Retirement savings ....Yikes !

[mjarrels]

When I worked at Perdue Farms Inc. (private company) Had a generous 401K program, matched up to 6%. I was salary and took full advantage. Had probably 10 or 12 hourly folks working for me and none took part in the program. On good years, the company would actually deposit additional funds in your account. When I left after about six years, I took about $18,000 with me. Dang that would buy a tractor. Never could figure why hourly folks turned down free money.

mark

 

[mjarrels]

When I worked at Perdue Farms Inc. (private company) Had a generous 401K program, matched up to 6%. I was salary and took full advantage. Had probably 10 or 12 hourly folks working for me and none took part in the program. On good years, the company would actually deposit additional funds in your account. When I left after about six years, I took about $18,000 with me. Dang that would buy a tractor. Never could figure why hourly folks turned down free money.

mark

 

[KTurner]

Several of the comments here about budgets are referring to a budget as a way to know where your money went. That's NOT a budget, that's a report. Most online bank accounts can do this for you with the click of a button or two. It doesn't help you spend money wisely, but it may tell you if what you spent was done wisely, if you bother looking at it.

A budget is where you allocate where every single dollar goes. It forces you to sit down, think about your money and assign a purpose to every dollar you earn, before you earn it. And that way, you KNOW that if you want to buy an un-budgeted "NewShinyThing" for $300, that you're going to be $300 short somewhere else (groceries, rent, electricity, gas, etc).

Without a budget, someone will just check the checking account balance and say, oh I have enough in there to buy NewShiny, but they're not thinking about all the other bills they need to pay with that money. Or worse yet, if they just check their credit card limit and see that they haven't maxed it out yet.

It's the same idea as a grocery list. Write down what you need before you go to the store. If you go into the store and stick to your grocery list, you'll waste less money. If you don't take a list with you, you get "taken in" by the fancy marketing schemes and impulse buy things you don't need, like those candy bars and magazines starting at you while you're waiting in the checkout line.

Keith

 

[dmccarty]

We have a budget spreadsheet where we track big ticket items that we need/want done.

I create a new tab in the spreadsheet at the start of the year, cut/paste the prior year budget, and update the numbers. It is kinda funny that some items have been on that spreadsheet for years. :confused3::shocked: We prioritize what we want/need and go from there. Maybe one day we will add gravel to the driveway and I might build the well house. The current well house was built 9 years ago as a temporary structure to get us through the winter! :laughing::laughing::laughing: Looks like heck but it works.

We don't eat out much and if we do it is pizza or some other fast food. Last night, one of the kids had a play at school so we stopped at McD's for dinner. :licking: First McD's in quite some time. That stuff sure is salty though. I bet I drank a pint of water last night. :confused2: Oh, well needed to wake up in the middle of the night and put wood in the stove. :laughing::laughing::laughing:

On thing we have splurged is on vacations. We did not have any vacations when the kids were younger, and pre kids, only a few. We did wait until the kids were a certain age and then we took them on vacations. We found ways to save money on the vacation but the money spent over the years on the vacations would have paid off the little bit of the land loan we have left. One has to balance out expenses and those vacations, especially the time spent with us and the grandparents, is something the kids will remember the rest of their lives. PreKids, the land loan would have been paid off before taking a vacation. Now, we would rather give the kids memories than pay off the loan a bit earlier. The kids will only be kids for a short time and time goes by at the blink of an eye...

If I ever have the luxury of having a death bed, I won't be wishing I had paid off the land loan a few years earlier but I sure will be remembering the fun we had vacations. Tis a balance.

Later,
Dan

 

[JDgreen227]

Numerous posts here mention that the 30 and 40 year olds (or whatever age) today don't seem to be very concerned about saving for retirement. I look at it this way: Most likely a lot of people cannot count on a pension, or cannot save much because they are working a minimum wage job, and there are millions of people on assistance or just have to struggle to earn money to keep a roof over their heads and pay for food. Do we think many of those people are even able to save for a retirement? My oldest nephew will graduate from college with a Masters in education this year, and he is still somewhat concerned about being able to find a decent job and he is MUCH better off than a lot of young adults his age. A friend of mine has a son in his early 30's who spends everything he earns as fast as his earns it and the guy told me his son is that way because he feels "why save, I want to get some use out of my money NOW and not thirty or forty years down the road." I have to agree with his attitude in some way, I skim all the interest off my 457 plan earnings because I want to get some use of it now, not while I am in a nursing home.

