Great video. BUT viewers might want to keep in mind this type of financial planning is only 1 part of a successful retirement. I've been retired for 20 years and for me spending has been the main component of my success. It's a different lifestyle. It took some years to get this lifestyle. For example I haven't eaten out or ordered in for about 4 years. I used to eat out a lot...and had the belly to show for it. I loved food. Expensive and not healthy. I switched to low carb after learning about recent science on the effects of sugar/carbs on the body. I thought it would be really hard to give up carbs....was shocked no carbs made me happier. The cravings went away. When I ate a whole fruit pie at noon I wanted another one the next day and had to fight that. Even though I was eating a lot of carbs everyday I still craved more. Eating low carbs stopped almost entirely those cravings. That's an increase in happiness. 35 lbs lighter feels better too. I never would have experienced this increase in happiness if I wasn't looking for real ways to increase my happiness and/or reduce stresses. So just as people look everyday to increase their pile of money I look at everything I do to see if it's making me happy.
Great video explaining what early retirement can be like for single people. The importance of the scenarios cannot be understated. The tricky part is not knowing how long any of us will live, and we don't want to die not having sufficiently enjoyed the fruits of our labor.
@@clarifyingquestions Agreed. I would say a person should still save as much as possible towards a retirement fund. People are living longer and there have been a dramatic increase in elderly homelessness and food insecurity.
I'm thinking of just taking SS at 62 and dollar cost averaging into an S&P index fund for the first 3 to 5 years while living off the 401k. By 67, that should be a nice chunk of well over $100,000..
I’m 53 years old and I can’t recommend what more content you should add but this presentation helped tremendously for myself. More so than other content I have seen. Thank you
94 isn’t ridiculous at all, approximately 25% of women at 50 today are projected to live to 94. In terms of planning you want to be somewhat conservative. You don’t want to plan to 85 and then run out of money if you happen to live longer than expected
You want to tell that to my 95 year old parents? Or their parents who all lived into their 90s? You bet I’m planning to live to 100. Grandma died at 105. Best to be prepared.
I really like your scenario cases you use for your videos...love to see a 55 yo married couple looking to retire 62, so shorter window...with 500k retirement acct half in Trad IRA, half in roth...and ss and retirement income of 36k in current day money. Thanks again another great video!
Would really like to see you do a scenario of a couple using the FIRE movement type of retirement strategy. There is a CZcams couple who grew their savings and retirement to 2.5M and retired before the age of 40 with 2 kids. How is this done? What does the Monte Carlo simulation say about withdrawals, likelihood of success, social security, paying for college etc?
You don't have to worry about withdrawal in FIRE scenarios if you can make a CZcams channel about your FIRE journey as your side hustle to earn you heaps of passive income.....
I love Our Rich Journey! They lucked out a bit - they built their portfolio during the longest bull run in history. The past 10 years the S&P has averaged @13%/yr. If they started with $1M 10 years ago, that would be worth over $3M today.
You can't really use them because they're likely earning significant income from their CZcams channel and other business endeavors. Likely enough to fund their lifestyle and continue saving a significant amount of money.
@@MrGam3on They also bought real estate in San Francisco before things became completely insane with prices. I love their hustle, but they also got very lucky with timing.
I understand not wanting to run out of money in retirement, but passing away with or without kids and $1M+ portfolio is not ideal either. I've mapped out a plan where SS should cover living expenses and enjoy my 60s and 70s with money from portfolio. Having 50k or 60k or even 70k in RMDs in your 70s and 80s is just a waste if you cant put the money to good use.
JFIVE...now this is the scenario that needs to be discussed more often, I've been hoping he'd do more on the guardrails concept allowing for more taken out earlier or why'd you work for 40 years...to have a really great TV and food delivery?
I am 59 1/2, single, no kids, with 850K retirement portfolio. When can I retire and spend 45K per year to last 30-35 years? Most importantly, I have ZERO debt.
Using the info you provided, in 4 years your $45k/yr income requirement adjusted for inflation will be $50.6k/yr using 3% inflation per year. Based on the 4% rule, you would need around $1.26M when you retire in 4 years to withdraw $50.6k/yr. Your existing $850k portfolio will hit $1.26M in 4 years assuming no additional savings and an 8% annual market return during the next 4 years. This doesn't take social security or any other income streams into consideration (pension? rental income? part time job during retirement?).
You could retire right now really. You would need to take 5.29% initial social security and then take social security anywhere between age 62 and 66. Then you can drop your withdrawals significantly. Social security will likely make up a huge chunk of your withdrawals at that point which should give your portfolio enough time to recover since you will be taking much smaller withdrawals.
@@crimsonpearl4686 sorry...I meant to say initial withdrawal rate from your savings. It was a brain freeze. So 5.29% is the initial withdrawal rate you would be taking and then you would ramp down your withdrawal rate when you start taking social security. Your financial advisor would have to run the numbers to decide what the optimal age to take social security would be for you.
10:35 - Saying I don't believe in the 4 percent rule because interest rates are low blah blah is always a red flag to me. The 4 percent rule was a study of the financial markets over nearly 100 years and takes into account MULTIPLE different economic realities. So you're say because you have a few years or even decades of current data that worry you it negates a study that looks at nearly 100 years of data? Makes no sense to me.
