Kevin. Appropriate topic. Born very poor we devoted out life to not retiring poor. We are upper class as Pew Research defines it. In our 70s, we eat well and have a nice 4bdm home with pool. Life is good. Trick is to live below your means and keep out of debt.
Yes, that's the key. Always live below your means, especially in the years when "you don't have to" and you will be in great shape in retirement. Sounds like you did it right.
Agree 100% Similar situation for me. My parents weren't poor but money was tight. With frugal spending there was enough, but not a lot to spare. It taught me the value of spending wisely. I got a comp sci degree and a good paying career. We are no financial geniuses but we did avoid debt, have lived below our means, and invested the difference. I'm retiring in a month - almost to the day - and we're in pretty good shape. Our plan shows we should have about the same income in retirement as we have now - we'll see how that works.
@@prairiemark4084 Divorce me before retirement? Nope. We are in our 70s and completely compatible with each other. Plus she is my equal in wealth and education. Guess what? Neither of us are in debt!
I think investors should always put their cash to work, especially In 2024, we'll start to see more market diversification. I'm hoping to invest about $350k of my savings in stocks against next year. Hope to make millions in 2024
Since risk is at an all-time high right now, perhaps you should be a little more patient and return when it has decreased. Alternatively, you can consult a trained financial expert for strategy.
Yes true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
NICOLE ANASTASIA PLUMLEE' is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
I'm sixty six, and retired about a year and a half ago. I have very low requirements with regard to income. I only need around three thousand a month to live comfortably, so I only need to draw around a thousand a month from my retirement accounts, and have a pretty decent retirement account and also a good amount in liquidity. I think the key is living within your means and trying to get, and stay, as debt free as you can.
Yea me also, retired Master Chief from USN. Great pension & medical +. Full paid home in Savannah with 3 fully paid for rental properties. I am only 53 and do not need the ss income.
Woohoo! You boys win! Let the rest eat cake. But hey, didn’t yo mamma ever teach ya’ll to be humble and quiet about your earned riches and gifts? Mine did.
I need a way to draw up a plan to set up for retirement while still earning passive income to meet my day to day need and also get charged lesser taxes even while in a higher tax bracket. i want to invest around $250K savings.
Don't put all your eggs in one basket; instead, diversify into different asset classes to mitigate risk. If you lack extensive knowledge, consult a financial advisor.
Accurate asset allocation is crucial with an Experts guidance. I have 850k in equity, 300K cash earning 5.25 interest, 685k in 401k, 250k cash account, 120k in car assets ( paid off cars) Gold and silver bars. age is 64. My advisor helped me realign my portfolio to my risk tolerance and it boomed overtime.
Laura Grace Abels is the licensed advisor I use and im just putting this out here because you asked. You can Just search the name. You’d find necessary details to work with to set up an appointment.
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.
My grandkids would come and do work around our house, but they never got paid. Their parents wanted to teach them about being respectful of the family especially grandparents. We however open Roth IRAs for them and made small contributions to the accounts each Christmas. Now it’s up to them to continue, which they are doing. Although one is better at saving than the others. Point is we started them out on the right path
I am a diy investor and I am my own financial advisor. I also help my kids with their investments as well as grown grand kids. We are all doing great. My greatest frustration is that I fear my family isn’t financially literate enough to go it on their own. Working on that all the time.
40 now, and everything is paid for. Fortunately, I had a college economics teacher who taught me a lesson when I was 18 years old. That lesson was: you can't buy something else for every purchase you make. Having multiple sources of income is prudent, as is living within your means. I have a 13-year-old vehicle because it is all I need, I like it, and I can do whatever I want with it. My net worth is $900k, and I can pay my bills without stress, but I don't live like I have that. I have no complaints.
I’m also 40 now and currently live with my elderly parents due to my autism spectrum disorder but other than that I’m quite independent and can drive and cook 🧑🍳
Smart early middle ager 😊. I lived the same way since age 40 and I’m now 53. It only gets better keep doing what you were doing and you’ll have increasing discretionary income as you go can easily afford any vehicle but my 2015 prius takes care of me.😅
6 місяців тому+3
Good job, I also started early, lived within my means, didn't compete with the Jones, and never made excuses. I always maxed out my retirements. Now I am 57, retired my 2nd time at 55 and I can do what I want, when I want and where I want
I just started watching your videos. I think you're clear and concise in your presentation. These retirement topics can be are complicated and the future is unpredictable. I think your videos will help people plan and adapt when those plans ultimately need changing. Keep up the good work. Thanks for making Right Capital available to try (in your ROTH and SS videos). It was interesting and fun to examine the Roth conversion and various SS claim age scenarios. I can completely recommend that people at least try the Right Capital software if only for that. Most trial versions of retirement software that I've looked at do not provide their Roth conversion feature. I get it, they want you to buy/subscribe to their products. Lack of availability made me build a spreadsheet to do to simulations. Though my output was much less pretty and not very intuitive, I'm happy to see that I came to similar conclusions as Right Capital. It was a complicated spread sheet to put together, so having software that is moderately easy to use like Right Capital will help a lot of people.
it's not the income, it's the outgo. at 66, i have cashed out of the market and taking my house sale money to buy an off grid homestead. closing the gate and saying good luck to you all. ss at 70 and that will be annuity gravy. an income pond, no streams. i'm good.
Yes, I was old enough to know the original homesteaders who first settled the land and broke the sod. We don't even know what poverty is. One of my sadest memories was the day my Dad and I went around and burned down about 5 or 6 homestead shacks. That was in the 1960s and the homestead shack were put up between 1912 and 1919 in our isolated area. The tax man was billing Dad about $20 a year for each home so he felt he had to burn them. I got to keep the pots and pans and kitchen utensils. I had the best equiped playhouse in the community!
I love the way financial advisors disparage “DIY” investors in one breath, and then obfuscate and complicate everything in an attempt to sell their services.
Yes, that's what they all do. They try to confuse you.
6 місяців тому+3
Interesting, I've had the same financial advisor since I was 25, his expertise allowed me to retire at 55 for my 2nd time, I am now 57. I have 2 accts with his services then I have a few accts on my own, safe to say I can do what I want, when I want and where I want and I have zero chance of running out of money unless I get really really stupid.
From the time I was 18 I knew my priority was to retire well. I now have 2 pensions with COLA that are not dependent on the stock market or other investment strategies, full coverage health care for my wife and me (thank you military retirement!) and a nice chunk in a 401k. I retired at 56 with an annual income north of 130k and I still have 3 years before I can apply for SS. Regardless of what you do for work it's all about planning early and sticking to it.
I am headed in a very similar direction. Can you tell me what rank you retired? I am not sure how I compare, but I have 100k in investments plus two retirement accounts same.
It's great to have an estimate on how much you will want/need for retirement income. But one huge factor is location. Where you choose to live greatly effects what you need. A retiree in TN needs less than half what a retiree in NY needs.
@@andyd4298 My point is every state is different AND every region in a state is different. You really cannot compare state X to state Y. You need to get much more local than that.
Our SS plus pensions will be about $80k a year. Our investments are earning about the same amount of interests and dividends. So we will not need to withdraw anything. I am still working not because of $.
Nice. The best job to work is one you can do on your terms. That is what we do at retirement age. It keeps the brain active and prevents it from turning to mush.
