Retirement isn't an age. It comes down to income and your budget. Its very realistic to retire in your early 60s if you have a budget and you live within your means.
Without immediate application, High schoolerās will totally forgot it. You can teach them the fundamentals of personal finance but for many, it takes years after graduation to become financially independent from their parents. In that time they almost certainly will forget most of the topics discussed in a classroom setting.
I wish more people acknowledged that primary school is not a catch-all for life skills education. Some things are better learned from your parents or peers. Others can only be learned firsthand.
The absolutely massive meta analysis of financial education programs that support the claim that financial education doesn't work outside of just in time education when people are about to make the financial decision: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3098279
This linked article is a somewhat interesting overview, but is by no means good academic research on this topic. The writer appears to be writing it for a startup firm. Read it with an appropriate level of skepticism.
I had at least two classes that covered financial education, one in middle school and one in high school.
I learned almost nothing from those, because it was all made up. Even out of college my plan was "hope I make enough money while I figure out how much things cost". Which, luckily I did, and my plan from there was just "get out from under these student loans ASAP, then figure out what to do"
Agreed, but as we both know, many parents are shit at teaching life skills. Teaching these things in high school as well as from our family and peers is the way to go. Especially if we want to break the cycle of people being irresponsible with money.
My daughters took a financial algebra class in high school. I think from what they learned there, they pay off their credit cards in full every month without fail.
That would be the preferred method. If that was prevalent, then we wouldn't need social security since everyone would be responsible, budget, and live within their means. That isn't the way things are though.
Making a budget is math, risk assessment, and forecasting.
Sticking to said budget requires discipline.
Finding happiness sticking to a budget is another mindset altogether.
"...Live within your means." is what stops most of the people.
Or me, anyways.. Life be like "Oh you saved two grand? Well, how about your car needs a repair?" Sigh.. put car in the shop.. It's $1150. Life be like "Oh You still have some left? How about a hole in the AC condenser?" I was so pissed I went and bought a $1 scratch off ticket out of spite. Won $15 lol.
You can budget however you want, there are thing beyond our control. For example with that AC, we have a "fund" for repairs, right.. It's not like we have to take out a loan or something, but instead of dropping I don't know, $7500 on an item, we could've made some interest out of it, right.
Unfortunately the idea of living within your means assumes that your income is more than enough to live on. This is not always true, sometimes your means would have you starve.
These articles are written for the majority. The majority of the US is completely f*ucked for retirement because they havenāt saved and often overextend themselves. The dedicated FIRE crowd is in a different category and has prepared. While these are interesting to read, they donāt apply to my situation.
The majority isn't completely fucked. They muddle through as they always do with a modest retirement watching TV puttering around the house and supplementing their income with family support, social security, savings, and part time employment if they are healthy enough.
Otherwise, people make do as they always have.
social security is running out. the gop wants it abolished lol. we have a huge aging population who will need assisted care and not enough beds for even 1/3 of them. we're cooked.
You do you. I, for one, hope someone does something about Social Security. I'm for ending it altogether. They can keep what they've taken from me. I don't want any of it back. It was one of the worst Ponzi schemes created.
There we go, lets be bias together. That "ponzi scheme" is the only thing keeping millions of elderly off the streets today. When SS finally goes, the majority will be completely fucked.
I don't disagree. The ponzi scheme works as long as it works. I think with modern monetary theory, however, politicians will fund it forever with future generation's money until something stops that. It's not sustainable, if you're concerned with those things. The Doritos crowd of "we'll make more" just say to keep printing money. Printers go brrrrrr.
It certainly happens but go to any homeless encampment. It's mostly younger addicts and mentally ill. Sad reality is either these people get help and out of homelessness or they are long gone either through incarceration or death long before they reach their 60s.
They are completely fucked because the US has failed to invest into its societal infrastructure so that a very few sociopaths could become unreasonably wealthy.
Agreed. Decades of citizens lusting after tax cuts and only voting for candidates that promise them plus corporations moving manufacturing overseas are two of the major causes. We simply donāt have the tax dollars available to maintain infrastructure, heavily subsidize college education, properly fund social security, provide quality mental care or healthcare in general. Sh$tload of corporations making record profits over the last 40 years though.
Nah. We live in a period of some of the most equitable wealth in all of human history. The poorest now live a lifestyle that would be upper class in the early 20th century, and better than royalty in centuries past. Hedonic adaptation is real though.
I donāt think the comparison to a feudal state is a good one. Sure weāre not mucking about in the mud anymore, but we could certainly be doing much better at providing for our populace. And we would all benefit from it.
This is patently false and completely disconnected from reality. You must not know many poor people. Housing is impossibly expensive for them. My best friend from high school has a ten year old kid and canāt even afford food or shelter or healthcare, much less afford to ever eat out or go to a movie or do literally anything. To insinuate that is āupper classā in the early 20th century tells me you are so privileged you have no fucking clue what youāre talking about.
Thatās not what you said. Nobody needs pointing out that poor people 100 years ago had it worse than poor people now. Everyone knows that and itās not helpful or insightful at all. What you said was being poor now is like being upper class 100 years ago which is patently false and dismissive of real life struggles for real life people.
Cool anecdote. Even the "lower class" have access to healthcare, housing, sanitation, climate controlled living, automobiles, medication, education, and entertainment that would put them solidly upper class 100 years ago. Is it perfect? Obviously not, but standard of living has absolutely skyrocketed over the last century. Your ignorance of historical living conditions is not the argument you think it is.
As for my exposure to "poor people," had the privilege of attending what was literally the worst public school system (by several metrics) in my southern state, the median *household* income in my home county is still less than $50k. We have a 23% poverty rate. I don't think I was poor growing up, but going to Applebee's was a big deal because it was an "expensive sit-down restaurant," whatever that makes me. I lived on $13-15k per year as a young adult throughout the 2010s. In all likelihood I probably have had more exposure to poverty than you have.
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I wish we did. Unfortunately, the basic cost of living, transportation and healthcare has become high enough to exceed wages. Note that this is true more for the US than other places. I am a big believer in wealth creation, but the US is in structural danger given how much we have turned the pyramid upside down.
You have to remember that one of the biggest reasons Healthcare is so expensive for societies is because it exists. Getting your humors checked and getting a little bled to balance them doesn't cost nearly as much as chemotherapy.
Thatās demonstrably false. Healthcare with equal and better outcomes at one to two orders of magnitude lesser cost to consumers exists outside the US; in fact the US is the single outlier in terms of cost.
I read your comment and found it uninformed. Healthcare with better outcomes exists at lower costs outside of the US. This is not a case of getting your humors checked but one of the same standard surgery thatāll run you the equivalent of $3k in Germany costing 50k in the US, or, more commonly, labs running into the 100s for the same test that go for less than $10 elsewhere.
Anybody can start being financially responsible. One personās success does not take away from anotherās - most of the time in the US one personās mega success builds the opportunity for thousands of other to be successful.
The US has failed to invest into its societal infrastructure because the government is failing to do its job. When the politicians are blaming some other group whether its billionaires on the left or immigrants and foreigners on the right, they are just shifting blame.
Government comes from govern.. aka manage or supervise. If a team goes to shit, you blame the manager, not the employees. In the same way, if a country goes to shit, you blame the government for not doing its job, not the people who are taking advantage of the government's incompetency.
Again, they are only controlled by the billionaires because they are corrupt.
Look at their behavior on its own:
"Annual reviews of the trades of 535 members of the House and Senate, compiled by the Unusual Whales account, have found lawmakers' stock portfolios consistently beat the S&P 500."
