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[Yahoo! Finance] Economist: ‘Retirement for most people is financial suicide’

Maiden Voyage

Gold™ Member

Laurence Kotlikoff, the brash Boston University economics professor and Social Security expert, doesn’t mince words.

“We Americans are financially quite sick,” he writes in his new book, “Money Magic: An Economist's Secrets to More Money, Less Risk, and a Better Life” before listing all the financial gaffes we Americans make in our lifetimes.

“As a group, we undersave, underinsure, under diversify, pay for bad investment advice, rely on dying early, retire too soon, take Social Security at the first chance, free far too little trapped equity, borrow to invest in stocks, convince ourselves that stocks are safe long-term, live house poor,” he writes.

Marriage, divorce, college, and other lifestyle decisions we make irk him as well. But it’s a lack of savings — especially for retirement — that really gets under his skin.

“Most workers are saving bubkes,” he writes. “Half of today’s working families risk a major living-standard decline in retirement. The share would drop roughly in half were all workers to retire two years later.”

So, he offers his retirement advice in his book, which comes with a title that is a bit of a wink. It’s not abracadabra.

“It’s lifetime budgeting,” he told Yahoo Money. “It's the economics approach to financial planning … [it’s] not asking what you would like to spend, but here's what you can spend.”

Here’s what else he had to say in a conversation with Yahoo Money.

Kerry Hannon: Is conventional financial advice about retirement all wrong?

Laurence Kotlikoff: “The financial industry steers people looking for retirement planning advice into a fantasyland. Advisors ask them, how much would they like to spend in retirement? My answer is a billion dollars a day.

Then they ask them how much are you saving? ‘Not so much. Okay Let's put you into these high-yield funds.’ Your probability of success of not running out of money is higher. And your probability of success of failing is small –that really means the probability of starving to death.

So where you have financial planners kind of basically putting together a plan where the probability of starving to death is small. That doesn't sound like particularly good planning.

What are the biggest mistakes that people are making when it comes to their retirement?

A lot of people are just not planning for it. They leave it to somebody else. They're assuming that Uncle Sam and their employer are taking care of them. Then they are surprised when they hit retirement and find that they may not have enough money.

Second, there are lots of people that are not saving in 401(k)s, or are in 401(k) plans and aren't participating enough. They're not even putting in enough to get an employer match.

Taking advantage of the employer match is possibly the simplest money magic trick in the book. The average matching contribution to an employee’s retirement plan is over 4% of their pay. Yet a quarter of the workers eligible for this free money don’t participate in their employer’s plan. Let me proclaim this no-brainer:

If your employer offers to give you money for free, take it.

In my opinion, the whole 401k retirement account experiment in this country has failed.

Are people retiring too early?

Yes. They retire too early thinking they're okay without really looking at it carefully. The median wealth of Baby Boomers retiring is about $144,000, which is about three years of median spending, in a retirement that could last 35 or 40 years in some cases. So most boomers are retiring with too little money by a long shot for a retirement. That money could last longer if they worked longer.

I think retirement for most people is financial suicide. It's a decision to take the longest vacation of your life.

What is stopping people from saving in a retirement plan?

At least 32% of employers don't sponsor retirement account plans, period. And they're employing a good chunk of Americans.

And then we have a lot of people who have just got more pressing needs. They've got to pay for daycare. They've got to pay for the mortgage. They just don't feel they can contribute.

What are the biggest mistakes people make when it comes to Social Security?

They take Social Security too early at a much lower benefit. We have about 6% of people waiting until 70 to take their retirement benefit. My estimate is that about 85% should be waiting until 70 to take the benefit, when it’s 76% higher adjusted for inflation versus taking it at age 62.

That way, you're going to have more of your resources in an inflation-protected form. And then you've got this insurance if you keep living to a hundred. You've got this much bigger number year after year coming to you.

If you're disabled, and you can't work, and you don't have anything else, you're going to have to take it early, but there's lots of people that aren't and are taking it as soon as they can.

What’s your best piece of financial advice?

I know a lot of people that have student loans at the same time are investing in stocks. It's a crazy thing to do. That was one of the things I am trying to get across in the book.

So what they've done in effect is borrow money to invest in the stock market. If you put less in the stock market, and you pay off that student loan, now you're getting probably a 5%, maybe 7% return.

