Late 40s. We have about 3.5X our gross HHI saved. Is that ok?

[Anonymous]

Anonymous wrote:I'm retired at 48, because getting out of workforce is what I wanted from the get go.
There is no 401k (not the best account), retirement home is paid, income is passive. Took 30 years to turn earned income into passive income. At least now I know how it's done and could do it in 10 years.
3.5x is not a whole lot between 2 people in late 40s, but you should be fine by 62.

Teach us how to make passive income

[Anonymous]

Anonymous wrote:We have about 8.5x our current income saved, not including our home equity, and I still sometimes worry that it isn’t enough (early 50s). Not for any rational reason, though: The PPs here all have good suggestions and perspectives for you, OP. It’s hard to really know what you’ll need or what’s reasonable.

Early 50s as well and have 12x, not including both homes, college savings, and 401k.
It doesn't truthfully feel like enough if we live to 105.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We need some numbers. If you are lower to average in HHI income it’s impressive. But if you are higher income than you have a lot of work to do since social security likely does less of the heavy lifting for you in retirement as a percent of income.

why does it matter? i’m not the OP and our income swings wildly. ashanti’s we made double what we made last year, it we could make 25% of this years income next year. None of these silly comparisons make sense. I have an idea of what we need
o they in retirement and I just back into that

This is what some of us are saying. Either give us numbers so we can help answer the question, or do it yourself by backing into the number. But enough is based on expenses, not on what someone in their 40s needs. OP just wanted an answer if it was enough. We are saying no way to know.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well DH and I save and invest separately - spender (him) and saver (me).

Early 40s - I have 15x my income saved and invested (excluding significant home equity and $600k in 529 plans). About 50% of that is separate property (pre-marriage investments that I kept separate) and the other 50% of technically marital property, but that's only relevant if we get a divorce - I control it as long as we are married, and it's part of my estate.

DH is older and only has 3x saved.

Story of a spender versus a saver.

Whoa, 600k in 529s? I'm assuming you have 3 kids? I am also a saver but that's a very high number especially with your savings rate and investment property, you have many means of funding college for your kids.

It is weird to me how antagonistic you are towards your husband and the degree to which you keep your finances separate. My DH and I also have different financial personalities -- I'm more conservative and a saver, he's more risk taking and a spender. But we combine everything and I actually like how our tendencies balance each other out. We have way more total money saved/invested because of my influence -- I insist on high percentages of automatic savings and investing out of our income, and I don't allow lifestyle creep when we get raises, so the money builds up fast. But my husband's greater capacity for risk is why it's grown at a higher rate. I would have much more of our money in ordinary savings were it not for his influence, and we would have missed out on massive gains in recent years. Also he makes sure we actually enjoy life, take real vacations, and reminds me that there's no prize for living like a pauper. We balance each other out and both come out ahead.

600K in a 529 and you expect 3+ kids? Why? Currently you can expect to spend $40-50K per year for a moderate school, so $200K minimum per kid. But if they want to attend others, there are tons that cost much more. So why wouldn't you save for it? Also, what if your kid wants grad school/proofessional school? Those can cost $200-300K+. We just spent $370K+ for 4 years, and are looking at another $200K for just one kid. Good thing it's in the 529. The other kid was $160K total for 4 years but that was 6-8 years ago.

We have 2 in college and 1 in 9th grade. Each 529 was fully funded (to fund private college up to 400k total for 4 years per kid at a school like HYPSM or other private T20, if needed in today's dollars)?
600k and 3 kids is not that much??

[Anonymous]

Anonymous wrote:

Anonymous wrote:I'm retired at 48, because getting out of workforce is what I wanted from the get go.
There is no 401k (not the best account), retirement home is paid, income is passive. Took 30 years to turn earned income into passive income. At least now I know how it's done and could do it in 10 years.
3.5x is not a whole lot between 2 people in late 40s, but you should be fine by 62.

Teach us how to make passive income

The most typical forms of passive income are investing income. (Stocks, bonds, HYSA, REIT, etc.) Or, rental property income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Well DH and I save and invest separately - spender (him) and saver (me).

Early 40s - I have 15x my income saved and invested (excluding significant home equity and $600k in 529 plans). About 50% of that is separate property (pre-marriage investments that I kept separate) and the other 50% of technically marital property, but that's only relevant if we get a divorce - I control it as long as we are married, and it's part of my estate.

DH is older and only has 3x saved.

Story of a spender versus a saver.

Genuinely curious how marriages like this survive. What happens if DH looses his job at 50/55 and cannot easily find work equivalent to current job? What happens if at some point he needs to enter memory care/assisted living? But he has only enough left for 6 months? Do you spend down your savings? Do you manage with him at home (and stress yourself out to save the $$)?

