Retirement

cliffish

TJ Addict
Supporting Member
Oct 22, 2017
2,475
St James, NY, United States
After the wedding I think that will be the plan. That seems to be the consensus. If you can max it out go for it.
If kids come into play start early with a 529 or other college fund, but really, retirement savings come first. You/they can always borrow for college. It is near impossible to borrow for retirement...reverse mortgage should not be an option.
 
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Starrs

Starrs

TJ Expert
Aug 1, 2017
3,947
Indiana, United States
If kids come into play start early with a 529 or other college fund, but really, retirement savings come first. You/they can always borrow for college. It is near impossible to borrow for retirement...reverse mortgage should not be an option.
If I have it my way and I think the Mrs is on the same page the house will be paid off in around 2 yrs. I’ll be 34 and she will be 28.
 
OP
Starrs

Starrs

TJ Expert
Aug 1, 2017
3,947
Indiana, United States
that is awesome, took us a total of 16 years to pay ours off with one refinance in there to drop the interest from 8.625% to 3.75%...we also pulled out 60K to buy a second house at that time.
I should be in a much better spot financially, but ive got a grip on it now. My home loan is at 3.125% fixed. Did a 15 yr, and had 20% to put down so that helped a lot.
 

ac_

zombicon
Supporting Member
Jun 15, 2017
3,888
AZ, United States
Yeah if you get a raise too my trick is just to immediately allocate that money away to some sort of savings so then I’m living with the same amount as I have been which I’m still comfortable with and any additional adjustments just go straight into savings/401/Roth/ whatever before I see it.
My problem is I get a 3% raise every year, but my health care goes up 10% every year. Something has got to give, because I actually earn less every year. Most of my retirement is caught up in stocks, and that is in the tank at the moment. It will probably be a while now before I can consider retiring, but even if I could afford it, health care would wipe me out before actually retiring.

It sure aint like the good old days. My Dad put in 30 years at the phone company got stocks every 6 months for 30 years had health care paid for for his whole family. Then retired with a 180K bonus and a gold watch, and he gets 2/3s of his paycheck and healthcare for him and his wife till they die. He is like 100 now still with full medical 2/3s of his paycheck, and has his Fed retirement. He still lives better than me haha.

Now I wish I could find a gig like that.
 
OP
Starrs

Starrs

TJ Expert
Aug 1, 2017
3,947
Indiana, United States
My problem is I get a 3% raise every year, but my health care goes up 10% every year. Something has got to give, because I actually earn less every year. Most of my retirement is caught up in stocks, and that is in the tank at the moment. It will probably be a while now before I can consider retiring, but even if I could afford it, health care would wipe me out before actually retiring.

It sure aint like the good old days. My Dad put in 30 years at the phone company got stocks every 6 months for 30 years had health care paid for for his whole family. Then retired with a 180K bonus and a gold watch, and he gets 2/3s of his paycheck and healthcare for him and his wife till they die. He is like 100 now still with full medical 2/3s of his paycheck, and has his Fed retirement. He still lives better than me haha.

Now I wish I could find a gig like that.
Now that would be a solid retirement
 
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Wowens79

Member
Jun 7, 2018
42
Newnan, Ga
Start as early as you can, the compounding of interest will make huge differences down the road.

Also like others have said when you get a raise have it payroll deducted into savings, and you won't miss it. Also if you have any debt, get it paid off, and have those payments direct deposited into savings. My 2002 truck I paid off in 2006, but I still make a payment to my truck account. I bought my TJ from it, and still have plenty to buy a new truck, but just can't bring myself to write the check.
 

Powdermonkey

SAPPER
Supporting Member
Jun 17, 2018
370
Western Co
If I have it my way and I think the Mrs is on the same page the house will be paid off in around 2 yrs. I’ll be 34 and she will be 28.
If this is the case you shouldn’t have any problems maxing out your retirement and should. Obviously you’re good with money especially considering you have held out on purchasing another Jeep.
Hopefully you can invest post tax as well. A lot of people think they will be paying less in taxes when retired vs current tax bracket. Not to get political, but the way this country is moving I’m not sure that will be the case.
I always like hearing about people doing well in this very difficult world.
 
OP
Starrs

Starrs

TJ Expert
Aug 1, 2017
3,947
Indiana, United States
Start as early as you can, the compounding of interest will make huge differences down the road.