Same with mortgages. Because of mortgage interest rate differentials, mortgages are financial losers. They’re not nearly as bad as credit card balances, student loans, or payday loans, whose interest rates are far higher, but they’re still something to be avoided when possible. Paying off household debts, starting with the highest interest-rate debts, is your best investment. It’s entirely safe and it provides you a for-sure, above-market yield.

Parting thoughts?

Work on your financial health now, so you can spend your money ‘til the end. That’s the object. And if you've made a lot of money, if you're rich, you don't want to put it in the stock market. The stock market could drop 50%. It has.
 

Maiden Voyage

Gold™ Member
I've been tracking my net worth and such for a long time. Paying off my student loans and mortgage were a massive help for me & the Mrs. Most of our energy and finances are all funneling into our retirement accounts with the hope that we can retire early in the future. The current market has me a bit more skeptical about my retirement number but it is a good check on our methods & decisions.
 

greyshark

Member
I've been tracking my net worth and such for a long time. Paying off my student loans and mortgage were a massive help for me & the Mrs. Most of our energy and finances are all funneling into our retirement accounts with the hope that we can retire early in the future. The current market has me a bit more skeptical about my retirement number but it is a good check on our methods & decisions.

Sounds like you’re far ahead of the curve - way to go!

This article does not resonate with me. It seems like he’s prescribing “one-size-fits-all” solutions to retirement planning when in actuality it is FAR more complicated. Everyone’s situation is different - some people should take Social Security at 62 while for others it makes more sense to wait. Paying off mortgages early may not make sense in the low interest rate environment we’ve recently been in.

Of course the average person should be saving more than they are. Most recent retirees have had the luxury of relying on pensions, something our generation will not get. We should be focusing our efforts on educating ourselves on what it means to plan for retirement.

There is no magic answer that works for everyone. Understanding your options and building a plan for you is the way to go.
 

Maiden Voyage

Gold™ Member
Sounds like you’re far ahead of the curve - way to go!

This article does not resonate with me. It seems like he’s prescribing “one-size-fits-all” solutions to retirement planning when in actuality it is FAR more complicated. Everyone’s situation is different - some people should take Social Security at 62 while for others it makes more sense to wait. Paying off mortgages early may not make sense in the low interest rate environment we’ve recently been in.

Of course the average person should be saving more than they are. Most recent retirees have had the luxury of relying on pensions, something our generation will not get. We should be focusing our efforts on educating ourselves on what it means to plan for retirement.

There is no magic answer that works for everyone. Understanding your options and building a plan for you is the way to go.
I do agree. I think his point about not letting others, financial managers, etc., fully manage your retirement investments is rock solid though. The collective 'We' need to be better about educating ourselves on financial wellness. I think any education, including reading differing opinions, is better than status quo. In today's easy-to-digest-just-tell-me-what-to-believe news & media environment, it's getting more difficult to properly give people options. But it is critical to come to your own answers for sure.

The wife and I grew up dirt poor so it was critical for us to develop a financial strategy and execute on it. So far, we've surpassed our own expectations each year. With the current situation, I do worry this might the first year we fall short, but the market seems to be rebounding so maybe not. Either way, flexibility was the most important item for us--hence paying off all debts rather than prioritizing investments. That won't be the solution for everyone, but the greater point is to have those discussions in the first place. From that you can build your strategy and execute on it. Routine check-ins will help.
 

billyxci

Permabanned.
i don't give retirement much of a thought now. i'll probably be dead before i can retire and even if i somehow live that long i'll still need to work.

i'm not entirely clued up on it but as i understand it i can work until 2051 when, if i don't take a lump sum, i will get about £224/week (i think) from my work pension. that ain't going to do shit today never mind in 2051 so i'll still need to work and pay full rent since it's a private pension. in 2059 i will be able to get a state pension of ~£180/week but i'll still need to work because i still won't get any help with rent or anything else.

some people at my work recently retired but it's only really partial retirement. one born in 1958 is still doing 35 hours/week and the other, born in 1961, is doing 16 hours/week. it's not possible for them to fully retire. still gotta go to work.

i have always been a saver so have been trying to do that since i started working. hopefully i can keep doing that but i don't think it'll last. i've been working 14 years and if i need to live on only my savings it'd last about 8 months. so at best it's probably only enough to keep me going if i was between jobs.
 
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///PATRIOT

Gold Member
I read somewhere that in the United States, you'd need $2 million dollars to retire comfortably.
 
