Many of us are still living in the past when it comes to planning for retirement. Sure, we know that unlike previous generations we can't rely on generous Social Security benefits or fat corporate pensions. And we know that we can't count on double-digit market returns to make up the difference. We are more concerned about creating wealth rather than ways to preserve it. Before, while we were fresh out in college, we don't really consider the future as a whole. We were actually focus on our ideal career. We acquired our education, and now we're playing the corporate field, and vying for the job that will set us up with a great lifestyle. And soon we can purchase the home and abandon the apartment routine. Since we can now afford something a bit nicer, a new car is probably in order. And before we know it, we're married with a family. It's time to stop right here and it's time to consider early retirement planning. Yes I do realize that this is slightly far off yet, but there's no such
Perhaps one of the most difficult emotions to face when you are on the edge of retirement is fear. With an early retirement you are literally changing how you live on a very fundamental level (ie: living off your assets instead of generating more). So all sorts of questions come up: will my investments earn [...]
by Robert Brokamp Retirement is the No. 1 goal of investors. Yet, looking at the numbers, it's clear that many investors are undermining their good intentions with unfortunate actions. Here are nine mistakes to avoid if you want your retirement dreams to become a reality.1. Cracking your nest egg before retirement. A study by Hewitt Associates found that 45% of workers cash in their 401(k)s when they switch jobs. In other words, they take the money -- paying income taxes and a 10% penalty if they're not yet 59 1/2 years old -- rather than leave it in a retirement account. That's no way to build the retirement of your dreams.When you change jobs, you can transfer the money in your employer-sponsored retirement plan to an IRA, which will allow the money to continue growing tax-deferred. You might also be able to leave the money in your old plan or transfer it to the plan at your new job, depending on the plans' rules. But your best bet is the IRA. You'll have many, many more
Need to save 10% of your gross income for retirement?
Fact or Fiction
Many financial experts recommend setting aside at least 10% of your gross income for retirement, is this enough, too much, or just right? 10% might be a good starting point but this so called rule ignores several important factors like the return that the money [...]
It occurs to me while planning retirement, we all make a serious simplification while we make our plans. Almost everyone assumes you will never make another dollar from something other than your investments again while in retirement.
Is it just me or is that perhaps just a little stupid? After all if you sell [...]
After 35 years of carrying the mail through all kinds of weather to the same neighborhood, the mailman was going to retire. When he arrived at the first house on his route, he was greeted by the whole family who roundly and soundly congratulated him and sent him on his way with a tidy gift [...]
It occurs to me that perhaps every one is going about their retirement planning in the wrong way. You see I’ve been looking at factors around retirement to determine which ones are really significant. Like what happens to your plan when your rate of return on your investments is only 6% when you planned for [...]
Steve Finnan announced his retirement today from international football.Finnan has made 50 appearances for his country Republic of Ireland and also made his debut at the 2000 against Greece.He also made his appearance in the 2002 world cup and was a regular member of the squad for all these eight years.The former Fulham defender felt that with a new national manager set to be named in the near future the time was right to allow fresh faces to be given a chance.He declared"But I'll be 34 when the next tournament comes around so it's the right time for me to step down."
