Retirement

[Cole]

How are you guys saving for Retirement? I am only 24, but its something I think about daily.
Any of you have Financial advisors? I believe I am going to try and get one at the begining of next year.
What age do you plan on retiring?

 

[kid rok]

I will never retire, the trick is not to rack up debt. You can live like a king on 50 thousand with no debt. Be broke as hell making 500 thousand with debt. As far as retirement money I invest in properties and hope to have over a million in rentals and other properties when I get older.

 

[Bones]

35, been adding to it via 401K for god knows how long. Little here, REAL little there, more now, pulled some out during my divorce. I am at a measly 100K +/- and never plan to be able to retire comfortably.

 

[BamaTJ]

Not an FA, but do have an idea. Start with your employer and see what they offer in the way of retirement. Most employers offer a 401k plan in which you put in X percentage of your salary each year before taxes. This is good because it lowers your taxable income which means less money to uncle sam. At your age I would start with a manageable % you can afford, but at a minimum 2-3%. Most employers will add matching contributions, once a year contributions, etc (known as vesting) based on years of service mainly. All companies are different in this area so check it out. If your employer offers nothing in this area or you just don't want to go that route, then open a traditional or roth IRA through any decent financial instituion (I have one of each with Fidelity). This money is not deducted pre-tax generally, but a % of the amount you put in each year is tax deductible on your taxe returns. There are lots of things to consider in terms of taxation and benefits of a roth vs traditional ira, so do some research online and see which is best for you. Roth is more popular because it is a little more flexible on emergency removal of funds.

At your age start small and ramp up each year as you get older. If your money is invested in a good fund it will make steady 5-10% returns each year and since the money is off limits it adds up quick. I am 28 and started saving small about 3 years ago with a company 401k @ 2% contributions and $100/month into my IRA and I just looked today and I have $12k in my accounts. The average return on my 401k is 15% so it is killing it!

Hope this helps, good financial sites or places like fidelity.com are good resources to study up on this stuf.

 

[Cole]

I have a 401K at work which I put 20% of my paycheck in every week have been doing it for almost 3 years. The thing that sucks is they dont match anything at all. I also have a Roth IRA I have been doing for about 5 years. I try and put the max into it at the begining of every year so that it draws interest all year long.
Sometimes I just don't feel that it is enough because you have to be a certain age before you can draw the money out.

I was always told the money I saved before age 30 would mean the most.
I know I want be able to continue saving like this forever because I would like to buy a house in the next few years and that will take alot of my money.

I would like to get into the stock market alot more, but I am not sure how to go about it.

 

[DavidsCJ7]

You are very wise to begin thinking about retirement and saving at such a young age. I have been contributing to a 401k for since I was 30 (4 years) with a company match of 100% for the first 3% and 50% of the next 2%. I recently moved most of my retirement into high risk investments, with hopes of long term success. I also have another savings account that gets a little here and there. I am planning on retiring at age 55.

My advice is to pay yourself first. Before any bills, food, toys or anything else, pay yourself atleast 10%. You will be surprised that you don't even miss it after a little while.

 

[John Galbreath Jr.]

. The thing that sucks is they dont match anything at all.

I would check again, knowing who you work for. They may not match until you have been there for a period of time. At my company, I 50% match up to 6% of salary. So, employee puts in 6%, I put in 3%. They cannot touch my 3% until they have been with me 5 years (vesting).

 

[Cole]

I would check again, knowing who you work for. They may not match until you have been there for a period of time. At my company, I 50% match up to 6% of salary. So, employee puts in 6%, I put in 3%. They cannot touch my 3% until they have been with me 5 years (vesting).

My Dad has worked there for29 years, they don't match.
They give you like $2.40 a week and once you retire you have to pay back what they gave you.

 

[under_psi]

They give you like $2.40 a week and once you retire you have to pay back what they gave you.

that does not make sense....

i HAD a roth IRA...but had to cash in to get out of my last marriage....

i have been the head chef at BRAVO! for 10+ years...we ahve NOTHING.....

my new years resolution is to put $400 a month into a roth IRA and start saving....lord knows i cant work 70hrs a week in a restaurant for the rest of mah life.....

 

[DavidsCJ7]

In my position (HR) I see so many people in their late 60's and 70's that don't have anything. No retirement, no insurance, and stuck in a minimum wage job, because thats the only place they can find work. You don't want to be in that position. Go see a financial advisor. The cost of a consultation is usually minimal or free.

 

[BamaTJ]

You sound like your are ahead of the curve Cole as you are putting in a good bit to your retirement accounts at a young age and have been for some time

 

[blacksheep10]

cole, you are WAY ahead of the game. here's how it was put to me. your Simple or 401K goes in pretax. when you draw it out, (in 40 yrs) you will will be taxed on that as income then. Okay, lets say you saved enough to pay yourself 50K per year for the rest of your life. you are taxed like a person making 50K, pretty hefty tax bracket. A roth is post tax. you can save any money you come across if you can prove you make that much (no drug money). you earn on that money and also get to deduct that. when you retire and start taking it, you aren't taxed on it coming out. I've been told to put whatever your company will match and then some in the Simple/401K and then half that much in a roth. My boss matches 100% my contributions up to 3%, my money since day 1.