As an lnvesting enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?
I like your channel. Nearly all of this information is the same as you teach in all of your other videos. You do not actually ever answer the question (when can I retire with 50K per year) for the case study. What is the answer...? If you are not going to answer, that is fine... but you should not claim you are going to.
He does doesn't he? It's always a probability, so if you get to about 80% chance of success in the monte carlo simulation then it's a success for most people. If you're conservative you can try to push it to 90% success. And he goes through that at the end with retiring with 50k and 40k income.
Thabk you for posting this example. If one decides to retire early and single, what are some peripheral factors that may need to be considered? Ex. If have not paid into social security for 35 years, would social security payment calculations change? If divorced, would past marriage (depending on how long it lasted) impact this calculation as well?
Very good video. Thank you! I would like to see a video that explains your company though and how you work with Clients. Do Clients have to move their money into your company? Or do you help with planning even if the money is held elsewhere. And how do the fees work?
I was wondering the same & called them a couple of weeks ago. Despite having $1M+ in my portfolio, they wouldn't work with me since a majority of that is in my 401k & I'm still employed. That leads me to believe they want to manage it.
This scenario is similar ( about $500000 in 401k by time of retirement) with the exception that I’m married and my husband will receive a pension. He is planning to retire in 2 years and I believe his yearly pension should be about $45000. He plans to teach possibly for 2-3 more years in FL and I’ll retire ( in 2026, he’s 63 and I’ll be 58). Our expenses at that point will be $80000 a year and would want to travel the first 10-12 years, $10000-12000 if possible. How would I know best strategy for SS ? With having the pension, how does the probability of withdrawal from my 401k be effective.
I really liked this video and will share it with my daughter. I am 72 and taking RMD’s for the first time this year. My husband died 6 years ago and my taxes have been relatively low since then. I did opt for we at 65 when I retired. I have done several small Roth conversions and am considering another next year since the market reduced my RMD for 2023 considerably. I am considering staying under the limit for triggering the added tax for Medicare. Trying to figure my State taxes and understanding what sort of investments are best kept in different accounts are my chief concerns. Perhaps in the 2024 tax year I should consider a large move to the Roth. Right now I’m in the 22 percent bracket and overall am paying 29 percent including the state and local taxes. Bumping up to the 24 percent will cost me more like 32 percent. Does that make sense to do?
Did you feel like he taught anything that hasn't been taught when talking about couples? He said that there are similarities, but taxes would be different... then never actually explained what the differences are. Perhaps I missed him explain and answer the question posed in the title of the video?
Just curious if you could break down what happens in retirement when the 401k is blended. Let's say $600,000, single male, Pre-Tax 75.62%, Roth 7.94%, Match 15.27%, and Rollover 1.18%. Then let's say $100,000 in Roth IRA, then $50,000 in an HSA account currently invested.
Im a 66 woman.I have $ 500,000 in an Ira, I’m selling a $1.5 million property, should end up with 760,000 which I’m planning to do an IRS 1031 exchange unto a Delaware statutory trust. I still have a rental property that nets me approximately $12400 per year. Can I retire?
Please create a scenario of a 42 years old person (married or single) with an 80K gross household income with zero investment. How much should person must save monthly in order to retire with at least 60K. Will that person be able to retire confortably? Is there any other strategies available? Or any simulation of a person that will just start learning investment.
Assuming you retire in 23 years at 65, your inflation adjusted $60k/yr will be $118k/yr (using 3% inflation per year). Based on the 4% rule, you would need almost $3M when you hit 65 to withdraw $118k/yr. To get there, you'll need to save $50k/yr assuming 8%/yr returns for the next 23 years. This doesn't take social security or any other income streams into consideration (pension? rental income? other?)
@@MrGam3on to be more specific with my situation, im married earning about 50K per year and my wife 40K per year = 90K gross income. We expect about about 36K to 38K in social security combined (which I believed important to include).
@@allandelossantos1392 ok! adjusting the #'s for $38k/yr social security. Assuming you retire in 23 years at 65, your inflation adjusted $60k/yr required income will be $118k/yr (using 3% inflation per year). This hasn't changed. In 23 years, your inflation adjusted social security will be $75k assuming a 3% cost of living adjustment each year. The difference between your $118k/yr required income & your $75k/yr projected social security is $43k/yr in retirement. This $43k/yr is the gap you need to solve for. Based on the 4% rule, you would need approximately $1.1M when you hit 65 to withdraw $43k/yr in retirement. This $43k/yr + your $75k/yr social security will give you your required $118k/yr required income. To get to $1.1M, you'll need to save $18k/yr assuming 8%/yr returns for the next 23 years. These are ballpark figures based on inflation assumptions, social security cost of living adjustment assumptions, and market return assumptions. Be sure to talk to a financial planner to confirm these estimates.
@@MrGam3on thank you so much for your help. We started to invest this year and we were able to save 20K since we just started March 2021, majority in ROTH IRA and ROTH 401K. Next year, if nothing bad happen, we will be able to invest around 21 to 22K annually as we also tried to increase our emergency fund. I hope the we will be able to make it. As of this moment, we were able fully paid all of our debt last year 2020.
