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Regular Savings Account

Discussion in 'Money Talk$' started by saturneptune, Apr 28, 2013.

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  1. saturneptune

    saturneptune New Member

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    Between putting kids through college, funding retirement 401Ks at work, etc, we, (I) have done a terrible job saving for emergencies and the future in general. Does anyone know what the average amount someone who is between raising kids and retirement should have in their savings??
     
    #1 saturneptune, Apr 28, 2013
  2. Crabtownboy

    Crabtownboy Well-Known Member
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    Saturn,

    It seems to me that a fair number of questions have to be answered before that can be determined.

    1. Do you own your home or do you rent?
    2. Will you have a pension?
    3. Will your spouse have a pension?
    4. Are you in a high tax state or a low tax state?
    5. How much do you estimate you will have monthly from Social Security and your 401K.
    6. What are you average total monthly expenses now?
    7. Can you live without luxuries. In other words can you live within your needs and ignore your wants?

    There has to be more to consider. Those are just what came to mind quickly.

    One thing I can tell you is your do not need as much as the "experts" claim.

    There are ways to cut down on expenses. Whether a person is willing to cut down on their expenses easy. I have a relative who absolutely refuses to cut down on what they call their "comfort luxuries" and this is going to hurt them dearly when they do retire.

    Give us more input and maybe collectively some good ideas will peculate up.
     
    #2 Crabtownboy, Apr 28, 2013
  3. annsni

    annsni Well-Known Member
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    Well, I believe the rule of thumb is 6 month's salary in savings for "emergency" and then there is retirement. I'm not sure what to say on retirement because I know we've been really neglectful in that area. :(
     
    #3 annsni, Apr 28, 2013
  4. Crabtownboy

    Crabtownboy Well-Known Member
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    Here are links to several retirement planning worksheets. I do not know how good they are, but if you fill in several then you should have an idea of what is needed. I did not check all the web sites.

    As I said in my earlier post in this thread, take the final figure of savings needed with a grain of salt. My experience was that investment houses always estimated higher than my needs. I felt they were high before I retired and that has been the case.

    3.
    Retirement Planning Worksheet - Virginia Tech
    faculty.agecon.vt.edu/.../Copy%20of%20Retirement%20Planning%20Worksheet%20-%20VRS%20... - Cached
    1, Retirement Planning Worksheet. 2, Developed by Dr. Alex White, Virginia Tech
    . 3. 4, Years Until Retirement, 40, years. 5, Years In Retirement, 30, years. 6 ...
    4. [PDF]
    RETIREMENT PLANNING WORKSHEET - Farrell Financial
    www.farrellfinancial.ca/pdf/Retirement Planning Worksheet.pdf - Cached
    MICHAEL A. FARRELL, B.A., FLMI, CFP. RETIREMENT PLANNING
    WORKSHEET. Pg. 1 of 3. CONFIDENTIAL. PERSONAL INFORMATION. LAST
    NAME ...
    5. [PDF]
    Retirement planning worksheet - Tuve Investments
    www.tuveinvestments.com/.../Retirement/Retirement planning worksheet.pdf - Cached - Similar
    benefit statement. MFS HERITAGE PLANNING®. Retirement. Helping Yourself.
    Helping Your Parents. Helping Your Children.®. Retirement planning worksheet ...
    6. [PDF]
    RETIREMENT PLANNING WORKSHEET - Wellington401k.com
    www.wellington401k.com/Participants/forms/retirement20worksheet.pdf - Cached
    Worksheet. RETIREMENT PLANNING WORKSHEET. Developing Your Personal
    Investment Strategy. Retirement Income Needed. Annual Salary Before ...
    7.
    Easy Retirement Planning - Money Clubs - WIFE.org
    www.wife.org/moneyclubs/easy-retirement-planning.htm - Cached
    *Assumes that investments will earn four percent more than inflation and will be
    exhausted in 40 years. Retirement Planning Worksheet – Table 1. Your Social ...
    8. [XLS]
    Retirement Planning Needs Worksheet - Personal Finance
    personalfinance.byu.edu/.../TT06%20-%20Retirement%20Planning%20Needs.xls - Cached - Similar
    2, Teaching Tool 6 - Retirement Planning Worksheet. 3, June 2008. 4, Personal
    Finance: Another Perspective. 5. 6, Purpose: 7, The purpose of this spreadsheet ...
    9.
    RRSP Annual Retirement Expense Worksheet - RBC Royal Bank
    www.rbcroyalbank.com/cgi-bin/retirement/ws_are.pl - Cached - Similar
    Registered Education Savings Plans (RESPs) · Registered Disability Savings ...
    Use this tool to help you estimate your retirement expenses while taking inflation ...
    10.
    Insights - Retirement - Retirement planning tools - Vanguard
    https://personal.vanguard.com/us/insights/retirement/retirement-tools - Cached - Similar
    Retirement expenses worksheet. Use our worksheet to create a realistic budget
    for retirement that includes basic and discretionary expenses.
     
    #4 Crabtownboy, Apr 29, 2013
  5. saturneptune

    saturneptune New Member

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    Thanks for the post. Yes I own a home clear. In Western Kentucky, it would probably sell for 120K, 32 years old, 1700 sq ft on a half acre
    Yes, I have a pension from the Postal Service.
    My spouse will not have a pension but she has some IRAs
    Kentucky is a medium tax state.
    SS probably around 1500 when I collect it, and 401 K about 1700.
    Average monthly expense now about 2000. That is food, utilites, and we set aside each payday for six month insurance bills, and tags, and of course tithe.
    We have no luxuries except I have a 10 dollar subscription to ancestry.com and about that to SIRUS radio.
     
    #5 saturneptune, Apr 29, 2013
  6. InTheLight

    InTheLight Well-Known Member
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    Each situation is different so there is no magic number. I have read that the average American couple looking to retire in five years or so have $52,000 in savings. That number was considered inadequate.

    What really matters is how much income you will have when you retire vs. your current income. Generally speaking when you hit retirement you should have income of about 75% of your current income. Also figure you will need $5,000 to $6,000 a year for health care coverage just to be safe, even with Medicare.
     
    #6 InTheLight, Apr 30, 2013
  7. saturneptune

    saturneptune New Member

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    Thanks for your response. I have read several articles about when Social Security started around 1937 (enacted 1935). The government spent some money trying to get out the message that this was a supplement, and never meant to be an entire retirement income. Yet today, almost 80 years later, it seems we did not get the message, as I cannot count the number of folks I know that this is their entire or most of their entire income. This will become even more critical in the future, as the average life span rises, and there become fewer workers to suppport more retires.

    Some are lucky enough to have a pension from the company they worked for, but the bottom line is, each individual is reponsible for saving for retirement through anything from a simple savings account to a complex mix of investments in a 401K from stocks, bonds, metals and other securities. It is hard for a young person to get their mind around this with raising a family to being young. Retirement seems so distant. However, the years pass, we fail to save, and one day, the date is here.

    What is more valuable than the actual amount we save (if any), is the time given to us to do so. Once the time is gone, it cannot be recaptured like saving more money can. The reason I bring this up, is I wonder how many millions look back over the years of not preparing and wishing they had as they battle a month to month budget.

    As Dave Ramsey has often said, about borrowing money for instant gratification, are the figures he uses for the money we used to buy new cars on a loan, when it could have gone for retirement. Basically, if one had used common sense and bought cars (it could be vacations, Christmas, etc) they could afford at the time and put the balance in a retirement fund, one could be a millionaire today. The bottom line comment is "hope you enjoyed the car."
     
    #7 saturneptune, May 4, 2013
    Last edited by a moderator: May 4, 2013
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