There are three fundamental retirement planning questions, that are universal to everyone, no matter their age, income, or wealth. More than investments, asset allocation, or tax strategy, people want to know the answer to the following three questions:
- When can I retire?
- How much savings do I need for retirement?
- How much can I spend in retirement?
The most important of the three questions, from a
retirement planning perspective, is the last one – How much can I spend in retirement?
How much can I spend in retirement?
How much you can spend in retirement, is based on how much you have saved for retirement, divided by an annual safe withdrawal rate of between 3% to 4.75% depending on your age at retirement.
A better, and the more important, question to ask is “How much do I need to spend in retirement?” To answer this question you will have to create a retirement budget.
Creating a retirement budget, insures that you will not run out of money during retirement, and it allows you to answer the other two retirement planning questions.
How much savings do I need for retirement?
How much savings you need for retirement, depends on how much you spend in retirement (your annual retirement budget), divided by an annual safe withdrawal rate of between 3% to 4.75% depending on your age at retirement.
The amount you need to save for retirement, is the amount of money you will need, to cover the cost of your retirement. The cost of your retirement is your retirement budget, which we calculated, when we answered the previous question – <<how much can I spend in retirement?>>
When can I retire?
When you can retire, is determined by when your savings can pay for your spending in retirement, based on your retirement budget. So, if your retirement budget is $3,000 per month, you currently have $600k, you need $900k to pay for your retirement, you save 25k per year, and your investments earn 10% compounded annually – you can retire in 3.5 years.
Did you notice, that the common thread in answering all three questions, was your retirement budget? That is because creating a retirement budget, your spending plan for retirement, is the key to calculating how much you will need for retirement, and to figure out when you can retire.
Watch the video related
Just watch it, one of the greats leaving forever.
Help answer the question
What are your thoughts on Pelosi's proposal to put a windfall tax on all retirements plans including 401K's?
Nancy Pelosi is moving forward with a plan to immediately tax any money made above and beyond what you have contributed to your 401K or similiar personal retirement plan.
retirements
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#1 by King of Kings on November 22nd, 2009
Well Undertaker didnt retire yet, but if I think they made a big deal about him taking his hiatus, then the answer is yes. The Taker questions have thankfully died down but have not completely fizzled out yet.
#2 by Tosha on November 22nd, 2009
Target retirement funds.
The best strategy is a long term one.
#3 by WPMixer on November 22nd, 2009
Piango sempre !! Lb
#4 by Wordpress on November 22nd, 2009
wow. how you gonna disrespect the greatest to ever play the game
#5 by Mr. Rodgers Neighborhood. on November 22nd, 2009
I'm sure this is unprecedented…No one has unretired twice…
#6 by Jpohn Doe on November 22nd, 2009
Nothing is bulletproof. Get a blanket policy. Also, understand that trusts that make assets unreachable by others will probably make them unreachable by you. (it's involved ((revocable…irrevocable trusts)) Further, If you have other suits or bankruptcy in the back of your mind…virtually nothing is protected in either divorce or bankruptcy.
#7 by nacao on November 22nd, 2009
larry bird can dunk, and whats more style then being a clutch shooter and one of the toughest guys to play the game. hes deff top 10.
#8 by guzen on November 23rd, 2009
I don’t say he is not,he gave much to celtics but I said he is not in my top 10 because i kinda prefer players like mj,drexler etc.But I said he was a player that wrote history noone doubts that I think
#9 by Blogger on November 23rd, 2009
who really gives a damn about mj so overrated wow he can dunk the ball shoot like reggie and bird he aint the best ever thats heresay
#10 by vsarnold on November 23rd, 2009
#11 by psychic on November 23rd, 2009
Thank you Larry Bird, I was a student at ISU when you played, thank you for all the amazing years and the court thrills you gave us. You are the best, never another one like you!
#12 by Dr. Mukhtiar S on November 23rd, 2009
on your 55th birthday
#13 by Arc Burn on November 24th, 2009
Modern liberalism appeals to the irrational tendencies of the human mind. o_O
#14 by Soma Holiday on November 25th, 2009
That depends on the season, the venue and the time of day.
If military personnel are wearing their camoflauge type uniforms (and yes, I've been to ceremonies, especially Seabees where they did), or working uniforms, and the ceremony is in the morning or early afternoon, then business casual is acceptable.
If the ceremony is before five pm, and the military folks will be wearing service dress (this is the most common for retirements) these are the equivalent of suits and ties (church attire / job interview attire) and you should dress appropriately.
In the rare event the military people should have decided on an evening ceremony with mess dress (yep, seen this too), then formal attire is required.
Remember to dress for the weather (ceremonies can be indoors or out). You don't need "hats and gloves" unless you need them to block sunlight or keep your fingers warm.
Just think conservative, classy, and refined. Don't wear long fingernails with bright polish or four-inch heels. Don't do anything crazy faddish with your hair or makeup or jewelry. You're shooting for Grace Kelly here, not Madonna. It's your brother's day…he's earned it, so avoid flashy prints and revealing cuts or fabrics. You don't have to dress for a funeral, but it's not a nightclub either.
One more thing…these events are usually pretty meaningful and touching…wear waterproof mascara…and bring a nice lace handkerchief.
Good luck, and thank your brother for his service.
#15 by doug g on November 25th, 2009
Years ago for my parents and most people who grew up in the last 70 to 80 years, when you retired, most companies paid a pension and continued your health insurance. So when you hit 65, medicare kicked in and your old employer picked up the supplement health, you had a pension plus social security. That's pretty good since like in my fathers case, he retired at age 55 with all of the above benefits.
Today that is not the case, most employers are dropping health insurance for retirees due to the high cost. Very few employers provide pensions anymore and now we have 401K that we have to pay a high percentage of the cost with some help from our employers, but we are at risk that the 401K we choose makes money or loses a lot after the financial crisis a year ago. With a pension it was guaranteed just like social security that every month you would receive a check in a certain amount.
Now many people are being forced to work to age 65 or fear if they retire early, could lose their health insurance and the cost they pay to their employer is about 1/2 cost vs a private plan if you are healthy enough to buy.
If you could take out the health insurance out of the equation on retiring or keep working, yes, many might choose to retire early, but that is not going to happen as health insurance just keeps rising and will continue till someone figures out a way to get it under control.
#16 by rails on November 25th, 2009
yes, but have you seen anthony munoz’s? (bengals)
#17 by WPBlog Shop on November 25th, 2009
I respect him way more than Brett Favre he had the guts to say goodbye and I AM DONE Brett Favre will never ever be the same now congrats to larry bird on of the greatest of all time
#18 by Free Blog on November 25th, 2009
reggie miler is the larry bird