To make their long-term dreams come true, Jodi and David Lewis, ages 26 and 27, need to be as serious about savings as they are about their careers.By Yuval Rosenberg, Money Magazine contributing writer January 9 2008: 1:58 PM EST(Money Magazine) -- When you're young, the most important thing you can do financially is get off to a good start. Jodi and David Lewis have certainly done that - at least when it comes to their jobs. Jodi, a development director for a nonprofit, was the youngest person ever elected to the Piedmont, Okla. city council. David is a regional manager for a staffing company, has written a book on leadership and was recently named one of the area's "Achievers under 40" to watch. And though he lost a 2004 run for state representative, David says he'd like another try at politics someday. But for this to happen, the Lewises have to shore up their finances. That's because a career in public service could cut David's income by more than half. Meanwhile, like other coupl
Great Spot Close to Grand Lake/Grove OK-Priced RightMany retirees would like to have a small home based business. Some of these businesses are selling wooden lawn furniture the owner has made, craft type items, flea market items, building and selling golf cart/lawn mower trailers and so on. The thing that hinders so many is having a location that is affordable.Well, look no more. Aaron and I just listed a 1/2 Acre parcel on Highway 59, just North of Grove, OK. Highway 59 is the main highway leading into town from the North. This listing includes a small one bedroom home that could be lived in, rented, or used for an office. It also has a large shop/barn with concrete floor to make your goods in or store product. The barn has a lean to for parking your pickup. The property has it's own water well.You can be in business here for the low purchase price of $47,500. Where else can you buy prime highway frontage with a large traffic flow moving at slowdown speed. The office or home and barn
Much of the discussion concerning retirement planning is targeted toward men who are retiring from their careers with a spouse who seems to be considered 'along for the ride'. Perhaps that scenario was true in the fifties, sixties and seventies but, for a lot of the population, that is no longer true today.Among the Baby Boomer generation are millions of single women who must plan for their retirement independent of any spouse. This is a double edged sword. While this independence eliminates the responsibility to provide for another person in your retirement years, it also means that there is only a single source of income to fund the retirement.Obviously, the earlier that a woman begins to think about and plan for her retirement, the better off she will be when she gets to the retirement "Red Zone". The "Zone" begins 5 years before actual retirement and ends 5 years after your retirement date. At all times before you enter the Zone, time is on your side. If you make mistakes or the ma
It is worth trying to define exactly what early retirement means since expectations vary. During the 1980's, many large employers used their well-funded pension schemes to pay for laying off workers in their fifties by giving them early retirement.In fact many of these people had no intention of retiring and used these generous packages to move into second careers. They did not retire at all until much later, in their sixties. Nowadays, what most people mean by early retirement planning is not stopping work altogether but having the financial freedom to change their lifestyles, free from children and a mortgage.Create Sufficient Wealth to Sustain Your Lifestyle on Meager EarningsFirst, it makes sense to try to estimate the amount of capital required. It pays to think of income and capital needs in real terms as it is easier to imagine an income need of, say, £35,000 per annum in today's money than the actual income needed once inflation has been factored in. We can allow for the effec
You may own a target retirement fund if you’re in a 401(k) plan and you signed up but didn’t pick a fund to invest in or you were automatically enrolled.This kind of fund has also become popular with individual beginner investors because it claims to be a “one-decision” fund: it adjusts its investments to become more conservative as you grow older and closer to retirement. The theory is great -- you don’t have to do anything. But the theory is flawed.If you’re 25 or younger your target fund will have a date like 2050. At this distance from retirement, the fund will be predominantly invested in stocks, so an investor needs to understand market cycles or trends to make the most of this investment.You face two problems and an opportunity.The first problem is doing the wrong thing: Buying high and selling low. This happens when you let your emotions make your decisions for you.In a market decline, for example, which happens on the average every four and half years, investors ar
CNNMoney.com had an interesting article on Monday about buying real estate inside of your IRA. It made me think of all the reasons why baby-boomers need to consider (if they haven't already) why they should own real estate as they enter into retirement. Here are a few that I can think of:1. Buying real estate now, at rock bottom prices, you will have the opportunity to see your money grow as your equity grows. The huge amount of people facing foreclosure will keep them out of the house-buying market for about 7 years. That will be 7 years of a booming rental market where you should have few problems finding qualified tenants to make your mortgage payments for you.2. You can always sell it if you need cash. When you buy real estate low enough, you have the comfort of knowing that you can always sell it quickly if you need to. 3. Tax deductions! There are a lot of ways to deduct taxes from investment properties. Did you know that you can write off DEPRECIATION from a rental property that
After my problems sorting out our new company’s pension plan, I’ve finally got my head around the various plans. The other component to this problem is how does this impact my grand retirement goal to get out of the workforce by 45.
Strangely enough on the pension side, there isn’t a huge amount of [...]
