As I’ve mentioned, I’ve felt very stressed out lately, mostly about work. Jim’s been experiencing the same thing which leads us to moan to each other in the evenings and dream of how great it would be to be retired.
Jim’s gone so far as to roughly calculate what we need to save in order to retire- $2.5 million. With $2.5M we could invest it in bonds (pretty safe 5% return on average) and live off the ~$100,000/year interest. He’s predicted that with careful planning we could realistically have this in 22 years.
22 years sounds like a short time to collect that much money and it is when that figure is based on maintaining current living standards (mortgage, 529 and 401K contributions, vacations, etc.). I’d be 50 in 22 years – about 15 years younger than most people anticipate retiring. Also, at the rate we’re paying off our mortgage, we’ll outright own our home in 21 years which means that we’d have no house payment during retirement and could enjoy spending the money we pay for our house on living (Egypt better be safe in 22 years because I plan on going!).
I’ll tell you though, 22 years seems like an eternity if this stress-level was maintained.
The downsides of retiring early? To retire at 22 we BOTH have to maintain our current earning rate. That means I have to continue to work full time- something that I was hoping not to do once we had kids. Also, at 28 being retired sounds like it could get kinda boring. Provided we have another kid in ’09 we’ll still have kid(s) in college 22 years from now that we intend on financially supporting (here’s hoping that today’s 529 contributions take care of most/all of that…). Given national statistics on saving, we probably won’t have many people our age retiring in their early 50’s to hang out with. Good thing we like each other!
Jim gave me another option for his retiring early – I move to P&G Marketing, become a [marketing] rockstar, advance to director, and make enough for him to drop down to a reduced workweek. Good plan for him!
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7 comments:
We have a plan like that. Martin's plan is getting me to work for a big organization like the UN and he can then do designs and sculpturing. My plan is Martin will become a world-famous architect and I can spend my time with writing and photography. :)
But we would both love to own a little café or B&B one day.
I have never researched how much I would have to save to retire early. I guess until my life gets settled, thats not worth it for me to do. :) Retiring at 50 would be nice. My dad's retiring at the end of the month and I am sure he will be happy to tell you all kinds of things he finds to keep himself busy.
I'd like for us to retire early, too, but we need to be maxing out our retirement accounts first...something we're really not even close to. If Trey stays with his employer for a few more years we'll be better off for sure. Also, both of us want to pursue more education, but as both of us would like more specialized degrees, our choices will be limited wherever we are.
I think I'd get bored retiring completely too early, but doing part time would be nice. Either that, or I'd volunteer more. :-)
I'm with Jen. I never really thought about it. I don't want to dream my life away. I'm already saving for short term and for retirement, as much as I can afford right now. But to actually plan how much I'll need and by when? nah. I'd rather "spread the wealth" in terms of working and enjoying life before and during retirement, even if that includes working another 5.
My dad retired when we were 15 and had 3 kids still in HS. It was great because he could actually attend events. But by then, we were no longer in real sports so I guess it didn't matter so much... He got worked at a florist for a couple years- to fill his time and ease into retirement and worked doing a hobby/interest of his. Makes sense to me (and probably my mom who wouldn't have been used to having him around all the time!)
Wow, you guys have really looked into this! The most we've done is whine about wanting to travel more and make a plan to pay off our student loans ahead of schedule.
Retire? Bah... that's for the birds. :-D I think I would be incredibly bored, but then again... maybe not.
I want to retire tomorrow...
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