Thank you for your support! We appreciate that you enjoy our content. Feel free to click the link below to speak to one of our advisors if you have any questions: click2retire.com/imsinglewith...
Millennials and Gen Z: "At 50, I hope to only have about 25k in student loan debt left, plus my mortgage, and one car payment. What do you suggest I do to stop my night terrors?"
They need to do some videos to deal with you and our boomer’s kids issues. I’m sick of all the, “Ive got a million here and there”. We boomers are the luckiest generation. Now we’ll leave you to clean up climate change, etc. disgusting.
First off, love your videos. Find them very educational, so thanks for doing them. However, I do have some constructive criticism: 1. I have watched more hrs of videos about retirement scenarios and they all have pretty much the same in common. They assume you have no idea what'll have to spend on living expenses, health care, etc, and they 90% of the video telling you how little you'll have because you'll spend x on this or y on that, and whether you can or not retire. Why not just say it in a simpler way that we all can relate to it equally and let me figure out if it is enough for me and when? Example: you are single, 55 (rarely early retirement accounted for but you did here) or 60 and you have a $1 Million. You'll live to 90. Here is the max you can take yearly to age 90 and have a $0 balance at 90. Assume 10-15%/year more to age 70, and then decrease appropriately to age 90 as expenses will drop. Don't complicate it w/ inflation %, location, rise in healthcare, and other variables. Just give me a max and worst case scenario of a reasonable budget and let ME figure out where and how I make it fit my life style and expenses. 2. Why is it all these scenarios assume we'll all be married (You didn't hear)?? 1st marriage divorce rate is over 50%, 2nd marriage over 62%, and goes up exponentially from there. So, if statistics say most or half of us will be single at retirement, why most never account for it in all scenarios? 3. If retiring early and assuming SS at age 62, what are the alternatives for funding to age 59.5 when one can draw retirement without penalties and how do we adjust as you add SS at age 62? 4. Most people don't have pensions, rental properties, etc. Most people I know at least have a 401K or a SEP IRA +/- Roth. Let's plan based on reality rather than complicating w/ other sources of income most people don't have. 5. Lastly, while I know you are molding your videos to a gnrl audience, and you do great w/ it, keep up with the inspirational portions of it. They are as helpful as the # breakdown. Thanks.......
We're glad you enjoy our videos and find them useful, @dgasmd1! And thank you for the idea! We will add it to our list of ideas for future content. As always, you can get your question answered and talk with one of our Financial Advisors, too, by clicking click2retire.com/imsinglewith500k to schedule your complimentary visit.
The arguments against the 4% rule were sorta off putting. It makes it look like he has no idea what he's talking about for me. The 4% rule (from Trinity study) was done with stock heavy portfolios so the bond rates are not that relevant, Trinity study was done in 1998 and has been further validated since then, and medical spending doesn't have anything to do with withdraw rates. I mean there are valid criticisms of the 4% rule but this just sounded ignorant. It's puzzling because the simulations his software is doing are basically inspired by the Trinity study but Monte Carlo methods have have additional issues.
While I'm a follower of the 4% rule, I see it as more of a guide. The Trinity study authors even said that mid-course corrections likely will be required, and that selection of a withdrawal rate is not a matter of contract but rather a matter of planning. Meaning be prepared to adjust your withdrawals based on market performance.
@@MrGam3on Agree. The 4% rule is a rule of thumb not an absolute rule. If his objection was that we can do more analysis and it's a crude tool I would have agreed. But his objections just felt misdirected.
I really enjoy your videos and have learned so much from you! Can you do a video that shows someone who has saved for a modest retirement, but has to take a 10 percent withdrawal on their retirement funds for an unplanned expense ( moving, new home, medical) and how that would affect their retirement savings. How much of an emergency fund should you have to cover these unplanned expenses and if you use up those funds, how do you recoup for a future emergency? Do you increase percentage you take out of retirement then and put the extra into another account that you can quickly access? Appreciate all you do to educate us!!
Taxes "destroy" income? Well then, I guess, bills destroy income; payments destroy income; purchases destroy income; fees destroy income; tips destroy income. We do get some things in return for taxes just like we get shelter from mortgage payments. Seems just a bit overly dramatic.
The short answer is you cannot retire. Why would you want to retire at 50 with only 500K in savings? That money needs to last at least 35 years. So you’re basically living below the poverty level for the rest of your life.
I'm not a professional but you can retire as long as you don't live in any major cities and/or California/new York. But as a non professional I would recommend having a part time job or do Uber eats part time to have pocket money for very basics. Thank you for trusting capital first financial network association of North America.
Hi Tammy, thanks for watching! We help people all across the country. There is a link in the description that allows you to connect with us for a consultation. There is no cost to the consultation. We look forward to getting to know you!
When using the estimator on the social Social Security website does it assume your latest years salary will run out until age 67 when it is making a calculation? How do you use the estimator if for example you’re 53 years old and plan to retire at 57? Is the estimator assuming you’re still making salary all the way until your retirement age? Since if you were retiring early technically your income would stop at the early retirement year.
It doesn't matter when you stop working. The SSN payout is based on your 35 highest earning years and the age that you elect to start receiving the benefit. If you maxed out your SSN contribution for 35 years, then you will receive the maximum payout.