Exquisite Home on Patricia Island Golf Course at Grand LakeIf a retirement home on the golf course is what you dream of and you also would like to live at the lake with great boating and fishing then we have the place for you today.The spouse will be elated with this exquisite home with so much extra attention to detail included. The Alder doors throughout the home even have a diamond pattern routered on both sides of the doors. The entertainment center is Alder with bookcases and display shelves on both sides with a built in fire place. The crown molding of Alder and the Alder base moldings add to the special touchs in this home designed for the buyer who appreciates the finer things of life.The master bedroom opens onto the patio and enjoys the terrific golf course and treed view. The master bath features his and her sinks, his and her closets, large jaccizi tub and separate tile shower. Two guest rooms are across the home in their own wing with one bath shared. Upstairs is the
Grove, OK with Integris Health is a wonderful retirement place on Grand LakeRetirement living is something to plan for. You will want great health care close by; probably a lake to enjoy fishing, boating, and water sports; great friends to meet; a great church to attend; quaint shopping; unique dining; and maybe golf in a great setting.Grove, Oklahoma may just be the place for you in retirement. Grove is home to Integris Grove General Hospital, a part of Oklahoma's number one health care provider-Integris Health. Integris has announced plans for a new 56 million dollar hospital about a mile east of the present hospital. Integris will invest over 50 million dollars and has ask the community to invest 5 million dollars to achieve this goal. You may call their donate line at 918 787-3464 for more information or to make a donation. Grove's Patricia Island Estates is the newest waterfront subdivision on the shores of Grand Lake. Patricia Island offers a fine golf course and has ma
Great home at great price in wonderful setting on Grand LakeGrove, Oklahoma on wonderful Grand Lake in northeast Oklahoma is a great place to retire, raise a family, or have a lake home. We have listed a great example of nice homes in Grove. You will love to walk out on the large back deck and watch nature at it's best in our own treed back yard without a home in view to the back, (there are neighbors to each side). The birds, deer, fox, and squirrels will abound. This quality home was built in 1996 and is in same as new condition. It is a beautiful red brick and contains three bedrooms and three baths. There is also an upstairs bonus room that can be a fourth bedroom, game room, or office. Two of the spacious bedrooms and the huge family/living area open up to the large wood deck to enjoy nature at it's best. The home features a large dining room and a parlor just off the front entry hall. The two car garage is oversized for lots of storage space. The home sits on a two acre lot in on
Grand Lake/Grove, OK is a great place to liveGrand Lake and Grove, Oklahoma in the northeast corner of the state in what is called Green Country is a wonderful place to call home. We have four moderate seasons to enjoy. Grove has a new Integris Grove General Hospital planned and will start construction in 2008. Grove churches and civic clubs are very inviting and the people are easy to get to know. You can move to Grove and soon feel like you have lived in the area forever. The lake is great for boating, fishing, bird watching, or just to sit by and enjoy. Lakefront homes can get a little expensive but a home a mile or so from the water is great. Cherokee Trails is one addition a short distance from Grand Lake and only 3miles to town. The large lots have ample room to add a nicely done shop, rv storage, or boat storage building. There are standards of construction for homes in addition to keep your property value up. The area is quiet, great neighbors, and inviting to you. My asso
When Meat Loaf left the stage claiming he'd retired, his promoter Andrew Miller gamely insisted it was a 24-hour type-thing and angrily denied that Loaf had decided showbiz had gone stale.He'd have been better off admitting that Meat is in trouble - "acute laryngitis" is now the official line - instead of subjecting his tour to a daily pitter-patter of cancellations. Another one has gone tonight.
Since I was sick yesterday I obviously spent some time thinking about my health in general. I don’t do too bad looking after myself, but I know I have a way to go on a few things. This becomes much more serious as you enter your retirement years since the damage you do [...]
This is my final post about your relationships in retirement series. In part I we talked about our spouse, while in part II we talked about the kids. Now we are going to explore your friendships.
I find it almost strange that it doesn’t occur to people that their relationships are likely going to [...]
Yesterday we covered your relationship with your spouse. Now I’m going to talk about your relationship to your children.
You will likely find that during raising your children that they say some of the oddest things. It’s like they forget about reality for a split second and try to ask for the moon (or [...]
With retirement we achieve a freedom we really haven’t felt since childhood. We can do what ever we want and when ever we want (within reason and your budget). So with all this new found freedom comes a few issues around our relationships that we just didn’t see coming.
So in order to address [...]
Find out why many are retiring to Grand Lake in OklahomaThe Grand Lake and Grove, Oklahoma area of Northeast Oklahoma is a popular retirement area for people from all walks of life and from every area of the country. I had someone call this week from the coast of Texas who is planning for his retirement early next year. The first thing he told me he wanted in a retirement area was four season, not a harsh winter or really hot summer, but four nice seasons. Northeast Oklahoma offers such a climate. Fall in the Grand Lake area is just wonderful with cool nights and warm days and lots of sunshine. It is a great time to enjoy fishing or boating on the lake. Winter is not too long nor usually very harsh. You can enjoy this time of year sitting around the fireplace and watching the pretty winter scenes of the lake area. Spring will come to life with dogwoods and redbuds blooming with their wonderful colors. This will be a time of great fishing. Summer is boating time--speed boat, sail boat,
Rob asks:
Hello Gina. I've been trying to figure out what my income and taxes will be in retirement and was hoping to get some help.