@@arisgod2749You are absolutely correct. Money is just accumulating from investments and streams of income coming in. I don't spend a fraction of my annual income, why? It's crazy one works all those years only to die leaving behind unspent money -:SMH.
I’m 69, and I have a couple of rentals that are paid off. Rents go up with inflation and renters bought the properties. Real Estate is hard to beat if you don’t mind the headaches.
Usually never makes sense to take SS later. Retired at 62 1/2 and took SS. My break even is 78 yrs old,but taking SS allows me to take less from my investments and let them grow. My expenses will go down as I age. Meanwhile, if I should die early, SS stops but I have more money for my family. Waiting to take SS until 70 doesn’t guarantee I will ever see it but I would be drawing down my investment savings and taking money out of my families pocket. Plus I will likely earn well more than what SS will adjust for over those years. If the number 1 concern for people is that they will run out of money in retirement, then it makes no sense to spend it early in retirement when you can get your SS.
OMG. I did and do the same thing. i couldn't agree more. Exactly what I believe. 69 retired at 60. I'm sticking to the plan. I paid my house off too with 401k money. I took a big hit on taxes and paid irrma for 2 years on part b. This all contrary to my know-it-all son in law. I said, when your my age your priorities change. Now they will inherit a house free and clear and not as much tax deferred savings. He also didn't think I should have taken social security at 62 but they will inherit more in inheritance this way. I'm not concerned with my break even age. It is what it is. To hell with what others say I should do with my money.
A very nice video thank you. I'm 63 and retired at 60. I would warn people in their 40s and 50s to change their lifestyle immediately. If you're going out to dinner two or three times a week, driving around in expensive cars, living, check to check… You're setting yourself up for an impossible retirement scenario. I will also tell you that homeownership even with the house paid off can be brutally expensive. I own a condo free and clear down in Fort Myers but my monthly run cost for that condominium, including property tax condo dues are $1250 per month. I'm property tax exempt here in Maryland but upkeep of HVAC, yard maintenance and, electrical repairs and such, they're very very expensive. I think that expecting the stock market to grow here after year is a very dangerous concept. There's going to be setbacks in the stock market, effect of life. With the median average retirement of $54,000, that's a huge drastic lifestyle change for people who are living high on the hog.
I think you pose the issue correctly. What is the monthly retirement income you need to maintain your lifestyle. Its a lot more than net worth as you note above. Then you can really see what you need to maintain your lifestyle. You need to adjust this to what you can come up with to support it. They should be in balance.
I own four rental properties. Each one gets 1600 per mo. I own all of them out right no bank notes. I also collect 3745.00 For social security each month.
In the United States, we live in a constitutional Republic, with a representative democracy as a form of government. This is reflected quite strongly in the way personal finance and debt accumulation among most voters is mirrored in the unconscionable spending we see from Congress. The short-sighted practices from both groups are going to have long-term consequences which impact all Americans, but most notably those who have lived far beyond their means, for far too long. It's why so many are working into their late 60's and even 70's...they have never prepared, so they will really never retire.
Disconnect from reality. My frist question to guys like this. What is the percentage of your clients that are millionaires or close? Like 40% of people don’t even have a 401k or similar. If you can make 80% of your working income in retirement you’re in good shape. 75k? I didn’t avg that when I worked construction.
Don't forget to knock off the Medicare Premium from your number. Minimum is $174/month up depending on your AGI. Also your SSI can be taxable up to 85% of your gross benefit, not the net benefit also depending on your AGI. You will not get the whole $4746/month. So do the math in your case and plan for the lesser amount. I do my tax calcs a year ahead so I won't be surprised the following April. I'm 75 this year.
Yes but that is not your full retirement age which is typically 66 years or so. That is what he was referring to. 70 is the maximum delayed benefit age.
But you left 8 years worth of income on the table ...better to collect at 62 and work a job part time . If you live to be 84 you will break even with what you left on the table by not taking it at 62 plus the interest on that money.
I got ss at 62. My bloodline has a history of ending life before 75. Getting it while the gettins' good. Don't have the energy I use to and happy I left work in my 50s. Had fun while my body could do more activities. Rocking chair life is cheap going into the home stretch if health cost don't get cha. .
There are a lot of metrics being surveyed in the past 20-30 years with regards to retirement. One metric I think is missing and would be absolutely useful and sought after would be: What is the percentage difference between what was spent before and after retirement. Broken up by income groups like 100k -200k. The income difference that was shown in this video is great, but the expense difference would be more useful for knowing if a person is ready.
Haha, a government pension when it is deferred (when you have a career after gov't service) really sucks. They don't give you any interest or increase for the time frame between leaving and retiring.
@6:20 The numbers are saying that a man goes to war for his country, put his life on the line & his pension is less than a federal worker's? Isn't he a federal employee, fighting for his country? I hope that he gets both the Federal & military 🪖 pension, otherwise it is very sad.
Something I crunched the numbers on a few years ago was collecting SS early versus waiting till age 70. If you collect at age 66 and you have no penalties for continued work due to age, you can keep working and draw SS too, then put that away for a rainy day. At say $3k a month in SS it will be $144k (plus compounded interest) by age 70. If you drop dead by age 70 at least your estate has more money in it, which you would NOT have if you waited to collect. The compound interest will he close enough to the increase you might have gotten for waiting. What you do with that is up to you. Reinvestment is one way, start IRAs or school funding for grandkids, or splurge on some personal goodies when you do retire. I am 4 years retired, age 70, house is paid off, and with no outstanding debt I am coasting nicely on SS. I have yet to tap into about $1,000,000 worth of nest egg.
@@mkeller8114 that number is pie in the sky… the average ss payment to a worker is 1916 what about the median ? Far lower most dont have pensions 17 per cent do and saving 600000 off a 30 dollar an hour job after living expense is impossible
Well the first thing you need is to work out what your budget will be like when you retire based on todays figures. I know I won't have a mortgage so i know what my annual budget will be. Next, I know what guaranteed income I will be getting from different sources and can project how much my investments will be based on historical data, That's the best you can hope for. Once you have a baseline, you can work out your average tax rate and estimate what your net income will be. Divide your net income by your expenses and if the answer is 1.25 or more then you are probably going to be OK. For example, if your net income is $40,000 and your expenses are $32,000 per annum then you have wiggle room for unexpected bills and can use the disposal income for treats like trips or eating out
Thanks for the video, I need at least $3K in monthly pension & at least $1M to be living comfortably in America. Anything less than that I'll be living in a Skid Row or move overseas in Asia.
I am currently in my 50s and This is no time to taper retirement savings. I want to max out my retirement contributions and I also have another $200k in a savings account that i want to invest in a non-retirement account. Where should I invest it now?
I recently retired and my pension and drop payments total $8100/month ($7400 after taxes). My pension continues for life, but my drop money runs out in 3 years. At that time SSI kicks in and that's $4400/month. Then it will be about $8300/month for life. In addition I have $594,000 in my 401k. If I don't go crazy with spending I should do ok.
How does a CFP guide a ‘younger person’ today planning for retirement and thinking about a retirement income stream they will need to make it? Major impending reforms to SS and Medicare are going to blow up the general wisdom of today. Just take two simple examples of SS FRA being increased even 1 year, or increasing penalty on collecting at 62 by another 20%, there must be generational differences built into the retirement planning software, right? When running generational data today, (median savings, median net worth, etc.) what does it matter if the expectations are going to materially change what ultimately projected retirement income is meant to support…it isn’t going to be an apples-to-apples set of rules….a younger generation person will need to have their retirement income work X% more than the older generations…with a crystal ball…what does a fiduciary think that % is applied to each generation after the boomers? At least for Millennials and Z, and targeting 62, back-of-the-napkin math shows a likely double-digit % increase from the conventional modeling of today….and converted to real present and/or future dollars…there are going to be many people that are going to cry real tears one day.
