Poll

Do you contribute to retirement funds?

No
 Contribute <15% of take home pay
Contribute >15% of take home pay
Max out all retirement funds

Author Topic: Retirement Funds  (Read 64892 times)

Online AsherO

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Re: Retirement Funds
« Reply #280 on: August 30, 2021, 11:31:21 AM »
Major factor for me was you get ZERO once you die.
SHOW ME THE MONEY!  :)

OTOH if you (expect to?) live to 95 then you’re getting a pretty good return on that $2m investment, even if there’s nothing left at age 95.
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Online skyguy918

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Re: Retirement Funds
« Reply #281 on: August 30, 2021, 11:33:44 AM »
See what I wrote about depleting the principal. $3m would plan for leaving that entire sum available “after-120”. $2m would plan for leaving $0 after 16/17 years.
The math for such a strategy is simply dependent on both the earnings rate on the money and the draw down rate.

The $2m I quoted was for a male age 65 receive $10k per month in perpetuity. No running out after x years. That's the contract. My point was that if someone plans to leave the principal alone and live on the earnings, they'd do better to buy a lifetime annuity. Obviously it's not apples to apples for various reasons, but the point stands.

Online CountValentine

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Re: Retirement Funds
« Reply #282 on: August 30, 2021, 11:34:13 AM »
OTOH if you (expect to?) live to 95 then you’re getting a pretty good return on that $2m investment, even if there’s nothing left at age 95.
Are we talking about the same thing, SS? At least with an annuity I have 10 years payout no matter what.
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Offline dovy2

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Re: Retirement Funds
« Reply #283 on: August 30, 2021, 11:35:32 AM »
Why would someone need 10K a month after they are retired? If house is paid off, children married etc...

Online skyguy918

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Re: Retirement Funds
« Reply #284 on: August 30, 2021, 11:36:03 AM »
Are we talking about the same thing, SS? At least with an annuity I have 10 years payout no matter what.
Annuities can be structured in many ways. What you're talking about sounds like Life with 10 Years Certain. There's also cash refund (death benefit of purchase price less payments received), fixed death benefits, etc.

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Re: Retirement Funds
« Reply #285 on: August 30, 2021, 11:36:24 AM »
The $2m I quoted was for a male age 65 receive $10k per month in perpetuity. No running out after x years. That's the contract.
So no survivor benefits and no amount of years guaranteed payout?
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Online CountValentine

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Re: Retirement Funds
« Reply #286 on: August 30, 2021, 11:36:53 AM »
Why would someone need 10K a month after they are retired? If house is paid off, children married etc...
Life style. I need 4-6k a month.
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Re: Retirement Funds
« Reply #287 on: August 30, 2021, 11:38:28 AM »
Annuities can be structured in many ways. What you're talking about sounds like Life with 10 Years Certain. There's also cash refund (death benefit of purchase price less payments received), fixed death benefits, etc.
Correct but figures you have seem high. Probably because government annuities are a better deal?
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Online skyguy918

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Re: Retirement Funds
« Reply #288 on: August 30, 2021, 11:40:56 AM »
So no survivor benefits and no amount of years guaranteed payout?
Yes. But at age 65, adding guaranteed years won't add much cost - certainly not small guarantees like 10 years. Adding the spouse is more impactful (as I quoted above), with 50% survivor benefit obviously being somewhere in between.
Correct but figures you have seem high. Probably because government annuities are a better deal?
Unlikely. As I said, you can't compare a few years ago to today at all.

Offline ushdadude

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Re: Retirement Funds
« Reply #289 on: August 30, 2021, 11:42:18 AM »
See what I wrote about depleting the principal. $3m would plan for leaving that entire sum available “after-120”. $2m would plan for leaving $0 after 16/17 years.
is 17 years enough? you also assumed expenses go down as you get older. That should be true for things like mortgages and child related expenses but things like medical expenses and taxes tend to go up.

Online skyguy918

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Re: Retirement Funds
« Reply #290 on: August 30, 2021, 11:45:19 AM »
is 17 years enough? you also assumed expenses go down as you get older. That should be true for things like mortgages and child related expenses but things like medical expenses and taxes tend to go up.
Taxes don't have to go up if you've structured things well to that point. Medical is important, and a major component of retirement planning. Having an employer with retirement benefits makes a huge difference. Without that, it absolutely needs to be budgeted for as a major component of expenses (more so than during working years). Getting a LTC policy is looking increasingly important. And the list goes on.

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Re: Retirement Funds
« Reply #291 on: August 30, 2021, 11:48:37 AM »
Unlikely. As I said, you can't compare a few years ago to today at all.
You are correct. Government plan is a little less that but as you have said you didn't shop around.
65 year old for both - 1.95m but lets say 2m cost
Monthly payouts
10k straight up
9.1k with cash refund
9.8k with 10yr certain
8.2k 100% survivor
9.8k 50% survivor
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Offline ushdadude

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Re: Retirement Funds
« Reply #292 on: August 30, 2021, 11:59:27 AM »
Taxes don't have to go up if you've structured things well to that point. Medical is important, and a major component of retirement planning. Having an employer with retirement benefits makes a huge difference. Without that, it absolutely needs to be budgeted for as a major component of expenses (more so than during working years). Getting a LTC policy is looking increasingly important. And the list goes on.
property taxes almost always do

Online zh cohen

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Re: Retirement Funds
« Reply #293 on: August 30, 2021, 12:01:12 PM »
Everyone I know it is the best decision they ever made. One neighbor retired a couple years ago at the age of 53. My other neighbor just retired last week at the age of 51. Trying to get the neighbor across the street to retire and he is 55. Best advice I can give is retire as early as you can.

You should look up the research into the health impact of retiring and retiring early.

Offline Fish Tank

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Re: Retirement Funds
« Reply #294 on: August 30, 2021, 12:01:29 PM »
property taxes almost always do
Generally seniors downsize to a smaller size home. . .

Offline Fish Tank

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Re: Retirement Funds
« Reply #295 on: August 30, 2021, 12:02:11 PM »
You should look up the research into the health impact of retiring and retiring early.
There's always DDF to keep them busy  ;)

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Re: Retirement Funds
« Reply #296 on: August 30, 2021, 12:03:52 PM »
You should look up the research into the health impact of retiring and retiring early.
I did. You live longer doing the things you enjoy instead of doing things you must.
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Online AsherO

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Re: Retirement Funds
« Reply #297 on: August 30, 2021, 12:05:44 PM »
There's always DDF to keep them busy  ;)

Can you retire and MS at the same time, or is that an oxymoron?
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Offline ushdadude

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Re: Retirement Funds
« Reply #298 on: August 30, 2021, 12:05:53 PM »
BTW just to put a number out there, if you want 10k a month to live, you need to save 3mm for retirement (assuming a 4% draw which is what is usually recommended to make sure you don't run out of money)
yes...I made a very broad statement.
obviously this doesn't cover every situation. My point is that retirement costs a lot more than people think. Having 500k squirreled away isn't gonna cut it.

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Re: Retirement Funds
« Reply #299 on: August 30, 2021, 12:06:06 PM »
Generally seniors downsize to a smaller size home. . .
...I hope.  :)
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