Proposition Joe said:

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YouBet said:

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Proposition Joe said:

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I've never really understood the "paying off the mortgage early is an emotional decision so it's OK that I've missed out on higher market gains".

You're still paying property taxes.

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I think this is a straw man. Property taxes are permanent. Mortgage payments don't have to be. Two different pieces of that puzzle. I never factored opportunity costs of market gains in this decision because it wasn't relevant for our scenario.

It was a cash flow scenario for us.

We sold our highly appreciated house in Dallas and purchased a nicer house in a small town for cheaper. Paid cash and retired the mortgage.

And then I retired early. If we still had the mortgage, I would not have retired because I would need more cash flow to pay the mortgage without dipping into our savings money. We can handle the property taxes and insurance without the job but not the full nut because my wife makes enough with her small business to cover the taxes and insurance.

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My comment is about those who frame it as an emotional decision, yours obviously was not.

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Gotcha.

Proposition Joe said:

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I've never really understood the "paying off the mortgage early is an emotional decision so it's OK that I've missed out on higher market gains".

You're still paying property taxes.

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I stand by what I said. I'd be much further ahead if I had put my money in the markets instead, and I can live with that. I would still have to pay property taxes regardless.

annie88 said:

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I'm Gen X to the core and I retired at 50. No matter what generation you're in if you don't plan when you're young that's on you.

Thank God, I had such an awesome dad that encouraged me to do so at every turn. Glad I listened to him. But then I usually did.

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I'll say it again, this "generational" stuff is stupid. There is a lot more commonality to groups of people across generations than within generations. IMO, you're not GenX to the core, you're among the "builders and planners" to the core. My wife and I have been able to take a lot of time off together(a year or so at a time).

I would say I would miss my last 10 or 15 years working, but tbh, most of my best working experience was between 19 and 50. But, we needed to run up the score for retirement.

flown-the-coop said:

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Over_ed said:

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MookieBlaylock said:

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wsince everyone is a inancial idiots- please give a detailed plan- genius

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1) Live way below your means
2) Marry, and to someone even cheaper than you are
3) Save, Save, Save
4) Occupation makes a difference, choose wisely
5) Be lucky, or at least not unlucky

I'll give you a quiz on this later, if it will help. Not really much to it, is there?

Edit - sp

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Do you ever get around to enjoying life in this approach?

There is a balance and deferred gratification is what tanks most people. Its not about saving the max, living below your means, and marrying a tight ass.

Develop a plan, remain diligent, plan for rainy days, weeks and months as appropriate.

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My wife and I were fortunate to be able to take time off together (~ 1 year 2X and about 6 months once). As a college prof I not only got time off to travel, but also paid to do so. And I was in the highest paid department in the highest paid college in the University. Most of my wife's peak career was consulting and could work anywhere.

If you can travel frequently for free, don't care about expensive cars or trappings, and have free time for each other, what else do you really NEED to be happy? I disagree that spending money equals happiness, but perhaps for you it does? Exactly because we were/are so happy, the rest is unimportant (except the cats).

When I wasn't a prof I was in high tech. point #4 - " Occupation makes a difference, choose wisely". I should amend that to say occupation(s) btw, being flexible helps a lot.

You found a balance that works for you. Finding that balance was all I was saying as it seemed your balance was a bit heavily weighted to the frugal side than the average bear.

But if it works it works. Money may not buy happiness. But being poor sure as **** doesn't buy it.

torrid said:

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infinity ag said:

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torrid said:

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AW 1880 said:

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For that $1 million, are we talking liquid funds or net worth, and does home equity count towards the million?

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A financial planner may say no, but personally I do. Two reasons behind that.

One, by not having a mortgage that means I will not have a monthly note to pay in retirement. Also, it is equity I can tap into if I really need it.

I will say this. If your net worth is entirely wrapped up in your home's equity, you will probably have an unhappy retirement. I money in several areas, my home being just one of them.

One other comment. I've had my house paid off for years. In retrospect, I would have been better off putting some of that money in the stock market instead. However, I'm not going back on that decision.

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I bought my house in 2010 and paid it off in 2018. Best decision I made. It's not just the financial part, it is the mental peace part of it. When my job got unsteady (which it did many times), I never had to worry about a mortgage payment. Mental peace does not have a price, it is invaluable.

So I think you did the right thing.

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I've discussed this with other people. Paying off your mortgage early is not a financial decision, it's an emotional one. And one I'm glad I made.