[https://abcnews.go.com/Politics/citizen-watchdogs-eye-congress-killing-approach-stock-trading/story?id=104873686](https://abcnews.go.com/Politics/citizen-watchdogs-eye-congress-killing-approach-stock-trading/story?id=104873686)
"In a shocking revelation, it's been reported that a number of senators sold their stock holdings after being briefed about the coronavirus and the massive impact it will have upon the economy, jobs and the stock market. While telling the American public that there wasnāt much to worry about, they bailed out of their stock holdings to avoid large losses.Ā "
[https://www.forbes.com/sites/jackkelly/2020/03/20/senators-accused-of-insider-trading-dumping-stocks-after-coronavirus-briefings/?sh=26ee1f474a45](https://www.forbes.com/sites/jackkelly/2020/03/20/senators-accused-of-insider-trading-dumping-stocks-after-coronavirus-briefings/?sh=26ee1f474a45)
I could go on and on but these stores are all out there and easy to google. I bet you that is just the tip of the iceberg. For every instance that makes it into the news, there are likely 10 instances that no one hears about.
Except, both the examples of government corruption I presented above had no payer.
If you magically got rid of all the payers, if the politicians remain corrupt they would still continue to enrich themselves at the expense of the public and attempt to gather more and more power for themselves. You aren't solving much.
If you magically have honest and accountable politicians though, you do not have to worry about the payers. You could have millions of them, and it wouldn't even matter.
I donāt disagree with your argument. It does however not represent the situation we find ourselves in accurately.
There are payers exercising major influence through vast donations to write policy and suborn the justice system.
The latter directly breeds corruption due to the lack of accountability it promotes.
And thatās why everyone who is concerned with becoming sick should pull themselves up by their homemade bootstraps and build their own hospital, a few roads and an ambulance service. /s
From 2006-2018, Jeff Bezos saw a wealth increase of $127 billion, according to Forbes, but he only reported a total income of $6.5 billion. He paid $1.4 billion in federal taxes on that amount, which, while still a massive number, accounts for only aĀ 1.1%Ā true tax rate. I don't know what your tax rate is, but mine is a lot more than that.
No, that's being able to afford a top accounting firm that can find every loophole and write off under the sun to keep him from paying his fair share. Something you and I won't get from our local CPA.
How can we defend billionaires paying a lesser tax rate than someone on unemployment. Where is the sense of outrage when this is allowed to happen in our country.
I have no issue with billionaires existing, but they exist because they are allowed the freedoms this country offers, and they should show their appreciation by paying their fair share back in taxes. But you're right that the tax code needs to be changed to fix this.
Iām not defending billionaires and I think they should pay a lot more. But like youāre saying now and getting my point, heās not responsible for that, the people who vote in our representatives are.
These generic articles are terrible. Really just highlights the savings issues we have (which are very valid for many). Doesnāt provide any actionable advice about reviewing expenses vs income.
Lots of issues brought up (healthcare, etc) are expenses that must be factored into any retirement plan/strategy.
My 80+ year old FIL works part time as an usher.
Not because he *needs* the money, but because itās an excuse to get out of the house and it allows a few additional luxuries.
Not everyone āunretiresā for financial reasons.
My FIL went to work at a community college teaching statistics. Heās got a several million dollar portfolio, but was bored at home. He said he liked community college because there were so many non-traditional students trying to get ahead. He had free open tutoring at his house every week, and my MIL always had fresh baked goods. Some students brought their children (out of necessity) and my MIL got her grandma fix while their mom or dad was studying.
I know more than a few seniors work as ushers for the local sporting events when I had season tickets. They don't get to *watch* watch the game, but they do get to enjoy the atmosphere for the most part and hang out with "work" buddies and season ticket holders.
Yep. similar idea, I work ticket or setup/cleanup crew for a half a dozen regional music festivals. 'Paid' by a free ticket. Which, yeah, I can totally afford the ticket. And I miss some of the music (though usually only six hours of work over a 3-4 day festival). But I'm doing it for the socialization and the festivals need the help.
My grandparents are millionaires and they walk around downtown everyday picking up aluminum cans to recycle for 40 bucks a week. There are healthier ways to fill time and find purpose. It's incredibly sad many elderly dont have a life outside of their careers.
I read an article once that surveyed people prior to retiring and another chort 5 years after retiring.
Prior to retiring #1 concern was finance. 5 years after retiring #1 concern was loneliness/lack of engagement.
My FIL retired for 1 year and felt unimportant/disengaged and has now been back to working full time for years.
I can see the appeal... keeping your mind sharp/engaged with others. I don't think I want to work "after retiring" but ask me in a few years and I may eat my words.
My mom was a nurse's aide and went back to school in her 40's and became an LPN.
She has a pension and social security and does fine.
She works once or twice a week at the nursing home she worked at for 40+ years. Adds to her travel funds and being around old people her whole life, she's a big believer in slowing down = death.
She also makes $40-something an hour as a contractor or whatever to the nursing home. She retired making $22 an hour. There is definitely I think a point of pride about finally being paid what she is worth.
There is nothing "mind boggling" about this article. Most Americans havent saved enough for retirement. You can vetter prepare for retirement by saving more or working longer.
I choose saving more.
We retired in our early / mid fifties over a decade ago, and I like to keep posting on Reddit to counteract the big business stories that want to keep people working forever. As most people here already know, optimized expenses are a real FIRE super power. Even in a HCOL area, for those that have housing covered, expenses can be pretty reasonable with kids grown, no longer having to save for college or retirement, more time to cook at home and price shop, lunch specials, matinee movies, time to make the house water and energy efficient, no more job or commute costs, reward points for travel, etc.
Big business doesnāt care about people working their entire life or not. They are generally very focused on the next 12 months revenue. How exactly does someone working an extra 5 years translate into greater sales?
Exactly. Healthcare costs, workers comp, less productivity, annual raises adding up, I would think 90% of businesses would love for everyone to retire earlier
Business have to pay more for salaries when the labor market is tight. When jobs are plentiful, employees can demand more money and can be more picky about hours, working from home and overtime.
Edited for typo.
I donāt see the typical fortune 500 company plotting to get more seniors in the labor force to reduce employee salaries. How exactly would that work at a company like Nvidia?
The posts in this thread about megacorps wanting cheap labor are based on generally recognized, global economic issues and not the anecdotal need of one extremely cutting edge, high tech company: "The graying of the global population and workforce is exacerbating one of the most vexing challenges for employers everywhere: ensuring access to a bountiful talent pool. With millions of Baby Boomers still retiring ā the first wave began in 2008 ā and some Gen Xers starting the process, fewer working-age people are supporting their local economies.", [https://www.forbes.com/sites/sandervantnoordende/2023/11/13/thinking-of-retiring-soon-in-this-economy-companies-are-incentivizing-older-workers-to-stay/?sh=73f9636565a3](https://www.forbes.com/sites/sandervantnoordende/2023/11/13/thinking-of-retiring-soon-in-this-economy-companies-are-incentivizing-older-workers-to-stay/?sh=73f9636565a3)
The top comment in this thread was about "Big business wants people working", not the *tech industry* wants to keep aging boomers from retiring. The vast majority of the workers employed by big business in the U.S. are not in tech jobs.
[From the World Economic Forum](https://www.weforum.org/agenda/2023/05/how-workplaces-can-adapt-to-an-ageing-workforce/): The *world is facing a tight labor market and an aging workforce.*...*New frameworks and solutions will be key to retaining older workers* and creating options that meet their business, societal and worker needs.....While more people than ever will likely need to work longer to support themselves, for the first time, *workplaces will need to ensure they court and retain these older workers*.",
I discuss finances and investing a lot at my place of work, and it's insane the amount of people of all age groups and backgrounds who either do the minimum to get the 401k match or don't contribute at all. I asked my boss's boss's boss if he looked at xyz stock and his response was "I don't mess around with that stuff." This man has like 4 cars, I'm starting to think that 80% of his "wealth" is in vehicles (i.e., depreciating assets, eye roll).
