Are you "lucky"if you have a secure retirement?

[JDgreen227]

What vtsnowedin says: Before I retired I sat down and crunched the numbers: I made near $20 an hour...now...after paying social security, FICA, state and federal tax, city tax, union dues, mileage, parking, etc. out of that wage I took home about $2.90 an hour MORE than my pension would pay me, at the time I did not have to pay state tax on it (pension) While I am not the first to agree I am not the sharpest tool on the rack, even my peanut size brain rebelled at the idea of working for $3 an hour net, what with a 20-25 minute commute one way, having to work outdoors year around, and paying big bucks for work clothing and boots that got ruined in short order ON TOP OF THAT miserly wage. Liked my job, liked most of the people, but who wants to earn $3 an hour?

 

[newbury]

<snip> That, or join me at the local social club that sells a dollar cup of coffee with free refills and sit around all day jibber-jabbing with your neighbors.

I thought TBN was the local social club, I'm having tea with free refills and jibber-jabbing with you!

I take a different view on the amount of income needed after retirement. When you retire your house should be paid for and your children should be grown ,educated and on there own so your expenses should be a lot less then when you were working full time with a house full of dependents. Let's for the sake of round numbers say that when you were working you brought in 100K, Of that you paid 7.65 % in social security and medicaid taxes or $7,650. then you probably paid 17% state and federal income taxes Or $17,000. Depending on when you bought your house and how big it is your mortgage payments might vary from $600 to $1300 per month or more but lets say $800/m not counting property taxes So $9600 per year. Then you were commuting to work about 20,000 miles a year at $0.50 per mile for $10,000. Lets skip feeding , clothing and educating kids as not everyone has them. So you were living on $ 100 -7.65-17-9.6-10 which equals 55.75K
Now if your retirement income was $56,000 and it came from SS or a pension plan you would not have to pay SS and medicare taxes on it and at that lower income the income tax bite might be just 10% or 5600 your house is paid for, and you don't have to commute to work and your Beemer can sit in the garage and appreciate. So assuming the kids have moved out you have $50,400 to spend on what you want as apposed to $55.75 net from $100K while working. That comes out to your only gaining $2.68 per hour for working a full 2000 hour year.
Oops I forgot that you were contributing 6% a year to your retirement plan or 401K. So you were living on less then $50K.

Excellent summary.
You have to calculate ALL KNOWN COSTS of working. Now ALSO calculate YOUR "cost of living" where you will be retiring.
For example - Alexandria, Va. moving to Fulton, Ms.
Most online calculators say the cost of living is greatly less. My ACTUAL decline in cost is cheaper gas, diesel, groceries, health care (virtually free dental from relatives), and utilities.
I reckon my decreased cost will be about 70% of living in Alexandria or more.
But bottom line is that after 3 years of retirement, without touching our retirement TSP savings SWMBO and I have started looking where to spend the $$ we are accumulating.

 

[gladehound]

It's luck... and luck favors the prepared.

 

[Travelover]

I thought TBN was the local social club, I'm having tea with free refills and jibber-jabbing with you!


Excellent summary.
You have to calculate ALL KNOWN COSTS of working. Now ALSO calculate YOUR "cost of living" where you will be retiring.
For example - Alexandria, Va. moving to Fulton, Ms.
Most online calculators say the cost of living is greatly less. My ACTUAL decline in cost is cheaper gas, diesel, groceries, health care (virtually free dental from relatives), and utilities.
I reckon my decreased cost will be about 70% of living in Alexandria or more.
But bottom line is that after 3 years of retirement, without touching our retirement TSP savings SWMBO and I have started looking where to spend the $$ we are accumulating.

I have to agree. I've been retired for 8 years now and have been banking a fairly good portion of my pension. A lot of the money I used to spend was to make myself feel better due to the stress of the job. Also there is time to shop carefully to get the best deal on anything, to travel on weekdays and shoulder seasons, to fix something myself rather than just write the check to make the problem go away. Plus I drive less than 10,000 miles a year now - a new car will last me literally 20 years.

Retirement living can be very cheap without depriving yourself of anything.

 

[300UGUY]

You need more than that because if you're not working, you suddenly find yourself with more time to spend money. As a result, you need more annual income in retirement than you had when working in order to maintain the same level of quality of life. That, or join me at the local social club that sells a dollar cup of coffee with free refills and sit around all day jibber-jabbing with your neighbors.[/QUOT

I don't spend as much on most things in retirement. I do more work on my property now, I used to hire stuff done, but now I just do it myself. At some point that will change again, but I will probably downsize at that point.

 

[Buggs67]

I'm not spending more. I'm driving less. I'm not wearing out clothes and don't need specialized clothes/equipment. I'm not buying lunch out. I started making my own bread (for fun and better quality), more time to cook.

And for social club, I go to my buddy's house and we walk in the woods with our dogs or sit on the deck and have a cold beer and watch the doggies play.

I stop in at work every so often to see what I'm missing:laughing:, BS with the guys and catch up. I miss being part of something, but glad to be out-from-under.

The biggest thing is, I planned financially for retirement, but I forgot (or never thought) of physical condition. It sounds stupid but when I was 40 I conceived that I would feel like that when I was 55-60. But life is what happens when you make plans.

 

[alchemysa]

You need more than that because if you're not working, you suddenly find yourself with more time to spend money. As a result, you need more annual income in retirement than you had when working in order to maintain the same level of quality of life.

Thats not correct at all. It costs a small fortune to go to work. Nice clothes, better cars, daily travel, lunch money etc are all required when you have a job. I'm semi-retired, and I now work from home. (My wife does the same). Our expenses are so low we can survive very comfortably on half what we used to earn. And, as has been mentioned elsewhere, the extra free time allows you to shop more wisely rather than making hasty decisions. (An example.. Recently I'd been thinking of buying a brand new car. I shopped around a lot but in the end I just lost enthusiasm for the idea. Nothing seemed to be a whole lot better than the 15 year old car I already own. $30,000 saved.)

 

[TomSeller]

All the men in my family stop working when they die..

I imagine I will too.

 

[riptides]

All the men in my family stop working when they die....

I believe in Heaven and Hades, I imagine I'll be working in one if I am not good and my deed list is not up to par.

 

[Duwop]

If you don't owe anybody any money, any at all what exactly do you think your going to spend 60-80k a year on in retirement? I don't need that much I am fairly happy and I'm not planning on leaving much if any when I pass. We complain about how lazy young people have become well I say it's because we are to easy on them and if they think they are getting a fat inheritance that just compounds the problem. I personally know some of these types I had several of them working for me over the years and it just confirms why I feel the way I do. I hope you live long enough to start spending what your delaying by convincing yourself that you need it.