How you do in retierment depends on where you live. If you live in NY or Cal. good luck. I live in the south and my property tax is less than 1000 dollars a year. All other cost are also less. Ben
Actually, in California it is pretty easy to retire in place. Especially if you have owned your home for more than a few years. Property taxes are largely fixed based on what you paid for your home. They limit the increase of property tax payment to under 2%/year regardless of the increase in the market value of your home. Also, if you decide to move elsewhere in the state you can take this low property tax amount to your new home if your new home is worth less than the market value of your old home.
I just turned 61 and awfully late to investing with barely any portfolio except my 401k, I have a decent amount of cash saved up and with inflation currently soaring AGAIN, I’m getting worried about retirement, my intention is to retire at 65 atleast, so how best do I maximize my savings of over $500k
For the average person, the strategies are fairly demanding. In actuality, most professionals who have the necessary abilities and knowledge to complete such occupations do so successfully.
Agreed, I always emphasize the significance of having an advisor. This has not only help to revamp my portfolio but has also kept me afloat since the covid-19 outbreak to date. I'm only about 10% shy of my first million dollar after subsequent investments.
90K income, from SS, G pension, rental income. It covers all expenses with left over. My 401k and mándame. CDs is over 1 million, with zero withdrawal. Age 66 and have no need to withdraw untill forced by Goverment mandate. How should I invest my 401K.
Wow…57,000 a year in expenditures! What the actual…? Except for unanticpated events, by 65 your goal should be to have paid off cars and a paid off house. I retired at 55 with everything paid off (now 63) and luckily have a decent pension and other investments (I don’t have to touch), but other than one year in retirement where I bought a good used car with very low miles for 24,000 cash, I haven’t spent more than 30,000. Including health insurance, car insurance, house insurance, income taxes, property taxes, heat/electric/food and 3 trips annually (U.S. usually driving but really enjoyable) etc…etc. I think people just live way beyond their means. We have a modest but nice 4 bedroom 3 bath home and 2 used but solidly reliable decent cars. I actually have saved money from my pension every year in retirement except the year I bought that car. When working we had a modest household income. Lessons for the young…It’s easier to be poor when you are young (because you are stashing away money) than to be poor when you’re old. Also along that same line, it’s not how much you make it’s how much you spend. Budget! This YOLO (you only live once) crap is ridiculous. And you may die tomorrow so enjoy…right? 🙄 Chances are really really good in today’s day and age you will get old. Then what.
I had this conversation with someone recently. Median makes far more sense when the average skews the data so much. Most people don’t know the difference between average and median. In this case, where the highest number of people’s income makes much more sense than averaging out including the extremes. That aside, the average or median really is not important when the cost of living and lifestyles are so widely different.
One thing that I didn't catch in this excellent video was the fact that in many, (if not most), retirees situations is as a couple and the video doesn't address the fact that in most cases there are two people with potentially two incomes i.e. pensions etc. Just wondering how that fact works into the calculations.
I'm glad you mentioned expenses. I'm out at the end of 2025 and will be doing the "bottom up" method. One year before retirement, determine your total annual expenses. Take that number and add in a 15% to 20% buffer for incidentals and emergencies. Take that total number and divide it by 0.8. The resulting number is the approximate minimum gross income you'll need during year 1 of retirement. Apply a COLA each year afterwards.
No, you need counciling on how not be arrogant in a comment section of people who are struggling. Have some consideration and be thankful, not boastful.
You have to start preparing for retirement by your mid 20's! If you can systematically save for your entire working lifetime, without 'raiding it', you should have enough money to have a "self-sustaining' fund! This way, you can now withdraw a prescribed, annual amount, w/o ever reducing the principle! This fund would be worth an estimated $300,000. which would generate some $15,000. interest a year, for life!
Sounds plausible provided you throw in a little family planning as well. Those little budget busters (AKA) Kids have a habit of wreaking havoc on the best laid plans . Lol.
I really like your videos. They are clear, detailed, and helpful. Thank you for that. I wish I had a local financial planner like you where I live. With that said, I have always followed a passive index investment strategy. I have tried to minimize the investment expense rather than pay a manager to try to beat the market. Is is possible to create a holistic retirement plan but eschew active money management?
'Individual' retiree or' household' income? It is important to clarify in the script at the beginning of these type of videos (though it was alluded to nearer the end).
When you talk about average expenses and income, are we talking about individuals or households? I am somewhat surprised if we are talking about individuals.
Very interesting and informative, Thank you. However, of all the retirement posts I have looked at, I have yet to hear a CFP discuss those of us who were self-employed and invested in only dividend-paying stocks. Companies that have paid dividends consistently over 25 years with an average of 4% increases per year. I never need to touch my principle and live in dividends and SS only. What are your thoughts? Thank you.
When you are discussing income, how is it defined? Is it the total of all sources, or is it what the IRS considers income for tax purposes? For example, my first 3 years of retirement looked like $0 income because I lived off of a savings account until age 65.
You're quoting the "mean" but the standard deviation is so great that it's really worthless and inaccurate number. Much more accurate would be the MEDIAN. The MEDIAN is substantially less than the mean and is much more reflective of what Americans really have. Do a video on the MEDIAN as the mean is a relatively worthless number.
I'm feeling pretty good. I have a lifetime annuity that with SS will give me 84k per year. Then 2 million in IRA, which I will let build ans give as generational wealth to my kids. Retired this year at 61. With my home paid off.
If the fact pattern is true above, you may want to consider a partial conversion to Roth IRA from your IRA, cuz you'll never need the money. Thus they (your heirs) get when you pass receive Inherited roth ira's with the taxes already already paid. A great deal for them, and unfortunately for you get to pay the taxes but you are still in a wonderful situation.
@victorhanson1475 agree that is my plan. I am 61 now so until I can get medicare I plan to only convert 20K a year to get a good ACA credit. Then I will covert up to the max so I do not have to pay additional Medicare premiums each year.
Income is not as important as your expenses. Retired at 65 in 2021. Live in WA, only expense is home, life is great. This is BS, I bring home more retired then when I was working.
Guess what, before Ronald Reagan most people had a defined pension plan versus a 401K. But thanks to Reagan and his policies, Pension plans disappeared and were replaced with 401K‘s and unions also were basically destroyed during this period of time. You reap what you sow . Good old private sector, and Wall Street “saving” American retirement. Now retirees either have money or they don’t and people with money blame retirement failures on the less fortunate: “they didn’t invest enough” or they are “spendthrifts” Well, hard to invest when most folks live paycheck to paycheck. That’s MOST people.
Your statement is incorrect, you would be correct if you said that “more” people had defined pension plans, but “most” people did not have define pension plans. You also did not state that many pension plans were underfunded and thus not able to play the promised benefits. You should not rely on others (either government or your pension) to provide for you, instead you should ensure that you provide for yourself, thus that is where 401k’s, IRA’s, Roth’s of both of these, and real estate are things you can control and ensure your own retirement. It really is not that difficult, we did it on a single income and retired @60. The key is to live below your means, don’t borrow money, and don’t make stupid mistakes (divorce, buying new cars, buying more house than you need, crypto, smoking, drugs, etc), stay clear of these things and in most cases your will thrive.
