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Thread: what is neccessary to retire?

  1. #1
    God/dess Lena's Avatar
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    Default what is neccessary to retire?


    I know everybody's different, but for you guys, what do you need to have before you retire?

    I think for me I need to have my house free and clear (done, but I'd like a different one now..), no debt (done), a fun way to make extra money, and about a hundred thousand dollars invested. Am I way off?



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    God/dess montythegeek's Avatar
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    Default Re:what is neccessary to retire?

    I am not playing word games, but I think the key is to turn the ? around. What does it get you to keep working in your present job? If you like it and still make enough extra to keep you going to work, then do it. If you are comfortable with the other income, or don't like the job unless you made even more money, then retire.

    If you are mired in what you are used to doing because of inertia, take some time off to think about it and try the other world. Go sit on the beach, or at the pool, and consider what things would be like. You might be surprised one way or the other. Money is just a tool to be happy. All we can do is give tips on making what you want out of the tools,

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    Veteran Member SaraNLA's Avatar
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    Default Re:what is neccessary to retire?

    What dollar amount should you have in the bank to live on per year, or should, as Lena said, that money be invested?

    And forgive me for being rude, but how old are you, Lena?
    Let your indulgence set me free. - Shakespeare

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    God/dess GoldCoastGirl's Avatar
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    Default Re:what is neccessary to retire?

    I will semi-retire (work less) when I have $400 per week in passive income (money works for me not me for money). I will definately retire when I have $800 per week in passive income.

    I do not care how I acquire that passive income - residential property investments, offshore investments, businesses (that I own yet can run well without me) - just as long as I am in a situation where money is coming to me without me having to necessarily work for it (currently if I don't work, I don't make any money).

    I try to pay off any debt first and foremost. Then invest.

    PS I was born in late October 1978 (for my age)


    enter: E3167322D9 for your 10% discount

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    Banned Melonie's Avatar
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    Default Re:what is neccessary to retire?

    These days $100,000 in investments is going to generate perhaps $8,000 per year in passive income at best. To seriously consider retirement as I am, you need about 5 times that much to generate sufficient annual passive income to live on !

    As far as mortgages, due to the tax benefits of paying mortgage interest in the US and the continuing appreciation in property values, I consider real estate purchase mortgages to be an investment and not a debt.

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    God/dess Lena's Avatar
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    Default Re:what is neccessary to retire?

    Sara, I'm in my early twenties.

    Mel... hmm... I think I could live on 8k a year, plus the money I make with my side business. I probably could live on the money I make with the business now, but I would be broke and it would suck. But, considering that I have no mortgage, car payment, etc, I think $1,000/month is enough...

    Monty, that's kinda the problem. My life is in the "other world" (I have a small business and I go to school and I do a lot of volunteer work in the child welfare system) and I'm getting tired of living in the "night world" and the "day world" at the same time. I've been offerred a part time real job that pays pretty good as far as real jobs go and is in the feild I'm studying and that I would enjoy... but it's still much less $$ then dancing. But I'm starting to think that might not matter so much. But I don't want to look back in a few years and wish I'd danced, either.

    Lena



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    Default Re:what is neccessary to retire?

    to retire you need a passive income EXCEEDING your monthly expenses. A great example is income-prodicing real estate properties. Actually, owning real estate or a SOLID corporation or business is the only way I would be comfortable during retirement. \


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    God/dess montythegeek's Avatar
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    Default Re:what is neccessary to retire?

    Lena, It is gonna sound silly but I have a simple exercise for you to consider trying. Sit down with a blank sheet of paper nd figure out where your money has come from and gone in the last year. Then where your money would come from and go if you retired. DO BOTH SIDES OF THE LEDGER, do not just add up the income side. If you are in your early twenties have a house, car, paying for school, and a hundred K in the bank/investments the odds are you have been saving upwards of $50K a year. Your post-dance income can be that much lower and you can still spend what you where. Your taxes go down too, quite a lot which cuts you some more slack. So do expenses. There may be a way to dance on weekends for fun money, if the career/job/future permits. If you can make enough to save that much that soon, odds are where you work at the club would like to keep you there at least part time. Would you be able to not stress so much after you graduate? Is part of your current busy schedule able to be put on hold for a year or two. There is also no rule that says you can't supplement the return on your savings with dupping into part of the principle if the career path says your income 4 years from now is higher than it would be tomorrow. Odds are you are not saving the money to leave a big estate but to be happy.

    RYAN is right in one imprtant regard. You can make higher than CD/dividend returns in some businesses like rental property. Those also require some risk and some effort but can produce a higher return than Mel's normal portfolio return. It is not for everyone, but it is an option. If you have been saving upwards of $50K per year in six months you could save enough to have a portfolio you reduce $5K a year for 5 straight years or $25 K and still have every dime you have today. You could do that with the principle you already have and still end up with more in 5 years than 90% of the people your age. Do the math and figure how much you need to "buy your way out" and not feel like you cheated yourself.

    Hindsight is always going to be myopic and what-if-I-had dones are always going to appear better than what you did do. It sounds like you are pushing yourself awfully hard and are a little stressed. You will never get yesterday back and tomorrow comes only tomorrow.

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    God/dess Lena's Avatar
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    Default Re:what is neccessary to retire?

    Monty, oh, no, I definitely haven't been saving that much or making enough to save that much. I made/saved most of my money when I was younger (I know, I am young, but I was really young then :-) ), but then I spent most of that buying my house. This summer (since schools been out) I've been saving $4-500/week, but then some of that will go for school, and I want to fence the back yard in. So I don't have anywhere near 100k - I was asking if that was a reasonable goal. I can see that in about three years of dancing, I might have 100k saved up, whereas it might be like ten years of a real job (but then, my income would go up over time). Or if I invested in real estate, less, I guess.

    This is too complicated.

    Lena



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