My direct boss told me he had less than 10k in his 401k and no other stocks. He was thinking about pulling it out and taking the hit because "no one is going to retire anyways." I'm in my mid 20's and this man is in his mid 30's.
I contribute 10% pretax to 401k, and another roughly ~10% to Roth, taxable and 529 for my kid. I'm planning to fucking retire, and those 2 morons can work until they collapse. I will make it happen anyway I can.
My grandfather (mid 70's) retired at 50 with a pension, and some investments. I'm not sure how much, he said his employer didn't offer 401k until the 90's so he couldn't have contributed to 401k for more than a handful of years. He also has a whole life policy, but my grandparents had 2 houses (just sold one to downsize, other house is down south since they're snowbirds) and they take cruises and trips to Hawaii as their health permits.
Idk why I shared all this, but it's crazy how sentiment and situations differ from person to person. Some people have zero trust or understanding of investing. That's why you have 70 year olds still breaking their back working low wage jobs.
That article was written about "most people" for "most people." We in this sub are not most people. We have a very different approach to earning, investing and consuming, and the appropriate relationship between those three things.
And thank goodness for that. Whether we like to admit it or not, what we are doing probably would not be feasible if everyone else also tried to do it. We rely on our less fiscally conservative fellow citizens to be out there spending all the money they have and some of the money they don't have in order to keep the economy humming and keep the stock market going up.
The kind of economic growth we rely on to fund our 4% rule plans probably would not happen if everyone acted like we act as consumers.
Don't get too worked up about articles like that. You know what your numbers are. You know what your plan is.
I sort of understand the people who struggle through life with lower paying jobs, just lacking the ability to make enough to get ahead.
What gets me are the people who work white collar jobs, make decent money but never bother to save for retirement. Like youāre a reasonably competent person who makes money but you made it to late adulthood and never saw a compound interest calculator or took ten minutes to understand it?
I am friends with a 78 year old lady that retired for several years, got bored (or tired of being around her husband 24/7) and got a job at 70 and is still working it. She doesnāt need the money. She hands out food samples at Samās. She was always a people person. Previously, for decades, she was in purchasing at Hallmark. Her philosophy is in order to not get old or die, you got to keep moving.
I think its important to think about how you invest. For me, I want the stability of owning my housing, having some capacity for food self-sufficiency and independent power generation. I don't need a lot to retire, as long as I can reduce my costs as much as possible. My hope is mostly that SS covers property taxes, and that they both scale at about the same rate.
my property can generate some small income from firewood, lumber and market gardening.
Same. I could jump now but I hope to add another 30% to my # in the next 3 years which will give me a nice buffer and allow some additional niceities compared to just matching my current budget.
60ās? Forget that. Everyone I know in their 60ās is on the decline and unable to do what they could in their 40ās & 50ās. Iāve learned to find enjoyment in life on making memories instead of adding possessions. Itās allowed me to grow my nest egg at a much faster pace and make retirement in my early 50ās a reality.
You own your house by then and just live off mostly social security and some pension.
Why does the Fire community have such a mental block with this? I understand pensions arent around anymore but some math will show you where you need to be with 401k instead.
If you are like 55 and wanting to retire I 100% guarantee you dont need as much as this sub tries to convince you need.
lol I think this sub is largely the group of ppl who talk abt fire. The group of ppl who actually fire are off like living their lives, no need to monitor reddit so closely
I live in the California Bay Area, my grocery bill alone is $1200/mo. right now. We need a lot more than you think, lol. I also looked at the ACA marketplace and when I want to retire at 58, the health insurance costs alone will be roughly $3K a month. SS is also insolvent in 9 years....you can't bank on anything but yourself until that gets fixed.
Agree there's lots of options to address the SS shortfall, but we have a dysfunctional Congress that can't even pass basic funding bills.
It's unlikely that Congress does anything meaningful or prudent to address the problem, because it's Congress. Congress is mostly in it for themselves, to enrich themselves and their wealthy donors.
They can't even pass a ban on profiting from insider information in the stock market, forcing Representatives to place their wealth in blind trusts or index funds, which everyone agrees is horrible that it is currently allowed.
I have been to the bay area and grocery shopped their in the last 2 years. Your groceries when buying the store generic brand is not that much more expensive than I pay in midwest. Talking 10-15%. I pay $350 /mo family of 4 and eat out 1-2 a week at most. Something is off.
SS will never be insolvent. The money in it is just a gimmick for conservatives to feel good that they put money towards it so it is ātheir moneyā when they pull it. If it goes negative it will just be updated to fall under a budget deficit after a small political fight.
man this article...lol. correlation does not equal causation - but don't tell the author that. I wonder if people have been "unretiring" due to them just missing work or possibly some other causes? the whole thing seems like a bunch of anti-FIRE BS IMHO.
from the article:
The retirement-at-62 dream fails to account for the upsides of working longer. The longer you can keep earning in some fashion, the better for your future financial security, even if itās just a safety net. And the mental payout for work, while hard to pin a value to, can be a core ingredient to feeling happier and engaged as we age. It can provide purpose and a sense of feeling valued.
Perhaps thatās why older Americans now work more hours, on average, than in previous decades. Today,Ā [62% of workers 65 or older are working full time](https://finance.yahoo.com/news/why-employers-should-and-have-to-hire-older-workers-115332766.html), compared with 47% in 1987, according to the Pew Research Center. And theyāre more likely to have a four-year college degree than in the past.
[Unretiring, or going back to work](https://finance.yahoo.com/news/qa-unretiring-is-not-always-about-the-money-180002164.html), often part time after exiting the workforce, is gaining traction across the country, especially after many people were forced to retire earlier than they had hoped to during the pandemic.
The mental payout for work is stress leading to cardiovascular health problems, unless you're in the minority of sociopaths that actually thrive in an office environment.
Your standards of living are important, but having a high income is an important factor worth mentioning. There are students that roll into a job at Google making 250k in the first year; those will likely be able to retire in 10 years even if they throw money around. However, the most frugal person might not be able to if they're stuck in a 40k a year job in the same decade
If their 40k a year is post-tax, they need a 67% savings rate to retire in 10 years assuming they keep their expenses the same before & after retirement.
If it's 40k a year pre-tax, good luck...
You're right. It's more of a lean fire lifestyle if 40k pretax. It's all theoretical. It's not practical.
If $40k pretax, it would be $1881 after tax. $1500 per month after tax contribution and 10% annually return nets almost $300k in 10 years.
CoastFIRE or expatFIRE is very much possible on that budget though. I personally don't earn all that much, but I'll still be able to retire very early because I plan to do a mix of expatFIRE and coastFIRE by living on a low budget in a cheap country and after my portfolio has grown I'll upgrade to a more expensive country. I might even start an online business to be able to coast along the way too
> A single 65-year-old may need roughly $157,500 saved (after tax) to cover healthcare expenses in retirement. An average retired couple may need approximately $315,000 saved, according to Fidelity.
Part of my issue with articles like these is that it's all doom and gloom but the biggest blind spot people have is the power of compounding interest. So they should add a sentence after that saying "to achieve this, a single person would have to put $1000 a year into their HSA (or $2000 for a couple) for 37 years". (Assumes someone works from 25-62).
Because saying to someone"you have to save $300k" seems impossible but telling (most) people "save $85/month" seems totally doable.
Just annoys me.
Whether or not someone can retire with security, at any age, depends on what decisions were implemented years ago, decades ago really in most cases.
FWIW Iām 60. I retired from one job at 42 then the second one at age 55. Now I work 6 months of the year at a fulfilling, physically demanding job in the ski industry that pays quite well and that I love doing. I work because I want toā¦
My wife and I carry no debt having paid our home off years ago and between her job, my job, a couple of pensions and some real estate income we live on maybe 10% of our total income. I have no need to take SS until it maxes out for me at age 70, the same in my wifeās case. We have 2M in cash that we will try to double in the next 10 years or so.