Your statement isn’t accurate. And I would love to know what policies were enacted that caused private companies to drop pension plans. These companies were already walking away in droves because of the liability. Hence, the 401K was created.
Can't really blame Reagan. 401ks were introduced around 1983 as a supplement to as opposed to a replacement for pensions. That didn't happen till the 90s around the shift to managed care. I blame baby boomers an their hatred of their fathers' labor unions (see the movie Wall st for an explanation)
Funny how the private sector couldn’t make pensions work but if you have a state or federal pension it works and with cola increases. Wonder why….. Oh that’s right the taxpayer will pay for it and make up the difference. So tired of people I know retiring after 30 years ( age 50-55 ) and retiring with crazy pensions thinking it is normal. No it is not normal and it is also not sustainable. Federal and state pensions use to be because they didn’t make as much as private sector. Now they earn more and still get killer pensions. Government over spending is what is causing this crazy inflation and increasing retiree stress.
You are still highly affected. Food costs, insurance costs, fuel and utility costs. I have been 100% debt free for years but my annual costs to just live continue to rise at an alarming rate.
Wrong they were killed because with the suppressed interest rates on bonds ( considered safe investments ) they could no longer afford to make payouts to retirees. Rates should have never gotten as low as they were. Savings and cost of capital should mean something but not in this crazy world. @@ronrollo5023
It depends on how much you spend. In reality it is a personal question and answer. What are your expenses? That basically is what you income will need.
This retirement planning is not hard. A home computer and excel spreadsheet ability is all you need. These videos are so dumbed down. I have $9800 monthly expenses and $12800 in monthly income. I am using a dynamic 401K withdrawal strategy. Right now, I am only taking 1.5% withdrawals. I have averaged 14% annual investment returns the last 5 years, including a positive return in 2022.
OK, I'm just gonna tell you what I did then ask my question. . . I worked 2 full time jobs and one part time job for almost 50 years. My wife and I raised 3 kids, bought a condemned house (officially unfit for human habitation); I rebuilt the home in my "spare" time; I paid for my wife and I to go to college at night; we worked different shifts in a factory so one of us would be with the kids at all times; we never bought a new car, never took a fancy vacation, and just worked until we were physically exhausted. Now we are 68 and we've managed to have a retirement income that is $175,000 annually, this includes our two soc sec pensions and four separate pensions that we've earned. Question: did we do good or did we squander our youth? We have some major mobility issues now, but we enjoy life, we own our home, we own our used cars, we have no debt, I mean zero debt. We can buy what we want, do what we want, but we want very little. I'm sure we missed some great ops for life experiences, but we kept tomorrow in our sights. So, did we F up or not?
Everything you do carries some opportunity cost with it. I know of people who spent every nickel they ever saw and are facing poverty in the elder years. It’s a trade off however one sees it.
fortunately I and wife have no debt, great federal pensions with health insurance at the employee premium + medicare, not taking SS until FRA + Va disability payments, wife took SS at 63 10 months. Not touching IRA/TSP other then Roth conversions
Its worse here, our economy is like a flailing fish, fighting for its life. The normal state of the U.S. economy is actually very bad. Because of this it goes into convulsive spasms fighting to grow any way it can out of desperation. Tricks, gimmicks, rule changes try to stimulate the economy and prevent it from falling but they only bring temporary relief to people since, when you factor in inflation we are declining.
Not true boomers that are doing well likely have a traditional pension as part of the mix. So in fact their employer or union put money away for a rainy day
Some investment advisors make a living scaring people into believing that they need a seven figure account to retire. Too many comments by scammers and braggarts on these videos.
Kevin. Appropriate topic. Born very poor we devoted out life to not retiring poor. We are upper class as Pew Research defines it. In our 70s, we eat well and have a nice 4bdm home with pool. Life is good. Trick is to live below your means and keep out of debt.
Yes, that's the key. Always live below your means, especially in the years when "you don't have to" and you will be in great shape in retirement. Sounds like you did it right.
Agree 100% Similar situation for me. My parents weren't poor but money was tight. With frugal spending there was enough, but not a lot to spare. It taught me the value of spending wisely. I got a comp sci degree and a good paying career. We are no financial geniuses but we did avoid debt, have lived below our means, and invested the difference. I'm retiring in a month - almost to the day - and we're in pretty good shape. Our plan shows we should have about the same income in retirement as we have now - we'll see how that works.
@@xlerb2286 Good Job!
And don't let your wife divorce you. She make take half of all you earned right before retirement!
@@prairiemark4084 Divorce me before retirement? Nope. We are in our 70s and completely compatible with each other. Plus she is my equal in wealth and education. Guess what? Neither of us are in debt!
The median retirement income has a bit more relevance to the average retiree.
I think investors should always put their cash to work, especially In 2024, we'll start to see more market diversification. I'm hoping to invest about $350k of my savings in stocks against next year. Hope to make millions in 2024
Since risk is at an all-time high right now, perhaps you should be a little more patient and return when it has decreased. Alternatively, you can consult a trained financial expert for strategy.
Yes true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
NICOLE ANASTASIA PLUMLEE' is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
I'm sixty six, and retired about a year and a half ago. I have very low requirements with regard to income. I only need around three thousand a month to live comfortably, so I only need to draw around a thousand a month from my retirement accounts, and have a pretty decent retirement account and also a good amount in liquidity. I think the key is living within your means and trying to get, and stay, as debt free as you can.
Good thing for you. With Bidenflation, your savings are becoming worthless.
THAT needs to START at age SIXTEEN!!!
This DOPE thinks MOST retirees WILL SEE 90??? He’s NUTS!!!
I think I'm good, SS and pension $80k per year, house paid off.
💤
Yea me also, retired Master Chief from USN. Great pension & medical +. Full paid home in Savannah with 3 fully paid for rental properties. I am only 53 and do not need the ss income.
Having a decent pension makes the difference!
@@rongendron8705 and no ex wife!
Woohoo! You boys win! Let the rest eat cake. But hey, didn’t yo mamma ever teach ya’ll to be humble and quiet about your earned riches and gifts? Mine did.
I need a way to draw up a plan to set up for retirement while still earning passive income to meet my day to day need and also get charged lesser taxes even while in a higher tax bracket. i want to invest around $250K savings.
Don't put all your eggs in one basket; instead, diversify into different asset classes to mitigate risk. If you lack extensive knowledge, consult a financial advisor.
Accurate asset allocation is crucial with an Experts guidance. I have 850k in equity, 300K cash earning 5.25 interest, 685k in 401k, 250k cash account, 120k in car assets ( paid off cars) Gold and silver bars. age is 64. My advisor helped me realign my portfolio to my risk tolerance and it boomed overtime.
pls how can I reach this expert, I need someone to give me a guide on how to manage my portfolio
Laura Grace Abels is the licensed advisor I use and im just putting this out here because you asked. You can Just search the name. You’d find necessary details to work with to set up an appointment.
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.
My grandkids would come and do work around our house, but they never got paid. Their parents wanted to teach them about being respectful of the family especially grandparents. We however open Roth IRAs for them and made small contributions to the accounts each Christmas. Now it’s up to them to continue, which they are doing. Although one is better at saving than the others. Point is we started them out on the right path
That is really awesome 👏. Thank you for sharing
I am a diy investor and I am my own financial advisor. I also help my kids with their investments as well as grown grand kids. We are all doing great. My greatest frustration is that I fear my family isn’t financially literate enough to go it on their own. Working on that all the time.
