We could debate for a long time what a reasonable rate of return is. I asked AI what the average return was and it suggested between 5% and 8% so that is the table I created.
While I'm sure there are useless employees in USA I'm not sure that every overseas seat is useful... I recall Donald's thread about what he had to go through to get an IT position, and I have to figure, there were more than a few pencil pushers involved in managing that mess.
Retirement is always different than planned.I wish I had started at 8%! I flat out did not trust the idea of saving and investing when I started my career, and so I only did 3% (and got a 3% match--had I done at least 5% I could have had a full 5% match!). I had a fundamentally wrong idea that people made money on the stock market by timing the market. Took too many years to learn otherwise.My only gripe and it's 100% on me.
I really should have STARTED at 20% retirement savings instead of 8%. All the dopey pre-internet pamphlets said 8% would be adequate. When I woke up and said, no way (around year 2001) was just barely in the nick of time. Point being, catching up is tough. I loved they added the 55+ catch up amount. I don't remember exactly but after the kids were out of school and flown the coop we were saving $4500`+ per month. Now we only save a few thousand per month.
And the positive....you are retired AND saving a few thousand a month not drawing down. That is way better than many/most.My only gripe and it's 100% on me.
I really should have STARTED at 20% retirement savings instead of 8%. All the dopey pre-internet pamphlets said 8% would be adequate. When I woke up and said, no way (around year 2001) was just barely in the nick of time. Point being, catching up is tough. I loved they added the 55+ catch up amount. I don't remember exactly but after the kids were out of school and flown the coop we were saving $4500`+ per month. Now we only save a few thousand per month.
Its hard to convince a 20 something year old that the "pennies" they put away in that decade will be the most valuable ones they ever save.. I was lucky enough to start putting away 11% +5% match at 23. Looking back at the actual amounts back then they were tiny compared to what I save now, but the "snowball" that they created generates more money every year than my current contributions. I'm 38 now and feel like I'm right on track.My only gripe and it's 100% on me.
I really should have STARTED at 20% retirement savings instead of 8%. All the dopey pre-internet pamphlets said 8% would be adequate. When I woke up and said, no way (around year 2001) was just barely in the nick of time. Point being, catching up is tough. I loved they added the 55+ catch up amount. I don't remember exactly but after the kids were out of school and flown the coop we were saving $4500`+ per month. Now we only save a few thousand per month.
The below link has to annual return for the S&P 500:
When starting out, building the nest egg, putting in as much $ as possible is beneficial. Later in life, the compound interest factor is lessened, thus, it's not as important. In fact, I'd have stopped entirely, but I wanted the companies 75% contribution match.My only gripe and it's 100% on me.
I really should have STARTED at 20% retirement savings instead of 8%. All the dopey pre-internet pamphlets said 8% would be adequate. When I woke up and said, no way (around year 2001) was just barely in the nick of time. Point being, catching up is tough. I loved they added the 55+ catch up amount. I don't remember exactly but after the kids were out of school and flown the coop we were saving $4500`+ per month. Now we only save a few thousand per month.
True, but the market run starting about 2010 has been unprecedented. I wish more people followed your advice; it is thought 50% or more Americans live paycheck to paycheck. Of course there is more to it than that, but just the same...
The Nasdaq is up 24% this year. It's a bit more scary than investing in an S&P index fund, though.
Do others agree with this? Especially in my case I stated I am on the cusp of retirement and the opportunity to recover from a deep loss is not there? I know people who lost 1/3 of their savings during the 2008 downturn. I was taught to manage your investments for stability at, and into retirement, not risky gains. I experienced at least three recessions - some got beat down severely.
You forgot to mention the pension is underfunded because they keep refusing to properly put their amount in. Current governor ran on fixing it then promptly forgot.
Yes, but there's a caveat. Here's the numbers:
My $.02 - comes down to your risk profile. If you are at the point that you can tolerate lower returns with what you have saved and are risk adverse, nothing wrong with that. If you can't tolerate the drop and don't have time to wait for the ride back up, hopefully you have enough saved you can be more risk adverse.
And that's what it is really about, right?
You need to talk to Schwab. They can help you find a balance; that balance is based on a big number of things. Do you have a home free and clear that needs nothing? Your health and life expectancy? Your goals?
