Poll:What's your number?

[SumDay]

In this thread, I asked if there's ever been a net worth poll survey/done on this board, and if anyone would participate. It appears there's some interest. However, I'm not a statistician by any stretch of the imagination. If you want minutia, read this 80 page Federal Reserve survey on consumer finances & net worth. <yawn>


I struggled with how to ask this, and decided to pilfer from ING and ask everyone this simple question: What's your number? In other words, how much retirement savings do (or did) you really need in order to leave the w*rkforce for good?

Obviously polling capabilities on this board are pretty limited, so it will be this one question which will provide us with anonymous results.

I know there a a bazillion variables. I'm just trying to make it simple. This is an off the cuff, down & dirty comparison.

I'm sure there are people who will question the integrity of this, but it isn't meant to be presented to congress or anything. If you'd like to run a similar survey with more detail and data points, please do. I'd love to respond, I love surveys.

 

[ERhoosier]

IMHO this retirement "net worth" question has sooooo many variables it's hard to make sense of sometimes. For example, a small business owner who builds his business of 30yrs then sells for a million$$ may appear "rich" but in reality is worse off financially than a blue-collar corp or govt worker who retires after 30yrs @ age 25 to a life-long pension with HI (& eventually medicare supplement). Each situation can yield very different "number" for one's desired RE lifestyle.

 

[rodi]

Can we get some basic rules for this poll:

In the past it was

* savings/investments.
* equity in real estate/home.
* pension = 25* annual payout (or something like that.)

Example would be this one from Rich in Tampa.

Other polls excluded primary home's equity.

So... Until we know the rules for pensions and home equity - how do we fill out the bubble

 

[SumDay]

I knew this wasn't going to be easy. When I filled out my bubble, I excluded my home equity. So far, 18 have taken a wild swing at it.

 

[Andre1969]

Well, I shot my wad. Picked the $1M-$1.5M bracket. Or, roughly $1.3M, to be exact. Not including my pittance of a pension ($349.21/mo at age 65, not COLA'ed) and not counting any home equity.

We'll see, once I get there, though. I may chicken out and pull the "one more year" thing.

 

[ls99]

I am not telling. Suffice to say it is satisfactory.

 

[devans0]

Hmmm... If I had counted pension/annuities, I already am at two categories higher than I had put as my number, and I am still w--king. I don't count home equity. I have to have a roof over my head and when I relocate, I don't expect a windfall.

 

[karluk]

I voted using the current value of our investment portfolio, but excluding the value of our house and the estimated cash value of our pensions.

 

[nun]

I included the estimated value of my future SS and pensions in todays dollars by working out what size annuity I'd have to have to generate that amount of income......it came out to $500k. Then I added my mutual funds and cash and the equity I have in my real estate.

 

[ziggy29]

I'm assuming what it would take in *current* dollars. Because if I think I need $2M in today's dollars, by the time I got to $2M it wouldn't "be" $2M any more in some sense.

 

[W2R]

I put the amount I was aiming for all along, and reached. This amount was sufficient to cover my present spending.

Later my dear sweet mother passed away and I came into some additional money. However I haven't touched it, and it did not influence my retirement, so I didn't count it.

Table 4 on page 17 at the Federal Reserve survey link Sumday gave, is pretty sobering. From the median net worth in my age category, it looks like Ramen noodles retirement for so many.

 

[H2ODude]

Mine was what it is, not what it needed to be (target). I could have left much sooner but the golden handcuffs of a partly COLA'd pension was too tempting. Meanwhile I kept adding to the IRA and 457 and now the "number" is probably 50% more than necessary. Looking forward to the day wife is released from eldercare duties and we can travel.

 

[gerrym51]

since this question is wide open and asks net worth and nothing else.

i have a 900,000 net worth.

but only 100,000 is home(condo)

the rest is all easily accessible cash instruments.


so i guess-how much is net worth tied up in easlily gettable cash and have to be sold assets.

i did not include wifes small pension or ss

 

[Brdofpray]

I put the amount we had in our investment and retirement accounts when we pulled the trigger. I did not include any mention of the pensions (or the amount of funds needed in an annuity to generate them) that my DW and I have in place. Suffice it to say, if we did not have the pensions, we would still be at W*RK.

