What's your "number"?

[Anonymous]

I am 50. My retirement plan is to work to 65, and retire with 3x my current 401K balance, or about 2 mil. We will move to a lower cost of living area, and get a new house with the equity in our house (another 500K by then in today's dollars).

That plus soc. sec. should be enough. 2 million will give me about 7000/mo, and soc sec should be another 2K per month.

[Anonymous]

Anonymous wrote:I am 50. My retirement plan is to work to 65, and retire with 3x my current 401K balance, or about 2 mil. We will move to a lower cost of living area, and get a new house with the equity in our house (another 500K by then in today's dollars).

That plus soc. sec. should be enough. 2 million will give me about 7000/mo, and soc sec should be another 2K per month.

Will you purchase an annuity with that $2M to get $7K monthly or will you use withdrawal method (of 4% or so)?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Some of these numbers seem very high. I think I'd like to hit 3m. I just wonder how many of the posters need 5 or 10 million. Most of the posts I read here are about how high income earners wear junky clothes and drive cheap cars, so really you needs 10s of millions for that??

We are currently worth $3.5 million, and are around 50 years old. No mortgage or other debt, but we still need to put the kids through college. Our number is about $5 million after the kids get done with college, in 10 years. The numbers might seem high to you if you make less than $400,000 like we do. I'm not interested in living on less in retirement; in fact, we don't have the time between work and kids' activities like I'd like.

I don't know about that. We make 480HHI. Right now most of our income goes to taxes, mortgage and a nanny, once those costs are gone I have a hard time thinking we'd *need* more than 3m. After all, we aren't really living on an income of 480 now. I also have a small Federal pension that is growing. Our income has gone up over the past few years so maybe once we're in our late 40s we'll be in a different place, but for now it seems to me people are throwing out some very high numbers.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:last summer I figured $4M. Now it seems more like $10M. That is to pay 2 college tuitions and have $200K/yr to live on (which sounds like a lot, but so did $100K 15 years ago)

Are you talking 200K/year in cash to live on? That's 16K+/month in cash with no mortgage/car payments/student loans/college. Seems like a lot to me.

Tax takes half

What would you spend the money on? Why so much? I'm trying to figure out if I'm missing something. I'm assuming mortgage is paid off as well as college. What will your monthly expenses be?

It depends on what you want to do in retirement. Without a pension and medical, you have health insurance ($1000 mo -- older), long term care insurance -- you would be crazy not to have that, travel budget ($20K+) hobbies (what are you going to do in retirement --read a book?), kids grad school, or other help, homeowners insurance, taxes on your paid off home, glasses, clothes, eating out -- trust me when you are 65 you will really be tired of cooking, household help, lawn service ... you cannot borrow, so everything comes out of capital...

[Anonymous]

I got $6M from CNN. That is presuming you stay here.

[Anonymous]

Anonymous wrote:I am 50. My retirement plan is to work to 65, and retire with 3x my current 401K balance, or about 2 mil. We will move to a lower cost of living area, and get a new house with the equity in our house (another 500K by then in today's dollars).

That plus soc. sec. should be enough. 2 million will give me about 7000/mo, and soc sec should be another 2K per month.

How is $2M giving you $7000 month? serious question.

[Anonymous]

If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

[Anonymous]

Anonymous wrote:If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

This thread is comical. I still do t understand what these people are going to be spending all that money on.

[Anonymous]

Anonymous wrote:

Anonymous wrote:If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

This thread is comical. I still do t understand what these people are going to be spending all that money on.

So what's your "number" and tell the rest of us why you won't need that much.

[Anonymous]

Anonymous wrote:

Anonymous wrote:If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

This thread is comical. I still do t understand what these people are going to be spending all that money on.

I posted early on that our number is in the $22M range. We're going to spend it on EVERYTHING!

[Anonymous]

Anonymous wrote:

Anonymous wrote:If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

This thread is comical. I still do t understand what these people are going to be spending all that money on.

I'm the OP. I said $6mm. Here's how I get there:

3x kids under 4. Assume 14-18 years from now, 4-year college will cost close to $200k/year = $800k per kid = $2.4mm.
I want (don't need, but this is an aspirational post) a nice vacation home = $1mm.
I want to retire by 55 ... assuming $80k min per year living expenses and 30+ years of coverage = $2.4mm.

That's $5.8mm and there's plenty left I'd like to do, let alone leave some for my kids or hopefully grandkids. Now, that doesn't assume any investment return on that money, but then again, with inflation that $80k/year could easily be more like $200k in 20 years.

I don't think any of that is comical at all ... and certainly not likely to raise some firestorm of controversy as implied by the PP that wants to "link this thread to regional papers."

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

This thread is comical. I still do t understand what these people are going to be spending all that money on.