If a married couple does not work after the age of 65, and we receive money from pensions/social security/401k/Traditional IRA/Roth IRA annually and/or monthly, do we have to pay Social Security & Medicare (7.65%) taxes on any of the income we receive from these
Grand Lake and Grove, OK in NE Oklahoma is a wonderful place to own propertyGrand Lake in NE Oklahoma and the largest city on the lake, Grove is a wonderful area to own your retirement home, second home, lake home, or set up your business. This area has experienced good property price appreciation and movement the past five years but that being said it has not seen sky high pricing with contracts presented over asking prices or homes sold as normal the first week of listing. The area has experienced solid growth and price appreciation which can be held as we go through the national slowdown in real estate.Should you buy now is often the question raised in the press or television news. Many areas of the country such as Florida, California, and Arizona are going through a real tough time in regard to housing. They also are the areas of frantic sales the past several years with huge yearly price increases and multipule price offers on homes listed less than one week. This type of market b
I’m starting to develop a pet peeve. It started out small, about the size of a flea, but now it’s morphed into a rather large beast about the size of a lion. It has to do with everyone constantly stating things along the line of ‘how can you live on $30,000 per year [...]
On June 30, 2006, we featured the following video with Christopher Smitherman, warning about an upcoming disaster concerning the retirement system. His projected dates may have been off, but given the recent developments regarding the retirement system, it seems time to revisit his warnings! (Smitherman was even interviewed for this article in the New York Times by Mary Williams Walsh.) We must face the potential problems with the system if we are going to support the retirees in any real way.
He's gone and announced a slew of UK tour dates. Why, it's like all that talk about going away if he didn't outsell Kanye was a lot of hotheaded nonsense that he never meant at all.
Charlie asks:
I have been contributing to a Roth IRA to the max amount and a little bit to a 401k. My employer also runs a profit sharing type plan that they contribute to. Now, the question is, am I also able to contribute to an SEP-IRA? I do contract work on the side and receive 1099s. For status I am single and my W2 income will be in the 60-70k range and my self employment will be about $10k.
Charlie asks:
I have been contributing to a Roth IRA to the max amount and a little bit to a 401k. My employer also runs a profit sharing type plan that they contribute to. Now, the question is, am I also able to contribute to an SEP-IRA? I do contract work on the side and receive 1099s. For status I am single and my W2 income will be in the 60-70k range and my self employment will be about $10k.
Q: I’m looking to retire and I want to sell my business. How do I go about finding a buyer and what sort of terms do I set up to sell my business?
Edward, FL
A: Ah, so you want to enjoy the garden of life in your retirement. You will want to [...]
I recently was talking to a couple that are rapidly closing in on their retirement date. They have been planning a bit around their retirement. They got a new place to live, a new car and replaced anything that was getting old to ensure they would have reduced replacement costs in retirement. Now they are completely debt free and are starting up an interesting experiment.They plan to live on their new lower income for six month prior to their retirement date to adjust themselves to their predicted spending in retirement. They call this their retirement experiment. I rather like the idea myself, so I did a little digging into my own spending.Currently after tax and deductions we take home around $3700 a month. If I deduct my current mortgage payments (principle and interest) I'm down to about $2600 and then if I drop off my extra retirement savings I'm down to $1900/month. If I convert that to a yearly amount I'm already living off just $22,800 with a small child. So if I can
I recently was talking to a couple that are rapidly closing in on their retirement date. They have been planning a bit around their retirement. They got a new place to live, a new car and replaced anything that was getting old to ensure they would have reduced replacement costs in retirement. [...]
I recently was talking to a couple that are rapidly closing in on their retirement date. They have been planning a bit around their retirement. They got a new place to live, a new car and replaced anything that was getting old to ensure they would have reduced replacement costs in retirement. Now they are completely debt free and are starting up an interesting experiment.They plan to live on their new lower income for six month prior to their retirement date to adjust themselves to their predicted spending in retirement. They call this their retirement experiment. I rather like the idea myself, so I did a little digging into my own spending.Currently after tax and deductions we take home around $3700 a month. If I deduct my current mortgage payments (principle and interest) I'm down to about $2600 and then if I drop off my extra retirement savings I'm down to $1900/month. If I convert that to a yearly amount I'm already living off just $22,800 with a small child. So if I can
One thing I think we can all agree on, or in theory should agree on, is that Canadian bacon and pineapple pizza is absolute rubbish. I can’t believe people actually eat that crap, apparently even willingly. Nasty.