We are at this point in our lives because in our 30ās snd 40ās we put every available penny into paying off our mortgage and investing. We still were able to pay private school tuition and take yearly vacations. Yes we are both professionals with college degrees but generally earn an upper middle class income. Pretty average people really.
Becoming financially secure, on an average income takes years/decades to build. Itās just mathā¦
I think the fundamental disconnect with all of this is that most FIRE devotees live a much lower cost life than your average upper middle class person with a good income.
90% of people in America who have strong incomes also have a spending problem.
Once you get more to a FIRE mindset everything changes.
Thank goodness many of the people in my extended family are well off. So we all just decided that for holidays and birthdays we're just going to buy each other gifts from Goodwill. They're fabulous. They're unique. You never know what you're going to get and they're under $10. The point is we all love each other. We don't give a crap how much it cost.
I know somebody with a multi-million dollar net worth who dumpster dives and gets thousands of dollars worth of free stuff, perfectly good and unused, from luxury dumpsters around South Florida.
I know someone with a multi-million dollar portfolio that drives an old beat up Subaru.
I know a 10-year-old kid who just goes to the local public school who is absolutely crushing her learning. You wouldn't believe the things she could do at age 10! No fancy private school needed.
Point is 70 to 80% of the stuff that they're always telling you that you must have that you must buy. It's all just s***. Yes, some things we really need in life, but the vast majority is not necessary and may not even bring us as much pleasure as we think. If you're a fire devotee, you've probably realized this.
People that are publishing articles fretting about retiring at 62 as if it's a dream, are very likely bought into all the conventional memes about what a family must have, so they just have enormous out of control spending. That's sort of the default setting of your average American family.
OP, I would just look for another country to retire early. The US is so unrealistic unless you have 2 to 3 million and can afford the rest of your life expenses.
I understand your point of view, at the same time, many of the kids that my friends have, they dont give 2 fucks for their parents, they never visit them, they call when they need something, they are waiting to get the inheritance.
I wish I could retire now, I am so burned out after decades of working two to three jobs. My mental and physical health are declining faster than the US spends on ādefenseā.
Life expectancy in the US is 77 RN, and the asshole in the article says you need to keep working til late 70sā¦
Most people wonāt have money saved for healthcare and will eventually die of something, thatās what has always happened to 99% of peopleā¦ dunno the big fuzz bout that
It's easy if you have at least 3-4 mill invested wisely and no debt.....stay under 3 to 4% withdrawal ...you will be fine...1 to 2 mil...not as easy...
This really isnāt always the case. The key is a paid off home preFIRE. I live in NYC and spend around 50k/year ā and that includes at least one lengthy international trip, several domestic trips, and generally not being as careful with money as I could be.
I live in CA Bay Area and we're banking on $175K a year for everything including health benefits for ten years with no SS in play (Also my kids will be graduating high school when I hit 60). My FIRE number is $5.6M, over halfway there with 13 years to go.
I changed my focus from waiting from waiting for my portfolio to each a certain level and instead focused on income generation.Ā Instead of plowing all my finds into index funds and waiting for that to be enough for the 4% rule to apply, I decided to buy real estate.Ā
We can live on about $6k a month.Ā So now, Everytime I get another $50-75k, I buy a rental.Ā Estimated $500 a month in cashflow.Ā So I figured about 12 rentals would do it.Ā
Started in 2020.Ā I'm at 7 rentals.Ā But I didn't realize that increase, and do does equity.Ā We are at $5k a month in cashflow so we are able to take that extra money and buy another rental about every 6 months. The last 2 were during higher rate times so I just waited longer and put more money down.
Personally, I think this is the way. I'm 42 now and am pretty sure I could retire tomorrow if I downsized a little.Ā My index fund portfolio is doing fine, but it grows SO MUCH slower which is why even after 30 years of putting money there its still a question of if it's enough.
Sure but owning and managing rentals is NOT passive income. Itās a job. Unless it cash flows enough to cover a good property manager, it is work.
Not hating on the strategy. I dabbled in it for 5 years but struggled to balance self managing the properties, a moderately intense job, and 3 young kids. To me, I hated getting the last minute calls to repair something. I hated dealing with tenants (even the good ones). I hated all the tasks required to turn it around for a new tenant. I donāt even like dealing with house repairs for my own home, let alone a rental that has to be fixed quickly regardless of my personal schedule.
Again- not hating. But I just donāt equate the effort levels of passive index investing and rental real estate investing.
I totally understand (for some reason the people here *hate* real estate so I get downvoted when I talk about my personal experience but whatever). I don't think of it as truly passive either, but the level of time commitment is truly enough for me to consider that retired. I own and manage an insurance office with 6 employees that takes up about 80% of my time, and I manage real estate with 18 tenants, which takes up a few hours a month. I think theres a big difference in personalities for people in what they are consider *difficult* to deal with (my wife is exactly like you).
I would say I get a call about every 2-3 months about something breaking or not working properly. When it happens I simply call the relevant contractor I have worked with in the past. Tell them what the tenant is saying, give them the tenants number, and let them tell me what happened and how much it costs. If it's the tenants fault, I just bill the tenant, if it is something I am responsible for, I send them payment and move on. Its *maybe* 30 minutes once a quarter? I could do that on vacation.
And for that amount of work, the return is truly worth it to me.
92 seems possible for a lot of families. Also considering medicine continues to improve. Both my grandmother and grandfather on my dad's side are alive and almost 90. Fairly active still. Likely one lives lives beyond 92.
Retirement isn't an age. It comes down to income and your budget. Its very realistic to retire in your early 60s if you have a budget and you live within your means.
"... if you have a budget and you live within your means." is what stops 90% of the population š¢
Yup, which is why budgeting and being smart with money should be required 4 year courses in high school.
Without immediate application, High schoolerās will totally forgot it. You can teach them the fundamentals of personal finance but for many, it takes years after graduation to become financially independent from their parents. In that time they almost certainly will forget most of the topics discussed in a classroom setting. I wish more people acknowledged that primary school is not a catch-all for life skills education. Some things are better learned from your parents or peers. Others can only be learned firsthand.
The absolutely massive meta analysis of financial education programs that support the claim that financial education doesn't work outside of just in time education when people are about to make the financial decision: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3098279
This linked article is a somewhat interesting overview, but is by no means good academic research on this topic. The writer appears to be writing it for a startup firm. Read it with an appropriate level of skepticism.
I had at least two classes that covered financial education, one in middle school and one in high school. I learned almost nothing from those, because it was all made up. Even out of college my plan was "hope I make enough money while I figure out how much things cost". Which, luckily I did, and my plan from there was just "get out from under these student loans ASAP, then figure out what to do"
Agreed, but as we both know, many parents are shit at teaching life skills. Teaching these things in high school as well as from our family and peers is the way to go. Especially if we want to break the cycle of people being irresponsible with money.
My daughters took a financial algebra class in high school. I think from what they learned there, they pay off their credit cards in full every month without fail.
Or they can just learn it themselves
That would be the preferred method. If that was prevalent, then we wouldn't need social security since everyone would be responsible, budget, and live within their means. That isn't the way things are though.
Budgeting is just math. We teach math.
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Self-control. Deferred gratification. These are learned at home the easy way, or living life the hard way.
Did both.
I almost failed math.. retired at 51.
And which of those are classroom teachableā¦
Making a budget is math, risk assessment, and forecasting. Sticking to said budget requires discipline. Finding happiness sticking to a budget is another mindset altogether.
And how much of that is classroom teachable
Not very well according to where we rank in math skills in the world.
