When can a couple retire and still travel?
Jun 29th, 2006, 07:01 AM
#22
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Also,it depends on what you do for entertainment once retired. I play golf up to five times a week and am more than willing to pay for the cost of doing so. I don't mean a country club, just your muni courses. I like one trip a year to Europe and plan on doing so for as long as I am healthy. As far as cost, you do really need to be debt free and then I would guess a monthly income,net, of around $3,000 to 5,000 depending on your life style. Eating out, plays and movies add up cost fast. In any event it is just my opinion.
Jun 29th, 2006, 07:06 AM
#23
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One way around the "80%" rule is to downsize your house in favor of traveling. It's not feasible/desirable for everyone, but moving into a smaller house -- or even a retirement community -- means lower mortgage payments, lower property taxes and lower energy bills. My parents went this route and it leaves them with enough money to travel 3-4 times a year. (They're budget travelers, but not hostel or even motel travelers.)
Jun 29th, 2006, 07:51 AM
#24
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karameli makes a great point. Selling a home and moving into a condo or apartment can free up a lot of money for travel. Not having a house to worry about at home also lets you travel for longer (no worries about it sitting empty or needing to have the grass cut).
Having more time to travel and flexibility when you travel allows you to travel much cheaper. You can save $ by snapping up last minute flights. Or you can go for a month and rent an apartment, where you make most of your own meals and take day trips. The flexability of retirement allows for a lot of savings possibilities.
The actual amount you need in the bank depends on your retirement income (pensions etc) and what you are supporting back home - a large home? two cars? a designer wardrobe? higly taxed property?
In most cases, there is room to save if you make travelling your priority.
Having more time to travel and flexibility when you travel allows you to travel much cheaper. You can save $ by snapping up last minute flights. Or you can go for a month and rent an apartment, where you make most of your own meals and take day trips. The flexability of retirement allows for a lot of savings possibilities.
The actual amount you need in the bank depends on your retirement income (pensions etc) and what you are supporting back home - a large home? two cars? a designer wardrobe? higly taxed property?
In most cases, there is room to save if you make travelling your priority.
Jun 29th, 2006, 08:01 AM
#25
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As for medical, at age 65 you have to sign up for Medicare. It doesn't cover you outside the US.
Another stupid government rip off. We need the greedy stooges in congress to change this restriction.
Another stupid government rip off. We need the greedy stooges in congress to change this restriction.
Jun 29th, 2006, 08:10 AM
#26
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Ek-Rex isn't talking about travel at all in his post. He's saying that, somewhat like Jackie O, who refused further chemo for her non-Hodgkin's lymphoma when it metastasized, that he's NOT going to go through extensive chemo and other treatments just to keep him alive for a few more years.
He's willing to pack in the towel at the first sign of trouble, apparently....
He's willing to pack in the towel at the first sign of trouble, apparently....
Jun 29th, 2006, 08:34 AM
#27
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O'k Iets rephrase the question, how much mthly $$ do you need to retire.
Based on where you live and your expectations when it comes to travelling how much do hope to accumulate in personal savings?
Inorder to fulfill your retirement living expectation!
regards
tc
Based on where you live and your expectations when it comes to travelling how much do hope to accumulate in personal savings?
Inorder to fulfill your retirement living expectation!
regards
tc
Jun 29th, 2006, 08:56 AM
#30
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I will just add this: my grandparents had what I consider a fabulous life. My grandfather decided to retire at age 65 (he was a traditionalist). He definitely could have retired before that (my mother's cousin was already well versed in the business and primed to run it), but he opted to stay until age 65. He and my grandmother had been to Europe in the 60s, and their big retirement trip was going to be to a cruise to the Norwegian fjörds. Then my grandmother had a stroke and was unable to travel until she passed away 7 years later. My grandfather never left her side, and once all was said and done, he was unable to travel.
I am not a fan of sob stories, but I share this one because my grandma always told me that she was so happy that they had traveled "while they could." You never know when you won't be able to, so as she told me "if the money is in the bank and there are places you want to see, it is time to do it."
I am not a fan of sob stories, but I share this one because my grandma always told me that she was so happy that they had traveled "while they could." You never know when you won't be able to, so as she told me "if the money is in the bank and there are places you want to see, it is time to do it."
Jun 29th, 2006, 08:57 AM
#31
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I'll take a shot at it.
Answer Points:
1. No debt including house payments.
2. Property taxes of $1100/year (been in the same CA. house 30+ yrs. with prop 13 property tax base).
3. Late 50's age brackets
4. Still active in my financial services business (part time).
5. Will remain semi-active for several more years because I enjoy it.
All that being said, I feel that $4-5000 per month should be adequate for regular monthly expenses including some unexpected nominal surprise expenses.
This assumes that you have adequate health coverage that supplements Medicare as well as possibly a modest Long Term Care policy. This will protect the survivor's savings in case something happens.
This is a little more than a quick dollar amount answer, but I've seen so many people don't even do some simple/modest planning as they "hope for the best".
Answer Points:
1. No debt including house payments.
2. Property taxes of $1100/year (been in the same CA. house 30+ yrs. with prop 13 property tax base).
3. Late 50's age brackets
4. Still active in my financial services business (part time).
5. Will remain semi-active for several more years because I enjoy it.
All that being said, I feel that $4-5000 per month should be adequate for regular monthly expenses including some unexpected nominal surprise expenses.
This assumes that you have adequate health coverage that supplements Medicare as well as possibly a modest Long Term Care policy. This will protect the survivor's savings in case something happens.
