- John
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 09:39 AM   #9
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by runchman
I'm in kinda the same boat target wise, but at 43 I'm a little bit further down the path. Have you been contributing to a 401k for some time? 55 is still a pretty goodly ways out from 37. For me my balance has really grown substantially from 37 to 43, I'll have to look it up when I'm on the other computer where my spreadsheet is.

I wouldn't get discouraged by reading these posts by folks that are saving 50% of their salary - us mere mortals with kids and mortgages can make it to retirement too, I think.

Care to share any info about where you are on the path, i.e. have a decent 401k balance, or getting a late start and have nothing, are way in debt, ....

Also you might map out on a spreadsheet what your mortgage will be at age 55 - maybe with that going away around then and the $$$ for your kids pop-tarts and fruit-snacks dropping, it will be easier than it seems right now.

- John
I'd like to see a houshold budget where the folks save 50% a year, have two kids, a mortgage, etc. AND, they make less than $100K a year.

THAT WOULD BE A BUDGET!!!
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 09:52 AM   #10
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Re: How many pulling off ER w/o pension and inheritance

I broke the 100k mark the last 3 years of a 20 year mega corp "career" ... Fired at 43 no pension or inheritance.

Really didn't matter what mega corp did (salary, bennies). What did it for us was taking ALOT of RISK very early (20's and 30's). For us it was real estate.

Just decide what your nitch is and enjoy the ride! The $$ will follow.
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 10:04 AM   #11
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by runchman
Care to share any info about where you are on the path, i.e. have a decent 401k balance, or getting a late start and have nothing, are way in debt, ....
- John
I've been saving since my 1st job at the age of 18. Currently we have
2 incomes maxing out 2 Roth accounts. We also throw about 12% into 401kís, however, the company matches are very low. Our savings rate is about 25% but I think I need to boost that to 30% soon.

Iím considering prepaying the mortgage so it will be gone when I turn 55 then
I would use that money for health insur. With so many yrs to go, there are a lot
of uncertainties. Current retirement savings is 250k.

The budget is ever changing but with a recent purchase of quicken, I have a much better handle on things.

JD
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 10:20 AM   #12
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Re: How many pulling off ER w/o pension and inheritance

I will receive neither pension or inheritance, and do plan to ER. However, I make well over 100k, which certainly makes it easier.
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 10:29 AM   #13
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Re: How many pulling off ER w/o pension and inheritance

This is comparing apples to oranges, obviously, but when I was around your age my networth was just north of $250k, meaning my savings must have been a fair deal less than that.
Now 6 years later my networth has moved to around 900k, with savings around 700k. At this point I feel like I can start seeing the light at the end of the tunnel.

At the 250k point it is hard to imagine ever 'getting there', but at the 700k point it is imaginable at least. I got here w/o any heroic efforts, basically just 401k and decent engineering pay.

My point being you probably have plenty of hope of getting there by 55, given that you have nearly 20 years to go. 20 years is a long time, keep plugging away at that savings and who knows where you'll end up. Probably much better off than you imagine!

- John
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 06:15 PM   #14
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Re: How many pulling off ER w/o pension and inheritance

I ER'd at 48 on an engineers salary with no pension, health insurance, or inheritance.
My salary did cross 100K over the last 6 years, but not by that much. 23 years of maxed
out 401k contributions, decent investment results, and some saving on the side provided
plenty to retire on.
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 06:18 PM   #15
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by tryan
I broke the 100k mark the last 3 years of a 20 year mega corp "career" ... Fired at 43 no pension or inheritance.

Really didn't matter what mega corp did (salary, bennies). What did it for us was taking ALOT of RISK very early (20's and 30's). For us it was real estate.

Just decide what your nitch is and enjoy the ride! The $$ will follow.
or the BanKruptcy....
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 10:17 PM   #16
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by FinanceDude
I'd like to see a houshold budget where the folks save 50% a year, have two kids, a mortgage, etc. AND, they make less than $100K a year.

THAT WOULD BE A BUDGET!!!
Married to stay at home mom, two teenagers, slightly less then $100K, but do not meet the mortgage criteria. Paid mortgage off 3 years ago. 60% savings rate. Was making 26K when the first kid was born and wife called me to tell me she just quict her $30K job to stay home with our newborn. Never regretted the decision. 4 years to ER at 53 with no pension, or inheritance or debt.
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Re: How many pulling off ER w/o pension and inheritance
Old 12-08-2006, 11:00 PM   #17
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by Hydroman
Married to stay at home mom, two teenagers, slightly less then $100K, but do not meet the mortgage criteria. Paid mortgage off 3 years ago. 60% savings rate. Was making 26K when the first kid was born and wife called me to tell me she just quict her $30K job to stay home with our newborn. Never regretted the decision. 4 years to ER at 53 with no pension, or inheritance or debt.
That's awesome... Great job....
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Re: How many pulling off ER w/o pension and inheritance
Old 12-09-2006, 05:25 PM   #18
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Re: How many pulling off ER w/o pension and inheritance

Quote:
Originally Posted by FinanceDude
I'd like to see a houshold budget where the folks save 50% a year, have two kids, a mortgage, etc. AND, they make less than $100K a year.

THAT WOULD BE A BUDGET!!!
I would like to see that budget too. Anyone care to post?
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Re: How many pulling off ER w/o pension and inheritance
Old 12-09-2006, 06:26 PM   #19
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Re: How many pulling off ER w/o pension and inheritance

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Originally Posted by ADJ
I would like to see that budget too. Anyone care to post?
Wouldn't this ENTIRELY depend on location in the US... I think I could pull this off easily in a cheap place in the midwest with solid public schools. 125k for a nice 4 bedroom, 3 bath house = less than 1000 a month in payments. But somewhere near civilization... no way.
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Re: How many pulling off ER w/o pension and inheritance
Old 12-10-2006, 06:24 AM   #20
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Re: How many pulling off ER w/o pension and inheritance

JohnDoe,

I am 25 years old and am working on an early retirement as we speak. How early? Not for the next 15-20 years or so.
I know that what I save now is much more important than if I were to wait a little longer to invest due to compound interest.

I do not make anywhere near 100K ($37,500 to be exact).
I work for a small company and have for the last 4 years. Invest 10% of my pay into the company 401k with at least 3% of my income put into my 401k from my employer. I am also putting money into other accounts (mutual funds, CD's, bonds, etc.) as much as I can.

I will not have a pension, or health benefits during early retirement. I am hoping to find a fullfilling part-time job that will provide this type of insurance for me. Or, I have contemplated moving to another country with good health insurance where my investment would/could last for the rest of my life.

I purchased my home 3 years ago...and have been working hard to pay it off early to be able to save more money. I am trying to be debt-free as well as save as much as I can for early retirement.

~M
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