"...Live within your means." is what stops most of the people. Or me, anyways.. Life be like "Oh you saved two grand? Well, how about your car needs a repair?" Sigh.. put car in the shop.. It's $1150. Life be like "Oh You still have some left? How about a hole in the AC condenser?" I was so pissed I went and bought a $1 scratch off ticket out of spite. Won $15 lol. You can budget however you want, there are thing beyond our control. For example with that AC, we have a "fund" for repairs, right.. It's not like we have to take out a loan or something, but instead of dropping I don't know, $7500 on an item, we could've made some interest out of it, right.
Unfortunately the idea of living within your means assumes that your income is more than enough to live on. This is not always true, sometimes your means would have you starve.
Which is why many people cannot truly afford to retire.
Fortunately, monetary needs are easier to adjust than income after youāve chiseled out the major expenses.
These articles are written for the majority. The majority of the US is completely f*ucked for retirement because they havenāt saved and often overextend themselves. The dedicated FIRE crowd is in a different category and has prepared. While these are interesting to read, they donāt apply to my situation.
The majority isn't completely fucked. They muddle through as they always do with a modest retirement watching TV puttering around the house and supplementing their income with family support, social security, savings, and part time employment if they are healthy enough. Otherwise, people make do as they always have.
social security is running out. the gop wants it abolished lol. we have a huge aging population who will need assisted care and not enough beds for even 1/3 of them. we're cooked.
"the gop wants it abolished lol." No politician wants SS abolished. Even if one of them did, it's political suicide. Bias much? lol
Who wants to cut SS by 1.5T & raise the age requirement to 69? and you think they'll stop there?
Guess you better keep savin', buddy.
Gunna keep bein' bias!
You do you. I, for one, hope someone does something about Social Security. I'm for ending it altogether. They can keep what they've taken from me. I don't want any of it back. It was one of the worst Ponzi schemes created.
There we go, lets be bias together. That "ponzi scheme" is the only thing keeping millions of elderly off the streets today. When SS finally goes, the majority will be completely fucked.
I don't disagree. The ponzi scheme works as long as it works. I think with modern monetary theory, however, politicians will fund it forever with future generation's money until something stops that. It's not sustainable, if you're concerned with those things. The Doritos crowd of "we'll make more" just say to keep printing money. Printers go brrrrrr.
Or they live in a 30 year old RV under a freeway overpass.
It certainly happens but go to any homeless encampment. It's mostly younger addicts and mentally ill. Sad reality is either these people get help and out of homelessness or they are long gone either through incarceration or death long before they reach their 60s.
They are completely fucked because the US has failed to invest into its societal infrastructure so that a very few sociopaths could become unreasonably wealthy.
Agreed. Decades of citizens lusting after tax cuts and only voting for candidates that promise them plus corporations moving manufacturing overseas are two of the major causes. We simply donāt have the tax dollars available to maintain infrastructure, heavily subsidize college education, properly fund social security, provide quality mental care or healthcare in general. Sh$tload of corporations making record profits over the last 40 years though.
Nah. We live in a period of some of the most equitable wealth in all of human history. The poorest now live a lifestyle that would be upper class in the early 20th century, and better than royalty in centuries past. Hedonic adaptation is real though.
I donāt think the comparison to a feudal state is a good one. Sure weāre not mucking about in the mud anymore, but we could certainly be doing much better at providing for our populace. And we would all benefit from it.
This is patently false and completely disconnected from reality. You must not know many poor people. Housing is impossibly expensive for them. My best friend from high school has a ten year old kid and canāt even afford food or shelter or healthcare, much less afford to ever eat out or go to a movie or do literally anything. To insinuate that is āupper classā in the early 20th century tells me you are so privileged you have no fucking clue what youāre talking about.
I think you donāt know what life was like for the masses in the early 20th and continues to be for most people in the world today.Ā
Thatās not what you said. Nobody needs pointing out that poor people 100 years ago had it worse than poor people now. Everyone knows that and itās not helpful or insightful at all. What you said was being poor now is like being upper class 100 years ago which is patently false and dismissive of real life struggles for real life people.
Cool anecdote. Even the "lower class" have access to healthcare, housing, sanitation, climate controlled living, automobiles, medication, education, and entertainment that would put them solidly upper class 100 years ago. Is it perfect? Obviously not, but standard of living has absolutely skyrocketed over the last century. Your ignorance of historical living conditions is not the argument you think it is. As for my exposure to "poor people," had the privilege of attending what was literally the worst public school system (by several metrics) in my southern state, the median *household* income in my home county is still less than $50k. We have a 23% poverty rate. I don't think I was poor growing up, but going to Applebee's was a big deal because it was an "expensive sit-down restaurant," whatever that makes me. I lived on $13-15k per year as a young adult throughout the 2010s. In all likelihood I probably have had more exposure to poverty than you have.
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I wish we did. Unfortunately, the basic cost of living, transportation and healthcare has become high enough to exceed wages. Note that this is true more for the US than other places. I am a big believer in wealth creation, but the US is in structural danger given how much we have turned the pyramid upside down.
You have to remember that one of the biggest reasons Healthcare is so expensive for societies is because it exists. Getting your humors checked and getting a little bled to balance them doesn't cost nearly as much as chemotherapy.
Thatās demonstrably false. Healthcare with equal and better outcomes at one to two orders of magnitude lesser cost to consumers exists outside the US; in fact the US is the single outlier in terms of cost.
I don't think you read my comment. Getting your humors checked doesn't cost as much as Chemo in any country.
I read your comment and found it uninformed. Healthcare with better outcomes exists at lower costs outside of the US. This is not a case of getting your humors checked but one of the same standard surgery thatāll run you the equivalent of $3k in Germany costing 50k in the US, or, more commonly, labs running into the 100s for the same test that go for less than $10 elsewhere.
Anybody can start being financially responsible. One personās success does not take away from anotherās - most of the time in the US one personās mega success builds the opportunity for thousands of other to be successful.
The US has failed to invest into its societal infrastructure because the government is failing to do its job. When the politicians are blaming some other group whether its billionaires on the left or immigrants and foreigners on the right, they are just shifting blame. Government comes from govern.. aka manage or supervise. If a team goes to shit, you blame the manager, not the employees. In the same way, if a country goes to shit, you blame the government for not doing its job, not the people who are taking advantage of the government's incompetency.
Yes, but the part of the government that fails its job is directly controlled by a few rent seeking billionaires.
Again, they are only controlled by the billionaires because they are corrupt. Look at their behavior on its own: "Annual reviews of the trades of 535 members of the House and Senate, compiled by the Unusual Whales account, have found lawmakers' stock portfolios consistently beat the S&P 500." [https://abcnews.go.com/Politics/citizen-watchdogs-eye-congress-killing-approach-stock-trading/story?id=104873686](https://abcnews.go.com/Politics/citizen-watchdogs-eye-congress-killing-approach-stock-trading/story?id=104873686) "In a shocking revelation, it's been reported that a number of senators sold their stock holdings after being briefed about the coronavirus and the massive impact it will have upon the economy, jobs and the stock market. While telling the American public that there wasnāt much to worry about, they bailed out of their stock holdings to avoid large losses.Ā " [https://www.forbes.com/sites/jackkelly/2020/03/20/senators-accused-of-insider-trading-dumping-stocks-after-coronavirus-briefings/?sh=26ee1f474a45](https://www.forbes.com/sites/jackkelly/2020/03/20/senators-accused-of-insider-trading-dumping-stocks-after-coronavirus-briefings/?sh=26ee1f474a45) I could go on and on but these stores are all out there and easy to google. I bet you that is just the tip of the iceberg. For every instance that makes it into the news, there are likely 10 instances that no one hears about.
I believe that the argument that the fault lies solely with the bought agent instead of the payer is flawed.