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Maiden Voyage

Gold™ Member
I read somewhere that in the United States, you'd need $2 million dollars to retire comfortably.
Area where you live will be a big impact on the amount needed. We live in a low cost of living state, so our threshold is lower than $2m but not by much.
 

StreetsofBeige

Gold Member
I can understand people who have always had bad paying jobs not being able to save, or some out of scope situation happens like divorce killing your money.

But for anyone out there who made decent money for 40 years (estimate all the money you'll make by the time youre 65 net of income tax), and is still broke at 65 and relying on the government's monthly social assistance payout (in Canada I think you get about $1000/mth when youre an old geezer), then you got issues.

I bet half the people broke at retirement who did make decent money in their career is due simply to one or more of these things under their full control:

- Bad spending habits (too expensive a car, too many trips etc...)
- Overkill on some fancy expensive student loan (jacked up by needing more to live on campus)
- Bad at investing
- Not taking advantage of companies offering perk like matching retirement contributions
- Renting. Most people's biggest asset appreciation will come from real estate
- The place you live in is way over your budget
- Too many kids (if you can barely afford to live being single or with 1 kid.... then why have 4 kids???????)

My plan is set to retire at 60 with about $3.5M of assets and money. And that doesn't even include real estate flips I do every 5 years worth $100s of thousand more. I excluded that because who knows if the bubble will continue + being conservative. If it happens, I'll be well clear of $4M.

I should have about $2M in cash and investments which I'm going to funnel to dividend paying stocks getting me around $80k/yr (4% yield), and when I'm 65, the gov will also give me about $12k/yr as everyone gets it. So as long as the markets or real estate dont crash the next few decades, I should be able to pull in $92k/yr in gross income at 65. And I didn't even factor in selling my place for a smaller one and using those proceeds towards more dividends. If I do that, I should be able to make about $100k/yr sitting on my ass in dividends.
 
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StreetsofBeige

Gold Member
Sounds like you’re far ahead of the curve - way to go!

This article does not resonate with me. It seems like he’s prescribing “one-size-fits-all” solutions to retirement planning when in actuality it is FAR more complicated. Everyone’s situation is different - some people should take Social Security at 62 while for others it makes more sense to wait. Paying off mortgages early may not make sense in the low interest rate environment we’ve recently been in.

Of course the average person should be saving more than they are. Most recent retirees have had the luxury of relying on pensions, something our generation will not get. We should be focusing our efforts on educating ourselves on what it means to plan for retirement.

There is no magic answer that works for everyone. Understanding your options and building a plan for you is the way to go.
In low interest rate environments, I wouldnt pay off my mortgage either. I'll let it the normal payments continue. My mortgage renewal is set for May and it's currently a variable mortgage at 1.40%. That's basically free money.

If rates creep up (which they will) and it ends up at 3-4% I'll reconsider my mortgage contribution. But past 3 years my mortgage rate has been about 2% (right now it's at 1.70% and projected at 1.40% at renewal. Not paying it off when I use it to make more money in real estate and stocks.
 
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jason10mm

Member
I read somewhere that in the United States, you'd need $2 million dollars to retire comfortably.
No where near that much. One of my parents has about 2 mill all in and can't spend the money fast enough.

The other has far less and has to penny pinch but still owns her home and does whatever she wants.

If course they both have goodish health so that is a major factor in living cheaply well.
 

NahaNago

Member
I think most of my family will be okay, maybe not 2 million dollars okay but most of my siblings are saving right now for retirement already or at least to some extent and half of them have nearly paid off their homes already. Me on the other hand :LOL::messenger_downcast_sweat:. I don't really plan to start aggressively saving for retirement for 3 more years since I plan on traveling and I guess finding myself or a career(midlife crisis).
 
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kiunchbb

www.dictionary.com
I read somewhere that in the United States, you'd need $2 million dollars to retire comfortably.

It is probably 4 millions now, that's how you able to still travel every year, eat expensive food, by only using your interest; so you can leave most of those money to your kids.

If you own a house, or better yet, sell the expensive house and move to a cheaper place to retire, you can live worry-free with only social security. Even if you don't have huge social security, there are social security insurance for low income elder, food program, etc; sure you won't be going to Europe every year, but I wouldn't call it hopeless. The biggest problem is rent, but if you pay off your house, or got a government housing (super long line), then you are pretty much set. America is one of the best place to retire being poor.