Also like others have said when you get a raise have it payroll deducted into savings, and you won't miss it. Also if you have any debt, get it paid off, and have those payments direct deposited into savings. My 2002 truck I paid off in 2006, but I still make a payment to my truck account. I bought my TJ from it, and still have plenty to buy a new truck, but just can't bring myself to write the check.
That’s the issue I know I will run into when I look for the next jeep. I’ll have the cash but will I be able to hand over all the cash...not sure. Over the past couple of weeks I started looking at money a lot differently haha.
 

DC0046

TJ Enthusiast
Supporting Member
Feb 23, 2016
298
My problem is I get a 3% raise every year, but my health care goes up 10% every year. Something has got to give, because I actually earn less every year. Most of my retirement is caught up in stocks, and that is in the tank at the moment. It will probably be a while now before I can consider retiring, but even if I could afford it, health care would wipe me out before actually retiring.

It sure aint like the good old days. My Dad put in 30 years at the phone company got stocks every 6 months for 30 years had health care paid for for his whole family. Then retired with a 180K bonus and a gold watch, and he gets 2/3s of his paycheck and healthcare for him and his wife till they die. He is like 100 now still with full medical 2/3s of his paycheck, and has his Fed retirement. He still lives better than me haha.

Now I wish I could find a gig like that.
If you are still contributing, the low market is not necessarily a bad thing. Dollar cost averaging ensures you will be up in the long run. When the market is down and you are pulling from your retirement account, that is a very bad thing.
 
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cliffish

TJ Addict
Supporting Member
Oct 22, 2017
2,475
St James, NY, United States
I should be in a much better spot financially, but ive got a grip on it now. My home loan is at 3.125% fixed. Did a 15 yr, and had 20% to put down so that helped a lot.
You are doing better than 90% of the people out there...a 15 year was a great move, that is what we did on the refie and dropped a $1,000 month extra on principal to pay it off early.

My problem is I get a 3% raise every year, but my health care goes up 10% every year. Something has got to give, because I actually earn less every year. Most of my retirement is caught up in stocks, and that is in the tank at the moment. It will probably be a while now before I can consider retiring, but even if I could afford it, health care would wipe me out before actually retiring.

It sure aint like the good old days. My Dad put in 30 years at the phone company got stocks every 6 months for 30 years had health care paid for for his whole family. Then retired with a 180K bonus and a gold watch, and he gets 2/3s of his paycheck and healthcare for him and his wife till they die. He is like 100 now still with full medical 2/3s of his paycheck, and has his Fed retirement. He still lives better than me haha.

Now I wish I could find a gig like that.
My wife works for our healthcare company for 25 years....what do we get..rates raised every year, higher copays, less choice, eliminated pension and no retirement healthcare anymore. I sure wish I took my father in law up when I graduated college and went into the NYC electrical union like him.
 
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OP
Starrs

Starrs

TJ Expert
Aug 1, 2017
3,947
Indiana, United States
If this is the case you shouldn’t have any problems maxing out your retirement and should. Obviously you’re good with money especially considering you have held out on purchasing another Jeep.
Hopefully you can invest post tax as well. A lot of people think they will be paying less in taxes when retired vs current tax bracket. Not to get political, but the way this country is moving I’m not sure that will be the case.
I always like hearing about people doing well in this very difficult world.
I love jeeps...new and old...AEV rigs. I’ve found a ton of course in the time that I shouldn’t be buying one, and I’ve held strong lol.
 
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TomT509

Member
Supporting Member
Jun 30, 2017
79
SE WA State
Well recognized, rule of thumb is to save 15% of gross:
First, max out your employer's match - let them give you money, right?
Second, start a Roth IRA at major online brokerage (e.g., TD Ameritrade, Fidelity, etc), and work your way to 15% or max IRS contribution amount. If you are not at 15% yet....
Third, go back to your 401k and just put the money into that.

Yes, more than 15% is better... it is your retirement, right? More money is better? Yes?

Attached is a graphic that may help. If you want to see the whole one page financial management "Money Stack, see it at my site here. No, not a business, no sales, no money. Just something I worked up over the years to show my Econ students and part of a little financial presentation I gave many times.

Note that kids college savings comes 'after' your retirement savings. Just like when you are on an airplane and you are supposed to put the oxygen mask on yourself first, then the kids...