You can do simulations on the SSA website. I have checked how much would happen if I reduce my annual pay... including if I stopped working altogether to see how much I would get at various ages (62... 65... 67... 70... for example).
True, you can simulate with various years, but simulations are restricted to only those years with the retirement age range (i.e. 62 or greater). I am trying to simulate (for example) retiring at 55, or 57, or 59. There doesn't appear to be that option in the simulator.
can you make a video that talks about what accounts would be helpful for general tax planning ex( if I have accounts: 401k,401k Roth, IRA Roth, brokerage, Crypto). do you just write a check to the IRS at the end of the year or do you make payments thru the year? thanks for making single videos they help me the most.
You don’t always have to think long term. Investing is as much a tool for shaping your present financial situation as it is for forming your future one. Do you want to buy a BMW next year? Do you want to go on a cruise? Wouldn’t a vacation that was paid for with dividends feel nice?
@@williamandersen1367 He does doesn't he? It's always a probability, so if you get to about 80% chance of success in the monte carlo simulation then it's a success for most people. If you're conservative you can try to push it to 90% success. And he goes through that at the end with retiring with 50k and 40k income.
@@dresser6135 The answer in the video was 10 years (60) at $50k of spending. And she could increase success with $40k spending and 9 years (59). He didn't explore any other options.
Take some of the 500k and purchase a rental. So so much is lost if one is only in the stock market. Any comments on using some of the 500k and purchasing a rental or two? Thanks for your work
I think the same thing - I do have one rental, and the passive income it generates makes a difference when calculating required income for future withdrawals. The tradeoff is having a rental is a bit of work. Fine if that's what you want. Another consideration is taking that $500k & putting it into an annuity for guaranteed income.
500k for a single person!.income from a rental is too small to live off.. appreciation will also be top small and annual cost / outgoings to maintain drag down your annual return... na... 500k not enough
I see that in some of your simulations there will be a down market for 5 years. If the market has never been down for more than 3 years in a row historically, have you ever thought of changing the software to reflect that so that you never see more than 3 years of a down market?
I'm Single with $500K. When Can I Retire? - The answer is NO. You will need at least 1.5M to retire. 1.5M will generate 60K. Plus 20K from SS will get you to 80K. That's what you will need to live a very modest life (after inflation adjustment). Good luck.
Live in another country where costs are lower even 60% lower.... add a balanced growth portfolio.....but 94 is completely ridiculous!!!!! People assume 44 yrs beyond 50 will be a breeze... try 84 max..
You can only retire if your house and financial can live longer than you 😂🤣😅😜🤪😛😋😝 retirement mean you don't have to work anymore , if you still working that you aren't retire unless your money make money for you without fail
Nice presentation, but you haven't talked about at least two topics that I believe are critical. Don't feel bad, I just made them up. 😏 1. "Voluntary Inflation". The nation voted for the current Executive and Legislative branches. The great majority of those currently in office have been honest about their proclivities for enacting fiscal and spending priorities that can ONLY be expected to increase inflation. We did this, so we volunteered for it. 2. "Inflation of taxes." Tax increases are coming, and they're coming for EVERYBODY. It doesn't matter which political party is in office. Dems want to spend more because it gives them more power while making it look like they're being kind and gentle. Repubs think they were "elected to work together with (which means "agree with") Dems". Now here in August 2022, I have the benefit of having seen the bill getting passed by our Congress, which allows for 87,000 MORE IRS agents. Even if that were not happening, I'd have still been right. Our taxes are going up because there are not enough people willing to fight the easy spend. We volunteered for both of these. Not necessarily "you as an individual", but we as a nation. We're in this together, and it doesn't matter who we voted for or whether or not our brothers and sisters outvoted us on getting more voluntary inflation or taxes. But it's there, it's a fact, and it's nearly impossible to plan for, not even if you doubled or quadrupled "Jane's" net worth at the start of her retirement.
Probably my favorite video so far on this channel. Very useful and easy to understand information. Thanks.
Thank you for the single woman example 😎
Great video. BUT viewers might want to keep in mind this type of financial planning is only 1 part of a successful retirement. I've been retired for 20 years and for me spending has been the main component of my success. It's a different lifestyle. It took some years to get this lifestyle. For example I haven't eaten out or ordered in for about 4 years. I used to eat out a lot...and had the belly to show for it. I loved food. Expensive and not healthy. I switched to low carb after learning about recent science on the effects of sugar/carbs on the body. I thought it would be really hard to give up carbs....was shocked no carbs made me happier. The cravings went away. When I ate a whole fruit pie at noon I wanted another one the next day and had to fight that. Even though I was eating a lot of carbs everyday I still craved more. Eating low carbs stopped almost entirely those cravings. That's an increase in happiness. 35 lbs lighter feels better too. I never would have experienced this increase in happiness if I wasn't looking for real ways to increase my happiness and/or reduce stresses. So just as people look everyday to increase their pile of money I look at everything I do to see if it's making me happy.
Great video explaining what early retirement can be like for single people. The importance of the scenarios cannot be understated. The tricky part is not knowing how long any of us will live, and we don't want to die not having sufficiently enjoyed the fruits of our labor.
I base my numbers on living to 100.
@@clarifyingquestions I wish you all the best towards that goal.
@@daw7773 It is not a goal . It is a response to what I do regarding "the tricky part is not knowing how long any of us will live,...."
