Retirement savings ....Yikes !

[daugen]

My trained inner self wants to go on a ten page disclaimer here...
but I pull at 5%, because I don't have kids, or needy siblings, and
am one of those folks who really doesn't want to take it with him,
except for charity bequests.

And males in my family haven't lived very long... so in my case, the "old" 5% rule,
which I find interesting that they refer to the 4% withdrawal rate as "old". Not old for some of us.

I was able to help two guys in their early sixties to retire early, without fear, because they found they really
did have the money to do so. We were able to lock in some five and six percent income streams plus for one guy,
the rest in a conservative managed account, which has done very well for him.

Sometimes it takes someone else to quietly say: It's ok, you really can retire. Or better yet, you now have financial independence,
and you can do what you want to do. And that includes continuing to work, getting a part time job in an industry that interests you,
or by just finding time for your hammock and saying goodnight to the business world all together.

For some, it's not easy to stop working. They've been working hard for a long, long time and been taking care of family, including
grandchildren. There's a feeling of being needed. So their work is very important to them. Be nice if they could ratchet back to part time
and transition to retirement over a while. Lots of businesses still have a desk reserved for the 90 year old original owner who comes in to just sit
and watch. And he's doing exactly what he wants to do. My local Kubota dealer's father does just that. He's pretty confused, but he loves to come in
and feel part of things. At his old desk, now cleaned off, but he's content. I hope I am when I turn 90.

 

[daugen]

I've noticed that also, on this and other forums.

some of my friends, and even a member of my family have free or almost free health insurance until they turn 65.
That is an incredible enabler for pulling the plug. Teacher, State employee, etc. Health care costs are 18% of the GDP.
A real challenge for planning today is wondering what Medicare will pay for twenty years from now; it's a real political football.

 

[zzvyb6]

One half of the population is below average. That, along with the politicaly incorrect use of the phrase 'common sense' is a recipe for retirement begging, government charity, income tax manipulation and runaway inflation.

 

[MacLawn]

I've also noticed what short (welcome, short!) and 300 about gubmint checks being most of our retirement, whether it's social security, military, postal, etc., most people I know get way more of their retirement income from some kind of gubmint funds. That will include me!!:mur:

But, I do have some invested, I call my grits and eggs money - enough to survive on! Daug, etc., my plan for this is to only take what the current interest will be and not even touch the principal. Interest now is 3.5% so that's what I'm basing our retirement budget on for now. Since I won't be taking principal, it will be there, and might even grow a tad if rates go up and I keep my withdrawals lower than rates. Am I right in this thinking?

 

[brin]

I've also noticed what short (welcome, short!) and 300 about gubmint checks being most of our retirement, whether it's social security, military, postal, etc., most people I know get way more of their retirement income from some kind of gubmint funds. That will include me!!:mur:

But, I do have some invested, I call my grits and eggs money - enough to survive on! Daug, etc., my plan for this is to only take what the current interest will be and not even touch the principal. Interest now is 3.5% so that's what I'm basing our retirement budget on for now. Since I won't be taking principal, it will be there, and might even grow a tad if rates go up and I keep my withdrawals lower than rates. Am I right in this thinking?

Mac...where are you getting 3.5% interest....? Can't be CD's right ? If so ...tell me where...But yes you are thinking right...you are maintaining your principal and interest rates will go up ...sometime...I think...?

 

[dave1949]

some of my friends, and even a member of my family have free or almost free health insurance until they turn 65.
That is an incredible enabler for pulling the plug. Teacher, State employee, etc. Health care costs are 18% of the GDP.
A real challenge for planning today is wondering what Medicare will pay for twenty years from now; it's a real political football.

That is a problem. Unfortunately, divisive politicians working for the Koch Bros. want us to blame the retirees for the cost of health care delivery, as if they had anything to do with it or could control it. It is a prime example of getting people to fight over the symptoms and not the root causes.

The real issue is the cost of health care delivery combined with the demographic pressures in the baby boomer retirement wave. Very few working families can keep pace with increases in the cost of health care, let alone retirees.

 

[MacLawn]

brin, our 3.5% is from an in house 403(b) plan. It's very controlled and not many people can be in this one, specific for our organization. I've seen it from about 11% down to present 3.5%.

 

[Travelover]

brin, our 3.5% is from an in house 403(b) plan. It's very controlled and not many people can be in this one, specific for our organization. I've seen it from about 11% down to present 3.5%.

A so called stable value option is common in 401(k) and 403(b) plans. I believe that it is where insurance companies borrow money. One of the last good payers for a cash investment.

http://stablevalue.org/help-desk/faq/

 

[cdaigle430]

Last year the CEO called me in to ask why I was not contributing to the 401k especially since a lot of employees come to me for advice...

I was frank and gave my reasons... the company no longer offered a match and my research on the funds offered showed high fees... she told me the employees pay no fees and that I need to watch what I say...

I then explained to her the costs are buried or taken from the yield... so we are all paying by virtue of having the 401k and I offered to bring in my research to show her the specifics on the 8 choices available...

Come to find out there was a 9th choice that was no where to be found... the 401k had a cash account that paid a guaranteed 3% and could never go lower.

With the new full disclosure of costs/fees on the horizon... the plan we had was terminated by the provider...

As to giving advice... all I could do is answer candidly my reasons for not participating.

A large chunk of the money I have is paying about 1% in a bank money market and guaranteed and Insured awaiting my next non Wall Street investment.

The problem with your theory is that most of us would never save for retirement and your forgetting that contributing to a 401k is a tax shelter for money your saving, can lower your yearly salary enough to put you in a lower tax bracket. Over time the 401k will compound in savings. Its money well spent in my opinion-even if you buy conservativley. I have over 100k in mine for 10 years(6 percent of my salary) putting in money I dont miss-no company matches and I am lower middle class. Thats moeny I would never have saved to begin with! How much has your money market account earned you?

Be carefull what you give for advice, it may be perfect for you but you may just doom others if they dont do there homework.

 

[daugen]

Mac...where are you getting 3.5% interest....? Can't be CD's right ? If so ...tell me where...But yes you are thinking right...you are maintaining your principal and interest rates will go up ...sometime...I think...?

:thumbsup: