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Inept posted:Roth 401k. You can withdraw contribution amounts without penalty. This made me think... can you actually do this? Do Roth-401k plans have the same withdrawal rules as Roth IRA's ? A quick google search suggests that they don't... Several websites mention the 10% penalty still applies but only to earnings portion, but can you withdraw contributions without earnings, or would the withdrawals have to be pro-rated and always contain some amount of earnings? If you rolled the Roth-401k over into a Roth-IRA would you be able to withdraw your contribution portion early without penalty then? In order to do so, it would seem like the Roth-IRA plan would have to know something about your contribution history, which they likely wouldn't... flowinprose fucked around with this message at 21:32 on May 1, 2013 |
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May 1, 2013 21:30
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BotchedLobotomy posted:I was assuming the investment that blows up is in my tax advantaged account so it wouldnt be something liquid. Basically I'd have a big ole 401k, enough to retire at X age before 60. Sounds like most people just take the hit though or work it out one way or another. Was just thinking aloud I suppose. v That makes a lot more sense, thanks. I was thinking you'd take riskier investments that may blow up in unsheltered accounts. In that case, I would work minimally until I could start taking out or take out only enough to live comfortably until I hit 60.
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May 1, 2013 22:35
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I find I'm way better at saving if I break everything into separate accounts for their specific purposes. Then I don't have to ask whether it's worth it to spend money on specific things, because that's literally what it's there for. Checking Account (Chase): My direct deposit account that catches my salary. I keep ~$5000 in this, and make sure it has no more than $5000 at the end of the month, IE the excess all goes to the remaining accounts. $5000 is more than necessary, but it buffers against months where I buy plane tickets, or have unexpected car issues, etc. With the money I make I can always cover my living expenses and student loan payments, and then feed the below four accounts. Checking Account 2 (Charles Schwab): For travel only. This is my pure luxury account, and I really have more in it than I need. That way when I go on vacation, I don't really need to think about where I eat or what souvenirs I buy. That's what this money is for. Savings Account 1 (Ally): This is 9 months' expenses. Not touching this ever unless I'm not gainfully employed. Savings Account 2 (Ally): I'll probably buy a house within 2 years. I'm building this up in anticipation of putting down 1/5 the overall cost of the house, and I'll keep going past that anticipated number because I'll probably want to make massive payments on a mortgage. Savings Account 3 (American Express): Car account. Plan is within 2 years I'll need a car, so I'll want to get a car with $0 and then pay it off within a year or so. Savings Account 4 (American Express): Since everything's basically covered by all of the other accounts, this is where anything extra goes. Once this goes above $xxxx.xx maybe I'll look at toying with stocks and the line, but until then this is my generic catch all after the others have been fed and my IRA and 401k have what I want them to. So I may be over preparing for things that are relatively uncertain costs, but at the same time I haven't had to think twice about purchasing anything for about four years now and I'm currently 29. That's the important part.
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May 1, 2013 22:39
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flowinprose posted:This made me think... can you actually do this? Do Roth-401k plans have the same withdrawal rules as Roth IRA's ? A quick google search suggests that they don't... Several websites mention the 10% penalty still applies but only to earnings portion, but can you withdraw contributions without earnings, or would the withdrawals have to be pro-rated and always contain some amount of earnings? If you rolled the Roth-401k over into a Roth-IRA would you be able to withdraw your contribution portion early without penalty then? In order to do so, it would seem like the Roth-IRA plan would have to know something about your contribution history, which they likely wouldn't... I've already rolled over a Roth 401k to a Roth IRA. It's not a big deal. Of course you have to be separated from your employer to do so, but we're talking about retirement so it's a bit of a given.
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May 1, 2013 22:52
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Inept posted:I've already rolled over a Roth 401k to a Roth IRA. It's not a big deal. Of course you have to be separated from your employer to do so, but we're talking about retirement so it's a bit of a given. Yes, that's fine and all, but what I was asking is whether after doing so, would you be able to withdraw contributions and not pay penalty on them? How does the Roth IRA account know how much of your account is contributions vs. gains? The only way that it could is if during the transfer process the 401k told the IRA what portion was contributions... does this actually happen?
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May 2, 2013 01:27
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I'm sure they keep track of your principal contributions throughout the life of the account. I think if you roll your Roth 401k over you'll have to pay taxes on the part your employer contributed but that's it.
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May 2, 2013 12:57
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So I have a question about the Federal Employee Retirement System and what I should do with the money that got paid in there. I see that you need to work for the government for 5 years to actually collect anything from FERS. You can also take the money out and put it in your own IRA or 401k (or pay it to yourself and take the penalty). I cannot collect anything from FERS so does it make sense to get that put in my current company's 401k account?
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May 2, 2013 15:14
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BotchedLobotomy posted:I was assuming the investment that blows up is in my tax advantaged account so it wouldnt be something liquid. Basically I'd have a big ole 401k, enough to retire at X age before 60. Sounds like most people just take the hit though or work it out one way or another. Was just thinking aloud I suppose. v If you have an IRA that you need to take from to support yourself in early retirement then rule 72(t) could be an option. As long as you adhere to the fine print, your IRA distributions will be penalty free. Regular taxes still apply, of course. The caveats are that the disbursements must be made as an ongoing series of "substantially equal periodic payments" according to several allowable calculations (annuitization, RMD, or amortization). You must take these distributions for five years or until you reach age 59.5, whichever is longer. You're locked in once you start and if you gently caress up your distributions anywhere along the line then the IRS will retroactively assess the 10% early withdrawal penalty on everything you've pulled out. As everyone else has said, it's usually better to exhaust your other options first. I think the rules are a little different for 401(k) accounts, so this might not be 100% applicable to your scenario depending on age.
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May 2, 2013 15:59
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BotchedLobotomy posted:I'm actually curious on how 401k and IRA works if you are able to retire early. Lets say I luck out and some sort of investment blows up and I'm swimming in dough. Forecasting into the future I could retire at lets say 54 or something. Is all the money I've socked away into the IRA and 401k locked up until I turn 60 or 59 1/2 or whatever it is? I know I can pull it early and take an excise tax hit but this is assuming I dont do that. I've been starting to think about the possibility of early retirement (mainly because my wife and I aren't planning on having any kids) and have been looking into options... Here is a short list of what I've come up with for tax-advantaged options with early retirement benefits: Roth IRA - Post-tax. Pull out contributions at any time tax and penalty free, no age restrictions. Currently 5.5k/year cap per person. 457(b) - Pre-tax. Some public sector jobs offer this. Like a 401/403, but no age restriction on when you can pull money out after you leave the employer. Yearly cap for contributions the same as a 401/403, but a separate pot of money (so you can do up to 17.5k/year in your 403 *and* 17.5k/year in your 457). Really slick option if you have it. HSA - Pre-tax. With healthcare in the US tied closely to employment, this seems like a good thing to max out if you are on a compatible health plan. You can pay for medical expenses out of this account with no penalty. At normal retirement age, works a lot like an IRA. Right now, I have 10% going to a 403(b), maxing out my Roth IRA, maxing out my HSA, and between 10-20% going to a 457(b) each month (changes due to savings goals - currently I'm saving for a new car so it is at 10%). Basically I got the point where my income was "comfortable" and all extra money past that point I have put into some sort of investing/savings. My expenses currently come out to a bit over half my yearly take-home income and that includes a reasonable vacation or two a year and a budget of $250/month for random fun stuff that I tend to end up just saving up mostly anyway since I finished off my home theater upgrades. I've looked around the web a bit for places focused on early retirement, but most that I've found seem to have fairly generic advise or are overboard "save 95% of your income by living in a cardboard box, then retire at 25 to live the rest of your life in a cardboard box!" silliness. Anyone have any good resources on early retirement planning to share?
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May 2, 2013 17:36
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https://www.mrmoneymustache.com One of his favorite topics is addressing people's complaints that he lived like a hermit so he can live like a hermit. One of his articles is about his "deprived family" that must live on $27,000/year. http://www.mrmoneymustache.com/2012/06/01/raising-a-family-on-under-2000-per-year/ Yes there is a typo in that URL but it is the correct link to the article.
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May 2, 2013 17:57
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GoGoGadgetChris posted:https://www.mrmoneymustache.com There's some really interesting stuff and great advice in there, I just wish every other sentence wasn't him being a crazy judgmental rear end in a top hat. I respect and admire his outlook on life, but it really bothers me to read him talking about everyone else as ignorant and "non-mustachian".
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May 2, 2013 22:31
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Brian Fellows posted:I find I'm way better at saving if I break everything into separate accounts for their specific purposes. Then I don't have to ask whether it's worth it to spend money on specific things, because that's literally what it's there for. Why not just keep two accounts for cash, one convenient (checking) and one higher-rate, if that exists these days (savings)? If you need to split it up into separate pools for tracking purposes, it's a lot more convenient to do it in Excel than dealing with multiple accounts at multiple banks. It will be less of a hassle when you're filing taxes, if nothing else.
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May 2, 2013 23:37
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SlightlyMadman posted:There's some really interesting stuff and great advice in there, I just wish every other sentence wasn't him being a crazy judgmental rear end in a top hat. I respect and admire his outlook on life, but it really bothers me to read him talking about everyone else as ignorant and "non-mustachian". Last I checked, he wasn't releasing how much he makes on his blog receiving 1.5 million viewers a month while obviously shilling stupid blog products and other things.
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May 3, 2013 00:08
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Need some advice from y'all please. We (my husband and I) have some traditional IRA accounts atm. Two of them are from Ameriprise and have had nothing entered into them at all, since they were pretty much forgotten about mostly other than claiming for taxes every year. There is only a few hundred in them at most. They have been sitting dormant for a while...not sure why we neglected them to be honest. The other two are traditional IRA from H & R Block with a few thousand in them. We were planning on consolidating them into only 2 individual accounts, and maxing the contributions every year for each of us. Should we stay with the traditional or change them into Roth IRA's? Which would be more advantageous for tax time (over the years) as well as retirement age? My husband has a 401 K that he is maxing out what he can...11% with 5% employer matching right now. He can put in more % every year, but is maxed atm. Any bonuses are added partially to his 401 K as well. We are planning to add to that s well to try to get close as we can to the limit per year he can put in. As for me, I do not have a retirement plan through my work. We have money going into a higher interest savings acct and are building our emergency fund, as well as doing some investing. So, we are trying to see what will work best for our situation. Any advice would be helpful! edit: forgot to mention we are about 20-25 years from retirement age as well. edit 2: nm got it answered Disco Salmon fucked around with this message at 21:57 on May 3, 2013 |
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May 3, 2013 00:13
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SlightlyMadman posted:I see, so this is more from the perspective of the economy I'm participating in, not me personally. So by over-saving, I'm effectively a drain on the economy because I'm pulling money out but not doing anything with it? I hate to sound like a deadbeat, and am far from any sort of Rayndian "I got mine" ideal, but from my perspective I don't see why I'm obligated to spend money just because it's given to me. Most of that money is being invested in 401k and IRA accounts so it ultimately ends up in stocks anyways, so it's not just sitting there, although I can certainly understand we'd be in trouble if everyone invested in companies but stopped buying their products. When we toss money into our 401ks/Roths or even individual stocks we're not really investing in those companies unless they were purchased during the IPO. The only people that really benefit from the purchase (so 99% of the time) are the other stockholders. If they're in for the long they won't benefit until they sell or collect a dividend. Bonds work the same way unless you're getting them directly from the treasury or the corporation that issued them. Basically buying a stock or bond does significantly less for society than buying your groceries or whatever. This is basically why we theoretically have a progressive tax structure. I'm not really bothered by this as a small investor because no matter how scrappy I am and how much I save the utility of my earnings will probably be all gone by the time I'm dead. I think it's something to think about when you have people that are still collecting from a trust fund started by their great great grandparents (yes I know people that do and he openly brags about it) though.
