New and Looking to Retire Young

[Sommie]

Hello All:

I'm new here and would like to retire early. I am married and my wife is scheduled to retire at least 15 years before I am eligibe. Because of this fact, I have made it my goal is to be able to retire around the same time as her and live comfortable.

We have approximately 15 years to save up for it, at which time I will be just shy of 50. I currently have an IRA and a minimal 401K account for retirement, while my wife has a state pension and when she is ready to retire will have a second pension.

I don't believe in the stock market and I take minimal risk.

Any suggestions to get me on my way to accomplishing my goal of retiring with my wife? Where should I put money for easy withdrawl, least penalty, and maximum return?

Thanks!

[Texas Proud]

Yes, start to believe in the stock market.

(others will tell you more!!)

[justin]

How do you plan on growing your savings over time without any exposure to the stock market? Do you have an expected rate of return in mind (real or nominal)? With zero exposure to the stock market your return will be rather limited. A few percent over inflation maybe.

15 years is a long time to weather out ups and downs in the stock market. Maybe try putting a few percent (5-10%) of your portfolio into the stock market each year to test your risk tolerance.

[uncledrz]

Long ago I learned no guts no glory.
No large returns without risk.

There are many places to make the large returns other than the stock market. Examples are real estate, commodities, your own business. One advantage of the market is that it does allow diversification, not complete, but somewhat, which can soften an adverse event.

OTOH it won't have the same return that your own business could.

[retire@40]

Quote:

Originally Posted by Sommie Hello All: I'm new here and would like to retire early.* I don't believe in the stock market and I take minimal risk. Any suggestions to get me on* my way to accomplishing my goal of retiring with my wife?* Where should I put money for easy withdrawl, least penalty, and maximum return?

By the way you ask your question, it looks like you haven't read a lot of the "good" posts in this forum.

I think if you spend an hour or two a day for a few days or weeks reading, you will find your answers and gain some knowledge to questions you may not have even thought of yet.

[MRGALT2U]

Quote:

Originally Posted by uncledrz Long ago I learned no guts no glory. No large returns without risk. There are many places to make the large returns other than the stock market.* Examples are real estate, commodities, your own business.* One advantage of the market is that it does allow diversification, not complete, but somewhat, which can soften an adverse event.* OTOH it won't have the same return that your own business could.

I've said it before but it bears repeating. I could have found a way to retire
anyway, but without several years of owning my own business............
well, it would have taxed even my creative powers

JG

[wildcat]

Quote:

I don't believe in the stock market and I take minimal risk

Ohhhhhh boy. Tough to earn returns necessary to ER unless you have a really high paying job and live like a monk. Sure there are other ways but it sounds like you are an employee like most of us. So I hope you have some real estate that will be the foundation for your early retirement.

[MRGALT2U]

Quote:

Originally Posted by wildcat Ohhhhhh boy.* Tough to earn returns necessary to ER unless you have a really high paying job and live like a monk.* Sure there are other ways but it sounds like you are an employee like most of us.* So I hope you have some real estate that will be the foundation for your early retirement.* *

Yep, real estate could do it.

JG

[laurence]

Read "Millionaire Next Door" for inspiration, then read "4 pillars" for education on the stock market as part of a healthy balanced diet. (I've become a broken record, I know). Try out some balanced/value funds in your 401k, learn about expense ratios, find out about the true risk of supposedly "safe" investments (hint:inflation). Read read read. Maximize 401k contributions, Roth IRA as well.

Do you own your home? Can you pay it off by then (if you love it and would like to stay there). That is one way to increase your chance of reaching your goal, as her money might be enough to cover er for the both of you without a house payment.

[azanon]

Quote:

I don't believe in the stock market and I take minimal risk.

>If you want to ER, start getting over your non-belief of the stock market.

>Please clarify what you mean by you "take minimial risk".* Do you mean you don't like the risk of investment volatility such as what you would see in the stock market or you don't like the risk of your money not being able to keep up with and exceed the rate of inflation?* ** *

The latter kind of risk scares me to death so i take action to prevent this fear from being realized.* The former "risk" i could care less about given my 15-30 year investment time horizon.

[OldAgePensioner]

Someone above mention "balanced fund", is that different than a "blend" fund in terms of what the funds hold?

[BUM]

Quote:

Originally Posted by OldAgePensioner Someone above mention "balanced fund", is that different than a "blend" fund in terms of what the funds hold?

Quite different. A good reference is www.investopedia.com

[OldAgePensioner]

So Blend=
A mutual fund composed of various asset classes (such as stocks, bonds and money market securities), allowing investors to diversify their holdings by owning just a single fund. Also called "hybrid funds".