 

[Budman]

I'm afraid this poll is going to end up with many apples and oranges. Depending upon what balance sheet assets are included as "My Number", I can identify three different ranges by using:

1. investments only, or
2. investments + home equity, or
3. investments + home equity + the present value of pensions & SSA

Other answers are very possible, especially when you inject timing into it.
I used the value of my portfolio investments the day I retired 3.5 years ago, since it appears that is what the requester used.

 

[rodi]

So - this poll has people computing the net worth in a variety of ways.
Some put net worth now.
Some put the number (whatever that is) they need to retire.
Some excluded home equity.
Some included it.
Some excluded pensions
Some included it as the cost of an annuity equivalent.
At least one person put a value on the SS they'll get (or are already getting.) I can see that - since not everyone gets SS. (WEP and all that.)

If you don't include real estate? Do you also exclude any rental income from the real estate? How does that work? Obviously rental income is an income stream worth considering in retirement if you have it.

I think this topic is very interesting - but the data from this poll is kind of meaningless since everyone made up their own rules on what to include or exclude.

But... it is very interesting.

Oops cross posted with Budman

 

[Budman]

We think alike rodi!

 

[jclarksnakes]

Reading the OP I could have honestly selected any of four different boxes..........so I did not vote.

 

[karluk]

So - this poll has people computing the net worth in a variety of ways.
Some put net worth now.

I was one of the people who voted using today's net worth. To clarify, I should add that I'm retiring this month, so for me today's net worth is also very close to what I will have on the day I retire.

 

[bo_knows]

I picked the 1-1.5M category. We'll be retiring whenever firecalc and my own spreadsheets say that our investments can afford it.

My wife will receive a pension of ~$10k-20k/yr at age 60, depending on how long she stays at her company. I get a $400/mo pension at 60 from MegaDenfenseCorp that I left 3 years ago. In my calculations I usually take 2/3 of the SS estimate that I get today (I'm seeing a rough estimate of $16k in today's dollars if I ER on time, and $12k for my wife).

Our expenses are ~$50-60k/yr these days... so whenever we can cover that for the long haul...

 

[Alan]

I voted, and used the value when we retired, and it included:

Savings, which includes the money from the sale of our house shortly before ER (we now rent).
Value of non-COLA annual pension * 15

I did not include our expected US SS's, or my UK SS

 

[bondi688]

Net worth is net worth, and is a snap shot at a point in time. The question of whether one should include home equity had been endlessly debated, and arguments for and against both have some basis for their claims. But future streams of income, whether they are rental income, pension, social security benefits, dividends are not, and should not be,included as part of the net worth calculation today.

 

[donheff]

I added a net present value for my pension and DW's SS, and the savings DW and I were satisfied would meet our additional expenses and called that composite figure our "number." That is not the same thing as our net worth but isn't actually that far off.

 

[rodi]

I voted. (Despite my questions about what to put).

I included the income stream from rental income (which I lowballed). The rental is on our property - which will be paid off next year - so I didn't include equity or debt. I'm awfully close to my "number" - but want the house paid off before I pull the plug. Firecalc and Quicken say I'm good... but I'm holding out for a severance package or mortgage free status before I pull the plug.

That and I worry that W2R said "wheee" last week and I've just recently hit the number... so it's kind of close to the edge. Fear keeps me at work for now.

 

[Alan]

But future streams of income, whether they are rental income, pension, social security benefits, dividends are not, and should not. be included as part of the net worth calculation today.

I agree, which is why I included the pensions I am currently receiving, and not the ones in my future. (I have another private pension due to start in 4 years, then we have 3 streams of future income for our US and UK SS).

I never had a "number" as a target. I used FIRECALC, Financial Engines and Fidelity RIP as my guides. All 3 calculators use your current day savings, future projected contributions, and expected income streams, along with other data to give a range of feasible incomes for specific target dates.