This year I dropped my retirement savings to minimum needed to get my 401k match plus max out my Roth IRA. In my early 50's and have enough saved that my chance of success was already above 95% even dropping my savings rate this low and retiring at 60. Longevity is not likely for me and I have plenty I want to do while I can so I am doing exactly what you are saying in this video and living now.
My 92-year-old father and his 87-year-old wife like to bemoan inflation and the fact that their pensions are never adjusted. Not long ago, I (67 and retired) realized that at their ages, they must be getting a lot of money from their IRA distributions. I asked where their IRA distributions are going. I learned that their financial advisor is rolling the IRA distributions to their taxable brokerage accounts. I tried to explain that the RMDs should be seen as their money to live on and to spend, but they looked at me like I'm nuts. Sigh.
Funny, my house insurance just went up 30%, I called the state office that monitors companies and they said 50% is the norm. It's unsustainable, thinking of getting a FT job as I work PT now and husband is retired.
Drew, I am wondering if at 61 1/2, no debt , single, with already at $1M in retirement savings, do I really need to be saving 30% of my salary towards retirement, which I have been doing for many years. Or can I take my foot off the gas a bit and cut it in half to maybe 15%? I will need right around $4000 a month in retirement to live comfortably. I plan on retiring at age 63, 64 at the latest. Any quick thoughts?
You can quit saving completely right now and will be more than prepared. You don't mention what type of accounts hold your savings and if you are looking at 4k pre-tax or post tax so I will go with everything in tax-deferred accounts and 4k post-tax as a worst case. As an example possibility for your scenario you could retire at 63 and set aside 450k in a cash type investment (money markets, short term bonds, etc.) and use that to pay living expenses for 7 years until age 70 (5k/month for 7 years = 420k and I threw in some extra just in case). At that point you file for SS with max payments and chances are you are going to be able to live almost completely off of SS. If not what you need will be very limited, probably no more than 1-2k/month. That 550k you still had sitting could be invested relatively aggressively and grow quite a bit in that 7 years. Even if you decided to not go aggressive, you would still have over 825k now sitting in that account assuming only a 6% annual return rate. If you were fully in tax-deferred accounts, your main problem is actually going to be RMD's kicking your taxes into high gear, not whether you had enough saved. You could also go ahead and file for SS at any time and save the up front distributions and just need more from your portfolio later, which again might not be a bad idea if you are fully tax-deferred. What is best for you is same as everyone else and there are too many variables for one size fits all. But short answer to whether you can reduce your savings rate is ABSOLUTELY you can.
@@chriskasprzyk6235 I have $210,000 in Roth IRA, $750,000 in 403B and $40,000 in taxable online savings account. 4K month, pre-tax. SS showing at 70 to be $3650 a month.
I saw your RUclips vids, and they're awesome! But I think they could be even more awesome with some better editing and thumbnails. I'm pretty good at editing and designing thumbnails, so I could help you out if you want. That way, you can focus on making even better vids! Plus, you'll save time and can pump out more vids. With my help, you can reach out to a lot more people too! Let me know if you're down! and if you want i can do the shortfrom too
I saw a great saying on Facebook today it said "Just buy the boat. No sense of being the richest man in the cemetery". Of course it does not apply to everyone but have a goal and enjoy life along the way. No point of pinching every penny to die with tens of millions but on the flip side, you don't want to work until you are 80 either. You are only in your 20s, 30s and 40s once so things like boats, ATVs vacations are more fun at those ages but make sure you don't have work late in life.
*Free Retirement Download: The Checklist to Retirement:* 📊
pearlwealthgroup.com/
This year I dropped my retirement savings to minimum needed to get my 401k match plus max out my Roth IRA. In my early 50's and have enough saved that my chance of success was already above 95% even dropping my savings rate this low and retiring at 60. Longevity is not likely for me and I have plenty I want to do while I can so I am doing exactly what you are saying in this video and living now.