If he loses his job, we'll have to sell our house because our mortgage (his idea) is based on his income. If he gets sick and needs care, I will pay for his care directly with my savings. Fully expect that day to come. If he wants to buy a boat in retirement or spend $250k per year caring for his parents, he will be SOL.

[Anonymous]

Multiple of income is a weird way to measure. Multiple of spending maybe? Consider your retirement goals and draw down rate, and then you know what you need.

[Anonymous]

We only have 4x income saved. $5 million HHI and only $20 million saved. How will we ever be able to live off $20 million? (This is why using multiple of HHI makes no sense.)

[Anonymous]

OP, don't feel badly. This board is widely out of touch with the way most of the country lives!!
Our HHI is ~400K, and we have a bit more than 3.5 saved across retirement and college (but a ton in home equity).

[Anonymous]

Wildly*

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well DH and I save and invest separately - spender (him) and saver (me).

Early 40s - I have 15x my income saved and invested (excluding significant home equity and $600k in 529 plans). About 50% of that is separate property (pre-marriage investments that I kept separate) and the other 50% of technically marital property, but that's only relevant if we get a divorce - I control it as long as we are married, and it's part of my estate.

DH is older and only has 3x saved.

Story of a spender versus a saver.

Whoa, 600k in 529s? I'm assuming you have 3 kids? I am also a saver but that's a very high number especially with your savings rate and investment property, you have many means of funding college for your kids.

It is weird to me how antagonistic you are towards your husband and the degree to which you keep your finances separate. My DH and I also have different financial personalities -- I'm more conservative and a saver, he's more risk taking and a spender. But we combine everything and I actually like how our tendencies balance each other out. We have way more total money saved/invested because of my influence -- I insist on high percentages of automatic savings and investing out of our income, and I don't allow lifestyle creep when we get raises, so the money builds up fast. But my husband's greater capacity for risk is why it's grown at a higher rate. I would have much more of our money in ordinary savings were it not for his influence, and we would have missed out on massive gains in recent years. Also he makes sure we actually enjoy life, take real vacations, and reminds me that there's no prize for living like a pauper. We balance each other out and both come out ahead.

600K in a 529 and you expect 3+ kids? Why? Currently you can expect to spend $40-50K per year for a moderate school, so $200K minimum per kid. But if they want to attend others, there are tons that cost much more. So why wouldn't you save for it? Also, what if your kid wants grad school/proofessional school? Those can cost $200-300K+. We just spent $370K+ for 4 years, and are looking at another $200K for just one kid. Good thing it's in the 529. The other kid was $160K total for 4 years but that was 6-8 years ago.

That is insane. Not normal to expect or provide that level of money for a child's education.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well DH and I save and invest separately - spender (him) and saver (me).

Early 40s - I have 15x my income saved and invested (excluding significant home equity and $600k in 529 plans). About 50% of that is separate property (pre-marriage investments that I kept separate) and the other 50% of technically marital property, but that's only relevant if we get a divorce - I control it as long as we are married, and it's part of my estate.

DH is older and only has 3x saved.

Story of a spender versus a saver.

Whoa, 600k in 529s? I'm assuming you have 3 kids? I am also a saver but that's a very high number especially with your savings rate and investment property, you have many means of funding college for your kids.

It is weird to me how antagonistic you are towards your husband and the degree to which you keep your finances separate. My DH and I also have different financial personalities -- I'm more conservative and a saver, he's more risk taking and a spender. But we combine everything and I actually like how our tendencies balance each other out. We have way more total money saved/invested because of my influence -- I insist on high percentages of automatic savings and investing out of our income, and I don't allow lifestyle creep when we get raises, so the money builds up fast. But my husband's greater capacity for risk is why it's grown at a higher rate. I would have much more of our money in ordinary savings were it not for his influence, and we would have missed out on massive gains in recent years. Also he makes sure we actually enjoy life, take real vacations, and reminds me that there's no prize for living like a pauper. We balance each other out and both come out ahead.

600K in a 529 and you expect 3+ kids? Why? Currently you can expect to spend $40-50K per year for a moderate school, so $200K minimum per kid. But if they want to attend others, there are tons that cost much more. So why wouldn't you save for it? Also, what if your kid wants grad school/proofessional school? Those can cost $200-300K+. We just spent $370K+ for 4 years, and are looking at another $200K for just one kid. Good thing it's in the 529. The other kid was $160K total for 4 years but that was 6-8 years ago.

That is insane. Not normal to expect or provide that level of money for a child's education.

Cost of attendance at my alma matter is over $90k per year. DH similar. So for anyone who wants to send their kid to an Ivy or NESCAC, you have to plan for ~ $360k for undergrad.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well DH and I save and invest separately - spender (him) and saver (me).