This is a little more than a quick dollar amount answer, but I've seen so many people don't even do some simple/modest planning as they "hope for the best".
Jun 29th, 2006, 08:59 AM
#32
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tcmazzi: as a retired banker and financial advisor, I must ask you to re-phrase your original question, please.
If I were to sit down with you in the quiet of your home, I would first have to ask you a very simple pair of questions.
1. First, can you show me, month by month, for the past five years, exactly where your income and expenses have been? Also, what are your debts? Have you figured out your own net worth? Assets minus debts, that is. These are nuts-and-bolts facts that anyone should be able to write down. Basic stuff.
2. Second, please write down what are your goals for the next five years?
This, of course, would only be the beginning of our discussion, but you might be surprised how few persons can answer those two questions. Their finances are not well organized, their records do not give them that information, and they (and their partners or spouses) have not organized their life priorities that well.
All are achievable answers -- but people must do their homework.
Otherwise, time passes, finances and priorities drift or remain unknown, and people wonder what happened at the end of those five years.
Don't rely on "canned" answers or "rules of thumb" because you must know the answers to those two questions first. What works for one person does not necessarily work for another.
The second question is especially important -- so often our dreams go unspoken because we are afraid what "they" will think.
If I were to sit down with you in the quiet of your home, I would first have to ask you a very simple pair of questions.
1. First, can you show me, month by month, for the past five years, exactly where your income and expenses have been? Also, what are your debts? Have you figured out your own net worth? Assets minus debts, that is. These are nuts-and-bolts facts that anyone should be able to write down. Basic stuff.
2. Second, please write down what are your goals for the next five years?
This, of course, would only be the beginning of our discussion, but you might be surprised how few persons can answer those two questions. Their finances are not well organized, their records do not give them that information, and they (and their partners or spouses) have not organized their life priorities that well.
All are achievable answers -- but people must do their homework.
Otherwise, time passes, finances and priorities drift or remain unknown, and people wonder what happened at the end of those five years.
Don't rely on "canned" answers or "rules of thumb" because you must know the answers to those two questions first. What works for one person does not necessarily work for another.
The second question is especially important -- so often our dreams go unspoken because we are afraid what "they" will think.
Jun 29th, 2006, 09:14 AM
#34
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Laclaire is right. Don't wait until retirement--do it now.
One thing on the issue of downsizing...In Florida, perhaps other states as well, many people are finding themselves "trapped" in their homes. Once they move, even to a smaller place, they find there is a huge jump in their tax bill. They are better off in their large, paid-for home than paying even bigger taxes on a condo. Crazy, huh?
One thing on the issue of downsizing...In Florida, perhaps other states as well, many people are finding themselves "trapped" in their homes. Once they move, even to a smaller place, they find there is a huge jump in their tax bill. They are better off in their large, paid-for home than paying even bigger taxes on a condo. Crazy, huh?
Jun 29th, 2006, 09:34 AM
#36
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guy18, how does that work? Are your property taxes based on what you paid for your home? Or do they only get reassessed when you move? Where I live, property taxes are based on the "market value" of your home, and are adjusted based on that - so if you move into a cheaper place, you pay less tax. How does it work in Florida?
Jun 29th, 2006, 09:47 AM
#38
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mikeyb--I don't think that the "portability" you mention exists in Florida. Legislators are discussing it as a possibility for the future.
Saltymuffin--In the early 90's, a "save our homes" law was passed. People were finding themselves being taxed out of their ability to afford their homes as values rose. This law caps tax increases at inflation or 3%, whichever is lower. (It makes sense, unless you are a newcomer paying A LOT more in taxes on a home of the same value as others in your neighborhood.) Then, when the property is sold, the value is reassessed and the new owners get the hit. The only problem is the one I mentioned--people don't dare move. Property taxes are a huge concern when it comes to real estate here. As I said above, portability of caps is under discussion. Of course, I'd be all for it, for completely selfish reasons.
I wonder what the rules are in other states?
Saltymuffin--In the early 90's, a "save our homes" law was passed. People were finding themselves being taxed out of their ability to afford their homes as values rose. This law caps tax increases at inflation or 3%, whichever is lower. (It makes sense, unless you are a newcomer paying A LOT more in taxes on a home of the same value as others in your neighborhood.) Then, when the property is sold, the value is reassessed and the new owners get the hit. The only problem is the one I mentioned--people don't dare move. Property taxes are a huge concern when it comes to real estate here. As I said above, portability of caps is under discussion. Of course, I'd be all for it, for completely selfish reasons.
I wonder what the rules are in other states?
Jun 29th, 2006, 09:50 AM
#39
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There is a middle ground to retirement vs. working so much you never get to go away. Folks at my law firm who have been here 15 years or more get 4 weeks of vacation. But that is meaningless because no matter how much or little vacation you take, you have a quota of hours to bill. So maybe when I'm 60 I'll tell myself: I am going to take all of my vacation, and if I get a bit of a cut in pay because I bill fewer hours, so be it; or, I could even go to the compensation committee up front and say "Now that I'm 60, I'm going to work 10% fewer hours, so feel free to cut my pay by 10%"
Jun 29th, 2006, 09:53 AM
#40
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I think its easy if you live in the high rent areas of the country- SF, Boston, NY- just sell that house, move to a low cost state that has no income taxes. Buy a nice house and then put the Bookoo bucks left over in a high yield account and draw the interest for your trips!