Hope this helps.

retirement.jpg
 
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astjp2

TJ Addict
Aug 22, 2018
1,106
Utah and Alaska
I was putting in as high as 16%, now I am putting in nothing to do the Dave Ramsey thing to become debt free. I am also in the process of changing jobs so I may have to cash out my 401 to keep my mortgage paid until I get a new job. At my age, its not ideal but I have enough equity in my home that I need to keep it and if I cash it out, I will be debt free except for the house. I will just have to start over on my retirement execpet for 2 small pensions which will total 1100 per month when I retire, which is not much but will pay taxes and utilities. Tim
 

Westtown Willy

TJ Enthusiast
May 10, 2018
620
West Chester, PA, USA
Tyson.jpg


Gotta love Iron Mike, he really summed it up on that one.

About a year after the great recession hit hard in 08 I lost my job with the firm I’d been with for most of my career & thought I’d be with until the end of time. Not long after that the wife showed her true colors, the 401k & IRAs I had contributed to for my entire career were lost in the resultant divorce, I had to start over at 45. It was worth every penny but that’s another thread.

A few takeaways, don’t hold too hard & fast to these ideas you have about where you’re going as life has a way of kicking your head right off your neck when you least expect it.

Two, when I cashed all that in (early 2012, the market had returned to general pre-recession numbers) to buy my way out I couldn’t help but notice the overall crappy return all these things had, nowhere near what the so called ‘experts’ tell you you’ll get. By the way that matched my experience in the market before that and so far back into it again it appears to be going the same way.

Three, I’m not advocating not maxing these things out as there are advantages, after all regardless of the return it’s still savings which you’ll need plus it has tax benefits, and if your employer kicks in some that’s even better… but I’d still (and always have) make that strategy subordinate to debt elimination first and foremost. This flies directly in the face of the banking and brokerage professional’s opinions that debt and maxing out market investment are good things, shocking from two groups that benefit so directly from you being in debt up to your eyeballs & having all your cash in their market as they churn it for their own gain…

Pay off your house then enjoy as a return its fair market rental value minus expenses each month, every month, for the REST OF YOUR LIFE. No investment in the market can guarantee a good, steady and specific automatic return like this that also enjoys the added bonus of not only retaining your initial investment at your death but most likely a greatly increased value, not a single one.
 

tquig01

TJ Enthusiast
Mar 12, 2018
339
Brewerton, NY, USA
Can't stress the importance of starting early and sticking with it. My goal has always been to increase my contributions at least 1%/yr. I work in an industry that is generally well-compensated and for the folks retiring today, had a pretty good pension. That pension plan has unfortunately ended and many people are scrambling to try and off-set the lost pension amount in their retirement planning. It is very hard to do in a 401K over a short period of time. If I could invest 50% of my income, I would. Life is to short to not want to retire as early as possible.
 

tworley

TJ Addict
Supporting Member
Ride of the Month Winner
May 23, 2018
1,845
Morrison, CO
Can't stress the importance of starting early and sticking with it. My goal has always been to increase my contributions at least 1%/yr. .
Depending on your 401k provider, that 1% may increase automatically. My last two companies did it that way. It was nice not having to think about it, but every year that email would come reminding you about it.
 

TomT509

Member
Supporting Member
Jun 30, 2017
79
SE WA State
I was putting in as high as 16%, now I am putting in nothing to do the Dave Ramsey thing to become debt free. I am also in the process of changing jobs so I may have to cash out my 401 to keep my mortgage paid until I get a new job. At my age, its not ideal but I have enough equity in my home that I need to keep it and if I cash it out, I will be debt free except for the house. I will just have to start over on my retirement execpet for 2 small pensions which will total 1100 per month when I retire, which is not much but will pay taxes and utilities. Tim
That is a rough spot to be in but life indeed does tend to throw curveballs.... often, it seems in my experience.

You may have noticed in the graphic that this was step 3 in my one-pager. Step 2 was the emergency fund of 6+ months of moderately high liquidity savings.

But, sounds like you are going through a big life reset and I can sure relate. I had a big one at 39. Two little kids and a big move. It turned out well but man, it was rough. Fond memories of my hand-me-down 140k miles VW Quantum diesel. Sheesh.....

Best to you and yours, Tim.
 
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Greenmachine

Member
Aug 13, 2018
58
New York
Nice to see people focusing on the long term, it makes me more calm about waiting to add another TJ to the collection. I’ll probably enjoy my next TJ more without having to wonder so much about the sunken money’s opportunity cost.
 
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