# Retirement - How to prepare and manage it



## ridgetop (Sep 13, 2007)

What are some ways to prepare for retirement and how do some of you plan on managing your time and finances once your at that point?
If your already retired what are some things your doing now to enjoy the time off and how are you budgeting for years to come?


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## Critter (Mar 20, 2010)

To add to what I posted in the other thread I'll add this. 

I did some math and started to take SS when I turned 62 instead of waiting. With the math my break even point would make me around 75 before it would add up to where I would get more if I would of waited until I was 65 or 66. 

I also figure that why wait? Use it now when you can enjoy it. I doubt that once I get into my late 70's I'll be buying like I am still doing. So far the SS money that I have got has paid for a new 4 wheeler and most of a 2016 vehicle. 

The best advise I can really tell anyone is to go see a certified financial planner. Figure out what assets you have now and do a risk analysis. Then tell them where you want to be in XX years or when you plan on retiring. It may just surprise you at what you can do and when you can do it.

And yes I a not just living off of SS alone.


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## 7mm Reloaded (Aug 25, 2015)

Recommend paying off your house and all your cars ,boats Atv's whatever FIRST then maybe you will be able to afford health insurance. Barely


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## DallanC (Jan 13, 2009)

7MM RELOADED said:


> Recommend paying off your house and all your cars ,boats Atv's whatever FIRST then maybe you will be able to afford health insurance. Barely


Good advice, but I would alter this slightly. DON'T buy an boat, atv, camper... whatever if you have to finance it. Period. If you can't buy it outright you shouldn't get it. Most people have no idea if they finance, they are increasing the cost of a purchase by as much as 1/4 to 1/3 depending on financing terms and rate. What a huge waste of $$. Wait a couple years, save a bit more and just buy it outright. Rent something occasionally if needed in the interim. I am **NOT** including housing in this, its a rare person that can buy a home outright, we all gotta bite that bullet, but find something that makes sense financially according to your income.

Look, I dont have all the answers but really it comes down to this: You spend money on 3 types of things.

1) One time use things. These are things like food, gas, ammunition, fishing worms etc.

2) Money draining things. These are things that depreciate, and or require constant additional up keep costs and maintenance like a Horse which needs daily food, a truck that requires tires & oil changes etc, a house that has taxes and utility bills, an ATV that burns fuel every time its used etc etc.

3) Money increasing things. These are investment type items, that generate value over time. Stocks, bonds, realestate. This can really add up over time.

The more you can put into #3 the better. Reduce #2 as much as possible. You can only reduce #1 so far... people gotta eat after all. But make a budget and keep to it.

Learn to do more with less. $50 for a local fishing trip can be just as fun for the kids as a $500 trip somewhere else.

Finally... become aware of the financial side of Markets, the country's Economy, watch for trends and investment opportunities. S&P 500 is up what, 17% since the start of the year? wow...

Now feel free to throw all of what I wrote above away and go with option B) Marry a ugly girl with a super rich father.

-DallanC


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## High Desert Elk (Aug 21, 2012)

50/30/20 or 50/20/30.

Percent distribution of living expenses/fun/saving depending on what kind of life and retirement you want.

Personally, my preference is the first one because at 65, 70, or 75 I cannot guarantee the health will be there to enjoy more in retirement. Done at a young enough age, the first one will accomodate a good life and retirement. If at an older age, better to do the second one to play catch up.

The more diversified your portfolio is, the better. Hire a financial planner/advisor. I have two for three separate accounts not including a 401K.

Retirement is a state of mind. Like I said in the other thread, once you figure out what you don't need, it makes it more simple on when and how. 

I've never dropped $3--4 k to bring the kiddos to Disneyland and never will. But we have dropped $400 occasionally to bring them to Lagoon...


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## Packout (Nov 20, 2007)

My advice is don't retire your dreams in your 20s-50s to wait for societal retirement. 

Make the memories today. If you can easily afford a trip to Disneyland or Alaska or Hawaii with your kids when they are at home then do it. If you can afford a day at Lagoon then do it. If you can afford a fishing trip locally then do it. But don't sit on a pile of capital and not spend some of it to make memories that invest in your kids' future. That memory to the beach might be more valuable than the money.

Take care with financial planners. They can be very valuable, but some charge high fees and call with investments that give the planner a bonus for selling the investment. 

