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Old 08-08-2007, 02:27 PM   #21
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I wish I had the discipline to "plan." I have number crunched and number crunched with my military retirement $$$$'s, TSP (also investing in a lifecycle fund) - and am retiring from the reserve in 2008. I just kept jacking my Deferred compensation (pre-tax retirement savings for state employees) until I "felt" it - and 20% of my salary is going into that - a Prudential Lifecycle fund. A new car on the horizon is the only large purchase coming up. Other $$$ going into a MM account and an ING account - my vacation/travel fund! I admit I have no specific $$ goals. (rather embarassing here)

Make no mistake, my friend, it takes more than money to make men rich. - A. P. Gouthey
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Old 08-18-2007, 08:21 PM   #22
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Join Date: Jul 2007
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My goals for the next 3 years are:

25K (euro) by june 2008 (when I graduate): This might be a stretch (I will be at 18K after this month), but 25K is really a goal I've had for a long time.

After that, I am thinking of paying myself a minumum wage (500 euro or so), saving the rest, and withdraw 2% at the end of each year as a bonus. First withdrawal will be end of 2008 probably.

I like the idea of rolling into financial independance like that.

However, my ideas change a lot and the exact numbers will depend on what job and life I go for.

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Old 08-18-2007, 09:26 PM   #23
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Each December I draw a game plan for the upcoming year: I create a budget, try to identify expenses that can be cut or eliminated and establish a (challenging) savings target for both retirement and non-retirement accounts. During the year I track expenses and savings to make sure my goals are reached or exceeded by year end (I mostly use automatic investments to make sure I reach my savings goal). Then the cycle starts all over again. I find that our income changes too much from year to year which makes it difficult to establish these goals several years in advance.
Once we know how much we haved saved in any given year, the numbers are plugged into an excel spreadsheet based a model extracted from the book "work less, live more": it lays out our financial plan for the next 30 years (or I should say that it extrapolates our financial plan based on our current situation). Each year we update the spreadsheet to reflect the current situation (actual amount of savings, actual annual expenses, actual savings rate) which gives us a new baseline for the next 30 years. I also monitor the ratio total financial assets / expected annual living expenses in retirement. When the ratio reaches 25, then I'll know that FIRE has become a reality. Right now it's about 7 (I am 33), so we still have some ways to go...
42 y/o, married, retirement portfolio = 43 x annual expenses
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Old 08-19-2007, 06:51 AM   #24
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I have a 3 year goal plan. Build my money market fund back up to two years of emergency funds. Get up to $X in total portfolio. When my wife retires in 2 1/2 years sell my house, move out west and buy a house for cash. Kick back and watch the world go by.
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Old 08-19-2007, 09:48 PM   #25
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My goals range from lifestyle goals to what I need to save materially to have that lifestyle - example, I want to retire early, so minimization of my monthly 'lifestyle costs' now will help me toward that goal by learning LBYM skills, adjusting one's expectations regarding material wants, etc. The next is to track my expenses for that desired lifestyle - with that idea in mind, calculate what would be needed in investment, pension, etc income to meet the expense amount. Next is to figure out how soon that amount can be amassed - it's an optimization problem with income, current expenses, savings and investment performance.

Practically, I've come up with a minimal amount to have amassed, possible pension amounts and times they will be available and save at least enough to meet my yearly goals - actually, we've been saving more than what we originally agreed upon - retirement will probably happen earlier than we thought - which is fine with us. The hardest part is trying to 'live' now while save for later - i.e. making the decision to enjoy our lives now - example, we have savings for vacation for travel - it is important to us and will be part of our retirement - we find ways to travel inexpensively and although those dollars could go towards our retirement goals, we are exceeding our original goals for the amounts we need for retirements - it is a combination of after tax savings, deferred tax savings and pension income - we will have a time where one pension and after tax savings will be our source for income (from 10-15 years), then my pensions will start along with easier access to the tax deferred accounts (no 72t withdrawals unless absolutely necessary). It's been an interesting ride so far!

Deserat aka Bridget
“We sleep soundly in our beds because rough men stand ready in the night to visit violence on those who would do us harm.” - George Orwell/Winston Churchill
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