It is a financial suicide for middle class though, because they have to pay everything out of their own pocket. The biggest issue is not having enough to leave any asset to your kids, imagine if your parent left you with 500k when you are at 40s or 50s, it is huge help, and that's how each generation get wealthier and more successful; for some people it is a responsibility to pass on wealth to their kids instead of spending them all just to retire.
 

StreetsofBeige

Gold Member
It is a financial suicide for middle class though, because they have to pay everything out of their own pocket. The biggest issue is not having enough to leave any asset to your kids, imagine if your parent left you with 500k when you are at 40s or 50s, it is huge help, and that's how each generation get wealthier and more successful; for some people it is a responsibility to pass on wealth to their kids instead of spending them all just to retire.
Thats what I plan to do. I've never been a big spender (though I have nice car). I just learned to live like my parents (cheap and pragmatic), but not that cheap. I still buy some nice things here and there, but if I had to buy a new TV stand for example and had to choose between Ikea and a hand made cherry wood tv stand, I'll buy the $100 one from Ikea made from MDF than a fancy $700 stand. Thats just me.

I plan on splitting all my assets and money in my will equally across my nieces and nephews. My parents will be long dead so they wont eed it. And my siblings dont need it either as they have more money than I do. So I'm going to hand it all down to my siblings kids, who are all good kids. No idiots or drug sniffers among them. So they deserve it.

If all goes well, I might be able to hand them $800,000 each if I die with $4M on me.
 

kiunchbb

www.dictionary.com
Thats what I plan to do. I've never been a big spender (though I have nice car). I just learned to live like my parents (cheap and pragmatic), but not that cheap. I still buy some nice things here and there, but if I had to buy a new TV stand for example and had to choose between Ikea and a hand made cherry wood tv stand, I'll buy the $100 one from Ikea made from MDF than a fancy $700 stand. Thats just me.

I plan on splitting all my assets and money in my will equally across my nieces and nephews. My parents will be long dead so they wont eed it. And my siblings dont need it either as they have more money than I do. So I'm going to hand it all down to my siblings kids, who are all good kids. No idiots or drug sniffers among them. So they deserve it.

If all goes well, I might be able to hand them $800,000 each if I die with $4M on me.

I am not a lawyer, and you are probably already know about it; just to be sure tho, with that much asset you should look into drafting a trust, there are a lot of benefits, protection, and tax saving to it.
 

StreetsofBeige

Gold Member
My life objective was always retirement so I took unionized jobs with defined pension plans. Sure not the most motivating sometimes but job security was always important for me. If I don't die soon, full pension at 51.
No worries. Do what you need to do to get through life. Defined pensions plans are what most of us dream about. My sis in law works for government and I know lots of teachers who have defined. As a ballpark they all say when they retire and they do their formula, they will all get around $40k (I think) every year till they die.

I don't even think there is a limit on number of years. So if they live to 95, they get every year to 95.

The rest of us have to ensure our savings and investments accrue. Although many of us working for big companies will get RRSP matching. It's typically somewhere around a max of 3-5% of salary I'd guess that gets put into a mutual fund you pick from a big list to choose from from Manulife or Sun Life Financial. But one guy I know his company matches up to 7%! I told that guy (pretty young), max that shit out every year if you can. Free money.
 
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There's plenty of things you can do to make the money last as well, but that's going out of regular people's comfort zone.

Me, I've travelled a lot so when I decided to semi retire, I moved internationally. There's literal paradises on earth that are 50x cheaper than Canada and the US. Where I live right now a regular person can live life very well off with 20-30k or so per year, and that's living with a decent degree of luxury. You can easily make it work with 10-15k if need be.

Helps that me and my wife are young with no kids, but really not enough people take the broader set of possibilities the world offers into consideration.
 

Lunarorbit

Member
I'm 40 and don't have anything saved for retirement. Nothing. No pension, 401k, Ira, etc. Have my house paid off. No school debt.

Oh well. It's really hard to save for alot of people. Personally I've never been given an option for retirement at work until I started working for a local municipality last year.

So I have one year vested in a county's retirement fund.
 

p_xavier

Authorized Fister
No worries. Do what you need to do to get through life. Defined pensions plans are what most of us dream about. My sis in law works for government and I know lots of teachers who have defined. As a ballpark they all say when they retire and they do their formula, they will all get around $40k (I think) every year till they die.

I don't even think there is a limit on number of years. So if they live to 95, they get every year to 95.