@@clarifyingquestions Agreed. I would say a person should still save as much as possible towards a retirement fund. People are living longer and there have been a dramatic increase in elderly homelessness and food insecurity.
It almost never goes as planned. On the way up.
I'm thinking of just taking SS at 62 and dollar cost averaging into an S&P index fund for the first 3 to 5 years while living off the 401k. By 67, that should be a nice chunk of well over $100,000..
I’m 53 years old and I can’t recommend what more content you should add but this presentation helped tremendously for myself. More so than other content I have seen. Thank you
Real world for a single person like myself is to move to another country where living costs are 60% lower... and 94 is completely ridiculous...
94 isn’t ridiculous at all, approximately 25% of women at 50 today are projected to live to 94. In terms of planning you want to be somewhat conservative. You don’t want to plan to 85 and then run out of money if you happen to live longer than expected
You want to tell that to my 95 year old parents? Or their parents who all lived into their 90s? You bet I’m planning to live to 100. Grandma died at 105. Best to be prepared.
I really like your scenario cases you use for your videos...love to see a 55 yo married couple looking to retire 62, so shorter window...with 500k retirement acct half in Trad IRA, half in roth...and ss and retirement income of 36k in current day money. Thanks again another great video!
Would really like to see you do a scenario of a couple using the FIRE movement type of retirement strategy. There is a CZcams couple who grew their savings and retirement to 2.5M and retired before the age of 40 with 2 kids. How is this done? What does the Monte Carlo simulation say about withdrawals, likelihood of success, social security, paying for college etc?
Love watching Our Rich Journey! They are living the dream!!
You don't have to worry about withdrawal in FIRE scenarios if you can make a CZcams channel about your FIRE journey as your side hustle to earn you heaps of passive income.....
I love Our Rich Journey! They lucked out a bit - they built their portfolio during the longest bull run in history. The past 10 years the S&P has averaged @13%/yr. If they started with $1M 10 years ago, that would be worth over $3M today.
You can't really use them because they're likely earning significant income from their CZcams channel and other business endeavors. Likely enough to fund their lifestyle and continue saving a significant amount of money.
@@MrGam3on They also bought real estate in San Francisco before things became completely insane with prices. I love their hustle, but they also got very lucky with timing.
I understand not wanting to run out of money in retirement, but passing away with or without kids and $1M+ portfolio is not ideal either. I've mapped out a plan where SS should cover living expenses and enjoy my 60s and 70s with money from portfolio. Having 50k or 60k or even 70k in RMDs in your 70s and 80s is just a waste if you cant put the money to good use.
JFIVE...now this is the scenario that needs to be discussed more often, I've been hoping he'd do more on the guardrails concept allowing for more taken out earlier or why'd you work for 40 years...to have a really great TV and food delivery?
I am 59 1/2, single, no kids, with 850K retirement portfolio. When can I retire and spend 45K per year to last 30-35 years? Most importantly, I have ZERO debt.
Using the info you provided, in 4 years your $45k/yr income requirement adjusted for inflation will be $50.6k/yr using 3% inflation per year.
Based on the 4% rule, you would need around $1.26M when you retire in 4 years to withdraw $50.6k/yr. Your existing $850k portfolio will hit $1.26M in 4 years assuming no additional savings and an 8% annual market return during the next 4 years.
This doesn't take social security or any other income streams into consideration (pension? rental income? part time job during retirement?).
You could retire right now really. You would need to take 5.29% initial social security and then take social security anywhere between age 62 and 66. Then you can drop your withdrawals significantly. Social security will likely make up a huge chunk of your withdrawals at that point which should give your portfolio enough time to recover since you will be taking much smaller withdrawals.
@@ariefraiser140 What is "initial social security"?? I am only 59!
@@crimsonpearl4686 sorry...I meant to say initial withdrawal rate from your savings. It was a brain freeze. So 5.29% is the initial withdrawal rate you would be taking and then you would ramp down your withdrawal rate when you start taking social security. Your financial advisor would have to run the numbers to decide what the optimal age to take social security would be for you.
@@ariefraiser140 Got it, thanks! I intended to work for at least 3 more years and continue to contribute 32% of my salary towards retirement.
The current FU number is 2.5 mil. 500k is not enough.
10:35 - Saying I don't believe in the 4 percent rule because interest rates are low blah blah is always a red flag to me. The 4 percent rule was a study of the financial markets over nearly 100 years and takes into account MULTIPLE different economic realities. So you're say because you have a few years or even decades of current data that worry you it negates a study that looks at nearly 100 years of data? Makes no sense to me.
As an lnvesting enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?
I have saved 3 times this and still think it’s not nearly enough.
I like your channel. Nearly all of this information is the same as you teach in all of your other videos. You do not actually ever answer the question (when can I retire with 50K per year) for the case study. What is the answer...? If you are not going to answer, that is fine... but you should not claim you are going to.
He does doesn't he? It's always a probability, so if you get to about 80% chance of success in the monte carlo simulation then it's a success for most people. If you're conservative you can try to push it to 90% success. And he goes through that at the end with retiring with 50k and 40k income.