NE OK is a great place to retire to Grand LakeGrove, Oklahoma is a great place to consider when thinking retirement homes. Grand Lake's shores wind around the city limits of Grove offering waterfront home sites, public access boat launchs, and fishing docks. Grove is a great small community with several active Churchs, Civic Clubs, great health care, and quaint shops to visit. Integris Health Grove General Hospital is in the planning stages of a brand new hospital that should have groundbreaking early in 2008. You can talk to people up and down the street and find many who have found this paradise and moved to the lake in the last ten years or less. You can get involved as much or as little as you like with local events, activities, clubs or churches, but it is an easy place to get to know people and feel right at home. The downtown area is under going a revitalization currently which will enhance the area. The main road in from the north is getting ready to add three more traffic lan
If your married you know that some days despite your best intentions you just forget to mention something to your spouse once in a while. Typically in my case, it is a fairly minor issue. My wife found me an interesting article while I was gone along those lines. It was about how well couples communicate about their retirement plans or their lack there of.In a survey done with over 500 married couples with at least one spouse just about ready to retire they were both asked the same questions and it was found each spouse often had different ideas about some fairly basic issues around retirement (For your reference the average age of those surveyed was 53 to 54 and they on average were married for24 years).For example, more than 1/3 of those couples did not know when the other wanted to retire. They also found more than 2/5 of couples give different answers on weather one spouse will continue to work in retirement. Also more than 1/3 expected a different standard of living in retir
I recently saw this article in The Star and I have to admit it made me laugh. It claims that 2/3 of Canadians who want to retire by 2030 are not saving enough money.Basically the article is a rewording of the official press release (see here). They mention all this information they went through and all their hard work, yet they don't provide one single number of useful data in the press release other the headline. What do you assume for inflation? What are 'basic household expenses'? Out of this 72 profiles what factors did you take into account? Where did you assume they are living?In the end this news article is not very useful other that getting people frightened and trying to get them to save more. They just don't provide enough information in a press release to tell if the report is useful or just full of holes in their logic. What really makes me mad is they never include a link to the actual report so I can read it myself and determine if it is useful.Have a good weekend,CD
It seems to me that several people are planning retirements using at least some dividends to provide part of their income. This is a good idea, the problem becomes when you take it too far and try to pull off a Derek Foster and live off only dividends.Let me say I do like dividends. They get great tax treatment from the government if you are lower income (see here) and if you pick good companies they will provide a nice raise and likely keep up with inflation. Yet people tend to ignore their dark side, the low yield.You see in this over inflated market of nearly continuous record breaking highs for the TSX index the actual yield on most dividend paying stocks is very low. When most dividends are around 1 to 4% yield you end up needing a lot of cash to generate your retirement income. Let me provide an example.Let’s say you need about $25,000/year in retirement income for a couple. If you buy all dividend paying stocks and manage to get an average yield of 2.5% you would need $1,000,
Common Sense Personal Finance
I found a nifty tool for doing retirement planning on MSN Money. One of the things that people always ask me is how much I would need for retirement. Well, this tool...
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Retirement itself can be a funny thing emotionally. Suddenly your entire world is turn upside down and shook a few times. For some people it's a great feeling like riding a roller coaster, for others it makes them feel a bit sick or detached from it all. Overall retirees actually share quiet a bit in common emotionally with high school students leaving their final year (as a reference point for anyone who isn't retired).I've spend a few weeks digging around message boards to see how everyone reacts to it all, as well as talk to several people my parents age about people who have recently retired and how they feel about it. In general there appears to be a few different patterns around it.First it is very common to actually miss your co-workers a bit. After all these are the people whom you spent most of your days with for years and depending what you do in retirement you will have very little contact with them and suddenly a lot less in common if you retire early and they remai
It occurs to me that I need to do some more planning about how my portfolio is going to look in early retirement. I specifically need to be conservative with that money that is going to bridge the gap between 45 to 65.Currently most of this money is in index funds with the following allocation:25% Bond index25% TSX index (Canada)25% SP 500 index (US)25% International indexThis is what I'm thinking about using when I turn 45:60% bond index or other fixed income15% Real Estate Income Trust or similar10% TSX index (Canada)10% S&P 500 index (US)5% CashAt the same time I'm unsure about dropping the international portion of the portfolio. Despite being subject shifts in the currency exchange international markets does offer some diversification outside of North America just in case there is an economic slow down just in our local markets.Another issue I'm a bit unsure on is how do I convert the one portfolio over to the other? Do I just wait until I'm a few years out and start to sl
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