Stay away from debt. Invest wisely. I plan on doing some type of work on a part time basis to maintain my social and mental health and to make a little cash to supplement. Look into a trust or llc which can protect against future issues.


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## HighNDry (Dec 26, 2007)

I'll be living in a tent down by the river probably eating more fish than normal. Then one day when I know I can't fend for myself, I'll wander off somewhere and disappear.


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## 2full (Apr 8, 2010)

My theory was to spend half the bonus checks and invest half of the bonus checks. That worked pretty well. I would take the family on one good trip a year. The kind they still talk about, and they are in their 30's. And, a couple of side trips per year. Then tuck the rest away. We could live well on the salary. I put 8-10% of that away as well. 
I worked 65+ hours a week for almost 30 years. But, was home for dinner every nite. I tried to make sure the time we got together was good. You have to have some fun as you go, or go crazy. 

The one thing I would do over is ...........don't put soooo much money into company stock. 
I knew better and still did it. Then when my first career company took a s**t. I lost a whole bunch of money. It did very, very, well for about 15 years. Then it died. 
Oh well, we are going to be fine, could have been better.......:smile:


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## 3arabians (Dec 9, 2014)

I like 2fulls advice because that is what I currently do. I take half of my yearly bonus in cash and the rest goes into company stock. On top of that I stash away 15% of my monthly salary into my 401k. I also work for one of the few remaining companies that offer a pension. They are ending their pension plans in 2023 but I will have 20 years with the company and a nice chunk of change by then. My goal is to retire at 55 and I’m 43 now. The bad thing for me is I didn’t come up with this plan until I was 30ish - never even had a 401k before then. So like 2full we will also be ok but it could have been better. 

Best advice I can give is to start saving for retirement as soon as you are 18.


Sent from my iPhone using Tapatalk


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## 2full (Apr 8, 2010)

I do get a pension from my first life. That does make a big difference. 
I started my 401k in my mid 20'S when they first came out. 
Started out small and raised it every time I got a raise. Worked it up to 15 percent. 
ALWAYS put in enough to get the company match if they have one. 
It's FREE money. Do NOT miss out on that. 8)

I always try to teach my employees that. 
As well as my kids !!!!


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## High Desert Elk (Aug 21, 2012)

At 41 I couldv'e retired at 52, more comfortably at 55. Then that changed quick fast and in a hurry. I used to spend half bonuses and save half bonuses. Then all that changed as well, at the age of 41. Before the big shakedown, I applied all the saved bonuses to reducing debt, and then eleminating all debt other than what we want to keep a good credit rating.

Now, the goal is to retire from corporate, the energy industry, and the rat race that comes with it within the next couple of years, all before the age of 50.

If my plan works out, I will be going to work Jimmie Buffet style...


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## 7mm Reloaded (Aug 25, 2015)

Pay an extra $200.00 or as much as you can on your house payment and you can pay off a 30 year loan in 13. I've paid off 2 houses in 30 years doing this. Also I've never had a car or anything else payment. Even 50.00 more helps A lot.:shock:


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## ridgetop (Sep 13, 2007)

7MM RELOADED said:


> Pay an extra $200.00 or as much as you can on your house payment and you can pay off a 30 year loan in 13. I've paid off 2 houses in 30 years doing this. Also I've never had a car or anything else payment. Even 50.00 more helps A lot.:shock:


That all depends what the amount of the mortgage is, doesn't it.
If a 30 year mortgage is set at $1,800 a month. I don't think it can be paid of in 13 years by paying an extra $200.


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## middlefork (Nov 2, 2008)

ridgetop said:


> That all depends what the amount of the mortgage is, doesn't it.
> If a 30 year mortgage is set at $1,800 a month. I don't think it can be paid of in 13 years by paying an extra $200.


I think he is saying any amount you can pay on the principle over and above the minimum will help reduce the time.

And it's been a long time since I've had a mortgage payment but even now I would shudder thinking about a payment like that. But I'm still living it what most people consider a starter home. It all depends on priority's.

Me I took the money saved and invested it land and a cabin. 30 years of family memories with hunting and fishing thrown in.


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## ridgetop (Sep 13, 2007)

middlefork said:


> I think he is saying any amount you can pay on the principle over and above the minimum will help reduce the time.
> 
> And it's been a long time since I've had a mortgage payment but even now I would shudder thinking about a payment like that. But I'm still living it what most people consider a starter home. It all depends on priority's.
> 
> Me I took the money saved and invested it land and a cabin. 30 years of family memories with hunting and fishing thrown in.


