I wish I knew before (or after) I retired???

[qwerty3656]

More HSA

 

[38Chevy454]

I'm wishing I did more Roth, more after tax savings, and less pretax.

 

[Midpack]

Add me to more Roth sooner group. I converted like crazy when it made sense before retiring, but 10 years earlier would have made life much easier now.

I’m really glad I started converting aggressively a few years ago, we’ll be far better off at 72. Only wish I’d started sooner.

 

[Car-Guy]

Should have retired at least two years sooner then I did... On the positive side of that, at least now I don't worry about my WR.

 

[skyking1]

simply been more aware. Money was accumulating, but nobody was really steering the ship, so to speak.

 

[punkinhead]

I'm wishing I did more Roth, more after tax savings, and less pretax.

For many Boomers or GenXers that simply wasn't an option. Roths came along for us later in life when we had high enough incomes that we couldn't save in Roth or were in a high enough tax bracket that they didn't make sense. Emotionally, I wish I had more in Roth, but mathematically I was better off putting that money in pretax and spending it in retirement in a lower bracket. Younger generations are fortunate to be able to start off their savings in Roth when their incomes (and tax brackets) are lower.

 

[Which Roger]

I suppose DW and I also have "too much" in tax deferred accounts, but what a nice problem to have! When the tax time-bomb hits due to RMDs, etc, charities are waiting to take our money, make us feel good about how we're using it, and solve the tax problem for us.

 

[Fleur58]

Three things I experienced:
1. The retirement estimates saying you need 80% of your salary in retirement was wrong. Perhaps those estimates are for married people. I didn't spend near as much with a paid off house. I am not a consumer anymore, I hardly ever need clothes, transportation costs gone down. No bills.

2. I was too young to retire early as a single person. I was almost 58. I was bored out of my mind even after taking nice vacations to see the world. Very little social interaction. I went back to work PT at age 61 and am much happier retired 5 days and working 2 days per week.

3. If you do early retirement and plan to do retirement activities like water aerobics in the day time--I was the youngest one there. People in 70s and 80s are not in my generation. I felt out of place. Still, you need a plan for how you will spend your time.

 

[street]

I regret not taking a few more chances on opportunities. My frugalness can be my inner voice and sometimes that good and sometimes not so good.

 

[punkinhead]

Three things I experienced:
1. The retirement estimates saying you need 80% of your salary in retirement was wrong. Perhaps those estimates are for married people. I didn't spend near as much with a paid off house. I am not a consumer anymore, I hardly ever need clothes, transportation costs gone down. No bills.

That rule of thumb seems to only make sense to people living paycheck to paycheck. When I retired at 54 we were saving 45% of our income while also paying for our son's last year of college. Our retirement spending will be less than 50% of our pre-retirement income, and that's with a substantial increase in travel & leisure spending.

 

[Andre1969]

3. If you do early retirement and plan to do retirement activities like water aerobics in the day time--I was the youngest one there. People in 70s and 80s are not in my generation. I felt out of place. Still, you need a plan for how you will spend your time.

I remember my grandmother's cousin saying that she experienced a similar thing, just with the generations reversed, and that's why she quit going to a lot of senior citizens' events! She lived to 95, but pretty much quit doing those events sometime in her mid-to-late 80's. She said that most of the people at those retirement activities were people in their 60's and 70's, so to her it was like hanging out with her kids, and she didn't have much in common with them!

Most of the people of her generation, if they were still alive, tended to either be bedridden, or just didn't want to go out anymore. A lot of them could no longer drive, so that often kept them home and isolated.

 

[rodi]

Agree with the thoughts on wish I'd:
- saved more in after tax accounts vs pre-tax accounts.
- Had a better understanding of my spending before I retired. (Though I was close enough).