And Balanced=
A mutual fund that invests its assets into the money market, bonds, preferred stock, and common stock with the intention to provide both growth and income. Also known as an asset allocation fund.

So, is the difference that Balanced seeks to provide more income versus growth? But otherwise they seem to be investing in the same assets.

[yakers]

Blend VS Balanced funds. I don't know the exact definition but I thend to see a blend fund as a stock fund with growth AND income, or one that combines value and growth. My balanced is one that includes stocks and bonds, an "asset allocation" fund my Vanguard Asset Allocation (VAAPX) is one of these. There are a lot of variations and crossovers in fund types. Also a fund may be authorized to have a variety of assets, like including some % of foreign or hedge funds and may not actually hold any at a specific time.

[Sillysal]

Quote:

Originally Posted by Sommie I don't believe in the stock market

What, like the tooth fairy? There is nothing more risky than letting your money sit around in "investments" that don't earn enough of a return to beat inflation, fees, and taxes!

[Arturo]

Lotsa great advice in this thread . Personally,I think the greatest asset anyone can have is flexibility. To be flexible enough not to be locked into a certain lifestyle or geographic area , for me , was a life saver. As I mentioned in my intro , I was forced into ER by an accident. I didn't mention that I was also mauled savagely by the IRS and divorced all within a matter of months. My yearly income post ER is about 1/3 of my rat race income. Has my life style changed ? you bet it has . Would I trade back to the RR if I could? No way Jose . I now live in muy economico , southwestern N.M. instead of the expensive Pacific Northwest . On weekends I'm now more apt to be headed to a garage sale than the race track or skiing . My investment strategy now, more like a hobby , is to search out under valued properties (they do exist in every market) and turn them into rentals or flip them. I'm not gettin 'rich " but I'm havin fun. For me ,that's what counts. (and I have made a couple real good deals just in the last few months) I cringe when I read or hear about someone grinding out the last few years to improve their pensions , get a little more in their IRAs ect. I once read a book by a guy who spent years counseling folks who were dying. He said , the only regret he never heard was regret of not having worked longer. Sorry , didn't mean to rant . I guess all I mean to say is be flexible , seriously look into equities , into R.E. and do something. I wouldn't worry about average returns on one or the other. You're probably not average anyway.

[MRGALT2U]

Quote:

Originally Posted by Arturo Lotsa great advice in this thread . Personally,I think the greatest asset anyone can have is flexibility. To be flexible enough not to be locked into a certain lifestyle or geographic area , for me , was a life saver. As I mentioned in my intro , I was forced into ER by an accident. I didn't mention that I was also mauled savagely by the IRS and divorced all within a matter of months. My yearly income post ER is about 1/3 of my rat race income. Has my life style changed ? you bet it has . Would I trade back to the RR if I could? No way Jose . I now* live in* muy economico , southwestern N.M. instead of the expensive Pacific Northwest . On weekends I'm* now more* apt to be headed to a garage sale than the race track or skiing . My investment strategy now, more like a hobby , is to search out under valued properties (they do exist in every market) and turn them into rentals or flip them. I'm not gettin 'rich " but I'm havin fun. For me ,that's what counts. (and I have made a couple real good deals just in the last few months) I cringe when I read or hear about someone grinding out the last few years to improve their pensions , get a little more in their IRAs ect. I once read a book by a guy who spent years counseling folks who were dying. He said , the only regret he never heard was regret of not having worked longer. Sorry , didn't mean to rant . I guess all I mean to say is be flexible , seriously look into equities , into R.E. and do something. I wouldn't worry about average returns on one or the other. You're probably not average anyway.*

I agree with this. Obsessing over getting another paycheck or another year
on your pension eligibility is silly. People are dying as I type that are younger than those of you reading this are. Do you think they give a rip about maxing their pension or
ss checks? I doubt it.

JG

[cube_rat]

Hey Arturo - I like your attitude! I don't want to be rich. I don't want a big house, SUV or any of the other trappings of success. I want to have enough saved to retire on so I could enjoy the things I REALLY want to do.

[Helen]

Quote:

Originally Posted by Arturo I once read a book by a guy who spent years counseling folks who were dying. He said , the only regret he never heard was regret of not having worked longer.

Yes, I just went to my ex-boss' funeral today. It was really sad, she was a great person. She could have retired two years ago but hung in there to get that pension a little higher. I think she really enjoyed her work, but at the funeral today it was evident that her family was the most important part of her life. She had one month of retirement before finding out about her brain cancer and passed five weeks later.

-helen

[Calgary_Girl]

Quote:

Originally Posted by Sommie I don't believe in the stock market and I take minimal risk.

That's too bad you feel that way. The market was VERY kind to me today...made $1,200 on my portfolio.