Retired at 60 when Covid hit. Glad I have a pension and a 2% yearly cost of living increase. Food going up didn't help but I get by
I am 68 years old and still working full-time. Divorce makes a big difference. She gets about 60 percent of what you have.
66. she died 6 years ago. saddest day and best day of my life...
HA!!!!
QUESTION: Should I buy SUPER gutters for $7,700….or hire a HIGH SCHOOL kid for $30 to come over for 25 minutes once a year to clean them out?
@@Tryp-j9d damn fine q.
not to mention the yearly visual inspection...
Amen brother, divorce is devastating to retirement. Retirement poor now.
40 now, and everything is paid for. Fortunately, I had a college economics teacher who taught me a lesson when I was 18 years old. That lesson was: you can't buy something else for every purchase you make. Having multiple sources of income is prudent, as is living within your means. I have a 13-year-old vehicle because it is all I need, I like it, and I can do whatever I want with it. My net worth is $900k, and I can pay my bills without stress, but I don't live like I have that. I have no complaints.
I’m also 40 now and currently live with my elderly parents due to my autism spectrum disorder but other than that I’m quite independent and can drive and cook 🧑🍳
Smart early middle ager 😊. I lived the same way since age 40 and I’m now 53. It only gets better keep doing what you were doing and you’ll have increasing discretionary income as you go can easily afford any vehicle but my 2015 prius takes care of me.😅
Good job, I also started early, lived within my means, didn't compete with the Jones, and never made excuses. I always maxed out my retirements. Now I am 57, retired my 2nd time at 55 and I can do what I want, when I want and where I want
I just started watching your videos. I think you're clear and concise in your presentation. These retirement topics can be are complicated and the future is unpredictable. I think your videos will help people plan and adapt when those plans ultimately need changing. Keep up the good work.
Thanks for making Right Capital available to try (in your ROTH and SS videos). It was interesting and fun to examine the Roth conversion and various SS claim age scenarios. I can completely recommend that people at least try the Right Capital software if only for that.
Most trial versions of retirement software that I've looked at do not provide their Roth conversion feature. I get it, they want you to buy/subscribe to their products. Lack of availability made me build a spreadsheet to do to simulations. Though my output was much less pretty and not very intuitive, I'm happy to see that I came to similar conclusions as Right Capital. It was a complicated spread sheet to put together, so having software that is moderately easy to use like Right Capital will help a lot of people.
Thank you! I really appreciate it. I'm glad it's helpful.
Majority retirement income in our area is Social security, 2nd is savings or investments, and last is pension.
it's not the income, it's the outgo. at 66, i have cashed out of
the market and taking my house sale money to buy an off grid
homestead. closing the gate and saying good luck to you all.
ss at 70 and that will be annuity gravy. an income pond, no streams.
i'm good.
Is the gate locked?😂
@@bright2915 locked to all outside my hoola hoop that don't know the code.
@@natureboy1313 why do you say that?
With 20 years on the time horizon - definitely go out with a bang!!!
@@roadking9680 66, on medicare. 1,038 a year.
no capital gains on house sale. lining up land in wv.
prop taxes between 200-600 a year.
Here it is 2024 and still my parents and grandparents' stories about the great depression are vividly remembered.
My parents are baby boomers born in 1952 and 1960 and my siblings and I are millennials
Yes, I was old enough to know the original homesteaders who first settled the land and broke the sod. We don't even know what poverty is. One of my sadest memories was the day my Dad and I went around and burned down about 5 or 6 homestead shacks. That was in the 1960s and the homestead shack were put up between 1912 and 1919 in our isolated area. The tax man was billing Dad about $20 a year for each home so he felt he had to burn them. I got to keep the pots and pans and kitchen utensils. I had the best equiped playhouse in the community!
I love the way financial advisors disparage “DIY” investors in one breath, and then obfuscate and complicate everything in an attempt to sell their services.
Yes, that's what they all do. They try to confuse you.
Interesting, I've had the same financial advisor since I was 25, his expertise allowed me to retire at 55 for my 2nd time, I am now 57. I have 2 accts with his services then I have a few accts on my own, safe to say I can do what I want, when I want and where I want and I have zero chance of running out of money unless I get really really stupid.
Look son, people complaining about free advise.
Becoming well off through DYI investing is not rocket science, but financial advisors try to make it seem like it is.😂😂
@@williewonka6694 exactly!
Yeah, average means nothing when it comes to retirement anything, always the median. So many people are very far behind.
From the time I was 18 I knew my priority was to retire well. I now have 2 pensions with COLA that are not dependent on the stock market or other investment strategies, full coverage health care for my wife and me (thank you military retirement!) and a nice chunk in a 401k. I retired at 56 with an annual income north of 130k and I still have 3 years before I can apply for SS. Regardless of what you do for work it's all about planning early and sticking to it.
I am headed in a very similar direction. Can you tell me what rank you retired? I am not sure how I compare, but I have 100k in investments plus two retirement accounts same.
It's great to have an estimate on how much you will want/need for retirement income. But one huge factor is location. Where you choose to live greatly effects what you need. A retiree in TN needs less than half what a retiree in NY needs.
Depends where in NY and where in TN, and lifestyle. Outside of NYC a lot of NY has pretty reasonable costs. And Nashville is not cheap.
@@JBoy340a You are just proving my point.
@@andyd4298 My point is every state is different AND every region in a state is different. You really cannot compare state X to state Y. You need to get much more local than that.
@@JBoy340a Which is exactly my point.
Our SS plus pensions will be about $80k a year. Our investments are earning about the same amount of interests and dividends. So we will not need to withdraw anything. I am still working not because of $.
Don't forget the most important lesson. You take nothing with you when it's time to leave this earth.
time you cant replace....you sound like okay to get out of job......wasting time....
Nice. The best job to work is one you can do on your terms. That is what we do at retirement age. It keeps the brain active and prevents it from turning to mush.
@@JBoy340aThere are many ways to keep mentally active other than at a job, but to each his/her own.....I couldn't wait to leave the rat race.
@@arisgod2749You are absolutely correct. Money is just accumulating from investments and streams of income coming in. I don't spend a fraction of my annual income, why? It's crazy one works all those years only to die leaving behind unspent money -:SMH.
I’m 69, and I have a couple of rentals that are paid off. Rents go up with inflation and renters bought the properties. Real Estate is hard to beat if you don’t mind the headaches.
Think I’ll stick with what the S&P provides. Been there done that with renters.
The headaches aren't worth it.
Usually never makes sense to take SS later. Retired at 62 1/2 and took SS. My break even is 78 yrs old,but taking SS allows me to take less from my investments and let them grow. My expenses will go down as I age. Meanwhile, if I should die early, SS stops but I have more money for my family. Waiting to take SS until 70 doesn’t guarantee I will ever see it but I would be drawing down my investment savings and taking money out of my families pocket. Plus I will likely earn well more than what SS will adjust for over those years. If the number 1 concern for people is that they will run out of money in retirement, then it makes no sense to spend it early in retirement when you can get your SS.
