Well, after you read my last post you think a billion dollar net worth is way too realistic. Maybe. The the lure is strong.
What if we just want to retire with $50,000 or so in passive income?
Do the following and see mastermind-university dot com :
- Take profits. When your stock shows a profit, at least sell the principal. The market is tough now.
- Buy into trends AND know what you own.
- Investigate a lot of big dividend payers and bonds. Don't limit yourself.
- Spread your money around.
- Watch some inverse etf's and funds.
- Be realistic regardless of what you hear or read. The economy isn't great. Be able to explain to your spouse, or kid why you made the investment you made. Use facts, common sense and logic. Admit mistakes. Admit it if your investments are too risky and make corrections.
- Read about investments. What did the gurus read? What to MBA candidates read? Get started.
- Follow the news on your stocks and your watch list.
- Have a competent MasterMind and a competent advisor cover your blind spots and expand your reach.
- Think of ways to make extra income. There are lots of people selling on ebay and amazon. Lots of people have side businesses and etc. What small deal can you think of? Invest your extra earnings.
- Think of ways to save money without hurting your lifestyle too bad. See the site I mentioned.
- Be nice to everyone. Its easier to build a huge network when its not all about you, or if you are really inconsiderate. Your employers and people you deal with every day should be able to say good things about you. You should pay compliments to others too. Your networks and lists could provide a job or some sales or some other deal. (Or preferential treatment.)
- Work hard at your job and your side projects. Sloppy work won't get you to early retirement. Focus on the bottom line. What makes the income for your work or business? Do those things.
- Admit it to yourself if you are broke. A baseless fantasy that a million bucks is around the corner is a path to disaster.
Showing posts with label can I afford to retire early. Show all posts
Showing posts with label can I afford to retire early. Show all posts
Friday, December 23, 2011
Sunday, May 18, 2008
Can I Retire Early?
There are many factors that will help you determine whether you’ll be able to retire early. Here’s how to figure it out. Question: I’m 50 years old, my wife is 44 and we would like to retire by the time I’m 55, if not sooner. We have a little over $600,000 in 401(k)s, IRAs and other retirement accounts and another $250,000 or so in stocks, mutual funds and cash that we can draw on once we retire. Our mortgage will be paid off shortly and we have no other debt. Do you think we can pull off early retirement?
—Anonymous Answer: The fact that you’ve saved a considerable sum and aren’t going into retirement saddled with debt, certainly increases your chances of being able to retire early. Still, I can’t give you a definitive answer to your question. I would have to know a whole lot more about your finances to even begin to take a reasonable stab at it. But I can tell you how to assess your situation so that you can figure out on your own or with help from an adviser whether it’s realistic for you to call it a career within the next five years. As I see it, you’ve got to size up your shot at an early retirement from two different perspectives - a financial and a lifestyle point of view. The two are related, of course, but we’ll tackle them separately, starting with the financial side. Whether you’re evaluating your prospects for retiring early or at a normal retirement age (whatever that may be), the fundamental financial question you face is this: Can the retirement savings you’ve accumulated in 401(k)s and other accounts generate enough sustainable income combined with Social Security and any pensions to support you for the rest of your life? You’ve provided a rough sketch of one aspect of your finances - namely, the assets that you can draw on during retirement. But in order to tell whether that nest egg is sufficient, you’ve also got to consider the other side of the ledger, which you haven’t mentioned - i.e., expenses. You need to know how much money you will need on an annual or monthly basis to live comfortably once you’ve left your job. I’m not talking about a guesstimate here. I’m talking about putting together a detailed retirement budget that lays out the actual expenses you’ll face at the time you retire and projects your likely spending even into the later years of retirement. Only after you do that can you judge whether the size of your savings stash will be large enough to support you throughout a retirement that, in the case of you and your wife, could last upwards of 40 years. Unless you’re some sort of a math wiz, this isn’t an assessment you can do with a pencil and paper. There are too many variables and uncertainties.
So you have two options: go to an adviser who can crunch the numbers for you, or run the numbers yourself using an online calculator, such as Fidelity’s Retirement Income Planner. One of the features I like about this tool is its interactive budget worksheet that allows you to break down your spending into nearly 50 different categories. You can even assign different rates of inflation to different expenses if you think, say, your health care costs will rise faster than what you spend on travel. What’s more, you can even budget for expenses that you know will disappear at some point in the future, such as a car loan or home equity loan that you’ll pay off. By plugging in this information along with details on your retirement investments and other resources plus an estimate of how long you’ll live (I generally recommend planning at least until your early ’90s), you will come away with a forecast of how many years your savings and other income sources will likely support you. http://asktheexpert.blogs.money.cnn.com/2008/05/01/can-you-retire-by-55/
I found this posted at the Raddr-pages.com by Wanderer.
—Anonymous Answer: The fact that you’ve saved a considerable sum and aren’t going into retirement saddled with debt, certainly increases your chances of being able to retire early. Still, I can’t give you a definitive answer to your question. I would have to know a whole lot more about your finances to even begin to take a reasonable stab at it. But I can tell you how to assess your situation so that you can figure out on your own or with help from an adviser whether it’s realistic for you to call it a career within the next five years. As I see it, you’ve got to size up your shot at an early retirement from two different perspectives - a financial and a lifestyle point of view. The two are related, of course, but we’ll tackle them separately, starting with the financial side. Whether you’re evaluating your prospects for retiring early or at a normal retirement age (whatever that may be), the fundamental financial question you face is this: Can the retirement savings you’ve accumulated in 401(k)s and other accounts generate enough sustainable income combined with Social Security and any pensions to support you for the rest of your life? You’ve provided a rough sketch of one aspect of your finances - namely, the assets that you can draw on during retirement. But in order to tell whether that nest egg is sufficient, you’ve also got to consider the other side of the ledger, which you haven’t mentioned - i.e., expenses. You need to know how much money you will need on an annual or monthly basis to live comfortably once you’ve left your job. I’m not talking about a guesstimate here. I’m talking about putting together a detailed retirement budget that lays out the actual expenses you’ll face at the time you retire and projects your likely spending even into the later years of retirement. Only after you do that can you judge whether the size of your savings stash will be large enough to support you throughout a retirement that, in the case of you and your wife, could last upwards of 40 years. Unless you’re some sort of a math wiz, this isn’t an assessment you can do with a pencil and paper. There are too many variables and uncertainties.
So you have two options: go to an adviser who can crunch the numbers for you, or run the numbers yourself using an online calculator, such as Fidelity’s Retirement Income Planner. One of the features I like about this tool is its interactive budget worksheet that allows you to break down your spending into nearly 50 different categories. You can even assign different rates of inflation to different expenses if you think, say, your health care costs will rise faster than what you spend on travel. What’s more, you can even budget for expenses that you know will disappear at some point in the future, such as a car loan or home equity loan that you’ll pay off. By plugging in this information along with details on your retirement investments and other resources plus an estimate of how long you’ll live (I generally recommend planning at least until your early ’90s), you will come away with a forecast of how many years your savings and other income sources will likely support you. http://asktheexpert.blogs.money.cnn.com/2008/05/01/can-you-retire-by-55/
I found this posted at the Raddr-pages.com by Wanderer.
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