Early 40s - I have 15x my income saved and invested (excluding significant home equity and $600k in 529 plans). About 50% of that is separate property (pre-marriage investments that I kept separate) and the other 50% of technically marital property, but that's only relevant if we get a divorce - I control it as long as we are married, and it's part of my estate.

DH is older and only has 3x saved.

Story of a spender versus a saver.

Whoa, 600k in 529s? I'm assuming you have 3 kids? I am also a saver but that's a very high number especially with your savings rate and investment property, you have many means of funding college for your kids.

It is weird to me how antagonistic you are towards your husband and the degree to which you keep your finances separate. My DH and I also have different financial personalities -- I'm more conservative and a saver, he's more risk taking and a spender. But we combine everything and I actually like how our tendencies balance each other out. We have way more total money saved/invested because of my influence -- I insist on high percentages of automatic savings and investing out of our income, and I don't allow lifestyle creep when we get raises, so the money builds up fast. But my husband's greater capacity for risk is why it's grown at a higher rate. I would have much more of our money in ordinary savings were it not for his influence, and we would have missed out on massive gains in recent years. Also he makes sure we actually enjoy life, take real vacations, and reminds me that there's no prize for living like a pauper. We balance each other out and both come out ahead.

600K in a 529 and you expect 3+ kids? Why? Currently you can expect to spend $40-50K per year for a moderate school, so $200K minimum per kid. But if they want to attend others, there are tons that cost much more. So why wouldn't you save for it? Also, what if your kid wants grad school/proofessional school? Those can cost $200-300K+. We just spent $370K+ for 4 years, and are looking at another $200K for just one kid. Good thing it's in the 529. The other kid was $160K total for 4 years but that was 6-8 years ago.

That is insane. Not normal to expect or provide that level of money for a child's education.

Cost of attendance at my alma matter is over $90k per year. DH similar. So for anyone who wants to send their kid to an Ivy or NESCAC, you have to plan for ~ $360k for undergrad.

When I see posts like this I think I've gone back to the 90s when attending one of those schools was perceived as so important. Now it is practically irrelevant to long term success...

[Anonymous]

47, $2.2 million total net worth (including housing). We plan to retire by 65 but move to a LCOL area in retirement.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Well DH and I save and invest separately - spender (him) and saver (me).

Early 40s - I have 15x my income saved and invested (excluding significant home equity and $600k in 529 plans). About 50% of that is separate property (pre-marriage investments that I kept separate) and the other 50% of technically marital property, but that's only relevant if we get a divorce - I control it as long as we are married, and it's part of my estate.

DH is older and only has 3x saved.

Story of a spender versus a saver.

Whoa, 600k in 529s? I'm assuming you have 3 kids? I am also a saver but that's a very high number especially with your savings rate and investment property, you have many means of funding college for your kids.

It is weird to me how antagonistic you are towards your husband and the degree to which you keep your finances separate. My DH and I also have different financial personalities -- I'm more conservative and a saver, he's more risk taking and a spender. But we combine everything and I actually like how our tendencies balance each other out. We have way more total money saved/invested because of my influence -- I insist on high percentages of automatic savings and investing out of our income, and I don't allow lifestyle creep when we get raises, so the money builds up fast. But my husband's greater capacity for risk is why it's grown at a higher rate. I would have much more of our money in ordinary savings were it not for his influence, and we would have missed out on massive gains in recent years. Also he makes sure we actually enjoy life, take real vacations, and reminds me that there's no prize for living like a pauper. We balance each other out and both come out ahead.

600K in a 529 and you expect 3+ kids? Why? Currently you can expect to spend $40-50K per year for a moderate school, so $200K minimum per kid. But if they want to attend others, there are tons that cost much more. So why wouldn't you save for it? Also, what if your kid wants grad school/proofessional school? Those can cost $200-300K+. We just spent $370K+ for 4 years, and are looking at another $200K for just one kid. Good thing it's in the 529. The other kid was $160K total for 4 years but that was 6-8 years ago.

PP here. I just don't view 529s as the sole savings mechanism for education, specifically because you can't know how much your kid will need. We would never put more than 250k in a 529 (per kid). The doesn't mean we won't spend more than that on education, but we might not spend much more than that, so I don't want to lock up money I'm an account that is as inflexible as a 529.

So yes, 600k is nuts to me if it's for 1-2 kids. Especially for someone who could likely easily cash flow 30-40k per year, and owns multiple investment properties. What happens if your kid decides to go to a 50k/yr school and doesn't want grad school? We have money in other accounts that is flexibly earmarked. The money is for education if we need it, but could also be used for down payment assistance or other things.

I'm not funding a 529 as though my kid is going to be a doctor when there's also a chance she could be a school teacher (which would mean a cheaper education but might result in us wanting to help more financially when she gets married or has a kid).