OMG. I did and do the same thing. i couldn't agree more. Exactly what I believe. 69 retired at 60. I'm sticking to the plan. I paid my house off too with 401k money. I took a big hit on taxes and paid irrma for 2 years on part b. This all contrary to my know-it-all son in law. I said, when your my age your priorities change. Now they will inherit a house free and clear and not as much tax deferred savings. He also didn't think I should have taken social security at 62 but they will inherit more in inheritance this way. I'm not concerned with my break even age. It is what it is. To hell with what others say I should do with my money.
A very nice video thank you. I'm 63 and retired at 60. I would warn people in their 40s and 50s to change their lifestyle immediately. If you're going out to dinner two or three times a week, driving around in expensive cars, living, check to check… You're setting yourself up for an impossible retirement scenario. I will also tell you that homeownership even with the house paid off can be brutally expensive. I own a condo free and clear down in Fort Myers but my monthly run cost for that condominium, including property tax condo dues are $1250 per month. I'm property tax exempt here in Maryland but upkeep of HVAC, yard maintenance and, electrical repairs and such, they're very very expensive. I think that expecting the stock market to grow here after year is a very dangerous concept. There's going to be setbacks in the stock market, effect of life. With the median average retirement of $54,000, that's a huge drastic lifestyle change for people who are living high on the hog.
I think you pose the issue correctly. What is the monthly retirement income you need to maintain your lifestyle. Its a lot more than net worth as you note above. Then you can really see what you need to maintain your lifestyle. You need to adjust this to what you can come up with to support it. They should be in balance.
I own four rental properties. Each one gets 1600 per mo. I own all of them out right no bank notes. I also collect 3745.00 For social security each month.
In the United States, we live in a constitutional Republic, with a representative democracy as a form of government. This is reflected quite strongly in the way personal finance and debt accumulation among most voters is mirrored in the unconscionable spending we see from Congress. The short-sighted practices from both groups are going to have long-term consequences which impact all Americans, but most notably those who have lived far beyond their means, for far too long. It's why so many are working into their late 60's and even 70's...they have never prepared, so they will really never retire.
Age 60 this year. Well above Pension and 401k. The biggest this has been no debt. Thanks.
Disconnect from reality. My frist question to guys like this. What is the percentage of your clients that are millionaires or close? Like 40% of people don’t even have a 401k or similar. If you can make 80% of your working income in retirement you’re in good shape. 75k? I didn’t avg that when I worked construction.
Predatory price gouging isn’t actually inflation.
According to my Social Security statement, if I wait to claim until age 70, my benefit will be $4,746.00 p/mo.
Don't forget to knock off the Medicare Premium from your number. Minimum is $174/month up depending on your AGI. Also your SSI can be taxable up to 85% of your gross benefit, not the net benefit also depending on your AGI. You will not get the whole $4746/month. So do the math in your case and plan for the lesser amount. I do my tax calcs a year ahead so I won't be surprised the following April. I'm 75 this year.
Yes but that is not your full retirement age which is typically 66 years or so. That is what he was referring to. 70 is the maximum delayed benefit age.
But you left 8 years worth of income on the table ...better to collect at 62 and work a job part time . If you live to be 84 you will break even with what you left on the table by not taking it at 62 plus the interest on that money.
@@dp.7616 3 years now...
I got ss at 62. My bloodline has a history of ending life before 75. Getting it while the gettins' good. Don't have the energy I use to and happy I left work in my 50s. Had fun while my body could do more activities. Rocking chair life is cheap going into the home stretch if health cost don't get cha. .
There are a lot of metrics being surveyed in the past 20-30 years with regards to retirement.
One metric I think is missing and would be absolutely useful and sought after would be:
What is the percentage difference between what was spent before and after retirement.
Broken up by income groups like 100k -200k.
The income difference that was shown in this video is great, but the expense difference would be more useful for knowing if a person is ready.
Haha, a government pension when it is deferred (when you have a career after gov't service) really sucks. They don't give you any interest or increase for the time frame between leaving and retiring.
No company would give you benefits if you leave before retirement eligibility. Stop whining
@6:20 The numbers are saying that a man goes to war for his country, put his life on the line & his pension is less than a federal worker's?
Isn't he a federal employee, fighting for his country?
I hope that he gets both the Federal & military 🪖 pension, otherwise it is very sad.
Something I crunched the numbers on a few years ago was collecting SS early versus waiting till age 70. If you collect at age 66 and you have no penalties for continued work due to age, you can keep working and draw SS too, then put that away for a rainy day. At say $3k a month in SS it will be $144k (plus compounded interest) by age 70. If you drop dead by age 70 at least your estate has more money in it, which you would NOT have if you waited to collect. The compound interest will he close enough to the increase you might have gotten for waiting. What you do with that is up to you. Reinvestment is one way, start IRAs or school funding for grandkids, or splurge on some personal goodies when you do retire. I am 4 years retired, age 70, house is paid off, and with no outstanding debt I am coasting nicely on SS. I have yet to tap into about $1,000,000 worth of nest egg.
Two Pensions and investments, post taxes I'm getting about 14k a month. I'll draw SS in 5 yrs.
That is impressive.
Very hard to do unless you had some serious government jobs.
@@mkeller8114 that number is pie in the sky… the average ss payment to a worker is 1916 what about the median ? Far lower most dont have pensions 17 per cent do and saving 600000 off a 30 dollar an hour job after living expense is impossible
Well the first thing you need is to work out what your budget will be like when you retire based on todays figures. I know I won't have a mortgage so i know what my annual budget will be. Next, I know what guaranteed income I will be getting from different sources and can project how much my investments will be based on historical data, That's the best you can hope for. Once you have a baseline, you can work out your average tax rate and estimate what your net income will be. Divide your net income by your expenses and if the answer is 1.25 or more then you are probably going to be OK. For example, if your net income is $40,000 and your expenses are $32,000 per annum then you have wiggle room for unexpected bills and can use the disposal income for treats like trips or eating out
Retirment costs vary greatly by area of the US that you call home. So the median for many is skewed by east and west coast retirees needed income.
True, median pension from Calpers is about $47,000.00 so it does make a difference.
Thanks for the video, I need at least $3K in monthly pension & at least $1M to be living comfortably in America. Anything less than that I'll be living in a Skid Row or move overseas in Asia.
I am currently in my 50s and This is no time to taper retirement savings. I want to max out my retirement contributions and I also have another $200k in a savings account that i want to invest in a non-retirement account. Where should I invest it now?
The maximum cpp benefit in Canada is roughly a third of what's available in the US. $16,375 annually. It's depressing.
I'm lucky. Things are going well for me. My withdrawal rate is under 3 percent.
I recently retired and my pension and drop payments total $8100/month ($7400 after taxes).
My pension continues for life, but my drop money runs out in 3 years. At that time SSI kicks in
and that's $4400/month. Then it will be about $8300/month for life. In addition I have $594,000
in my 401k. If I don't go crazy with spending I should do ok.
Hey look into the WEP before you count your eggs. I'm in the same boat. All with pensions will be affected by the windfall provision.
Are you defining "retirees" as individual spouses in a 2 person household, or is this the "household" income per couple? BIG difference!!
The study looks at households, but many are headed by single filers.
@@foundryfinancial So roughly $50k median household income, not $100k?