As mentioned above - the 80% rule is kind of dumb. I got closer by taking my gross - subtracting out things I wouldn't pay anymore (payroll taxes like SS and Medicare taxes; 401k contributions, ESPP investments, mortgage and extra mortgage payments.) (I planned to retire when the house was paid off.) Then I added in to the downard adjust number things that would increase in retirement: healthcare would be higher, travel would be more...

80% of your former income "rule" assumes you weren't deferring a lot of your former income to retirement savings.

 

[Mulligan]

Three things I experienced:

1. The retirement estimates saying you need 80% of your salary in retirement was wrong. Perhaps those estimates are for married people. I didn't spend near as much with a paid off house. I am not a consumer anymore, I hardly ever need clothes, transportation costs gone down. No bills.



2. I was too young to retire early as a single person. I was almost 58. I was bored out of my mind even after taking nice vacations to see the world. Very little social interaction. I went back to work PT at age 61 and am much happier retired 5 days and working 2 days per week.



3. If you do early retirement and plan to do retirement activities like water aerobics in the day time--I was the youngest one there. People in 70s and 80s are not in my generation. I felt out of place. Still, you need a plan for how you will spend your time.

Your number 2 cracks me up. I retired a little over 10 years ago, and started playing in weekly 2 man scramble one day tourneys. My partner is about 20 years older than me and generally 100 or so people will show up to these. First time I went I thought I was in a nursing home jail break, ha. As everyone was at least 70 years old.
After a few weeks I didnt even notice.
Now, 10 years later Im 57 and still about 20 years younger than any of the various groups I play with. My golfing friends are 20 years older than me and my personal friends are my age…And still working… It seems normal to me now.

 

[COcheesehead]

things I experienced:


3. If you do early retirement and plan to do retirement activities like water aerobics in the day time--I was the youngest one there. People in 70s and 80s are not in my generation. I felt out of place.

When I retired I didn’t hang out with older people, I hooked up with younger ones. I was the “old” guy. I love it. Keeps me young.

 

[aja8888]

Well, three things come to mind.

1. I should have stayed in the Air Force after my 4 year tour was up in 1968. If I stayed until they threw me out, I would probably have a pension and better health care insurance (Tricare).

2. My skill at picking a spouse could have used an upgrade as I really made some bad choices. Consequently, a failed marriage at age 50 cost me about $1 million in 1992. Even my golf game suffered!

3. The last wife (current one) is a keeper and we have been together since 1996, which is a record for me. But we started saving for retirement from scratch back then as I was near broke and she had $50.

 

[Koolau]

Have been doing good after retirement. Did a few boners before.

1) Sold the townhouse in Huntington Beach, CA for what I bought it for. Should have kept and rented. Could have sold for 3X six years later.

2) Had a go at "penny stocks", lost 25 grand.

3) Didn't buy the house next door (in foreclosure) for 150 in 2009. Just sold for 575.

Heh, heh, I often "brag" that I made every investing mistake in the book (selling at the bottom, buying Willie Nelson style tax shelters, using a sales guy/gal for investments, etc.)

I did two things right. 1) I saved and then saved some more and then I saved even more than that. 2) Long before moving to Paradise, I bought a place and paid it off.

Other than that, I've been well below average as an investor. YMMV

 

[Koolau]

That rule of thumb seems to only make sense to people living paycheck to paycheck. When I retired at 54 we were saving 45% of our income while also paying for our son's last year of college. Our retirement spending will be less than 50% of our pre-retirement income, and that's with a substantial increase in travel & leisure spending.

That's an interesting perspective. We too saved a LOT. Not sure of the actual percent - don't think it was quite 45% but not too far from it. BUT now, we spend WAY more than the 80% rule of thumb that you see typically quoted in the retirement articles. In fact, we probably spend 2 to 3 times as much as when we were wage slaves. Having said that, we still consider ourselves frugal and we don't accumulate much nor spend "lavishly." We try to help the kids and our favorite charities - and we don't scrimp on stuff that's important to us. Very much a YMMV situation.