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This sort of "happened" to me when I bought a house after the 2008/2009 financial crisis. I had just switched jobs, so I did not have enough of a history with my new job to be able to qualify for a mortgage after the lending standards tightened so significantly. Even though I had enough in liquid assets to be able to purchase the home with cash, I couldn't get a loan. The whole thing kind of pissed me off, to be honest.

With what I got for the sale of my previous home, I bought the new one with cash and never looked back. I completely understand that it wasn't the best financial decision, and a couple of years ago I probably would have been better off taking out a mortgage on the house when rates were ridiculously low. That being said, not having a mortgage, for someone who hates debt, is kind of nice. Definitely gives a sense of security, even though obviously I still have to pay property taxes, etc. Financial decisions most certainly have an emotional consequence as well.

[Do not bypass obscenity filters -- Staff]

LMAO

Millenials are going to need a LOT more than one million dollars to retire!

for 20 years of retirement and in still another 20 years of inflation?

that is like only 800.000 in todays dollars!

I am around 2 million dollars saved up and still don't think it is enough to retire by age 57. and only live for 20 years on just 2 million.

that is still just an upper middle class lifestyle. (I don't own a home)

LMCane said:

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I am around 2 million dollars saved up and still don't think it is enough to retire by age 57. and only live for 20 years on just 2 million.

that is still just an upper middle class lifestyle. (I don't own a home)

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what kind of returns are you expecting on that 2 million and how long before you turn 57? what kind of condition is your health now and expected to be between 57 and 65? are you planning on retiring in southern California or Hawaii or something?

2 million in your 40s should project to be enough to retire at 57, or at least retire from the grind and work into a lower paying second career of something you enjoy with fewer hours. that $ will grow until you're 57 and every penny you don't spend should keep growing.

Most people would need at least 20 million

frenchtoast said:

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Most people would need at least 20 million

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To be ultra high net worth or considered wealthy, I agree. I cannot imagine working if I hit 20 million liquid.

Just inherit from wealthy Boomer parents. Problem solved.

Pumpkinhead said:

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Just inherit from wealthy Boomer parents. Problem solved.

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Not if the Dems get a shot at confiscatory estate taxes. That will happen much quicker than changes to SS, imo.

Whatever you have for retirement cut it in half for medical expenses.

Over_ed said:

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Pumpkinhead said:

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Just inherit from wealthy Boomer parents. Problem solved.

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Not if the Dems get a shot at confiscatory estate taxes. That will happen much quicker than changes to SS, imo.

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Wealthy boomer parents pay expensive lawyers to set up irrevocable trusts. Problem solved.

I'm technically a Millennial (see username). Have done absolutely no formal retirement planning, mainly due to having no clue what I'll do when I'm retired.

But I have 4.5 years of salary in my 401(k), have increased my contribution rate to 10% (plus 6% employer match), and hoping I'll have enough after 20-24 more years of working.

Burpelson said:

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Whatever you have for retirement cut it in half for medical expenses.

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There is zero chance that medical will cost 1/2 when people have Medicare and part B. What are you talking about?

Tom Fox said:

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Burpelson said:

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Whatever you have for retirement cut it in half for medical expenses.

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There is zero chance that medical will cost 1/2 when people have Medicare and part B. What are you talking about?

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He may be including healthcare beyond Medicare like assisted living, memory care, etc. My FIL's memory care was $8K+ per month and Medicare covered very little of it.

YouBet said:

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Tom Fox said:

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Burpelson said:

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Whatever you have for retirement cut it in half for medical expenses.

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There is zero chance that medical will cost 1/2 when people have Medicare and part B. What are you talking about?

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He may be including healthcare beyond Medicare like assisted living, memory care, etc. My FIL's memory care was $8K+ per month and Medicare covered very little of it.

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My maternal grandmothers was quite expensive too.. I guess it depends on your individual retirement portfolio. But a blanket it is going to take half is asinine.

oh no said:

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you can't draw from your 401k without penalty until you're 60. you can't get any social security until you're 71 (if there's anything left at that point). the value of our currency only goes down with our bloated socialist government growth and spending. if anyone wants to have any sort of retirement before then, like at 55, you have to not only put enough away in 401k/IRA your whole adult life, but also save and invest a lot more outside of that. why don't they teach this stuff in school?

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You can take it early at 62...

And full age is 67...

You bring up a good point about why it's hard to take these surveys of what people think they need seriously. It's not clear if it's in real or nominal dollars. Also most people have no idea what they spend or any knowledge of safe withdraw rates and likely can't even define the difference between real and nominal dollars.