How does a CFP guide a ‘younger person’ today planning for retirement and thinking about a retirement income stream they will need to make it? Major impending reforms to SS and Medicare are going to blow up the general wisdom of today. Just take two simple examples of SS FRA being increased even 1 year, or increasing penalty on collecting at 62 by another 20%, there must be generational differences built into the retirement planning software, right? When running generational data today, (median savings, median net worth, etc.) what does it matter if the expectations are going to materially change what ultimately projected retirement income is meant to support…it isn’t going to be an apples-to-apples set of rules….a younger generation person will need to have their retirement income work X% more than the older generations…with a crystal ball…what does a fiduciary think that % is applied to each generation after the boomers? At least for Millennials and Z, and targeting 62, back-of-the-napkin math shows a likely double-digit % increase from the conventional modeling of today….and converted to real present and/or future dollars…there are going to be many people that are going to cry real tears one day.
How you do in retierment depends on where you live. If you live in NY or Cal. good luck. I live in the south and my property tax is less than 1000 dollars a year. All other cost are also less. Ben
You obviously don’t live in Florida!!
Actually, in California it is pretty easy to retire in place. Especially if you have owned your home for more than a few years. Property taxes are largely fixed based on what you paid for your home. They limit the increase of property tax payment to under 2%/year regardless of the increase in the market value of your home. Also, if you decide to move elsewhere in the state you can take this low property tax amount to your new home if your new home is worth less than the market value of your old home.
Whatever your plans on retirement, make sure you account for RMDs.
I just turned 61 and awfully late to investing with barely any portfolio except my 401k, I have a decent amount of cash saved up and with inflation currently soaring AGAIN, I’m getting worried about retirement, my intention is to retire at 65 atleast, so how best do I maximize my savings of over $500k
For the average person, the strategies are fairly demanding. In actuality, most professionals who have the necessary abilities and knowledge to complete such occupations do so successfully.
Agreed, I always emphasize the significance of having an advisor. This has not only help to revamp my portfolio but has also kept me afloat since the covid-19 outbreak to date. I'm only about 10% shy of my first million dollar after subsequent investments.
The numbers are for an individual or a household?
Household
I questioned that also.
It would seem like 2 persons with SS would cover more than 1/2 of a $50K income.
90K income, from SS, G pension, rental income. It covers all expenses with left over. My 401k and mándame. CDs is over 1 million, with zero withdrawal. Age 66 and have no need to withdraw untill forced by Goverment mandate. How should I invest my 401K.
Since many retirees are married, are you implying that your average/.median incomes are 2x what you quote for the household?
Blue color worker...invested heavy in my 30s. I maxed out what the government would allow me to put into my 401K. 56 and just retired.
Wow…57,000 a year in expenditures! What the actual…? Except for unanticpated events, by 65 your goal should be to have paid off cars and a paid off house. I retired at 55 with everything paid off (now 63) and luckily have a decent pension and other investments (I don’t have to touch), but other than one year in retirement where I bought a good used car with very low miles for 24,000 cash, I haven’t spent more than 30,000. Including health insurance, car insurance, house insurance, income taxes, property taxes, heat/electric/food and 3 trips annually (U.S. usually driving but really enjoyable) etc…etc. I think people just live way beyond their means. We have a modest but nice 4 bedroom 3 bath home and 2 used but solidly reliable decent cars. I actually have saved money from my pension every year in retirement except the year I bought that car. When working we had a modest household income. Lessons for the young…It’s easier to be poor when you are young (because you are stashing away money) than to be poor when you’re old. Also along that same line, it’s not how much you make it’s how much you spend. Budget! This YOLO (you only live once) crap is ridiculous. And you may die tomorrow so enjoy…right? 🙄 Chances are really really good in today’s day and age you will get old. Then what.
Much bigger fan of median over average
"With one hand in a bucket of hot coals and the other hand in a bucket of ice on average am I comfortable?" Mark Twain
I had this conversation with someone recently. Median makes far more sense when the average skews the data so much. Most people don’t know the difference between average and median. In this case, where the highest number of people’s income makes much more sense than averaging out including the extremes.
That aside, the average or median really is not important when the cost of living and lifestyles are so widely different.
One thing that I didn't catch in this excellent video was the fact that in many, (if not most), retirees situations is as a couple and the video doesn't address the fact that in most cases there are two people with potentially two incomes i.e. pensions etc. Just wondering how that fact works into the calculations.
Thank you! The numbers are based on the household.
I’m single
Wonderful video. 😊
I'm glad you mentioned expenses. I'm out at the end of 2025 and will be doing the "bottom up" method. One year before retirement, determine your total annual expenses. Take that number and add in a 15% to 20% buffer for incidentals and emergencies. Take that total number and divide it by 0.8. The resulting number is the approximate minimum gross income you'll need during year 1 of retirement. Apply a COLA each year afterwards.
Thank you! Finally something I can relate too. 🎉
I'm make $50,000 per year. And I'm debt free! I've been retired now for 11 years and I was able to retire at age 53. Life is good.
Use the median and does that graph indicate couples or single people on how much they spend
what are those expenses ? a break down would be nice.
I am 71 years old, retired, debt-free, and have a positive cash flow. Do I need a CFP?
No, you need counciling on how not be arrogant in a comment section of people who are struggling. Have some consideration and be thankful, not boastful.
My dad is also 71 years old and is really well off and has a pension and a positive cash flow born in 1952
@firefeethok_tui2355
That person asked a honest question !🙄
You have to start preparing for retirement by your mid 20's! If you can systematically save for your entire
working lifetime, without 'raiding it', you should have enough money to have a "self-sustaining' fund! This
way, you can now withdraw a prescribed, annual amount, w/o ever reducing the principle! This fund would
be worth an estimated $300,000. which would generate some $15,000. interest a year, for life!
Sounds plausible provided you throw in a little family planning as well. Those little budget busters (AKA) Kids have a habit of wreaking havoc on the best laid plans . Lol.
I really like your videos. They are clear, detailed, and helpful. Thank you for that. I wish I had a local financial planner like you where I live.
With that said, I have always followed a passive index investment strategy. I have tried to minimize the investment expense rather than pay a manager to try to beat the market. Is is possible to create a holistic retirement plan but eschew active money management?
Thanks, Alan!
'Individual' retiree or' household' income? It is important to clarify in the script at the beginning of these type of videos (though it was alluded to nearer the end).
$57,818? glad i retired off grid. my projected out go next year is $23,482
god bless low needs and no family legacy...
Is the median pension the median of those who have pensions, or does it include people with zero pensions?
When you talk about average expenses and income, are we talking about individuals or households? I am somewhat surprised if we are talking about individuals.
Household, but of course there are a lot of single family households.
Great video. Thanks 🙏
Very interesting and informative, Thank you. However, of all the retirement posts I have looked at, I have yet to hear a CFP discuss those of us who were self-employed and invested in only dividend-paying stocks. Companies that have paid dividends consistently over 25 years with an average of 4% increases per year. I never need to touch my principle and live in dividends and SS only.
What are your thoughts?
Thank you.
Hi, a very interesting video. Can you make one on the pros and cons of HELOC or similar programs , for people 70+ ?
When you are discussing income, how is it defined? Is it the total of all sources, or is it what the IRS considers income for tax purposes? For example, my first 3 years of retirement looked like $0 income because I lived off of a savings account until age 65.
Good advise
Is average life expectency 95? Most retirees DON'T have 30 years ahead of them.
Thank You
people are becoming aware of the correct way to file for social security..wait as long as you can...
I've been living on a $20k/yr retirement with no problem.
What part of the world do you reside in ?