 

[pjigar]

That rule of thumb seems to only make sense to people living paycheck to paycheck. When I retired at 54 we were saving 45% of our income while also paying for our son's last year of college. Our retirement spending will be less than 50% of our pre-retirement income, and that's with a substantial increase in travel & leisure spending.

+1

 

[iloveyoga]

Less IRA more Roth.

That is the thing I would change also. But otherwise it has worked out great for DH and me.

 

[Andre1969]

I was thinking about the Roth, myself, and if I could have done better. In searching online, it looks like it first became a retirement option for 1998. I opened one in 2000, by converting a traditional IRA and paying the taxes on it. I started with $3,980.

I added $1000 in 2001, only $300 in 2002, and $400 in 2003. But from 2004 on, I've been maxing it out. So I guess I haven't done too badly.

 

[Perryinva]

In my case, the Roth became a more flexible option, as my company had an after tax 401k option. Somehow, thanks to my poor self education on investment products coupled with the cryptic quarterly statements that came by mail, I assumed the after tax 401k WAS a Roth 401k. A savvy work friend corrected me at lunch one day when we were discussing the poor funds in the 401k. Luckily, that was about the same time period where Roth conversions were first allowed, so I opened a Roth @Fido & from then on converted all after tax 401k to the Roth annually. But even then, I still mistakenly assumed I would be in a lower bracket in retirement (again, poor self education) and so I split savings pre and post tax plus company matching was pre tax, & it was probably a few years before I realized that pretax would do me little good at all in retirement thanks to my rising pension & SS amounts. My retirement brackets with RMDs would be the same, or more, and it made no sense at all to save anything more pretax. It was even years after that before I realized that early retirement without winning the lottery was even a thing! That realization until FIRE was maybe 6 years? So the OP is already ahead of where I was. If I had found this place 20 years ago (did it exist?) that would have been a game changer. At least I “paid myself first” by putting as much as I could in the 401k, always got the match, and made good returns during the last 10 years I was in it. It took 9 years from broke & in debt to saving $200k, and 9 more to make the first $1M. So I know I learned something at least.

 

[ERD50]

Originally Posted by Fleur58 View Post
Three things I experienced:
1. The retirement estimates saying you need 80% of your salary in retirement was wrong. Perhaps those estimates are for married people. I didn't spend near as much with a paid off house. I am not a consumer anymore, I hardly ever need clothes, transportation costs gone down. No bills.

That rule of thumb seems to only make sense to people living paycheck to paycheck. When I retired at 54 we were saving 45% of our income while also paying for our son's last year of college. Our retirement spending will be less than 50% of our pre-retirement income, and that's with a substantial increase in travel & leisure spending.

Yes, but it is even worse than that - it can go both ways.

Some people may have scrimped and saved aggressively with the goal of retiring and spending *lots* of money in retirement (travel, or other hobbies that were difficult to do while working). Healthcare is another question mark for many.

The important thing is to try to figure what *you* will spend in retirement. It is *your* retirement, not anyone else's.

-ERD50

 

[ERD50]

I see a lot of Roth vs Trad-IRA remorse. I get it, I have large RMDs looming, but I wonder?

It would be rather tedious to go back and look at my true marginal rates for the IRA/401K contributions, but my taxes would have been pretty high during my working years. I'm not sure it was a mistake, or if so, maybe not a big one?

But Roth conversions certainly appear to make sense for me (based on what we know now), while I delay my pension and our SS. But I never could have predicted that, it's an opportunity that arose.

-ERD50

 

[Dash man]

I wish I had known about backdoor Roth conversions sooner than I did. But I don’t have any financial regrets.
I wish I could have found ways to counter my spinal issues and arthritis to allow life to be more enjoyable as I age. But I do count my blessings and try not to complain.

 

[swakyaby]

Wished I had selected the health insurance with HSA while w*orking instead of the standard insurance.