[Jerry F2]

No debt....retire with no debt that is the key. No house payment No car payment
Whatever you charge on credit card ...pay it off every two weeks. Get Airline Credit cards use the points earned for your flights....example round trip to Cincinnati for two. $22 with our points. Savings great...stocks great...other investments great...however no debt is the key.

Originally Posted by huge-pigeons

If you ask Americans, the average answer is an astounding $1.46 million.

That’s per a recent Northwestern Mutual survey of 4,500 U.S. adults, which found retirement cost expectations have spiked since 2020. This year’s average estimate is 53% higher than it was four years ago, when people said they’d need $951,000 to retire.

When it comes to their actual savings, though, Americans are far from achieving their expected retirement needs: Survey respondents reported their average retirement savings is just $88,400 in 2024.

That’s a $10,000 decrease from the average retirement savings recorded by Northwestern Mutual in 2021, when the metric hit its five-year peak of $98,800.

IMO, having $100,000 in your savings when you retire is pretty sad. I know many people the made good money throughout their careers but always seemed to spend more than they made. I think $1.5M is a little low too to retire on especially if you are fully invested. That $1.5M could become $800,000 if another 2008 happens and you might not have to years for your money to come back, all the while taking distributions out of it.

[billethkid]

Originally Posted by bowlingal

it all depends on your lifestyle. I don't have a million dollars....or anywhere near it. BUT I am living a very active lifestyle, retired, own my home and car and have a nice nest egg. Managing your money is key.

Thank you. Not much more need to be said!

[vintageogauge]

Originally Posted by Randall55

Agree with most of what you said. However, when interest rates are high, paying cash for a home is not always the best solution. You are throwing away the possibility of earning good interest. Interest rates go back down? Then you pay cash for your home. Hopefully, the period of time you were able to make a good return on your investment will pay for the bulk of your home purchase. In the interim, you enjoy maintenance free living while renting.

And you lose the possibility of appreciation which has been quite significant down here.

[jimbomaybe]

Originally Posted by Blueblaze

Inflation has an enormous impact to those of us living off our savings and SS checks. But it does not have any impact on whether a working person, whose income is inflating along with the rest of the economy, can save that scary $1.5m number for retirement -- which, by the way, does NOT include their real estate and SS. I just showed you the math -- which included 3% for inflation -- proving that someone with an average $80K income can easily save over $2M in 45 years. The question is not, is it possible. The question is whether the average wage earner has enough common sense to do it. Given the fact that the average American has less than $1,000 in the bank, obviously, most don't.

My biggest fear is that the generation who refuses to show up at the office to work, and thinks the Gooberment ought to pay for their student loans, is going to look at my nestegg one day and say "gimme".

Living off savings is one thing living off income from savings another, SS is more like a government run ponzi scheme kept afloat with taxes at worst, a transfer of wealth at best, for the most part its that people do not plan ahead with any reasonable expectations, will all to often accept the best possible outcome as what they can expect, make excuses for their poor judgments , blame a failure of plan when in fact it was a failure to plan ,, Taxes ? of course the middle class will bear the brunt , that's where the money is, the most consumers , consumers always pay the taxes in the end , taxes are built in every item we use, economic demagoguery sounds good , your a victim so we will take from the people who took it from you, you deserve it , its your right,, in so doing kill the goose that has given you the golden egg

[rsmurano]

Originally Posted by Randall55

Agree with most of what you said. However, when interest rates are high, paying cash for a home is not always the best solution. You are throwing away the possibility of earning good interest. Interest rates go back down? Then you pay cash for your home. Hopefully, the period of time you were able to make a good return on your investment will pay for the bulk of your home purchase. In the interim, you enjoy maintenance free living while renting.

Just the opposite. Right now, interest rates are in the 7% range or higher. If you want a longer term safe investment like money market funds, you are getting 5% which is good, but you are losing 2%, and that is today, it could go higher but it could go lower to < 1% like it was for a decade. If you invest in stocks/funds, a good average of earnings over a 30 year span is 8-10% if you do it right, don’t have high expenses, no finance fees, and you don’t time the market. For example, all of my investments have gone up from 12% to 30% and some stocks have doubled this past 8 months, and I sold everything last week. When you look at the market late last week and tomorrow morning, you will know why.
During the past 20-30 years, I had home loans at 2-3% and got a loan for the max amount possible (80%), and was making triple times on an annual basis during this same time.
As for cash to buy a home, cash is king. I’ve had 2 custom homes built during the past 11 years and I was the bank, I didn’t get a builders loan nor an end loan which saved me over 4% just in loan fees.
In normal years and in most places, when a recession hits, house values go down and interest rates go up. Prime time for somebody with cash to go in and get a great deal, 2008 and the last 2 years are an example of this.

I also think $1.5M is low to have financial independence, this doesn’t take in account if you have a nice pension or 2. My reasoning is the golden rule of taking 4% of your money out of your portfolio to live on so you don’t live past your mooney. $1.5M x 4% is $60k a year which isn’t that much. Somebody mentioned that their expenses are $70k a year and they make $72k. What happens if you want to go on a $10k vacation a couple times a year? Say you need a new car? A new golf cart? Do some renovation? Have a medical issue or you want to help you kids with a big expense? $2k extra isn’t going to cut it. Then what happens when the market goes down for 18-24 months while you are still taking 4% out each year? Next year you might be taking 4%out of $1.2M. Having $2M-$3M gives you breathing room to pay for expenses or luxury items that you want. No reason to cut back on doing things in retirement.

