my dad is 47 and he's retired . he started working for the city as soon as he graduated highschool .
you can retire at any age if you wish but SSI will not be available to you.
I bought a van new and live in it. After 2 yrs it was paid for. I go to the 24/7 gym at $25 a month for showers. I stay mostly at Wamarts and different hotel / motel parking lots. I have a quiet Honda generator to run my window ac and or heater. My only expense is food. I still work and no one knows what Im doing because they just wouldnt understand. I love the travel. Im in Florida right now. Ive got $8,200 in the bank. How many people can say that? It was tough at first but as long as your bed / cot is comfortable it makes life simple. Renting or even a mortgage is a waste. All that space was wasteful and I was never there to enjoy it. I was only in the bedroom, kitchen and bathroom. The other 2 bedrooms and bath I was never in. Marriage is out so dating is cheaper because I'm 51. Once or twice a month I will get a $40 motel room for my one night stands. Google van living or rv living. In the end its ALL about the money saved, not what you spent. Stuff I dont need or want. Any questions patricklp773@gmail.com
Whats the difference between me and a 65 yr old retired couple with an rv? They paid $600,000+ for their rig and I paid $12,000 for mine. Their tires are $600 each, mine are $52 each. Their gas mileage is 8 mpg, mine is 28 mpg. They pay $60 to $120 a night at an RV Park, I pay nothing. Their insurance is $1,200 a year, mine is $280 a year. I can park anywhere, they cant. See where I'm going with this?
I retired at 50, so I have some relevant expertise. My thoughts:
- By 2032, you will likely need more than $2 million for a decent lifestyle.
- Note @Frank's comment about sustainable withdraw rate. At age 40, even 4% is probably too high.
- You need to make more. $50k at 22 is fine, but you need a few big years.
- My biggest expense in retirement has been taxes rather than food, shelter, health care.
- The biggest threats to my retirement are the government (taxes, deficits) and inflation.
The single best thing you can do is invest in your own education and credentials. Build earning power. Consider starting a business at some point. Ignore anything that looks like a get-rich-quick scheme.
Where there is a will, there is a way.
I don't believe this question should be in the 'investing' section, as much as it should be in the 'budgeting' section. The first question is: On what type of budget do you hope to retire?
For instance:
*How much does your cost of living require (in retirement)?
-home taxes
-food
-entertainment
-location
-money for emergencies
-etc
-etc
Hopefully you get the picture. I would wager that you could retire right this moment if you chose, as long as you chose a state with a low consumer price index (items are inexpensive) and you have enough money. There is a line you have to draw for yourself, however... for instance: Are you willing to live in a foreign country (where the USD goes much farther)? I for one, would not.
Like this comment? Please check out my financial blog: http://paulkarch.blogspot.com/
The assumptions in that blog are bit unrealistic. I'll go through them:
If you save 55% of your take-home pay, you will build up a nice amount of savings. That's more than half of your pay going straight into your savings. Most people struggle to save 15% of their pay.
Withdrawing 5% a year is a little high. For your principal to keep up with inflation, a 4% withdrawal rate is more realistic.
So, Floyd goes from making $180k his last year of work (40 years old) and having $73k to spend after he pays taxes and save to living off of the earnings on $902k. 5% of that is $45k. 4% is $36k. Whether you use 45k or 36k as the number, that's a huge difference. A lot of people could retire early if they started living off of half as much money (the samurai's 5%). At a more realistic 4% withdrawal, Floyd will have half as much money to spend each year if he retires.
Here's the other sneaky part. Floyd is getting huge pay raises each year. That's unrealistic.
So, to summarize: you can retire at 40 if you save more than half of your take-home pay, get annual raises while you are working that are much higher than normal, and then start living on half of what you used to make.
Saving for retirement is important, and the sooner you do it, the more you will end up with, but these numbers are too optimistic.
NOPE. {And I totally agree with Ursugardaddy.}
Simply math: If you lived on air and love, paid no taxes, and banked every penny ... $50,000 a year for the next 18 years only gets you near $1m. (anything extra would more than be offset by inflation).
But if you do want a decent life in the future, buy a house now, while prices and rates are down. Maybe even go with a 15 yr mortgage.
... and do not come on here and insult people that have decades of real world experience.
How are you going pay for medical expenses? What if the market lose 20-40% of its value? You are 22 so its time to grow up and stop with the day-dreaming
Best of luck
visit a library to learn what "retire" in real world actually means.
visit AARP.org for real world info.
"retire" is NOT what u think.
u will WORK after u 'retire'.
do some more learning.
do get some books on TAXes also to learn
about 'retirement' taxes.
I'm 22 and I want to retire early. I make $50,000 per yr and want to know how to do it. I found this and it seemed interesting:
http://www.financialsamurai.com/how-to-retire-early-and-never-have-to-work-again/
Is what this samurai guy saying legit?
I am also 22 and plan to retire early at 55 years old. Honestly it is unlikely that you will be able to retire at 40. Let's assume that at 40 years old you have $2 million dollars. Now let's assume you live until at least 70 years old. That means you will need your $2 million to last at least 30 years. But in reality $2 million will only be worth about $700,000 30 years from now. If you were to retire at age 40 and lived until lets say 90, then you would probably need around $5 million to live comfortably. That's 50 YEARS you'd need to live off that money, it's a long time.
If you do want to retire early I suggest retiring at age 55. It's a lot more realistic and a lot of people do it now days. If you work until you are 55 and assume you have an annual 3% raise your salary at age 55 would be $128,000. Most financial advisers say we should have 25 years worth of 80% of our last working year salary, which in this case would be about $102,000. Times that by 25 (assuming you live until you are 80) and you get $2,560,000. In your case you would need around $2,560,000 pre tax dollars to retire at 55 and live comfortably until you are 80.
Every persons situation is different though. You may not need as much to live off compared to others or maybe you want to pay for kids education so it really just depends on your situation. Also I recommend owning a house when you retire vs renting, you save a lot of money that way.
Unfortunately retirement isn't cheap, thank inflation for that.
2 million 18 years from now wouldn't let you retire at 40 and live at the level you're living now on 50K a year.
I read Financial Samurai's blog a lot. Yes what he is saying is legitimate. You should read some of this articles.
If you want to retire early, you need to save and invest a lot of money, starting right now. You should calculate for yourself how much money you will need in retirement. You will need to decide how much money you will need per year, and how many years you have from retirement until death.
If you retire at 40, and live until 100 (very possible for you) then you have 60 years in retirement. If you start with $2M, and don't have it invested, you have $33K per year to live on until you die. However, if you have that $2M invested and it has an average return of 3% a year, you can take out about $72K per year until you are 100. If you only have $1M when you retire, divide all of these numbers by 2.
That might sound like a lot, but remember prices are always rising, and as you get older you may have children, a spouse, grandchildren, expensive health problems, etc. Ask your parents/grandparents how much gas cost when they were your age. When you are 60 it may cost $30 a gallon.
Whatever you do, start saving and investing now. Time is on your side, and whatever you decide to do, it gives you more options.