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May 3, 2013 00:57
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Orange_Lazarus posted:When we toss money into our 401ks/Roths or even individual stocks we're not really investing in those companies unless they were purchased during the IPO. The only people that really benefit from the purchase (so 99% of the time) are the other stockholders. If they're in for the long they won't benefit until they sell or collect a dividend. Bonds work the same way unless you're getting them directly from the treasury or the corporation that issued them. It's a little more complicated than that as CEOs have fiduciary duties to the shareholders (generally around increasing the price of shares), so by buying shares you're generally indicating you approve of their methods and goals. The health of the stock price / market capitalization factors into the bond rates that a company can raise money at. Employees of a lot of companies too are granted stock or stock options in the hope that they will be motivated to work harder so the price will go up. So even though your money isn't going directly into company accounts, it still helps the company grow.
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May 3, 2013 01:10
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Harry posted:If you have a HDHP, you can put money into a HSA. It's tax deductible and tax free going out. Guinness posted:HSAs are great if you have access to them. If you max out the contribution (about $3100) the tax deduction is rather substantial and in most HSAs you can invest in some funds once you have a balance over a couple thousand dollars. If you just leave it alone and let it grow rather than withdrawing from it for medical expenses it works almost exactly like an IRA.
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May 3, 2013 01:13
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AreWeDrunkYet posted:Why not just keep two accounts for cash, one convenient (checking) and one higher-rate, if that exists these days (savings)? If you need to split it up into separate pools for tracking purposes, it's a lot more convenient to do it in Excel than dealing with multiple accounts at multiple banks. It will be less of a hassle when you're filing taxes, if nothing else. When I do that I'm pretty bad about actually saving the money. My main concern is that if I decide I want a car that's ~15K more expensive than I planned, I don't want to throw money at it that I really should be socking away for a house payment. It basically lets me be guilt free. What I track in a spreadsheet is monthly contributions to each account, so it becomes super obvious when I've ignored my car account for two months. Taxes aren't an issue. All income goes to the checking account to be dispersed, and it's not exactly difficult to wait for three or four tax forms to come in the mail. I think it's definitely important to keep my travel account separate- when I'm on vacation the last thing I do is think about the kind of money I'm spending, and I go on several trips a year. I'm able to say "whoops, only have $500 bucks left for the next few days, time to slow up." I'll never run into the "oh crap, I'm going to have to let my checking account build back up for a couple of months because I spent way too much in Vegas" issue.
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May 3, 2013 01:53
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I agree with you there. I don't have quite that many accounts, but I have an emergency fund, a general purpose savings account, and a vacation savings account. A big part of learning how to save is making it easy on yourself, and it definitely helps me out to see clear balances and know exactly what they are. Also, it lets me associate goals with them separately in Mint.com.
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May 3, 2013 01:57
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Evil Robot posted:It's a little more complicated than that as CEOs have fiduciary duties to the shareholders (generally around increasing the price of shares), so by buying shares you're generally indicating you approve of their methods and goals. The health of the stock price / market capitalization factors into the bond rates that a company can raise money at. Employees of a lot of companies too are granted stock or stock options in the hope that they will be motivated to work harder so the price will go up. So even though your money isn't going directly into company accounts, it still helps the company grow. Right but that's still only a small minority of people and while the stock market has exploded over the past thirty+ years most people are worse off. Anyway, I really want to read about the eighties/nineties boom now. Why do we expect history to repeat itself before we retire?
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May 3, 2013 02:09
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Two HSA questions. I have an HSA from an employer now, and have been contributing for a couple years 1.If I move employers do I end up with two HSA, or can I roll the old HSA in to the new HSA. 2.Is there a third party company that I can use for my HSA or am I stuck with whatever HSA I can get through work? (If so who's the best fee-wise)
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May 3, 2013 02:13
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Harry posted:Last I checked, he wasn't releasing how much he makes on his blog receiving 1.5 million viewers a month while obviously shilling stupid blog products and other things. I don't know, he seems to be pretty transparent about it in this post, but that was quite awhile ago. I think his blog income is really beside the point, just like Jacob's net worth from from Early Retirement Extreme.