[Cuervo]

A lot of figures have been tossed out and also different lifestyles.
If you have a pension, social security, investments and debt free all these factors must be included into this calculation.
The question should be after you tally your position what type of income will permit you to have the lifestyle you want.
After you considered all normal annual expenses, taxes, food, HOA fees, cable, insurance, what is a decent income to cover that and still let you have a comfortable life here in The Villages?
Is it $100K, $200K, more or somewhere in between, that is the real question.

[Robojo]

Originally Posted by Nell57

“Comfortable “ is a relative term. Some are only “comfortable” if they are dining out three nights a week, golfing championship courses twice weekly …..several nice vacations a year.
Others are “comfortable” with burgers on the grill, executive golfing, free entertainment nightly on the squares.
It’s not money that makes you comfortable. It’s the relationships you build in life.

I'm comfy with a nice cabin and some beefaroni LOL

[Dusty_Star]

Originally Posted by Cuervo

A lot of figures have been tossed out and also different lifestyles.
If you have a pension, social security, investments and debt free all these factors must be included into this calculation.
The question should be after you tally your position what type of income will permit you to have the lifestyle you want.
After you considered all normal annual expenses, taxes, food, HOA fees, cable, insurance, what is a decent income to cover that and still let you have a comfortable life here in The Villages?
Is it $100K, $200K, more or somewhere in between, that is the real question.

I think INCOME of 100k, 200k or more, is way more than enough for the Villages. What do others think would be approximate normal annual expenses? This question excludes the extras that change people's lifestyles dramatically. So just as Cuervo said: taxes, food, amenity fees, TV/Internet, insurance (health, property, & vehicles), electricity, landscaping, house maintenance. Isn't it around 50, 55?

[conman5652@aol.com]

Are our monthly social security and pension payments included in your retirement figures

[opinionist]

I retired early up north and had just enough pension income to get by. When I moved to FL and got additional income from Social Security, my income exceeded my expenses by a lot. I am comfortable with much less than other people who like to travel the world. I will soon be forced to draw from my retirement account which I have not needed. Recently I have been going to a Naturopath doctor to get as healthy as possible. Staying healthy with a modest lifestyle is the easy way to not need a huge nest egg.

[rickaslin]

Originally Posted by Nell57

“Comfortable “ is a relative term. Some are only “comfortable” if they are dining out three nights a week, golfing championship courses twice weekly …..several nice vacations a year.
Others are “comfortable” with burgers on the grill, executive golfing, free entertainment nightly on the squares.
It’s not money that makes you comfortable. It’s the relationships you build in life.

I was going to answer but yours covered it nicely !!

[CoachKandSportsguy]

Originally Posted by Shipping up to Boston

In a perfect world what you say makes sense. Just one part i would offer a different view....in the 50's my grandparents bought their house for 17k, my sibling bought theirs in the early 80's for 56K. Boston mind you. Both sold recently for 1.1 mil and 1.3 mil respectively. You just dont see that kind of appreciation (at least in that region) anymore.

These are not unreasonable rates of appreciation

Your grandparents house appreciated at a bit over 6% a year, assuming 1955 purchase.

Your siblings house appreciated at a bit under 5% a year, assuming 1982 purchase.

over 40-50 years, houses in developed areas appreciate at about 5-6 percent a year. There in eastern MA, there is no more land to develop, the rate of appreciation actually increases as new land dwindles.

The issue is that the workforce configuration has changed. There is much less middle class due to automation, and then the experience and education of the past is being lost as the boomer generation retires. We had parents who lived in the depression, and taught us the manual skills which many now don't have.

So the upward mobility is harder / slower and education and work ethic will always win out. But not as many have that today.

best of luck in our retirements.

[margaretmattson]

Originally Posted by vintageogauge

And you lose the possibility of appreciation which has been quite significant down here.

For some, their bank account, which includes the proceeds from the sale of their large home, is appreciating faster because of high interest rates. Home prices are moving the opposite. Downward!

Which would you prefer? $800,000 proceeds from sale of prior home collecting an easy 5% or more? Or, paying cash for a home with no guaranteed return on investment? There is no sign of home prices moving upward anytime soon. Most likely it will continue to move downward.

In the meantime, I think it is clever that some are choosing to rent and relying on social security and pensions to foot the bill. They are not losing a dime of their savings. Instead, it is earning income.

[Justputt]

IMO, if you sold your primary home to buy and move to TV, i.e. mortgage free., it's pretty affordable here. The estimated monthly expenses the TV puts out are comfortably lower than SSI. Beyond that, unless you eat out and party out a lot, there's not much in expenses unless the great unknown (healthcare) hits hard and exceeds the lifetime cap, so long-term care needs to be factored in. From my very first job I was advised to always max out my 401k, 403b, Keogh, SEP IRA, etc. and that advice served us well, and I passed that advice to our kids. The advice is the same I'd give any young person, "live within your means, buy what you need, and think carefully about things you just want."

[jimbomaybe]

Originally Posted by Justputt

IMO, if you sold your primary home to buy and move to TV, i.e. mortgage free., it's pretty affordable here. The estimated monthly expenses the TV puts out are comfortably lower than SSI. Beyond that, unless you eat out and party out a lot, there's not much in expenses unless the great unknown (healthcare) hits hard and exceeds the lifetime cap, so long-term care needs to be factored in. From my very first job I was advised to always max out my 401k, 403b, Keogh, SEP IRA, etc. and that advice served us well, and I passed that advice to our kids. The advice is the same I'd give any young person, "live within your means, buy what you need, and think carefully about things you just want."

I couldn't agree more,, what seems like common-sense to some, seems like an overly austere lifestyle to others,, not so, at least to me and I suspect you, but it is a matter of one's emotional relationship to money, like credit it can be your master or your servant , instant gratification or looking at a farther horizon ?