Thanks for sharing!
💯 agree
Thank you!
My 92-year-old father and his 87-year-old wife like to bemoan inflation and the fact that their pensions are never adjusted. Not long ago, I (67 and retired) realized that at their ages, they must be getting a lot of money from their IRA distributions. I asked where their IRA distributions are going. I learned that their financial advisor is rolling the IRA distributions to their taxable brokerage accounts. I tried to explain that the RMDs should be seen as their money to live on and to spend, but they looked at me like I'm nuts. Sigh.
My wife only heard Drew say to spend it now 😂
HAHA
😂😂😂
Funny, my house insurance just went up 30%, I called the state office that monitors companies and they said 50% is the norm. It's unsustainable, thinking of getting a FT job as I work PT now and husband is retired.
Our home insurance went up 33% and health insurance 10%. It's crazy!
I spent all my money before 50, now i need to save like a maniac for 10 years.
You can do it!
How does a 50
yo retire when their money is parked in 401k and IRA? Is this advice predicated on having loads of liquid cash?
Nope. Rule of 55 or 72T.
Drew, I am wondering if at 61 1/2, no debt , single, with already at $1M in retirement savings, do I really need to be saving 30% of my salary towards retirement, which I have been doing for many years. Or can I take my foot off the gas a bit and cut it in half to maybe 15%? I will need right around $4000 a month in retirement to live comfortably. I plan on retiring at age 63, 64 at the latest. Any quick thoughts?
You can quit saving completely right now and will be more than prepared. You don't mention what type of accounts hold your savings and if you are looking at 4k pre-tax or post tax so I will go with everything in tax-deferred accounts and 4k post-tax as a worst case.
As an example possibility for your scenario you could retire at 63 and set aside 450k in a cash type investment (money markets, short term bonds, etc.) and use that to pay living expenses for 7 years until age 70 (5k/month for 7 years = 420k and I threw in some extra just in case). At that point you file for SS with max payments and chances are you are going to be able to live almost completely off of SS. If not what you need will be very limited, probably no more than 1-2k/month. That 550k you still had sitting could be invested relatively aggressively and grow quite a bit in that 7 years. Even if you decided to not go aggressive, you would still have over 825k now sitting in that account assuming only a 6% annual return rate. If you were fully in tax-deferred accounts, your main problem is actually going to be RMD's kicking your taxes into high gear, not whether you had enough saved.
You could also go ahead and file for SS at any time and save the up front distributions and just need more from your portfolio later, which again might not be a bad idea if you are fully tax-deferred. What is best for you is same as everyone else and there are too many variables for one size fits all. But short answer to whether you can reduce your savings rate is ABSOLUTELY you can.
@@chriskasprzyk6235this man got it figured out! 👍👌
@@chriskasprzyk6235 I have $210,000 in Roth IRA, $750,000 in 403B and $40,000 in taxable online savings account. 4K month, pre-tax. SS showing at 70 to be $3650 a month.
Wow! Great contributions. I hesitate giving direct advice but you are doing awesome and have many factors in your favor!
@@yourfinancialekg Thanks, I understand.
I saw your RUclips vids, and they're awesome! But I think they could be even more awesome with some better editing and thumbnails. I'm pretty good at editing and designing thumbnails, so I could help you out if you want. That way, you can focus on making even better vids! Plus, you'll save time and can pump out more vids. With my help, you can reach out to a lot more people too! Let me know if you're down! and if you want i can do the shortfrom too
I saw a great saying on Facebook today it said "Just buy the boat. No sense of being the richest man in the cemetery". Of course it does not apply to everyone but have a goal and enjoy life along the way. No point of pinching every penny to die with tens of millions but on the flip side, you don't want to work until you are 80 either. You are only in your 20s, 30s and 40s once so things like boats, ATVs vacations are more fun at those ages but make sure you don't have work late in life.
Great comment and thank you for sharing!