Thabk you for posting this example. If one decides to retire early and single, what are some peripheral factors that may need to be considered? Ex. If have not paid into social security for 35 years, would social security payment calculations change? If divorced, would past marriage (depending on how long it lasted) impact this calculation as well?
Great information! Explained very clearly.
Thank you!!
It depends
Very good video. Thank you! I would like to see a video that explains your company though and how you work with Clients. Do Clients have to move their money into your company? Or do you help with planning even if the money is held elsewhere. And how do the fees work?
I was wondering the same & called them a couple of weeks ago. Despite having $1M+ in my portfolio, they wouldn't work with me since a majority of that is in my 401k & I'm still employed. That leads me to believe they want to manage it.
This scenario is similar ( about $500000 in 401k by time of retirement) with the exception that I’m married and my husband will receive a pension. He is planning to retire in 2 years and I believe his yearly pension should be about $45000. He plans to teach possibly for 2-3 more years in FL and I’ll retire ( in 2026, he’s 63 and I’ll be 58). Our expenses at that point will be $80000 a year and would want to travel the first 10-12 years, $10000-12000 if possible. How would I know best strategy for SS ? With having the pension, how does the probability of withdrawal from my 401k be effective.
Your scenario is absolutely NOT similar.
I really liked this video and will share it with my daughter. I am 72 and taking RMD’s for the first time this year. My husband died 6 years ago and my taxes have been relatively low since then. I did opt for we at 65 when I retired. I have done several small Roth conversions and am considering another next year since the market reduced my RMD for 2023 considerably. I am considering staying under the limit for triggering the added tax for Medicare. Trying to figure my State taxes and understanding what sort of investments are best kept in different accounts are my chief concerns. Perhaps in the 2024 tax year I should consider a large move to the Roth. Right now I’m in the 22 percent bracket and overall am paying 29 percent including the state and local taxes. Bumping up to the 24 percent will cost me more like 32 percent. Does that make sense to do?
Retirement Planning at 50. I'm Single with $500K. When Can I Retire? When you are 65. Keep working.
Nonsense. Totally doable in this scenario to retire at 59 or 60.
Thank you for addressing the concerns of singletons!
Did you feel like he taught anything that hasn't been taught when talking about couples? He said that there are similarities, but taxes would be different... then never actually explained what the differences are. Perhaps I missed him explain and answer the question posed in the title of the video?
Just curious if you could break down what happens in retirement when the 401k is blended. Let's say $600,000, single male, Pre-Tax 75.62%, Roth 7.94%, Match 15.27%, and Rollover 1.18%. Then let's say $100,000 in Roth IRA, then $50,000 in an HSA account currently invested.
This was so helpful, thank you!
I'm so glad! You're welcome!
This was very helpful, Troy. Thanks so much.
Im a 66 woman.I have $ 500,000 in an Ira, I’m selling a $1.5 million property, should end up with 760,000 which I’m planning to do an IRS 1031 exchange unto a Delaware statutory trust. I still have a rental property that nets me approximately $12400 per year. Can I retire?
Please create a scenario of a 42 years old person (married or single) with an 80K gross household income with zero investment. How much should person must save monthly in order to retire with at least 60K.
Will that person be able to retire confortably? Is there any other strategies available?
Or any simulation of a person that will just start learning investment.
You should be saving as much as you can there you go Allan Delos Santos
Assuming you retire in 23 years at 65, your inflation adjusted $60k/yr will be $118k/yr (using 3% inflation per year).
Based on the 4% rule, you would need almost $3M when you hit 65 to withdraw $118k/yr. To get there, you'll need to save $50k/yr assuming 8%/yr returns for the next 23 years.
This doesn't take social security or any other income streams into consideration (pension? rental income? other?)
@@MrGam3on to be more specific with my situation, im married earning about 50K per year and my wife 40K per year = 90K gross income. We expect about about 36K to 38K in social security combined (which I believed important to include).
@@allandelossantos1392 ok! adjusting the #'s for $38k/yr social security.
Assuming you retire in 23 years at 65, your inflation adjusted $60k/yr required income will be $118k/yr (using 3% inflation per year). This hasn't changed.
In 23 years, your inflation adjusted social security will be $75k assuming a 3% cost of living adjustment each year. The difference between your $118k/yr required income & your $75k/yr projected social security is $43k/yr in retirement. This $43k/yr is the gap you need to solve for.
Based on the 4% rule, you would need approximately $1.1M when you hit 65 to withdraw $43k/yr in retirement. This $43k/yr + your $75k/yr social security will give you your required $118k/yr required income.
To get to $1.1M, you'll need to save $18k/yr assuming 8%/yr returns for the next 23 years.
These are ballpark figures based on inflation assumptions, social security cost of living adjustment assumptions, and market return assumptions. Be sure to talk to a financial planner to confirm these estimates.
@@MrGam3on thank you so much for your help. We started to invest this year and we were able to save 20K since we just started March 2021, majority in ROTH IRA and ROTH 401K.
Next year, if nothing bad happen, we will be able to invest around 21 to 22K annually as we also tried to increase our emergency fund.
I hope the we will be able to make it. As of this moment, we were able fully paid all of our debt last year 2020.
Great video again. Could you bring a case where the spouses have a 10+ difference in age?
Great job helping us prepare emotionally if we see multiple years of negative returns.