The rest of us have to ensure our savings and investments accrue. Although many of us working for big companies will get RRSP matching. It's typically somewhere around a max of 3-5% of salary I'd guess that gets put into a mutual fund you pick from a big list to choose from from Manulife or Sun Life Financial. But one guy I know his company matches up to 7%! I told that guy (pretty young), max that shit out every year if you can. Free money.
I'm lucky enough to have many millionaires in my family including my parents that will leave half of what they have as they put me on their will. They also own two houses paid in full that I'll be able to sell eventually if I make it through. Same for my uncles and aunts that don't have any children. I expect to have a pension of about 100kCDN per year in 2022 dollars. Pension fund is not fully indexed, about 1% per year though.
 

StreetsofBeige

Gold Member
There's plenty of things you can do to make the money last as well, but that's going out of regular people's comfort zone.

Me, I've travelled a lot so when I decided to semi retire, I moved internationally. There's literal paradises on earth that are 50x cheaper than Canada and the US. Where I live right now a regular person can live life very well off with 20-30k or so per year, and that's living with a decent degree of luxury. You can easily make it work with 10-15k if need be.

Helps that me and my wife are young with no kids, but really not enough people take the broader set of possibilities the world offers into consideration.
IMO a lot of people assume when they retire, they retire in the same location. So if it means retiring in an expensive location, they think they have to keep living there forever.

You dont even have to move to a different country or province.

If I move 2 hours away from the Toronto core, I can get a similar house to what I have now for probably at least $500,000 cheaper. That goes right to my bank account. OK, when I'm in my 60s I might 2 hours away from fam and friends, but who cares. It's not like I'm hanging out with them every weekend. Many of them might be dead anyway.
 

jufonuk

not tag worthy
My life objective was always retirement so I took unionized jobs with defined pension plans. Sure not the most motivating sometimes but job security was always important for me. If I don't die soon, full pension at 51.
What about ionised jobs ?

Meme Reaction GIF by Travis
 
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IMO a lot of people assume when they retire, they retire in the same location. So if it means retiring in an expensive location, they think they have to keep living there forever.

You dont even have to move to a different country or province.

If I move 2 hours away from the Toronto core, I can get a similar house to what I have now for probably at least $500,000 cheaper. That goes right to my bank account. OK, when I'm in my 60s I might 2 hours away from fam and friends, but who cares. It's not like I'm hanging out with them every weekend. Many of them might be dead anyway.
Know exactly what you mean, my dad and his wife moved from Toronto into London (ON) a few years ago when he decided to retire, they sold their house and picked up a nice 2 story + basement house for I think $380k. It's currently worth about $600k. He still drives to Toronto whenever he pleases and his life really hasn't changed that much.
 
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StreetsofBeige

Gold Member
Know exactly what you mean, my dad and his wife moved from Toronto into London (ON) a few years ago when he decided to retire, they sold their house and picked up a nice 2 story + basement house for I think $380k. It's currently worth about $600k. He still drives to Toronto whenever he pleases and his life really hasn't changed that much.
LOL. London ON was exactly the place I was thinking of.
 

jufonuk

not tag worthy
Living in Europe and the U.K. so far having free health care is great. With the option to pay a bit extra to get private healthcare. To get faster treatment. Is a massive benefit. It’s not something we need to worry about for now. But if the tories gut the NHS let’s see 😞

To be honest I dont think a pension alone will keep me going. So might have to pick up a part time job in the future but let’s see.
 

p_xavier

Authorized Fister
Know exactly what you mean, my dad and his wife moved from Toronto into London (ON) a few years ago when he decided to retire, they sold their house and picked up a nice 2 story + basement house for I think $380k. It's currently worth about $600k. He still drives to Toronto whenever he pleases and his life really hasn't changed that much.
I purchased my "forever home" in a rural area for that reason. I'm less than an hour train from my job and can walk to the train station. Places in Northern Ontario or the Atlantic provinces are still quite cheap. But even then, Halifax is now expensive and Moncton prices nearly were up 50% YoY. Crazy.
 

StreetsofBeige

Gold Member
I purchased my "forever home" in a rural area for that reason. I'm less than an hour train from my job and can walk to the train station. Places in Northern Ontario or the Atlantic provinces are still quite cheap. But even then, Halifax is now expensive and Moncton prices nearly were up 50% YoY. Crazy.
Ya. My buddy scopes out real estate and those eastern places are hiked up a lot. He says Montreal is still great for deals. He bought some places for dirt cheap. Montreal some reason has low prices and low rents according to him.

