Anonymous wrote:4m exclusive of kids' college

Us too. I think I could do it on less as well.

$5-6 million.

Just to cover living expenses and some modest travel. College savings for 1 kid is outside of what we'll need in retirement because we won't be retired until the child is well through college, so that expense will have come and gone.

$500.00

$5 million.

Anonymous wrote:For those of you who have done extensive planning (as opposed to "save what I canand hope I have enough when I need it"), what rate of return net of inflation do you assume on your portfolio? And if it's over 4-5% annually, are you in something other than a mix of stocks and bonds?

I assume a 5% return not taking inflation into account.

Anonymous wrote:

Anonymous wrote:For those of you who have done extensive planning (as opposed to "save what I canand hope I have enough when I need it"), what rate of return net of inflation do you assume on your portfolio? And if it's over 4-5% annually, are you in something other than a mix of stocks and bonds?

I usually calculate a 6% return, not taking into account inflation. It's on the conservative side, but I really started investing in 1999 and that's higher than what I've experienced so far unfortunately.

This is smart and not as conservative as you think. If we get 7% nominal over the next 30 years and less than 3% inflation I'll be pleased ... That equals a 4% annual return in today's dollars. And that's equity ... fixed income will be more like 1%-2% inflation-adjusted, ie, "real." Assuming you've got some balance in your portfolio, I think you're being aggressive to assume you'll get more than a 4% real return. Might happen, but at today's valuation and prospective low economic growth, it's aggressive to assume more for all but the most privileged (ie, better access to opportunity) investors.

Anonymous wrote:For those of you who have done extensive planning (as opposed to "save what I canand hope I have enough when I need it"), what rate of return net of inflation do you assume on your portfolio? And if it's over 4-5% annually, are you in something other than a mix of stocks and bonds?

I usually calculate a 6% return, not taking into account inflation. It's on the conservative side, but I really started investing in 1999 and that's higher than what I've experienced so far unfortunately.

For those of you who have done extensive planning (as opposed to "save what I canand hope I have enough when I need it"), what rate of return net of inflation do you assume on your portfolio? And if it's over 4-5% annually, are you in something other than a mix of stocks and bonds?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We'll probably sell our house. We can't pay off the mortgage before we retire because we bought it in our late 40s and the mortgage is too high to pay when we aren't working. We'll probably sell and downsize.

If the above is true you can't afford your house NOW. The sooner you realize that the more secure your retirement will be.

Could you explain?

Also, if we sell now we will lose money after closing costs and other fees and we won't have enough to buy another houses. Don't many people downsize when their kids move out and get a smaller house or condo? We need to own our house long enough to gain equity and appreciation.

However, what pp isn't considering is that DC has become an unusually expensive place to live, so people's houses consume a greater portion of their net worth here than in other locations. My dh and I could retire tomorrow on our savings, quite comfortably, IF we took the equity out our house and bought a house (with no mortgage) in a lower cost area. In many areas we've looked at, we could buy a nicer house than we have now. While we're working, we can easily afford our mortgage and save for retirement. However, we'd need to work quite a bit longer to be able to afford to retire here in our current house.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What will you all be doing in retirement that you need so much money? Just curious? We have a HHI of $300k but can't imagine we'd need such large sums of money for day to day expenses in retirement. We will pay off the mortgage before we retire and own a rental property we 'll probably sell. With no mortgage payment, what will you do with all the money??? I'd like to do some traveling but not that much.

+1. We are also at $300k. I actually think ~$100k a year in retirement will be just fine (in today's dollars). House paid off, no debts, etc. I look at akin to life pre kids - $100k a year was plenty then.

how much will you need to have when you retire then if you're planning on 100k/year?

Depends how old you are now, how old you are when you retire and your risk tolerance. In future dollars our number is $7.5M to throw off the equivalent.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Can someone provide some advice on how to save that much? We're 35 and have a HHI of 350. We just started contributing to our 401Ks this year. How do we save 5 million by 65? Thanks.

Put about 1/3 of that away every year. Can I ask why you are in your mid-30s with a HHI like that and haven't started saving for retirement?

Our number is around $2.2M with house paid off and college fund established. I'm hoping for a bit more with additional savings, working 3 or 4yrs more until DS heads off to college, instead of retiring when he's still in HS. Amazed and awed by those of you who expect to reach $10-25M, then again you out-earn me now so I really shouldn't be that surprised!

450,000 in student loan debt between the two of us.

Ouch.

Anonymous wrote:Can someone provide some advice on how to save that much? We're 35 and have a HHI of 350. We just started contributing to our 401Ks this year. How do we save 5 million by 65? Thanks.

Well, that makes it harder, but if you save 100-120K per hear (any matching included) you should be good. We make about that much now and are able to save 120K+ per year, but that's with an excellent match.

Our goal is to have $2 mil in retirement money. Our house will be paid off before that and our kids' college will have been paid for. Our HH income is $140K.

My "number" for "if the money were to show up, I'd feel like I never needed to work for money again" is about $10M.

My goal for retirement is considerably more modest.

We are early 40s at 2.8M. My goal is 12M, maybe 15, at 55.