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May 3, 2013 10:33
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tuyop posted:I don't know, he seems to be pretty transparent about it in this post, but that was quite awhile ago. I think it matters a lot when you're saying you're living on less than $27,000 a year and then make a post about how getting rid of just one of your credit card referral links is causing you to drop $4,000 a month.
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May 3, 2013 14:16
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That dude really seems like he's full of poo poo. Nothing seems to add up.
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May 3, 2013 15:17
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Harry posted:I think it matters a lot when you're saying you're living on less than $27,000 a year and then make a post about how getting rid of just one of your credit card referral links is causing you to drop $4,000 a month. He lives on $27k, he makes more than that. I read a bit of the blog and other than the standard tips on being frugal it doesn't seem very useful unless you want to save up a bunch of money and then work freelance like him.
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May 3, 2013 16:11
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Hashtag Banterzone posted:He lives on $27k, he makes more than that. vOv, I think he covers the stoic philosophy that helps with financial independence in a really good, accessible way. And for a lot of people, debt repayment and retirement are like lights at the end of a tunnel. Reading his blog and YMOYL really kind of helped me and my partner get over the idea that living on 40-50% of our income is a "tunnel" at all. It's just a different way to do life, and with the right outlook and strategies, we could still be happy on even much less.
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May 3, 2013 17:27
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Hashtag Banterzone posted:....it doesn't seem very useful unless you want to save up a bunch of money and then work freelance like him. Saving up a bunch of money and then working on your own terms is MMM's entire thesis. He did a great article recently about the "Internet Retirement Police" (another of his mannerisms that are either endearing or enraging, depending on whom you ask), in which he reiterates that early retirement does not mean sitting on the beach for 16 hours a day and committing seppuku if you accidentally work a 4 hour shift at a job you love.
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May 3, 2013 17:33
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tuyop posted:vOv, I think he covers the stoic philosophy that helps with financial independence in a really good, accessible way. To be fair, he stated that to live that kind of retirement lifestyle you need a lot already in the bank. He already owns a home, cars, and toys. He does state how he got them in good deals, but he's obviously established and has a nest egg. He also spends tons of time on repairs and shopping around himself. A lot of people don't have that kind of time or knowledge. It's still an interesting read.
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May 3, 2013 17:34
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GoGoGadgetChris posted:Saving up a bunch of money and then working on your own terms is MMM's entire thesis. I just don't see that being an option for most people. Seems to me like there aren't a ton of jobs you can do that like. And the ones I can think of don't seem like they would be much fun.
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May 3, 2013 17:44
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He's taken a lot of really good and sensible ideas and then created a mythology of bullshit surrounding it in order to perpetuate himself as an entertainer and advertiser. While I have no doubt he started as genuine, I do not think he actually lives that way any more (or at least not to the extreme that he portrays). He's incredibly judgmental about watching people order $20 entrees when he himself eats a $16 salad; it makes little sense. Then in other articles he does things like mention the Toyota Prius as an economical car choice when if you actually look at the price it's clearly a luxury vehicle in almost every respect. He has some great advice though, like pointing out that if you can eliminate something like a cable bill from your life early, you're not only adding that amount to your savings every month, but decreasing the total amount you need to save in order to perpetuate your lifestyle forever. What he misses is that sometimes it's fun to go out on your birthday and eat a $20 dinner with some over-priced drinks between friends. If you do this all the time because you think you should, it's potentially irresponsible. If you do this every once in a while because it makes you and others happy, it's worth it. By making blanket judgments about everyone who's not making the exact same life decisions that he is at that specific moment, when he knows nothing about them, he's just being an rear end in a top hat.