I really appreciate your videos. Subscribed and addicted. :)
Thank you for your support! We appreciate that you enjoy our content. Feel free to click the link below to speak to one of our advisors if you have any questions: click2retire.com/imsinglewith...
Millennials and Gen Z: "At 50, I hope to only have about 25k in student loan debt left, plus my mortgage, and one car payment. What do you suggest I do to stop my night terrors?"
They need to do some videos to deal with you and our boomer’s kids issues. I’m sick of all the, “Ive got a million here and there”. We boomers are the luckiest generation. Now we’ll leave you to clean up climate change, etc. disgusting.
I have a ways to go but this is good information 💁♀️
First off, love your videos. Find them very educational, so thanks for doing them. However, I do have some constructive criticism: 1. I have watched more hrs of videos about retirement scenarios and they all have pretty much the same in common. They assume you have no idea what'll have to spend on living expenses, health care, etc, and they 90% of the video telling you how little you'll have because you'll spend x on this or y on that, and whether you can or not retire. Why not just say it in a simpler way that we all can relate to it equally and let me figure out if it is enough for me and when? Example: you are single, 55 (rarely early retirement accounted for but you did here) or 60 and you have a $1 Million. You'll live to 90. Here is the max you can take yearly to age 90 and have a $0 balance at 90. Assume 10-15%/year more to age 70, and then decrease appropriately to age 90 as expenses will drop. Don't complicate it w/ inflation %, location, rise in healthcare, and other variables. Just give me a max and worst case scenario of a reasonable budget and let ME figure out where and how I make it fit my life style and expenses. 2. Why is it all these scenarios assume we'll all be married (You didn't hear)?? 1st marriage divorce rate is over 50%, 2nd marriage over 62%, and goes up exponentially from there. So, if statistics say most or half of us will be single at retirement, why most never account for it in all scenarios? 3. If retiring early and assuming SS at age 62, what are the alternatives for funding to age 59.5 when one can draw retirement without penalties and how do we adjust as you add SS at age 62? 4. Most people don't have pensions, rental properties, etc. Most people I know at least have a 401K or a SEP IRA +/- Roth. Let's plan based on reality rather than complicating w/ other sources of income most people don't have. 5. Lastly, while I know you are molding your videos to a gnrl audience, and you do great w/ it, keep up with the inspirational portions of it. They are as helpful as the # breakdown. Thanks.......
We're glad you enjoy our videos and find them useful, @dgasmd1! And thank you for the idea! We will add it to our list of ideas for future content. As always, you can get your question answered and talk with one of our Financial Advisors, too, by clicking click2retire.com/imsinglewith500k to schedule your complimentary visit.
The arguments against the 4% rule were sorta off putting. It makes it look like he has no idea what he's talking about for me. The 4% rule (from Trinity study) was done with stock heavy portfolios so the bond rates are not that relevant, Trinity study was done in 1998 and has been further validated since then, and medical spending doesn't have anything to do with withdraw rates.
I mean there are valid criticisms of the 4% rule but this just sounded ignorant. It's puzzling because the simulations his software is doing are basically inspired by the Trinity study but Monte Carlo methods have have additional issues.
While I'm a follower of the 4% rule, I see it as more of a guide. The Trinity study authors even said that mid-course corrections likely will be required, and that selection of a withdrawal rate is not a matter of contract but rather a matter of planning. Meaning be prepared to adjust your withdrawals based on market performance.
@@MrGam3on Agree. The 4% rule is a rule of thumb not an absolute rule. If his objection was that we can do more analysis and it's a crude tool I would have agreed. But his objections just felt misdirected.
I really enjoy your videos and have learned so much from you! Can you do a video that shows someone who has saved for a modest retirement, but has to take a 10 percent withdrawal on their retirement funds for an unplanned expense ( moving, new home, medical) and how that would affect their retirement savings. How much of an emergency fund should you have to cover these unplanned expenses and if you use up those funds, how do you recoup for a future emergency? Do you increase percentage you take out of retirement then and put the extra into another account that you can quickly access? Appreciate all you do to educate us!!
Taxes "destroy" income? Well then, I guess, bills destroy income; payments destroy income; purchases destroy income; fees destroy income; tips destroy income. We do get some things in return for taxes just like we get shelter from mortgage payments. Seems just a bit overly dramatic.
omg, someone at 50 years old is only making $60k?. A manager at Quick Trip makes more than that.
The short answer is you cannot retire. Why would you want to retire at 50 with only 500K in savings? That money needs to last at least 35 years. So you’re basically living below the poverty level for the rest of your life.
She doesn’t want to retire at 50. The question is “when” can she retire. Answer is 60 and not at poverty level.
She can retire at 60 if she continues to save and no crisis incurs substantial expense.
I'm not a professional but you can retire as long as you don't live in any major cities and/or California/new York.
But as a non professional I would recommend having a part time job or do Uber eats part time to have pocket money for very basics.
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When the market declines, I just say to myself, "Everything's on sale now!" The lower the price, the more shares you can accumulate.
Do you/are you able to provide services to people in other states?
Hi Tammy, thanks for watching! We help people all across the country. There is a link in the description that allows you to connect with us for a consultation. There is no cost to the consultation. We look forward to getting to know you!