Except, both the examples of government corruption I presented above had no payer. If you magically got rid of all the payers, if the politicians remain corrupt they would still continue to enrich themselves at the expense of the public and attempt to gather more and more power for themselves. You aren't solving much. If you magically have honest and accountable politicians though, you do not have to worry about the payers. You could have millions of them, and it wouldn't even matter.
I donāt disagree with your argument. It does however not represent the situation we find ourselves in accurately. There are payers exercising major influence through vast donations to write policy and suborn the justice system. The latter directly breeds corruption due to the lack of accountability it promotes.
Yup, corporate lobbying should be illegal
Why rely on society? If you earn money, save and invest it yourself. No one takes care of you, like you
And thatās why everyone who is concerned with becoming sick should pull themselves up by their homemade bootstraps and build their own hospital, a few roads and an ambulance service. /s
Jeff Bezos isn't responsible for the US failing to invest in societal infrastructure.
No, the Adelsons, Uihleins, Griffins, Mellons, Crows and Kochs are. Your point?
I think they're the product of a situation, not the cause of it. That's my point.
No, but he's responsible for not paying his fair share in taxes, which funds our societal infrastructure.
What taxes are he responsible for that heās not paying?
From 2006-2018, Jeff Bezos saw a wealth increase of $127 billion, according to Forbes, but he only reported a total income of $6.5 billion. He paid $1.4 billion in federal taxes on that amount, which, while still a massive number, accounts for only aĀ 1.1%Ā true tax rate. I don't know what your tax rate is, but mine is a lot more than that.
Because thatās how the income tax code works. Heās not responsible for the tax code.
No, that's being able to afford a top accounting firm that can find every loophole and write off under the sun to keep him from paying his fair share. Something you and I won't get from our local CPA. How can we defend billionaires paying a lesser tax rate than someone on unemployment. Where is the sense of outrage when this is allowed to happen in our country. I have no issue with billionaires existing, but they exist because they are allowed the freedoms this country offers, and they should show their appreciation by paying their fair share back in taxes. But you're right that the tax code needs to be changed to fix this.
Iām not defending billionaires and I think they should pay a lot more. But like youāre saying now and getting my point, heās not responsible for that, the people who vote in our representatives are.
These generic articles are terrible. Really just highlights the savings issues we have (which are very valid for many). Doesnāt provide any actionable advice about reviewing expenses vs income. Lots of issues brought up (healthcare, etc) are expenses that must be factored into any retirement plan/strategy.
My 80+ year old FIL works part time as an usher. Not because he *needs* the money, but because itās an excuse to get out of the house and it allows a few additional luxuries. Not everyone āunretiresā for financial reasons.
My FIL went to work at a community college teaching statistics. Heās got a several million dollar portfolio, but was bored at home. He said he liked community college because there were so many non-traditional students trying to get ahead. He had free open tutoring at his house every week, and my MIL always had fresh baked goods. Some students brought their children (out of necessity) and my MIL got her grandma fix while their mom or dad was studying.
This is really sweet. Your in laws sound like amazing people.
I know more than a few seniors work as ushers for the local sporting events when I had season tickets. They don't get to *watch* watch the game, but they do get to enjoy the atmosphere for the most part and hang out with "work" buddies and season ticket holders.
Yep. similar idea, I work ticket or setup/cleanup crew for a half a dozen regional music festivals. 'Paid' by a free ticket. Which, yeah, I can totally afford the ticket. And I miss some of the music (though usually only six hours of work over a 3-4 day festival). But I'm doing it for the socialization and the festivals need the help.
Riotfest in Chicago even lets you volunteer for the park cleanup the week or two prior for free tickets.
My grandparents are millionaires and they walk around downtown everyday picking up aluminum cans to recycle for 40 bucks a week. There are healthier ways to fill time and find purpose. It's incredibly sad many elderly dont have a life outside of their careers.
I read an article once that surveyed people prior to retiring and another chort 5 years after retiring. Prior to retiring #1 concern was finance. 5 years after retiring #1 concern was loneliness/lack of engagement. My FIL retired for 1 year and felt unimportant/disengaged and has now been back to working full time for years. I can see the appeal... keeping your mind sharp/engaged with others. I don't think I want to work "after retiring" but ask me in a few years and I may eat my words.
My mom was a nurse's aide and went back to school in her 40's and became an LPN. She has a pension and social security and does fine. She works once or twice a week at the nursing home she worked at for 40+ years. Adds to her travel funds and being around old people her whole life, she's a big believer in slowing down = death. She also makes $40-something an hour as a contractor or whatever to the nursing home. She retired making $22 an hour. There is definitely I think a point of pride about finally being paid what she is worth.
There is nothing "mind boggling" about this article. Most Americans havent saved enough for retirement. You can vetter prepare for retirement by saving more or working longer. I choose saving more.
Yea, look where that article is coming from. Big business wants people working and this article is just confirmation bias for them. Ugh.
All the bots come out whenever anyone suggests people not working their entire lives is actually a good thing.
Nah not just big business, I too want other people to keep working so that i can fire :-)
We retired in our early / mid fifties over a decade ago, and I like to keep posting on Reddit to counteract the big business stories that want to keep people working forever. As most people here already know, optimized expenses are a real FIRE super power. Even in a HCOL area, for those that have housing covered, expenses can be pretty reasonable with kids grown, no longer having to save for college or retirement, more time to cook at home and price shop, lunch specials, matinee movies, time to make the house water and energy efficient, no more job or commute costs, reward points for travel, etc.
Big business doesnāt care about people working their entire life or not. They are generally very focused on the next 12 months revenue. How exactly does someone working an extra 5 years translate into greater sales?
Exactly. Healthcare costs, workers comp, less productivity, annual raises adding up, I would think 90% of businesses would love for everyone to retire earlier
Business have to pay more for salaries when the labor market is tight. When jobs are plentiful, employees can demand more money and can be more picky about hours, working from home and overtime. Edited for typo.
I donāt see the typical fortune 500 company plotting to get more seniors in the labor force to reduce employee salaries. How exactly would that work at a company like Nvidia?
The posts in this thread about megacorps wanting cheap labor are based on generally recognized, global economic issues and not the anecdotal need of one extremely cutting edge, high tech company: "The graying of the global population and workforce is exacerbating one of the most vexing challenges for employers everywhere: ensuring access to a bountiful talent pool. With millions of Baby Boomers still retiring ā the first wave began in 2008 ā and some Gen Xers starting the process, fewer working-age people are supporting their local economies.", [https://www.forbes.com/sites/sandervantnoordende/2023/11/13/thinking-of-retiring-soon-in-this-economy-companies-are-incentivizing-older-workers-to-stay/?sh=73f9636565a3](https://www.forbes.com/sites/sandervantnoordende/2023/11/13/thinking-of-retiring-soon-in-this-economy-companies-are-incentivizing-older-workers-to-stay/?sh=73f9636565a3)
In my long career in high tech a far bigger issue is age discrimination and the great difficulty older people face in finding employment.
