Retirement Savings Rule Of Thumb

[Matt_C]

And be the guy making 90k a year living like the guy making 30k. 😁

Bingo, It ain't how much you make, it's how much you keep/save.

[BrianL]

10% is a good easy rule. But the more you save the better, and the sooner you start the better. I think most need at least 10-15x their annual salary invested by the time they retire to supplement SS. Investing in a 401k is a great way to help get you there IMO, but if you don't have one find a way to start investing. Low cost index funds are good options. Not many folks beat the S&P over long term.

[curtintex]

If you choose to live well within your means, living like most people WON'T (investing heavily rather than spending heavily), especially during the first 20-30 years of your working life, then you will be able to live like most people CAN'T for the rest of your life after that.

Words my Dad has hammered into me as long as I can remember hearing his voice: "Do today what others won't, live tomorrow like others can't". So I bet all my **** everyday like a serial entrepreneur should. Everytime I've had a substantial amount in the market, I've taken it out to buy real estate or start another company. I bet I'd have had a lot less stress if I'd have been conventional. I bet I'd have had a lot less fun too.

I'm gonna pass on another piece of wisdom I got from my Dad...."Don't get so busy making a living, that you forget to make a life". If you plan to retire at 65, you only have about 11 years (US male life expectancy is 76). However, lots of people die in their 50s and 60s...even 40s. I can tell you that it won't make a bit of difference what's in your 401k when they put you in the ground. So there has to be a balance. If you plan to "live the good life" in retirement and miss out on the good life while you're in your prime...Vacations with family, dinner out with friends, epic hunting trips, good bourbon, helping your fellow man... you may surely regret that as well. Jen and I made the decision a few years ago to retire a little bit everyday. Balance is the key, because not a one of us is promised tomorrow.

[Chief Big Toe]

well, after reading this, sure makes me think and wish i would have been lucky to have gotten in to were i work when i was in my 20's, now i see all these guys retiring out, ( old coots) and here all about there pensions worth, and plus the 401K, i just wish to be able to pay my bills and have to work part time as a door greeter (nothing wrong with that)
i got perhaps 10 more years, never going to hit that big $$ number, but its ok

[Wood Rat]

So i hear you need 10x your salary when you are ready to retire. But at what age. and on 39k or 90k? its a lot to think about, how much money do you need to retire and what age, you can withdraw from your 401k at 59.5 without the penalty. is that two early and if not how much do you really need if you are debt free. Dam taxes alone makes you need a part time job.

[Chad74]

I know how much I spend a year. I have tracked it for years. It is easy to predict how much I will need to live when I am not working. The rest is just math.

What are you tracking? Money you spend on fun stuff or living expense money like on mortgage, car notes, etc? Or both?

[BrianL]

So i hear you need 10x your salary when you are ready to retire. But at what age. and on 39k or 90k? its a lot to think about, how much money do you need to retire and what age, you can withdraw from your 401k at 59.5 without the penalty. is that two early and if not how much do you really need if you are debt free. Dam taxes alone makes you need a part time job.

Probably best answered by a financial advisor and your situation, but I think most assume 62-65 with life expectancy around 84.

[thegrouse]

What are you tracking? Money you spend on fun stuff or living expense money like on mortgage, car notes, etc? Or both?

Every expense I have, NOT including savings or investments. So all housing, vehicles, healthcare, blow money, utilities, taxes, etc.

[Mike D]

My wife and I got started late in life investing and then building our dream home.

We have been putting away 15% in employee matches 401k. Our goal is to retire 100% debt free. We’ve been there before and will get there again. You can have a much more enjoyable retirement when you don’t owe anything but living expenses and of course extortion money (taxes).


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[SaintBlaise]

This is a concept I've been struggling with lately. The wife and I have been saving like crazy. We could be at a point in roughly a year to be able to pay the house off and be 100% debt free. But at 3% on a 15 year, would I be better off investing it? Or pay the house off then start dumping that payment amount in? Tough decision.

Solo, invest your money. You can't get much lower than 3% on a loan, enjoy. You only have to make 4% on your investment to breakeven, so you don't need to take a lot of risk. If you make more, and I would expect to, then you are playing the game right. If something happens and can't pay for your mortgage, you have the money saved to dip into.