He said the Niagara region skyrocketed and is a total bubble, so avoid. That area has historically been dirt cheap for decades. Not anymore.
 

p_xavier

Authorized Fister
Ya. My buddy scopes out real estate and those eastern places are hiked up a lot. He says Montreal is still great for deals. He bought some places for dirt cheap. Montreal some reason has low prices and low rents according to him.

He said the Niagara region skyrocketed and is a total bubble, so avoid. That area has historically been dirt cheap for decades. Not anymore.
Not anymore, well yes compared to Vancouver or Toronto but you can't get a nice house under 800k$. I had sold my 512sf condo in 2020 for 460k$...
 

EviLore

Expansive Ellipses
Staff Member
The median wealth of Baby Boomers retiring is about $144,000

They take Social Security too early at a much lower benefit. We have about 6% of people waiting until 70 to take their retirement benefit. My estimate is that about 85% should be waiting until 70 to take the benefit, when it’s 76% higher adjusted for inflation versus taking it at age 62.

^ Key points. You have to max out your IRA and 401(k) contributions for as many years as possible, and delay taking social security if you don't have a substantial nest egg (and even if you do, depending on your target annual spending). The typical retiring boomer has apparently done neither.
 

StreetsofBeige

Gold Member
^ Key points. You have to max out your IRA and 401(k) contributions for as many years as possible, and delay taking social security if you don't have a substantial nest egg (and even if you do, depending on your target annual spending). The typical retiring boomer has apparently done neither.
Ya, the whole maxing out thing is important too. Canada has the same thing where if you extract early you get dinged a lot. Too lazy to check the formula, but no way I'm doing it early.
 

BigBooper

Member
I think a lot of younger people think they don't have to save because they can just jump off a building if it gets too bad when they're old. I've heard that sentiment quite a lot.
 

p_xavier

Authorized Fister
I plan to fly out to wherever euthanasia is legal when I'm old and go out that way.
It's legal in Canada and one of my friend had Lou Gherig disease. He video called me and said, well was great knowing you, I'm going to be dead tomorrow. I don't think we should choose our way of death nor time. Was such an awkward moment to reflect on.
 

Blade2.0

Member
Boy howdy. You pay everyone less and make everyone pay more for things, get rid of pension plans and then try to kill social security. Then you make a news story about how most people can't retire. I wonder fucking why. 🤔
 

gatti-man

Member
A simple savings plan I’ve always done is one paycheck limit for all solid bills. Rent car and anything else that’s monthly. The other pays for food and fun. Save as much of the second check as possible. Really sucked when I was younger now I’m 43 and worth close to a million.

This year will be a wash bc the market is trash but before I went all cash I made 30k so that’ll do incase things really get ugly.

People don’t believe me but your 20s are for grinding. If you aren’t working your dick off in your 20s you won’t make it later imho. I didn’t really take a breathe until mid 30s. Finances are as much a choice as anything else.

Oh yeah fuck 401ks do an IRA and HSA. 401ks are only good if your employer has a good match and the funds are quality. The IRA I manage myself is up 500% in 2 years time (no I don’t trade options or penny stocks)
 
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It's a disgrace that personal finance or economics isn't taught in school. Learning about value investing was hands down the best thing I've ever done. I'll probably be able to retire by the time I'm 30.

To hell with pensions.
 

jason10mm

Member
Thats what I plan to do. I've never been a big spender (though I have nice car). I just learned to live like my parents (cheap and pragmatic), but not that cheap. I still buy some nice things here and there, but if I had to buy a new TV stand for example and had to choose between Ikea and a hand made cherry wood tv stand, I'll buy the $100 one from Ikea made from MDF than a fancy $700 stand. Thats just me.

I plan on splitting all my assets and money in my will equally across my nieces and nephews. My parents will be long dead so they wont eed it. And my siblings dont need it either as they have more money than I do. So I'm going to hand it all down to my siblings kids, who are all good kids. No idiots or drug sniffers among them. So they deserve it.

If all goes well, I might be able to hand them $800,000 each if I die with $4M on me.
You need some more hookers and blow my friend, more hookers and blow.
 