I know that but I've been paying a little less than $100 each month extra for the past 12 years and have shaved off a little more than a year so far. By saying if I could have doubled that amount, I would have my mortgage almost paid off by now is not true. At least in my case.


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## High Desert Elk (Aug 21, 2012)

We refied our house in 2014 with a large pile of cash we had saved up to essentially cut the mortgage in half, then continued to pay the "old" mortgage payment. In 12 months of doing this, we cut 16% off the loan amount. Then, in early 2015, I took out a 401K loan to pay off the house and pay myself back the interest instead of the bank.

But, a few weeks later, the horse manure hit the fan and I joined the ranks of the unemployed in the San Juan Basin. A handful of weeks later, picked up another gig and paid the house off anyway and took the 10% penalty hit.

At the end of the day, we cut a "small" check to the tax man and now are debt free being able to channel more money into investment retirement accounts. I can also cop and attitude at work, per se, and don't have to worry about losing my house over it.

Guess I'm sorta retired in a way...


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## ridgetop (Sep 13, 2007)

AS for a 401k, in the other thread. It was said by someone that a person would need to have about 1.5 - 2 million saved to retire at 60. That seems a little misleading. I know for a fact that I'll do just fine if I can get my 401k up to around $400,000 by time I'm 62.


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## Critter (Mar 20, 2010)

$400K invested properly with SS will keep a person quite happy in his retirement as long as you don't go off of the deep end.


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## DallanC (Jan 13, 2009)

ridgetop said:


> AS for a 401k, in the other thread. It was said by someone that a person would need to have about 1.5 - 2 million saved to retire at 60. That seems a little misleading. I know for a fact that I'll do just fine if I can get my 401k up to around $400,000 by time I'm 62.


That was me who mentioned it, after having talked several times with financial advisors. Lots of articles from various financial institutions are all saying the same thing. Right now it seems the consensus is you need to have saved up 8 to 16 times your _*final *_years salary. For the average salary in Utah right now, that's $1,088,000 on the high end... and thats if you retire TODAY.

The younger you are, the more money you will need due to inflation. So yea, I really feel that 1.5-2 million is needed to retire in 15'ish years and live a fairly comfortable life.

But I'll bet ridge has more investments to tap than relying fully on the 401k money.

-DallanC


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## 7mm Reloaded (Aug 25, 2015)

ridgetop said:


> I know that but I've been paying a little less than $100 each month extra for the past 12 years and have shaved off a little more than a year so far. By saying if I could have doubled that amount, I would have my mortgage almost paid off by now is not true. At least in my case.


 Remember when your loan gets down around 50,000.00 you wont be paying hardly any interest ,you will be paying almost all principal and it will drop faster. In my case it is true.


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## middlefork (Nov 2, 2008)

Dallan,
I've seen those figures mentioned in more than one place. If I divide $1.5million by 8 I come up with $187,500 per year salary and $2 million divided by 16 comes out to $125,000 per year.

I may be living in a bubble but I think most people are in the range of 1/3 that amount per year. So I really think peoples definition of "comfortable" has a pretty wide range.

But if you are still trying to pay off a mortgage and a bunch of other debt after you retire you may be pretty well screwed.


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## CPAjeff (Dec 20, 2014)

ridgetop said:


> I know that but I've been paying a little less than $100 each month extra for the past 12 years and have shaved off a little more than a year so far. By saying if I could have doubled that amount, I would have my mortgage almost paid off by now is not true. At least in my case.


This seems off - is your additional amount being applied to interest?


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## middlefork (Nov 2, 2008)

7MM RELOADED said:


> Remember when your loan gets down around 50,000.00 you wont be paying hardly any interest ,you will be paying almost all principal and it will drop faster


I think I was at about 15 years on a 30 year mortgage when I finally started making enough to start paying the same amount on the principle as I was paying on the mortgage. It goes down fast at that rate.


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## 7mm Reloaded (Aug 25, 2015)

CPAjeff said:


> This seems off - is your additional amount being applied to interest?


 Applied to principal every time. My situation is probably alittle different then most is that I made a killing on my first home and then applied all the money down on my second .So my payments were ALOT lower than 1800.00. Now I own a $300.000 dollar home. WOOOPS Jeff I guess you wasn't asking me....


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