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May 3, 2013 17:52
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Hashtag Banterzone posted:I just don't see that being an option for most people. Seems to me like there aren't a ton of jobs you can do that like. And the ones I can think of don't seem like they would be much fun. Do you mean to say that there aren't a ton of jobs that pay enough to accumulate a big chunk of money, or there aren't many jobs that you can continue to work on at your own leisure after "retiring"? If it's the former, he addresses the "I could never retire early on MY income!" issue here: http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/ If it's the latter, I don't know that he has an article explicitly focused on it, but he touches on it in just about every post. This is somewhat related: http://www.mrmoneymustache.com/2011/10/25/the-joy-of-part-time-work/
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May 3, 2013 17:58
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http://www.mrmoneymustache.com/2011/09/15/a-brief-history-of-the-stash-how-we-saved-from-zero-to-retirement-in-ten-years/ He does a good job of laying out exactly how he got to where he was, which distills down to "be a computer engineer with zero debt leaving college, make $160k with you and your spouse 5 years out of college, get huge investment returns in the heady days of the late 90's stock market, buy an investment property at the perfect time, start a home building business right before the peak of the housing market and generally live like a miser". Which, hey, is by no means impossible, but best of luck to you.
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May 3, 2013 18:16
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GoGoGadgetChris posted:Do you mean to say that there aren't a ton of jobs that pay enough to accumulate a big chunk of money, or there aren't many jobs that you can continue to work on at your own leisure after "retiring"? The latter. Saving and living on less is easy in theory, if not in practice. Finding something you want to do part time seems much more difficult.
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May 3, 2013 18:18
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His plan also assumes you hate your job. If I can choose between: A) working a job I love every day and having money to spend on luxuries I don't need, or B) spending all day every day trying to pinch every penny and live as frugally as possible, I'll choose A every time. Of course the reality is somewhere between the two, but it's an incredibly personal decision that's different for everyone.
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May 3, 2013 18:29
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/\/\/\ That only makes sense if you connect spending to happiness, which is problematic.SlightlyMadman posted:He's taken a lot of really good and sensible ideas and then created a mythology of bullshit surrounding it in order to perpetuate himself as an entertainer and advertiser. While I have no doubt he started as genuine, I do not think he actually lives that way any more (or at least not to the extreme that he portrays). He's incredibly judgmental about watching people order $20 entrees when he himself eats a $16 salad; it makes little sense. Then in other articles he does things like mention the Toyota Prius as an economical car choice when if you actually look at the price it's clearly a luxury vehicle in almost every respect. Well he's advocating more than just frugality and early retirement. If you really consider the philosophy that he's operating under, it makes a lot more sense if you translate what he's saying from "face punches" and "Mustachianism" to "living well" in the classical sense. He's like an obnoxious internet version of a stoic sage: quote:The role of the Stoic teacher was to encourage his students to live the philosophic life, whose end was eudaimonia (‘happiness’ or ‘flourishing’), to be secured by living the life of reason, which – for Stoics – meant living virtuously and living ‘according to nature’. The eudaimonia (‘happiness’) of those who attain this ideal consists of ataraxia (imperturbability), apatheia (freedom from passion), eupatheiai (‘good feelings’), and an awareness of, and capacity to attain, what counts as living as a rational being should. It just so happens that living "according to nature" (by bicycle commuting, limiting utility use, edit: in the stoic sense this also can mean volunteering and helping others) is potentially very frugal, imperturbability (endless optimism) tends to generate financial success or at least put you in a position to enjoy the opportunities you have, freedom from passion keeps you from buying endless piles of useless poo poo, and focusing on sustainable and legitimate sources of "good feelings" (friends, family, challenge, new experiences) is better than living on the hedonic treadmill and trying to buy or finance the next consumerist high. tuyop fucked around with this message at 18:47 on May 3, 2013 |
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May 3, 2013 18:34
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tuyop posted:/\/\/\ That only makes sense if you connect spending to happiness, which is problematic. It's as much of a mistake to disconnect money and happiness as it is to connect them completely. I wasn't saying so much that I would be less happy with less money, but that the stress of constantly struggling to spend as little as possible would make me unhappy. I think for some people that's not true, as many people seem to enjoy coupon-clipping and that sort of thing. I do not.