When using the estimator on the social Social Security website does it assume your latest years salary will run out until age 67 when it is making a calculation? How do you use the estimator if for example you’re 53 years old and plan to retire at 57? Is the estimator assuming you’re still making salary all the way until your retirement age? Since if you were retiring early technically your income would stop at the early retirement year.
It doesn't matter when you stop working. The SSN payout is based on your 35 highest earning years and the age that you elect to start receiving the benefit. If you maxed out your SSN contribution for 35 years, then you will receive the maximum payout.
You can do simulations on the SSA website. I have checked how much would happen if I reduce my annual pay... including if I stopped working altogether to see how much I would get at various ages (62... 65... 67... 70... for example).
True, you can simulate with various years, but simulations are restricted to only those years with the retirement age range (i.e. 62 or greater). I am trying to simulate (for example) retiring at 55, or 57, or 59. There doesn't appear to be that option in the simulator.
can you make a video that talks about what accounts would be helpful for general tax planning ex( if I have accounts: 401k,401k Roth, IRA Roth, brokerage, Crypto). do you just write a check to the IRS at the end of the year or do you make payments thru the year? thanks for making single videos they help me the most.
You don’t always have to think long term. Investing is as much a tool for shaping your present financial situation as it is for forming your future one. Do you want to buy a BMW next year? Do you want to go on a cruise? Wouldn’t a vacation that was paid for with dividends feel nice?
How do RMDs come into play when you've already been taking withdraws out of your IRA's over years?
I'm doing good shorting stocks in a bull market. When the market declines, I'm going to do great in a bear market.
NEVER !!!
I haven’t watched this yet, but I’m gonna guess the answer is NO! Edit - misleading headline. She’s not retiring at 50…
I'd say she is at least 7 or 8 yr's. away from being able to retire.
**Not a misleading headline, you misread the headline**
It actually is misleading, but not in the way that Barbie is saying. The video does not actually answer when she could retire with 50K income.
@@williamandersen1367 He does doesn't he? It's always a probability, so if you get to about 80% chance of success in the monte carlo simulation then it's a success for most people. If you're conservative you can try to push it to 90% success. And he goes through that at the end with retiring with 50k and 40k income.
@@dresser6135 The answer in the video was 10 years (60) at $50k of spending. And she could increase success with $40k spending and 9 years (59). He didn't explore any other options.
When you give all your money away, lol
Take some of the 500k and purchase a rental. So so much is lost if one is only in the stock market. Any comments on using some of the 500k and purchasing a rental or two?
Thanks for your work
I think the same thing - I do have one rental, and the passive income it generates makes a difference when calculating required income for future withdrawals. The tradeoff is having a rental is a bit of work. Fine if that's what you want.
Another consideration is taking that $500k & putting it into an annuity for guaranteed income.
500k for a single person!.income from a rental is too small to live off.. appreciation will also be top small and annual cost / outgoings to maintain drag down your annual return... na... 500k not enough
I see that in some of your simulations there will be a down market for 5 years. If the market has never been down for more than 3 years in a row historically, have you ever thought of changing the software to reflect that so that you never see more than 3 years of a down market?
if you are single with 500 k I am looking for you hehe
Controversially dismisses the 4% rule ,yet will use the 4% rule himself ..
I'm Single with $500K. When Can I Retire? - The answer is NO. You will need at least 1.5M to retire. 1.5M will generate 60K. Plus 20K from SS will get you to 80K. That's what you will need to live a very modest life (after inflation adjustment). Good luck.
That person needs to double her saving for retirement and maybe delay retirement for at least another year or more like two.
Live in another country where costs are lower even 60% lower.... add a balanced growth portfolio.....but 94 is completely ridiculous!!!!! People assume 44 yrs beyond 50 will be a breeze... try 84 max..
You can only retire if your house and financial can live longer than you 😂🤣😅😜🤪😛😋😝 retirement mean you don't have to work anymore , if you still working that you aren't retire unless your money make money for you without fail
When you double that and have enough for both of us.
It better to get married, went get older no want will take care of old folk homes is not a nice place to stay
Nice presentation, but you haven't talked about at least two topics that I believe are critical. Don't feel bad, I just made them up. 😏
1. "Voluntary Inflation". The nation voted for the current Executive and Legislative branches. The great majority of those currently in office have been honest about their proclivities for enacting fiscal and spending priorities that can ONLY be expected to increase inflation. We did this, so we volunteered for it.
2. "Inflation of taxes." Tax increases are coming, and they're coming for EVERYBODY. It doesn't matter which political party is in office. Dems want to spend more because it gives them more power while making it look like they're being kind and gentle. Repubs think they were "elected to work together with (which means "agree with") Dems". Now here in August 2022, I have the benefit of having seen the bill getting passed by our Congress, which allows for 87,000 MORE IRS agents. Even if that were not happening, I'd have still been right. Our taxes are going up because there are not enough people willing to fight the easy spend.
We volunteered for both of these. Not necessarily "you as an individual", but we as a nation. We're in this together, and it doesn't matter who we voted for or whether or not our brothers and sisters outvoted us on getting more voluntary inflation or taxes. But it's there, it's a fact, and it's nearly impossible to plan for, not even if you doubled or quadrupled "Jane's" net worth at the start of her retirement.