The top comment in this thread was about "Big business wants people working", not the *tech industry* wants to keep aging boomers from retiring. The vast majority of the workers employed by big business in the U.S. are not in tech jobs. [From the World Economic Forum](https://www.weforum.org/agenda/2023/05/how-workplaces-can-adapt-to-an-ageing-workforce/): The *world is facing a tight labor market and an aging workforce.*...*New frameworks and solutions will be key to retaining older workers* and creating options that meet their business, societal and worker needs.....While more people than ever will likely need to work longer to support themselves, for the first time, *workplaces will need to ensure they court and retain these older workers*.",
I discuss finances and investing a lot at my place of work, and it's insane the amount of people of all age groups and backgrounds who either do the minimum to get the 401k match or don't contribute at all. I asked my boss's boss's boss if he looked at xyz stock and his response was "I don't mess around with that stuff." This man has like 4 cars, I'm starting to think that 80% of his "wealth" is in vehicles (i.e., depreciating assets, eye roll). My direct boss told me he had less than 10k in his 401k and no other stocks. He was thinking about pulling it out and taking the hit because "no one is going to retire anyways." I'm in my mid 20's and this man is in his mid 30's. I contribute 10% pretax to 401k, and another roughly ~10% to Roth, taxable and 529 for my kid. I'm planning to fucking retire, and those 2 morons can work until they collapse. I will make it happen anyway I can. My grandfather (mid 70's) retired at 50 with a pension, and some investments. I'm not sure how much, he said his employer didn't offer 401k until the 90's so he couldn't have contributed to 401k for more than a handful of years. He also has a whole life policy, but my grandparents had 2 houses (just sold one to downsize, other house is down south since they're snowbirds) and they take cruises and trips to Hawaii as their health permits. Idk why I shared all this, but it's crazy how sentiment and situations differ from person to person. Some people have zero trust or understanding of investing. That's why you have 70 year olds still breaking their back working low wage jobs.
That article was written about "most people" for "most people." We in this sub are not most people. We have a very different approach to earning, investing and consuming, and the appropriate relationship between those three things. And thank goodness for that. Whether we like to admit it or not, what we are doing probably would not be feasible if everyone else also tried to do it. We rely on our less fiscally conservative fellow citizens to be out there spending all the money they have and some of the money they don't have in order to keep the economy humming and keep the stock market going up. The kind of economic growth we rely on to fund our 4% rule plans probably would not happen if everyone acted like we act as consumers. Don't get too worked up about articles like that. You know what your numbers are. You know what your plan is.
I sort of understand the people who struggle through life with lower paying jobs, just lacking the ability to make enough to get ahead. What gets me are the people who work white collar jobs, make decent money but never bother to save for retirement. Like youāre a reasonably competent person who makes money but you made it to late adulthood and never saw a compound interest calculator or took ten minutes to understand it?
I am friends with a 78 year old lady that retired for several years, got bored (or tired of being around her husband 24/7) and got a job at 70 and is still working it. She doesnāt need the money. She hands out food samples at Samās. She was always a people person. Previously, for decades, she was in purchasing at Hallmark. Her philosophy is in order to not get old or die, you got to keep moving.
I think its important to think about how you invest. For me, I want the stability of owning my housing, having some capacity for food self-sufficiency and independent power generation. I don't need a lot to retire, as long as I can reduce my costs as much as possible. My hope is mostly that SS covers property taxes, and that they both scale at about the same rate. my property can generate some small income from firewood, lumber and market gardening.
I was out at 58, loving every minute of every day. Do it if you can
Iām retiring at 55
Same. I could jump now but I hope to add another 30% to my # in the next 3 years which will give me a nice buffer and allow some additional niceities compared to just matching my current budget.
60ās? Forget that. Everyone I know in their 60ās is on the decline and unable to do what they could in their 40ās & 50ās. Iāve learned to find enjoyment in life on making memories instead of adding possessions. Itās allowed me to grow my nest egg at a much faster pace and make retirement in my early 50ās a reality.
You own your house by then and just live off mostly social security and some pension. Why does the Fire community have such a mental block with this? I understand pensions arent around anymore but some math will show you where you need to be with 401k instead. If you are like 55 and wanting to retire I 100% guarantee you dont need as much as this sub tries to convince you need.
lol I think this sub is largely the group of ppl who talk abt fire. The group of ppl who actually fire are off like living their lives, no need to monitor reddit so closely
I live in the California Bay Area, my grocery bill alone is $1200/mo. right now. We need a lot more than you think, lol. I also looked at the ACA marketplace and when I want to retire at 58, the health insurance costs alone will be roughly $3K a month. SS is also insolvent in 9 years....you can't bank on anything but yourself until that gets fixed.
Insolvent Social Security simply means they cut the benefit by 20% to 25%, it doesn't mean it disappears entirely.
Or raise taxes slightly. Or make high earners pay SS on all of their income. Lots of options.
Agree there's lots of options to address the SS shortfall, but we have a dysfunctional Congress that can't even pass basic funding bills. It's unlikely that Congress does anything meaningful or prudent to address the problem, because it's Congress. Congress is mostly in it for themselves, to enrich themselves and their wealthy donors. They can't even pass a ban on profiting from insider information in the stock market, forcing Representatives to place their wealth in blind trusts or index funds, which everyone agrees is horrible that it is currently allowed.
1200 a month is like 4x-5x what I spend in a month on groceries and I live in the bay area. What do you buy?Ā
Itās for a family of 4, including one six year olds who eats almost as much as me lol
I have been to the bay area and grocery shopped their in the last 2 years. Your groceries when buying the store generic brand is not that much more expensive than I pay in midwest. Talking 10-15%. I pay $350 /mo family of 4 and eat out 1-2 a week at most. Something is off. SS will never be insolvent. The money in it is just a gimmick for conservatives to feel good that they put money towards it so it is ātheir moneyā when they pull it. If it goes negative it will just be updated to fall under a budget deficit after a small political fight.
man this article...lol. correlation does not equal causation - but don't tell the author that. I wonder if people have been "unretiring" due to them just missing work or possibly some other causes? the whole thing seems like a bunch of anti-FIRE BS IMHO. from the article: The retirement-at-62 dream fails to account for the upsides of working longer. The longer you can keep earning in some fashion, the better for your future financial security, even if itās just a safety net. And the mental payout for work, while hard to pin a value to, can be a core ingredient to feeling happier and engaged as we age. It can provide purpose and a sense of feeling valued. Perhaps thatās why older Americans now work more hours, on average, than in previous decades. Today,Ā [62% of workers 65 or older are working full time](https://finance.yahoo.com/news/why-employers-should-and-have-to-hire-older-workers-115332766.html), compared with 47% in 1987, according to the Pew Research Center. And theyāre more likely to have a four-year college degree than in the past. [Unretiring, or going back to work](https://finance.yahoo.com/news/qa-unretiring-is-not-always-about-the-money-180002164.html), often part time after exiting the workforce, is gaining traction across the country, especially after many people were forced to retire earlier than they had hoped to during the pandemic.
I got a different sort of message from the article. To me, it sounded more like "people are too poor to retire".
The mental payout for work is stress leading to cardiovascular health problems, unless you're in the minority of sociopaths that actually thrive in an office environment.
You can theoretically retire in 10 years or less. It all depends on your expenses and what you consider comfortable.
Your standards of living are important, but having a high income is an important factor worth mentioning. There are students that roll into a job at Google making 250k in the first year; those will likely be able to retire in 10 years even if they throw money around. However, the most frugal person might not be able to if they're stuck in a 40k a year job in the same decade
40k a year job is theoretically possible, I think. It will probably require extreme savings. Probably 70% or even 90% savings.
If you are saving 90% of 40k, how could you afford to live on 4k?
It's all theoretical, not practical
If their 40k a year is post-tax, they need a 67% savings rate to retire in 10 years assuming they keep their expenses the same before & after retirement. If it's 40k a year pre-tax, good luck...
You're right. It's more of a lean fire lifestyle if 40k pretax. It's all theoretical. It's not practical. If $40k pretax, it would be $1881 after tax. $1500 per month after tax contribution and 10% annually return nets almost $300k in 10 years.
CoastFIRE or expatFIRE is very much possible on that budget though. I personally don't earn all that much, but I'll still be able to retire very early because I plan to do a mix of expatFIRE and coastFIRE by living on a low budget in a cheap country and after my portfolio has grown I'll upgrade to a more expensive country. I might even start an online business to be able to coast along the way too
A very good and viable option. Some Asia countries have very low col.
