If you are asking yourself, how much to retire? You are asking yourself the wrong question. It should be how bad do I want to retire?
It is 2009 and 401K’s have turned into 201K’s…or worse. It is especially cruel to the baby boomers that have saved and saved only to see many years of steady gains disappear in their portfolios.
There is hope to still go ahead and retire if you are willing to examine some alternatives to “normal” retirement. I call it normal, because the massive financial planning industry has conditioned us to a certain formula for retirement.
How much to retire usually goes like so…you need to have enough to generate 75% (or pick a number) of the income you made when you last worked.
In 2009 that means no retirement for lots of boomers if they believe that 75% criteria.
But how bad do you want to retire? Only you can answer that question.
But stop and think…you are swapping years of your life to gain a few more bucks to generate the 75% figure. If you work another 5 years to “get there”, you are going to enjoy retirement less.
Why? Because we not able to do the things, we could when we were younger…and I’m not just referring to “that”. As we age, we become less and less able to do the things we could 5 years ago.
How many people do you know that can run faster, or hit the golf ball further, when they were 60 vs. 55?
How much to retire is usually a question about money. It should be time related, how much longer am I going to be able to jog, play golf or tennis, play catch with the grand kids, or anything else you enjoy doing?
I retired when I was 49 by practicing frugal retirement living. 14 years later, I am still retired and continue to do the things I enjoy. It was more important to me to retire than to continue the lifestyle I had when I last worked.
My cheaper retirement lifestyles have included living aboard a sailboat; full time RVing; park model living; all small space living. Ask yourself again…how bad do I want to retire?
How much to retire, from a dollars standpoint, decreases with these lifestyles, they are less expensive.
If you think you can’t retire unless you can still afford to belong to a country club…these lifestyles will seem foolish and Spartan. People may say I am depriving myself. The only thing I have deprived myself of is a commute. I don’t miss the commute.
So much of our old life was spent in keeping up with the neighbors…If that’s important to you, how much to retire will be an ever increasing number. Meanwhile, you get older.
What’s the worse that can happen? You might have to go back to work. I’ll take my chances…how about you.