 

[InDaShop]

Max it out each year, with or without employer contributions. 401k max funding was $15,500 this year, I think its $16k next year for our age group. Knock it down so you pay less income tax now when it counts. And for all you guys that mess around in your 401k, get it over to the foreign funds as soon as possible. I've been 70+% overseas for over a year. Mo Money'!!! American dollar isn't worth ****.

Debt, get the fawk out of it. Kick scream, lie cheat, whatever, just get out of it.

I may be a trader but financial planning isn't my thing. I probably leave money on the table in some areas, I need to button those up. I sock everything I can away. I owe on two things, my house (no ****) and my wifes car (doh). Everything else gets put away. And like Dave said pay yourself 1st.

I started a car account to funnel money through that I was cool with using for hobbies. Thing is a life saver. If I dont have dough in there, I dont get to do it. The last 2 months, nothing in there. But I expect Jan-April to be good, so thats how I'm going to run XRRA (maybe money gives out after 1 race, hopefully not). How did I buy a buggy? Ask Kelly (Blacksheep), I've been shopping for one for 18+ months and been socking a rediculous amount of money for buggy or build for close to 4 years. Yeah I know, no wheeling except as a rider, but now I'm feeling pretty solid.

Also you'd be amazed at where you can add value to your pocketbook. If you always have a lil cash cushion, you can always jump on that HP60 that so and so is offloading for $700 cause he needs to dough. Then flip that bitch for $900-1000. I just made my Christmas money on selling a f'load of SBC parts that I completely bought on spec cause the guy was going vintage Ford Flathead in his hotrod. Know whats hot, know whats not, know what you can move and the value of it. Cash is always the best to be liquid, but if you can flip something for some coin do it. We are in prime parts swap season as guys are all buying building, and the opposite guys are selling crap to pay for Christmas, and April 15th.

 

[kid rok]

Forget 401k ****, get into real estate. If you start now by the time most think about retiring you'll beable to retire.

 

[wngrog]

Best advice I can give you is to sock away 10% and pay your bills the minute they arrive. You can do amazing things with your life with a good credit rating. You will always pay less interest and have opportunities not available to others if you have a good credit rating.

Lots of good info in this thread. So far I have not seen any that is bad.

 

[BamaTJ]

Don't take your credit score lightly, I learned that today. It is a long story, but basically a utility fawked up a year ago and I just now found out about it today. There fawkup cost me 100 points on my credit score, but I got it resolved in time. Luckily I found it 4 months prior to closing and not a few weeks. Don't take things for granted and always pay attention to things involing your person.

 

[wngrog]

Just an example. Great credit-qualify for 0% financing when the local stealership runs the promotion. Bad to moderate credit, pay 8% for the life of the loan. That hurts.

Add that same scenario to a house payment and it could cost you upwards of 100,000 over the life of the loan.

Saving is awesome but it is only one part of the puzzle.

I use credit for everything because I am a points junky. That said, I don't carry CC balances that cost me interest.

 

[P]

Cool thread, Im only doing the 401K thing personally right now . I dont want to retire per say though, Id rather stay busy like a bee

(Mine is matched from the company up to 5% of my annual salary )

 

[InDaShop]

I use credit for everything because I am a points junky. That said, I don't carry CC balances that cost me interest.

Agreed! If you think you are weak, and could possibly over spend and let it ride the card. Get an American Express. You have to pay it off every month. If you go to buy something you always think twice about paying for it by the end of the month. I know I do, and sometimes, I'm like, naw I really dont need it that bad right now.

As for points. I'm a junkie too. This past January, my wife and I took a week long trip to Cali. We paid for our flight there and back, our rental car for the week, and 4 of the 7 nights we were there with points. The other 3 nights we were staying places that points wouldn't work at. Cheapest trip eva'!
And how did we swing it? By just using our AmEX's for everything, gas, food, everything. We didn't change what we were buying just what we were buying it with. Why not get rewards for business as usual?

 

[wontwork]

I am also 24 and saving. I don't have to worry about the 401k since I am a state employee, but investing with an invester is a good idea. They have plans that you can put your money into stocks and make money with and you can loose alos, but you can set it up where you only loose what you have gained in stocks not what you put in. I just recently got some life insurance for 20 years I pay the amount I choose which is $33 a month which covers me for 150,000. After 20 years I either die and someone else gets the money or I get what I put in it. Just be wise and put your money where it is safe. I also done the house thing, but I remodeled to save money, so you might also want to think about that.