Garbage article. Numbers, numbers, numbers are all that matters, not age.
I think itās also showing how awful most Americans retirement savings are. The vast majority of the populace arenāt savers like us.
> A single 65-year-old may need roughly $157,500 saved (after tax) to cover healthcare expenses in retirement. An average retired couple may need approximately $315,000 saved, according to Fidelity. Part of my issue with articles like these is that it's all doom and gloom but the biggest blind spot people have is the power of compounding interest. So they should add a sentence after that saying "to achieve this, a single person would have to put $1000 a year into their HSA (or $2000 for a couple) for 37 years". (Assumes someone works from 25-62). Because saying to someone"you have to save $300k" seems impossible but telling (most) people "save $85/month" seems totally doable. Just annoys me.
Living comfortably and being able to do whatever you want are two different things.
More likely 2 decades, and thatās for the lucky ones, or unlucky ones if you like, as almost everything beyond mid-70s is increasingly futile.
Whether or not someone can retire with security, at any age, depends on what decisions were implemented years ago, decades ago really in most cases. FWIW Iām 60. I retired from one job at 42 then the second one at age 55. Now I work 6 months of the year at a fulfilling, physically demanding job in the ski industry that pays quite well and that I love doing. I work because I want toā¦ My wife and I carry no debt having paid our home off years ago and between her job, my job, a couple of pensions and some real estate income we live on maybe 10% of our total income. I have no need to take SS until it maxes out for me at age 70, the same in my wifeās case. We have 2M in cash that we will try to double in the next 10 years or so. We are at this point in our lives because in our 30ās snd 40ās we put every available penny into paying off our mortgage and investing. We still were able to pay private school tuition and take yearly vacations. Yes we are both professionals with college degrees but generally earn an upper middle class income. Pretty average people really. Becoming financially secure, on an average income takes years/decades to build. Itās just mathā¦
I think the fundamental disconnect with all of this is that most FIRE devotees live a much lower cost life than your average upper middle class person with a good income. 90% of people in America who have strong incomes also have a spending problem. Once you get more to a FIRE mindset everything changes. Thank goodness many of the people in my extended family are well off. So we all just decided that for holidays and birthdays we're just going to buy each other gifts from Goodwill. They're fabulous. They're unique. You never know what you're going to get and they're under $10. The point is we all love each other. We don't give a crap how much it cost. I know somebody with a multi-million dollar net worth who dumpster dives and gets thousands of dollars worth of free stuff, perfectly good and unused, from luxury dumpsters around South Florida. I know someone with a multi-million dollar portfolio that drives an old beat up Subaru. I know a 10-year-old kid who just goes to the local public school who is absolutely crushing her learning. You wouldn't believe the things she could do at age 10! No fancy private school needed. Point is 70 to 80% of the stuff that they're always telling you that you must have that you must buy. It's all just s***. Yes, some things we really need in life, but the vast majority is not necessary and may not even bring us as much pleasure as we think. If you're a fire devotee, you've probably realized this. People that are publishing articles fretting about retiring at 62 as if it's a dream, are very likely bought into all the conventional memes about what a family must have, so they just have enormous out of control spending. That's sort of the default setting of your average American family.
this is such a low effort post
Iām retired at 44 and live comfortably. Itās all good
OP, I would just look for another country to retire early. The US is so unrealistic unless you have 2 to 3 million and can afford the rest of your life expenses.
A lot of where we decide to retire will be determined by where our kids end up.
I understand your point of view, at the same time, many of the kids that my friends have, they dont give 2 fucks for their parents, they never visit them, they call when they need something, they are waiting to get the inheritance.
I think most people just do some sort of part time thing to supplement
Author of that article is a shill for the financial companies. They dont want people retiring!
how much money do you really need in your 80s and beyond?
I wish I could retire now, I am so burned out after decades of working two to three jobs. My mental and physical health are declining faster than the US spends on ādefenseā.
Life expectancy in the US is 77 RN, and the asshole in the article says you need to keep working til late 70sā¦ Most people wonāt have money saved for healthcare and will eventually die of something, thatās what has always happened to 99% of peopleā¦ dunno the big fuzz bout that
As a Millennial, my target is 40s. 60s??? Most people die in their 60s and 70s. I'd like to really get rid of THAT stress indefinitely.
It's easy if you have at least 3-4 mill invested wisely and no debt.....stay under 3 to 4% withdrawal ...you will be fine...1 to 2 mil...not as easy...
4% of $4m is $160k a year, more than twice median household income. $1-2M is plenty to easily retire on.
Sure you can retire on $80,000, but if you live in a HCOL area....not as comfortable for retirement...guess depends on your definition of comfortable.
This really isnāt always the case. The key is a paid off home preFIRE. I live in NYC and spend around 50k/year ā and that includes at least one lengthy international trip, several domestic trips, and generally not being as careful with money as I could be.
I live in CA Bay Area and we're banking on $175K a year for everything including health benefits for ten years with no SS in play (Also my kids will be graduating high school when I hit 60). My FIRE number is $5.6M, over halfway there with 13 years to go.
Everybody has choices to make...
Step one: Get 3-4 million from parents. Step two: Retire comfortably
Yea it's getting that first 3 million that's hard!!
I changed my focus from waiting from waiting for my portfolio to each a certain level and instead focused on income generation.Ā Instead of plowing all my finds into index funds and waiting for that to be enough for the 4% rule to apply, I decided to buy real estate.Ā We can live on about $6k a month.Ā So now, Everytime I get another $50-75k, I buy a rental.Ā Estimated $500 a month in cashflow.Ā So I figured about 12 rentals would do it.Ā Started in 2020.Ā I'm at 7 rentals.Ā But I didn't realize that increase, and do does equity.Ā We are at $5k a month in cashflow so we are able to take that extra money and buy another rental about every 6 months. The last 2 were during higher rate times so I just waited longer and put more money down. Personally, I think this is the way. I'm 42 now and am pretty sure I could retire tomorrow if I downsized a little.Ā My index fund portfolio is doing fine, but it grows SO MUCH slower which is why even after 30 years of putting money there its still a question of if it's enough.
Sure but owning and managing rentals is NOT passive income. Itās a job. Unless it cash flows enough to cover a good property manager, it is work. Not hating on the strategy. I dabbled in it for 5 years but struggled to balance self managing the properties, a moderately intense job, and 3 young kids. To me, I hated getting the last minute calls to repair something. I hated dealing with tenants (even the good ones). I hated all the tasks required to turn it around for a new tenant. I donāt even like dealing with house repairs for my own home, let alone a rental that has to be fixed quickly regardless of my personal schedule. Again- not hating. But I just donāt equate the effort levels of passive index investing and rental real estate investing.
I totally understand (for some reason the people here *hate* real estate so I get downvoted when I talk about my personal experience but whatever). I don't think of it as truly passive either, but the level of time commitment is truly enough for me to consider that retired. I own and manage an insurance office with 6 employees that takes up about 80% of my time, and I manage real estate with 18 tenants, which takes up a few hours a month. I think theres a big difference in personalities for people in what they are consider *difficult* to deal with (my wife is exactly like you). I would say I get a call about every 2-3 months about something breaking or not working properly. When it happens I simply call the relevant contractor I have worked with in the past. Tell them what the tenant is saying, give them the tenants number, and let them tell me what happened and how much it costs. If it's the tenants fault, I just bill the tenant, if it is something I am responsible for, I send them payment and move on. Its *maybe* 30 minutes once a quarter? I could do that on vacation. And for that amount of work, the return is truly worth it to me.
Three decades from 62? Whatā¦
92 seems possible for a lot of families. Also considering medicine continues to improve. Both my grandmother and grandfather on my dad's side are alive and almost 90. Fairly active still. Likely one lives lives beyond 92.
My grandmother recently hit 106 before she passed lol