Realistic calculator for retirement
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Anonymous
I think you have to double to $100k. My parents retired in 1997 and moved to a lower COL (Carolina coast). They spent about $50k a year then. They were frugal depression babies and generally took one big (not DCUM big) trip a year. So, with inflation, I think you need $100k to do it now- more if your retirement is further off. I would also caution you about the lack of decent primary care doctors in many LCOL areas. Both my of my parents’ lives were cut short by inept doctors. |
Anonymous
| My parents retired to coastal Maryland and live on 70k/year. They aren’t extravagant at all but they do go out to eat once a week or so, travel twice a year across the country, have excellent medical care. Just in case anyone thinks you need to have 200k in retirement to live a comfortable life. |
Anonymous
No. Not wasteful. But you will spend every dollar you do now with healthcare likely replacing your other expenses that went away. You also may want to do other stuff that will cost and maybe help out kids even if just a hundred or two once and a while. I would run it at currect expenses and then work backward from there. |
Anonymous
I guess that is not a retirement that I would like. Certainly could live it if I had to but why would anyone? Travel more than twice a year for sure. Do it now not sure why dial back. Eat out once or twice a week? I am a cook and love to cook and eat in but that is pretty sucky. You might end up there but you want the freedom to do more. |
Anonymous
I’m not retired and we make a good living but we never eat out more than once a week. It’s wasteful and unhealthy. |
Anonymous
I think it's easy to imagine what your life would be like in retirement. I'm a different poster, but many of my parents friends don't travel as much because they want to be around their grandkids all the time. If they do it's like once a year or twice if with family. They also often have health issues or just anxieties that come with getting older and stay put more. One of my mom's friends has endless money and feels like all of her grandkids moved on to another area. She complains but she can easily buy a home or condo in their town. Fear keeps her back and I would imagine it would for so many other people. Fear of the unknown and fear of meeting new people and being in a different environment. I feel like I wouldn't be that way but it's easy for me to say that now when I'm super healthy, fit, no real fears, comfortable in many different environments. In 30 years I have no idea what I'd be like. |
Anonymous
Here's what I'd do to create an estimate.. - Estimate your current expenses; remove items that are childcare related or otherwise won't recur; add in expenses that will replace them (e.g. more travel). Assume a 3-5% annual inflation for this bucket and project that out to your year f retirement and beyond. That's your "maintenance" expenses. - Estimate medical and long-term care costs in retirement and add them in to create a total budget The above gets offset by pension and social security, both of which I'm sure you can estimate. If there's a shortfall, it needs to be funded by investments at 25X (e.g. if shortfall is $10,000/yr, you will need $250K in investments). In addition to all of this, I'd say have at least 10X your annual expenses (1+2) above for the unforeseen (e.g. if annual expenses calculated above is $100K at the time of retirement, you'll need $1M). Adjust this number as needed. You'll know more as you get closer to retirement but I recommend planning for 10X as a goal. You are only 42 and have a long runway to make this happen. |
Anonymous
It is healthy depending on where you go. Often better than home. And there is no such thing as wasteful in this context unless you also cooked a meal at home and did not eat it. Eating out is less wasteful than eating at home. |
Anonymous
Depends. I don't know anyone whose kids live in the DMV. They travel several times a month either long drive or fly to see kids and grandkids. |
Anonymous
This is really good. |
Anonymous
"Wasteful" in the context of money and finances, is about expenditure - you spend more eating out vs cooking. Are you claiming that it's cheaper to go out and eat relative to cooking your own meals? |
Anonymous
| If I think we will need $100k per year for retirement, how big does my pension pot need to be? |
Anonymous
It sounds like perhaps you’re planning on having an investment that provides a steady withdrawal like a pension, not an actual pension? I like to use Monte Carlo predictors for my planning of a similar situation, and then tailor it so the odds of running out of money early are acceptably low (I pick 10%). This provides some reasonable expectation of the desired annual draw without relying overly much on a single historical average like the 25x FIRE-type methods. https://www.portfoliovisualizer.com/monte-carlo-simulation |
Anonymous
No but if you are worried about this retirement will not go well for you. Two more meals out a week will add maybe 6 months to your spend over a lifetime. |
Anonymous
Do tell us. I haven't heard that. I thought it was generally accepted fact that eating out is less healthy than home cooking. Where do you go that serves healthier dishes? |