The earlier you start investing for retirement the longer it has to grow. Unless the government takes it for your own safety.
47 and wife has the (much) bigger 401k.
i’m in a lot of trouble :)
Get a government job when you’re 25 retire on six figure income when you’re 50.
Simple.
Doesn't do much for you when interest rates are so low, or when 401k's lose 5% or more per year, rather than gaining 5%+.
Get a Roth? Good lord, no. You’ll be paying taxes on the money before it’s invested. Get a regular fund and when you retire, structure your mandated withdrawals such that your income is below the bar for attracting income tax. Your withdrawal will be tax-free, and the money that went into your fund instead of paying income taxes back then will have been increasing your investment value over time, rather than coming back to you in tax returns you might not even get.
Here's what NOT to do. Take out loans against your 401(k). Yes, you are paying yourself back with interest and so it sounds smart. But you are reducing the size of your paycheck (to pay it back) and will be subject to heavy penalties if you get laid off from your job and are unable to make the lump sum payment to pay it off all at once.
The ship has already sailed on this one for me. I’ll be working a long time.
Yeah, at current interest rates, uh, maybe when I'm 567 1/2...
Alternatively, vote Democrat. Then, you can have fun going to "college" until you're 50, then retire comfortably on your ADHD or similar "disability". The government will take care of all your needs such as a free Obamaphone, Internet, housing, Obamacare, Food Stamps, and so on.
The 11th thing - get a job and work your way up the experience ladder. Too many lazy young people, flitting from job to job because it doesn't easily give them lots of money for little work. I saw this in my twenties with some friends. They were more interested in goofing off and partying, when they got jobs it didn't last more than a month. My wife and I married young, and started saving in our 20s, put us way ahead of the others. Now we're in our mid-60s and very comfortable. Those friends, not so much at all because they didn't save until very late in life after 40.
The writer appears to be cribbing from something written some years ago. If I had been able to work straight through from 40 to 65, my retirement would be quite comfortable. But throw in a company failing, a couple of layoffs for economic reasons, and a stretch of underemployment, and I realize he's writing fantasy, not advice.
Do not make the mistake of thinking that the future will be very similar to the recent past:
Not the stock market - it may or may not. It may have another very severe decline or it may grow exponentially, or both. Like musical chairs, it will depend on how close to the retirement chair you are, when the music stops.
Not banks - we are in a new era where the FDIC cannot cover more than 2% of deposits. This is why they have adopted the Bank Bail In provisions. I think the really smart people are setting up some financial reserves in an offshore bank account before capital controls are established here.
Few have pensions any more. If they do, they should consider whether theirs will be among those that are poorly funded and subject to a haircut.
Consider something outside the market that has cash flow. This includes many kinds of real estate and other categories of investment.
I have a friend who invested $335,000 in a flock of egg-laying chickens two and a half years ago. He was getting a nice dividend. Chickens lay eggs even while you sleep. After the bird flu hit out west, egg prices went up. Corn prices are depressed. He has made approximately $5 million. Yes, that much. I asked for some details about the flock. He has never seen them personally. Despite the windfall, he was making a great 15% cash flow before the bird flu hit. On his original investment, that is +$50k per year.
Put together a couple non-stock market investments like that and you have created a pension.
I could give other examples of cash flow investments that do not depend on greater fools to enter the stock market.
I think the words of Scripture got this right:
"Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth." Eccl. 11:2
I know, I'm a terrible judge of character. But that doesn't mean I should empower a pair of leechettes to exploit my trusting nature.
The patriarchs and the prophets didn’t retire. They labored until they died.
God does not promise us a bunch of indolent years sitting on our asses.
The search within Christendom for some sort of golden years is the early onset of name it and claim it prosperity gospel.
1. Live within your means.
2. Marry only once.
3. Blame only yourself for your problems.
4. Rely on nobody but yourself to make your dreams come true.
5. Remember that gratitude is the secret of happiness.
I think investing in a home is a key component. By “investing” I don’t mean using goofy interest-free or variable rate loans and expecting to make a killing in 2 years. I mean getting a home sized for your family, using a conventional mortgage... and STAYING in it for a long time so you can ride out the market ups and downs and have a real asset to cash in on when the kids are out and it’s time to downsize.
bkmk
Nix the 15 year mortgage, and the life insurance policy stuff is only good the life insurance salesman.
High inflation always benefits the borrower. Just look at the $15 minimum wage and the level of government debt, and use your own brain to see that we will have strong inflation for many years to come. Right now we have an interesting combination of high real inflation and low fixed mortgage interest rates. DW and I are retired already and have 30 year fixed mortgages on our house and rental properties. The payments can not increase, but the rents we collect sure can...
While we worked, we had employer-supplied life insurance which we maxed out in case of a disaster, but now that we are retired, there is no need for life insurance.
The advice few financial planners will give is that rental property is a great retirement investment. Rents go up with inflation, but mortgage payments don’t. Sure, taxes can increase, but the fraction of the rents that we get to keep increases every year.
I’m starting to think retirement is not really “American” or biblical.
I don’t read much of founders era folks retiring, they seemed to keep right on working in one capacity or other until truly unable to work, or death. many gave all they had during their life to fund the start of USA or colleges or such, didn’t ever think of just playing golf or such all day.
I think retiring is a man conceived desire, but I think it’s really rooted in selfishness. I know so many in”retirement” that are living in nice homes but rubbing pennies (so they say) to keep afloat. What is the point of that? Definitely able to work in some capacity.
Years ago as a teen I worked with senior citizens who worked seasonally/part time. They liked the extra income and interaction with people and were so less stressed than average workers trying to work toward retirement.
Where I live now, i see huge billboards for luxury retirement - their catch phrase:
“retire like you mean it” LOL I got news for that builder:
God doesn’t ever tell us to retire, except maybe when He calls us home.
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Sneak across the border then come back as an illegal?
.
(That is if the Mexicans don’t shot you. Try reading their immigration policy)