How much money is enuf to retire?

[Bennykoh_gay]

I always hear people say "It's not how much you earn that matters but its how much you save". How much can you save a month?

For me, I'd say an average of USD200 a month. I earn about USD1500 a month
Don't know if this will be enough when I retire

 

[ahotjock71]

Retire?

I'm going to die young & fabulous.

 

[belamy]

€999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999,999

... or so.

 

[belamy]

Retire?

I'm going to die young & fabulous.

You mean like Lupe Velez?

 

[KentuckyPython]

Retirement is something I doubt I'll ever be able to do. I'll pretty much have to work until the day I die, but hopefully that 401K will ease some of the burdens.

 

[KentuckyPython]

I'm going to die young & fabulous.

Honey, you're young and fabu now. Please don't be in a hurry.

 

[winterknight]

I can't afford to save anything.

 

[rotary]

Will you have a pension?

 

[Bennykoh_gay]

Nope, here in Malaysia, its called Employees Provident Fund. Employees contribute 11% of their salary monthly while the employers contribute a minimum of 12%. It's quite common here (according to surveys) that people finish using the funds within 3 years of retirement...scaryyyyyyyy....

 

[Golliwog]

Answer: More than anybody says or thinks. I retired 11 years ago, and have long since gone through all savings and benefits. Now subsisting on bare bone Social Security benefits, and the kindness of others. Yes, Blanche, I, too have always depended on the kindness of strangers. But that kindness has no cash benefits. In summary: Retire when you have to before going completely off the deep end, but not until then. And be prepared to simplify your wants and demands. Which is not all bad. It is a tough situation. Requires one to reevaluate his life priorities.

 

[Tongue_Me]

If I stay in this country (the uk) then I doubt i'd be able to afford to retire until I was about 70 and even then I wouldn't have enough money to have a great life I suspect. I'll move overseas if I want to retire for the better quality of life and to make whatever retirement fund I have go further.

 

[JayHew]

^^ you should shoot for about $850-900K in a retirement fund at todays returns. That would allow for about $50K a year with some going back into the fund to keep it growing. Not a hell of a lot per year, but enough to cover things IF you own your own home and have no other debt. Make sure you have insurance to cover any health issues that may come up and about $30K available to you in a money market fund should you need a lump of ready cash.

 

[metta]

I try to look at it but every time I do....it is just a little depressing. Who knows how much things will be when I retire. Being self employed, I probably will never retire unless I'm forced to. I will probably work less and hopefully take some vacations.

If I was going to retire, I would want to make sure that I had at least $6 million and that would be if I waited until my mid 60's. Even at that, I'm not so sure that would be enough. Either that, or I would have to move to a cheaper area to live....which would probably be a foreign country...I can't see myself live in a red state.

 

[gvlatinboi]

If you live in the US and you don't think you'll be throwing money away when you retired, you should be fine with 1.5-2 million dollars. (If you put it in a high yield savings account of 3-5% apr, that will be 45k-60k a year in interest income.

 

[Croynan]

USD $1500.00 a month is not that great.

One bedroom apartments here in the valley area of Los Angeles are going now for an average of about $1300-$1600 a month.

At least owning a home or a condo you have the tax deduction of all the interest which helps a lot.

If there is any sort of a 401 K Plan go for it - just be careful what it is invested in.

"Can you spare a dime, sir?"

eM.

 

[star-warrior]

If you invest in real estate, it could bring in a welcomed income and not just on retirement.

 

[thermodynamics]

OK, here's the formula

Choose the yearly amount you want to generate from the fund, call it YearCash.

Assuming this fund will exist largely in bonds (which it should be--low risk) and a 4-7% average rate of return (pick 5% for instance), call it IntRate (convert from percent to decimal [5% become .05]).

The amount you need, NestEgg is:

NestEgg = YearCash/IntRate

This is an extremely crude approximation, but it's generally pretty good. This formula also assumes that the nest egg is NOT touched--you're leaving the principal alone and spending the earnings.

Between now and then, depending on your age, the money should sit in a moderate to aggressive index fund.

 

[metta]

If you live in the US and you don't think you'll be throwing money away when you retired, you should be fine with 1.5-2 million dollars. (If you put it in a high yield savings account of 3-5% apr, that will be 45k-60k a year in interest income.

At retirement, $45k-60k, will that really be a realistic income, taking into consideration inflation, especially health care cost increases? I'm guessing that $120k-$200k/year will be necessary, especially if you plan on going on a few trips each year. I guess a roommate could help to cut down the expenses.

 

[Bennykoh_gay]

Wow. Seems like the living standard in US is very high. As mentioned earlier, I am earning abt USD1500. I know its very little compared to what you guys are earning. But there are many people here who earns abt USD200 a month, so I guess I am lucky in that sense. Problem is things are getting more expensive by the day but our salary's annual increment sux...it cannot even keep up with the inflation...

Prices of cars and houses here are not helping either. A decent Toyota sedan would cost us ~USD30K. A double storey linked house is at least USD85K :-(

We don't have any Social Security benefits either...I wonder if I can ever retire...

 

[metta]

I think that what can take the biggest chunk of money in the US when your older is health care costs. Your premiums are much higher at retirement age than when you are younger. And then there is the cost of medications, as well as the huge annual increases in health care costs.

Right now, my property taxes and association dues alone come to around $12k a year. At retirement, they would probably be much higher. So even if my home was paid off, I would still have that plus the cost of upkeep of my home. So if you figure that at retirement, that my annual health care costs will be at least $1k to $2k per month, and I'm guessing that decent insurance will probably be much more than that, unless we have some kind of national health care plan. Those three bills alone would amount to more than $30k-40k.

I say just do the best that you can do....that is all you can do anyways.

Unless my business gets to be pretty big and I sell it when I'm older, I just don't see how I would have enough money for retirement. That is why I will probably not stop working unless I was not able to do it anymore.