These surveys are basically just asking a random group what number sounds good to them but doesn't mean it's the actual number the average person will need.

permabull said:

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You bring up a good point about why it's hard to take these surveys of what people think they need seriously. It's not clear if it's in real or nominal dollars. Also most people have no idea what they spend or any knowledge of safe withdraw rates and likely can't even define the difference between real and nominal dollars.

These surveys are basically just asking a random group what number sounds good to them but doesn't mean it's the actual number the average person will need.

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Agreed. This is people hanging onto the utterly arbitrary and psychological number that is $1M with zero concept of real and nominal dollars. Pretty obvious.

Makes one think of the Dr. Evil blackmail scene from Austin Powers.

Tom Fox said:

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frenchtoast said:

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Most people would need at least 20 million

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To be ultra high net worth or considered wealthy, I agree. I cannot imagine working if I hit 20 million liquid.

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Yes, My personal goal is $20M all inclusive. But that includes my house but that is about $700k today so it just makes tracking easier. I am still some years away from reaching that. My projection is to get there in about 5-7 years if things go as I hope (reasonable prediction). But who has seen the future?

infinity ag said:

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Tom Fox said:

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frenchtoast said:

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Most people would need at least 20 million

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To be ultra high net worth or considered wealthy, I agree. I cannot imagine working if I hit 20 million liquid.

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Yes, My personal goal is $20M all inclusive. But that includes my house but that is about $700k today so it just makes tracking easier. I am still some years away from reaching that. My projection is to get there in about 5-7 years if things go as I hope (reasonable prediction). But who has seen the future?

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I won't make it unless the market essentially averages 10% until I retire, but I should be close. I am 14-16 years away.

Tom Fox said:

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infinity ag said:

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Tom Fox said:

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frenchtoast said:

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Most people would need at least 20 million

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To be ultra high net worth or considered wealthy, I agree. I cannot imagine working if I hit 20 million liquid.

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Yes, My personal goal is $20M all inclusive. But that includes my house but that is about $700k today so it just makes tracking easier. I am still some years away from reaching that. My projection is to get there in about 5-7 years if things go as I hope (reasonable prediction). But who has seen the future?

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I won't make it unless the market essentially averages 10% until I retire, but I should be close. I am 14-16 years away.

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Well done, I wish you luck. I am confident you will get there, please come back and post when you do! You may get there sooner than you imagine.

Tom Fox said:

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infinity ag said:

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Tom Fox said:

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frenchtoast said:

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Most people would need at least 20 million

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To be ultra high net worth or considered wealthy, I agree. I cannot imagine working if I hit 20 million liquid.

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Yes, My personal goal is $20M all inclusive. But that includes my house but that is about $700k today so it just makes tracking easier. I am still some years away from reaching that. My projection is to get there in about 5-7 years if things go as I hope (reasonable prediction). But who has seen the future?

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I won't make it unless the market essentially averages 10% until I retire, but I should be close. I am 14-16 years away.

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Them some nice-ass keyboards, sir.

BigN--00 said:

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torrid said:

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Any Gen X'er that started saving for retirement as soon as they got their first job out of school, and I mean putting enough into their 401k to get the full match, should be sitting on a nice little nest egg at this point.

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I doubt there was much information was out there about 401K's and getting the full match starting in 1983 when Gen X joined the workforce. For that matter, how many companies had them back then?

I would argue that for the vast majority of American's with retirement on there mind, 401K's did not become important until the early 2000's. This would clearly put (elder) Gen X at a disadvantage, as many of them hey joined a workforce without pensions or any other alternative.

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Every company I worked at had them.
Either that or a 403B. My father also got me into IRAs as well.

But the point is, they should've been looking at it a minute they started working.

I'd like to know which generation has ever been ready for retirement?

What if the s&p chopped sideways for 10 years?
Thats unfathomable. But could happen.

FobTies said:

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What if the s&p chopped sideways for 10 years?
Thats unfathomable.

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But is it though?

Dec 96 = 757
Dec 08 = 798

To be fair, ups and downs in between those two points.

Nasdaq took almost 15 years to regain its peak of 1999.

The Japanese Nikkei took 34 years to regain its peak of 1989.

I mean, its unfathomable to youngsters who have only seen the post 2008 Fed pumped MMT market. The 401K bi-monthly bid slapping has been the biggest wind in sail....not sure the fed can offset the boomer contributions fading.

Gen X here and I planned on not having social security so I have made sacrifices and saved for retirement and college funds for four kids. But yes the majority of Americans Gen X included live paycheck to paycheck and aren't prepared for retirement or to be honest any issue that pops up more than $1k.

Gen X here and from this thread I learned that apparently I'm part of the 0.1% of savers and I'm 53. I don't feel rich and continue to stress about money.