 

[NoTrespassing]

Worst case... wife and I can move back to the Philippines and live like king and queen on Navy retirement and other investment income. Clark Howard was talking about the same thing, too many baby boomers have nothing, nada. If I knew I was going to live this long, I would have taken better care of myself.

We've discussed the same thing but I doubt it will ever happen. I don't think my wife would move back, we'd probably have to leave our child or children in the US. The way the exchange rate is going lately it might not make sense in 20 years anyway.

 

[300UGUY]

Numerous posts here mention that the 30 and 40 year olds (or whatever age) today don't seem to be very concerned about saving for retirement. I look at it this way: Most likely a lot of people cannot count on a pension, or cannot save much because they are working a minimum wage job, and there are millions of people on assistance or just have to struggle to earn money to keep a roof over their heads and pay for food. Do we think many of those people are even able to save for a retirement? My oldest nephew will graduate from college with a Masters in education this year, and he is still somewhat concerned about being able to find a decent job and he is MUCH better off than a lot of young adults his age. A friend of mine has a son in his early 30's who spends everything he earns as fast as his earns it and the guy told me his son is that way because he feels "why save, I want to get some use out of my money NOW and not thirty or forty years down the road." I have to agree with his attitude in some way, I skim all the interest off my 457 plan earnings because I want to get some use of it now, not while I am in a nursing home.

For a lot of folks, a median income of 50K, you add a couple kids, insurances, car payments, house payments, there isn't much left for retirement.

 

[bdog]

People have no one to blame but themselves. At my work there is a retirement plan. You can contribute whatever you want (up to a federal limit) and the company matches is dollar for dollar up to 3% of your pay. Despite repeated attempts by the company to try and explain the benefits of the program and to encourage people to participate only maybe 10% of the employees do. Lots of them cash out their account and pay all the penalties as soon as it gets big enough for them to buy a new TV or whatever.

We did a back of the envelope calculation one day and if someone making $10/hr just contributed 3% of their wages, and got the 3% company match and left it alone at the stock market average they would have hundreds of thousands of dollars at retirement age. Who can't afford $3 per $100 they make to ensure they are not eating alpo when they are old?

The people who say they can't afford it are the same ones who buy $5 packs of cigarettes every day or are always buying lottery tickets, or have new cars, or the latest gadgets, etc.

I am sure there are some scenarios out there where people are in bad situations due to no real fault of their own but 90% of it is people living beyond their means like there is no tomorrow.

 

[npalen]

Lots of folks are driven by the need for instant gratification which is becoming more rampant in today's materialistic society. Are piggy banks extinct yet? Sure don't see any around here.

 

[300UGUY]

People have no one to blame but themselves. At my work there is a retirement plan. You can contribute whatever you want (up to a federal limit) and the company matches is dollar for dollar up to 3% of your pay. Despite repeated attempts by the company to try and explain the benefits of the program and to encourage people to participate only maybe 10% of the employees do. Lots of them cash out their account and pay all the penalties as soon as it gets big enough for them to buy a new TV or whatever.

We did a back of the envelope calculation one day and if someone making $10/hr just contributed 3% of their wages, and got the 3% company match and left it alone at the stock market average they would have hundreds of thousands of dollars at retirement age. Who can't afford $3 per $100 they make to ensure they are not eating alpo when they are old?

The people who say they can't afford it are the same ones who buy $5 packs of cigarettes every day or are always buying lottery tickets, or have new cars, or the latest gadgets, etc.

I am sure there are some scenarios out there where people are in bad situations due to no real fault of their own but 90% of it is people living beyond their means like there is no tomorrow.

I calculated it out to be about 132K after 30 years. This obviously will vary as I used the stock market return for the last 10 years, 7.2%. This would give you about $100 per week, assuming a 4% burn rate. It would help, but you still might be eating alpo.