I'm the OP. I said $6mm. Here's how I get there:

3x kids under 4. Assume 14-18 years from now, 4-year college will cost close to $200k/year = $800k per kid = $2.4mm.
I want (don't need, but this is an aspirational post) a nice vacation home = $1mm.
I want to retire by 55 ... assuming $80k min per year living expenses and 30+ years of coverage = $2.4mm.

That's $5.8mm and there's plenty left I'd like to do, let alone leave some for my kids or hopefully grandkids. Now, that doesn't assume any investment return on that money, but then again, with inflation that $80k/year could easily be more like $200k in 20 years.

I don't think any of that is comical at all ... and certainly not likely to raise some firestorm of controversy as implied by the PP that wants to "link this thread to regional papers."[/quote]

Yes, right, because most people around the country are sitting around during a work day debating on a public forum whether or not they are on track to save between $6-25 million. They don't call The Beltway "living inside the bubble" for nothing!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If people here have and anticipate this much, what about the rest of the country. I am linking this thread to the regional papers.

This thread is comical. I still do t understand what these people are going to be spending all that money on.

I'm the OP. I said $6mm. Here's how I get there:

3x kids under 4. Assume 14-18 years from now, 4-year college will cost close to $200k/year = $800k per kid = $2.4mm.
I want (don't need, but this is an aspirational post) a nice vacation home = $1mm.
I want to retire by 55 ... assuming $80k min per year living expenses and 30+ years of coverage = $2.4mm.

That's $5.8mm and there's plenty left I'd like to do, let alone leave some for my kids or hopefully grandkids. Now, that doesn't assume any investment return on that money, but then again, with inflation that $80k/year could easily be more like $200k in 20 years.

I don't think any of that is comical at all ... and certainly not likely to raise some firestorm of controversy as implied by the PP that wants to "link this thread to regional papers."[/quote]

Yes, right, because most people around the country are sitting around during a work day debating on a public forum whether or not they are on track to save between $6-25 million. They don't call The Beltway "living inside the bubble" for nothing!

Who is "they?" I've not heard that expression. But I did grow up in TN, in a very modest area, and $5mm+ does not strike me as outrageous at all. Fortunate, yes, of course. But there are fortunate people everywhere and a few million in savings is not that rare.

[Anonymous]

Someone upthread asked about extra expenses in retirement that they don't have now. Unless you get health benefits from the military, that is a big one. Especially if you r health begins to decline. Even on Medicaid you can spend thousands per year between premiums and prescriptions.

Another related expense is long-term care insurance or alternatively paying for a nursing home. My MIL got long-term care insurance and paid $5K per year for it for about 12 years. Lucky she did because she's now in a nursing home. If she didn't have the insurance, she'd be looking at about a $5K-$6K per month nursing home expense or using medicaid and going through all of her assets.

Health and healthcare is always the big question mark in retirement.

[Anonymous]

Anonymous wrote:

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Anonymous wrote:

Anonymous wrote:Currently 45, a fed, making $160K a year and saving about 10% of my salary in the Federal retiree system.

My goal is to retire at at 60. At that point, I expect to have college paid for and done for two kids, and have about $1 million in home equity. That will allow us plenty of options to stay in place, sell and move to smaller condo and buy vacation home, or sell and just put the equity into savings.

I will have earned a federal pension - which I will be able to collect at 60 - of about $75,000 per year.

Based on current retirement savings - about $400,000 - plus saving 10% more per year - I expect to have about $1.7 million saved. Figure using about 4% of that annually gives me an annual income from savings of about $70,000

Add in Social Security for me and DW and that gets us right to about $170,000 a year.

It's not the $10-25 million that other posters are talking about, but I think we can retire well and be happy with what I describe above.

PP, can you please explain how federal pensions work? Are they still being offered for new employees? How long does it take to earn one? How is it determined how much it will pay out and for how long? Thanks.

Quick summary:

You must work at least five years in federal service to qualify.

The value of the pension = 1.1% of your average highest three-year salary X your years of service

You can begin collecting at age 62, and there is a cost of living adjustment

Details here: https://www.opm.gov/retirement-services/fers-information/

So if your average high salary is 150k and you work for 20 years for the govt your pension is only 33000? 150k x 1.1% x 20?

Correct. The pension is set so if you work for the government for 30 years you would collect about a third of your salary at age 62, and then it would adjust upward with inflation.

Confused about this. My spouse is a federal employee and contributes to the TSP program. Our understanding is that is the only pension he will be eligible, what we have saved ourselves. From the link you provided , it mentions a Basic Benefit or Service plan. What the heck is that? Spouse works for Department of Veteran's affairs, if it matters.

When was he hired? Doesn't he have funds taken out of his paycheck for this? Check his leave and earnings statement. Look for "Retire, FERS with a code "k" on his leave slip under Deductions. That would be the 1.1% times years. -- it works out to about 1/3 of whatever you make now. It's taxed as income, remember. Your TSP adds to that.

How many years do they pay you the pension for? Until you die?