We need good skill sets to do well. I won t retire till 66 or 67
You're quoting the "mean" but the standard deviation is so great that it's really worthless and inaccurate number. Much more accurate would be the MEDIAN. The MEDIAN is substantially less than the mean and is much more reflective of what Americans really have. Do a video on the MEDIAN as the mean is a relatively worthless number.
I'm feeling pretty good. I have a lifetime annuity that with SS will give me 84k per year. Then 2 million in IRA, which I will let build ans give as generational wealth to my kids.
Retired this year at 61. With my home paid off.
If the fact pattern is true above, you may want to consider a partial conversion to Roth IRA from your IRA, cuz you'll never need the money. Thus they (your heirs) get when you pass receive Inherited roth ira's with the taxes already already paid. A great deal for them, and unfortunately for you get to pay the taxes but you are still in a wonderful situation.
@victorhanson1475 agree that is my plan. I am 61 now so until I can get medicare I plan to only convert 20K a year to get a good ACA credit. Then I will covert up to the max so I do not have to pay additional Medicare premiums each year.
Your numbers and comments reflect households. Is there a difference for single vs married folks?
Good video raw dog. 👍
When 'average' Social Security is quoted, is it AFTER Part B deductions or is it before?
Sorry if this was answered but is this 50K this per person ? Per household - double or single occupant?
Per household.
Average isn’t the correct measure. You should use mean.
Income is not as important as your expenses. Retired at 65 in 2021. Live in WA, only expense is home, life is great. This is BS, I bring home more retired then when I was working.
Guess what, before Ronald Reagan most people had a defined pension plan versus a 401K. But thanks to Reagan and his policies, Pension plans disappeared and were replaced with 401K‘s and unions also were basically destroyed during this period of time. You reap what you sow . Good old private sector, and Wall Street “saving” American retirement. Now retirees either have money or they don’t and people with money blame retirement failures on the less fortunate: “they didn’t invest enough” or they are “spendthrifts” Well, hard to invest when most folks live paycheck to paycheck. That’s MOST people.
Your statement is incorrect, you would be correct if you said that “more” people had defined pension plans, but “most” people did not have define pension plans. You also did not state that many pension plans were underfunded and thus not able to play the promised benefits. You should not rely on others (either government or your pension) to provide for you, instead you should ensure that you provide for yourself, thus that is where 401k’s, IRA’s, Roth’s of both of these, and real estate are things you can control and ensure your own retirement. It really is not that difficult, we did it on a single income and retired @60. The key is to live below your means, don’t borrow money, and don’t make stupid mistakes (divorce, buying new cars, buying more house than you need, crypto, smoking, drugs, etc), stay clear of these things and in most cases your will thrive.
Your statement isn’t accurate. And I would love to know what policies were enacted that caused private companies to drop pension plans. These companies were already walking away in droves because of the liability. Hence, the 401K was created.
Reagan was 40 years ago. Biden is now. Blame Reagan all you want, Biden has brought back Stagflation. Let me guess Union Teacher right?
Can't really blame Reagan. 401ks were introduced around 1983 as a supplement to as opposed to a replacement for pensions. That didn't happen till the 90s around the shift to managed care. I blame baby boomers an their hatred of their fathers' labor unions (see the movie Wall st for an explanation)
Funny how the private sector couldn’t make pensions work but if you have a state or federal pension it works and with cola increases. Wonder why….. Oh that’s right the taxpayer will pay for it and make up the difference. So tired of people I know retiring after 30 years ( age 50-55 ) and retiring with crazy pensions thinking it is normal. No it is not normal and it is also not sustainable. Federal and state pensions use to be because they didn’t make as much as private sector. Now they earn more and still get killer pensions. Government over spending is what is causing this crazy inflation and increasing retiree stress.
Retirees should not be affected as much by inflation as people who still have mortgages and debt. Well, smart retirees won’t be affected as much.
I agree, but other home costs are sky rocketing. apple.news/APwA5At_bTfu2YGcexZ2XYQ
You are still highly affected. Food costs, insurance costs, fuel and utility costs. I have been 100% debt free for years but my annual costs to just live continue to rise at an alarming rate.
We are experiencing not only unexpected inflation but hyperinflation in 2024!!!
what's a pension?
The things that were killed by baby boomers cause 'I can manage my money better'
Wrong they were killed because with the suppressed interest rates on bonds ( considered safe investments ) they could no longer afford to make payouts to retirees. Rates should have never gotten as low as they were. Savings and cost of capital should mean something but not in this crazy world. @@ronrollo5023
Something that Richard Nixon and Ronald Reagan killed
Averages are not good measurements. Median income more appropriate.
Sooo…if my house is paid off and my property taxes are waived (100% Disabled Veteran)…How much income do I need?
It depends on how much you spend. In reality it is a personal question and answer. What are your expenses? That basically is what you income will need.
This retirement planning is not hard. A home computer and excel spreadsheet ability is all you need. These videos are so dumbed down. I have $9800 monthly expenses and $12800 in monthly income. I am using a dynamic 401K withdrawal strategy. Right now, I am only taking 1.5% withdrawals. I have averaged 14% annual investment returns the last 5 years, including a positive return in 2022.
What's the median income from Social Security?
Far lower than the average worker 1916 per month I know of two folks getting less than a thousand per month
Most of these retirees are still making mortgage payments and car payments id bet.
OK, I'm just gonna tell you what I did then ask my question. . . I worked 2 full time jobs and one part time job for almost 50 years. My wife and I raised 3 kids, bought a condemned house (officially unfit for human habitation); I rebuilt the home in my "spare" time; I paid for my wife and I to go to college at night; we worked different shifts in a factory so one of us would be with the kids at all times; we never bought a new car, never took a fancy vacation, and just worked until we were physically exhausted. Now we are 68 and we've managed to have a retirement income that is $175,000 annually, this includes our two soc sec pensions and four separate pensions that we've earned. Question: did we do good or did we squander our youth? We have some major mobility issues now, but we enjoy life, we own our home, we own our used cars, we have no debt, I mean zero debt. We can buy what we want, do what we want, but we want very little. I'm sure we missed some great ops for life experiences, but we kept tomorrow in our sights. So, did we F up or not?
Money is not everything , it does help to live better, enjoy life , have memories to share with your kids and grandkids !!! etc,etc,!!!
Everything you do carries some opportunity cost with it. I know of people who spent every nickel they ever saw and are facing poverty in the elder years. It’s a trade off however one sees it.
Is this household income or single person income?
Household
fortunately I and wife have no debt, great federal pensions with health insurance at the employee premium + medicare, not taking SS until FRA + Va disability payments, wife took SS at 63 10 months. Not touching IRA/TSP other then Roth conversions
Its worse here, our economy is like a flailing fish, fighting for its life. The normal state of the U.S. economy is actually very bad. Because of this it goes into convulsive spasms fighting to grow any way it can out of desperation. Tricks, gimmicks, rule changes try to stimulate the economy and prevent it from falling but they only bring temporary relief to people since, when you factor in inflation we are declining.
I will have 10% withdrawal rate for five years and will then be able to live off Social Security and pension alone ...
The median boomer actually put some money aside for the rainy day
Not so sure about the current gen
Not true boomers that are doing well likely have a traditional pension as part of the mix. So in fact their employer or union put money away for a rainy day
Some investment advisors make a living scaring people into believing that they need a seven figure account to retire.
Too many comments by scammers and braggarts on these videos.