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May 3, 2013 18:41
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tuyop posted:/\/\/\ That only makes sense if you connect spending to happiness, which is problematic. It's not so much that spending = happiness, but having the financial security to not have to stress about strict budgeting, penny-pinching, and coupon clipping for everything is definitely a net positive for my personal happiness. I don't find any joy in any of that - in fact, it's quite the opposite. It's not consumption for consumption's sake that makes me happy. I actually try to consume very little and lead a relatively simple life, but knowing that I can go on a vacation, go out for a fancy night on the town, occasionally buy that new piece of equipment for a hobby or sport, or even just buying the fancier foods at the grocery store without having to worry about how it impacts my budget does improve life happiness. There was a study that was making the rounds not too long ago that basically came to the conclusion that overall life happiness does correlate with having more money up to the point of about $75,000 per year or so - because that's about the point where you have the financial freedom and security to not stress about casual expenses and still save a good amount for retirement and larger purchases (if you're even a little bit smart about it). Obviously that number will fluctuate a bit depending on COL of where you live, but the point still stands. For reference: http://www.time.com/time/magazine/article/0,9171,2019628,00.html
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May 3, 2013 18:53
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Funny you should mention the magical $75,000 number: http://www.mrmoneymustache.com/2012/09/06/does-peak-happiness-really-come-at-75000year/ And why is anyone throwing out the "Why would I want to live like a peasant so I can retire like a peasant" straw man as nobody in this thread or in any finance blogs is advocating it?
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May 3, 2013 18:57
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MMM does not even live like a peasant. He owns his house so he does not pay rent anymore. 60% of our monthly expenses goes to rent (apartments in NorCal are expensive). Scratch that if you own a home and you can live a happy life in under $25,000 annually. Our monthly expenses including rent is only 1/3 of our take home pay (we're earning a modest amount of income, nothing high), save the rest to retirement accounts and we live a happy life. Obviously we don't have kids yet but we're not worried when that time comes since we're financially ready for it. There's a difference between being frugal and cheap. We're frugal but we spend sometimes on things that are considered luxury for other people. We still have cable TV because I can't give up watching live sporting events. We sometimes go to NBA/MLB/NFL games. We eat out sometimes but we consciously try to cook at home. I bring my own lunch at work because gently caress eating out 3-4 times per week much less every day. We buy gadgets (just bought a 60" inch TV) but we think long and hard before buying to avoid impulse purchases and try to wait for sales/discounts/deals (hello Slickdeals). We're planning to retire during our mid-40s. You can say that we're pretty fortunate because we have the option of spending our retirement age at a cheaper country. We just want our future kids to be quite ready to handle their own lives before taking that plunge. And as Mr. MMM said, retirement is not about doing nothing. It's about being financially independent and not working just for the money. Congratulations to you if you love your job and want to keep at it until you are 60. But for the rest of the people not as fortunate like me, I want to do some things not because I need to *earn* money to survive and enjoy the things in life but because I love doing it. Earning money from such activities is just a bonus. Working for the next 40 years is a nightmare to me. 15-20 years is a sweet spot for me personally. I'm not saying I got this all figured out but having a goal and the lack of desire to be a slave to hedonism can go a long way. As they always say, "it's not how much you earn but how much you save that matters."
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May 3, 2013 19:23
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I've got a Roth IRA with some diversity through ETFs, such as SPY, and an emerging markets ETF. I also have some money I play with in companies like Verizon(which has been incredibly good to me), but right now I have some uninvested money I just want to put somewhere safe. I'm not sure if I should put any more into SPY, that feels pretty diverse to me, but, well, you never know. I'm looking for suggestions for broadly-invested ETFs, basically. Or should I be worried about anything else?
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May 5, 2013 20:44
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