MachRc

Member
what a coincidence i was looking at social security website with my ID.me sign in this morning to see how much I would get if I waited til I was 70 today...(since I did some retirement stuff for my parents online)

Ill be(I hope to be) 70 years old in 2050 yo...

My retirement plans are basically property and family trust. I will most likely work another 20 years, and kick back ten, and start collecting in 2050 from a little apartment in Hawaii.

Surfs up.
 

dem

Member
Yay for the wife and I both having defined benefit pensions. Don’t really have to think about it at all. Really hoping to be out by 55. Technically I think I can at 53.

Not great for leaving wealth… but I should have a pretty good figure invested by then as well.
 
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MikeM

Member
I can understand people who have always had bad paying jobs not being able to save, or some out of scope situation happens like divorce killing your money.

But for anyone out there who made decent money for 40 years (estimate all the money you'll make by the time youre 65 net of income tax), and is still broke at 65 and relying on the government's monthly social assistance payout (in Canada I think you get about $1000/mth when youre an old geezer), then you got issues.

I bet half the people broke at retirement who did make decent money in their career is due simply to one or more of these things under their full control:

- Bad spending habits (too expensive a car, too many trips etc...)
- Overkill on some fancy expensive student loan (jacked up by needing more to live on campus)
- Bad at investing
- Not taking advantage of companies offering perk like matching retirement contributions
- Renting. Most people's biggest asset appreciation will come from real estate
- The place you live in is way over your budget
- Too many kids (if you can barely afford to live being single or with 1 kid.... then why have 4 kids???????)

My plan is set to retire at 60 with about $3.5M of assets and money. And that doesn't even include real estate flips I do every 5 years worth $100s of thousand more. I excluded that because who knows if the bubble will continue + being conservative. If it happens, I'll be well clear of $4M.

I should have about $2M in cash and investments which I'm going to funnel to dividend paying stocks getting me around $80k/yr (4% yield), and when I'm 65, the gov will also give me about $12k/yr as everyone gets it. So as long as the markets or real estate dont crash the next few decades, I should be able to pull in $92k/yr in gross income at 65. And I didn't even factor in selling my place for a smaller one and using those proceeds towards more dividends. If I do that, I should be able to make about $100k/yr sitting on my ass in dividends.
Sounds like good financial decisions. Good job fellow Canadian.
I work for the federal government and am very thankful for the pension plan in a world that doesn’t offer it much anymore. That’s obviously my retirement plan, but still have a savings, equities and RRSPs with housing that has doubled in value. Good enough for me and on plan to retire at 55.
 

Lunarorbit

Member
The discussion about waiting on starting social security is real deal. I've had coworkers that are close to destitute that wait til 67 to take it cause it can make a big difference.

Big difference being several hundreds of dollars. But that can really mean alot. Either way I don't know if people on this thread grasp what retirement means.

I live in an area where there's tons of retired people. If you have your health even having a part time job to supplement your savings is great. It's way more important to stay active though in my opinion. See lots of alpha types not being able to transition mentally and then it comes out in their shitty attitude.

You can't be the titan of industry when you're retired. You just become a dick and no one wants to deal with you. I gave up long ago dealing with these types when I worked retail. I had zero patience and luckily I used to work somewhere I could defend myself and not capitulate to ridiculous boomers. Unfortunately not many places let you do that and it's not worth it to handle the bs even if you can tell people to fuck off
 

gatti-man

Member
The discussion about waiting on starting social security is real deal. I've had coworkers that are close to destitute that wait til 67 to take it cause it can make a big difference.

Big difference being several hundreds of dollars. But that can really mean alot. Either way I don't know if people on this thread grasp what retirement means.

I live in an area where there's tons of retired people. If you have your health even having a part time job to supplement your savings is great. It's way more important to stay active though in my opinion. See lots of alpha types not being able to transition mentally and then it comes out in their shitty attitude.

You can't be the titan of industry when you're retired. You just become a dick and no one wants to deal with you. I gave up long ago dealing with these types when I worked retail. I had zero patience and luckily I used to work somewhere I could defend myself and not capitulate to ridiculous boomers. Unfortunately not many places let you do that and it's not worth it to handle the bs even if you can tell people to fuck off
Waiting to 67 to retire is a shit sandwhich though. I’m hoping to retire by early 50s. Probably won’t make it but I’ll be damn sure to retire by 62. At 67 you’re fading fast. The big issue is social security in all forms is essentially trash. Wouldn’t even pay my mortgage.
 
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