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Re: How much do you need for a comfortable retirement?

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I am afraid it is too late for that.  I am in the highest tax bracket I have ever been in and most of my tax shelters are gone due to the new tax law.  Our earned income is way higher than it has ever been and the same with unearned income.  We could owe 20k more taxes than 2016. Drawing money out of my IRA would be foolish.  I will at least wait until I retire.  My RMD will be a small to insignificant part of my income even then. Our combined SS plus her pension will be near 6 figures. More than half our money is in taxable accounts.  Before we retire, the taxable accounts will likley double again.  We plan to seek the advice of a tax lawyer in the next 12 months.  I have not been getting the level of tax avoidance advice we are getting from our accountant that we need.   We will need to see where the dust settles before we can make sane plans.  That will be after the 2018 taxes are figured out. The tax return will be a major focus point. We have been making crazy money in the market, my wife was forced to go from half time to full time to get her to retire.  She will in 3 years.  That is the first year she can retire without any pension penilty.  Her pension is calculated as years of service multiplied by what she earned in her top 3 years then divided by some number.  Working full time is like being eaten alive but she will try to hang in there since it will almost double her pension. 

 

We have been arguing about who should update our will for over a decade.  She wants the cheapest while I want one who understands death taxes and cost over double what the morons charge.  I can do better than a moron with my lawyer in a box application.  I did one of those for our family and one for my mom but my brother had mom's redone by a moron.  The new will could not be probated due to some little glitch.  They asked if she had a previous will they could look over.  Mine was fine and was probated.  The moron probably cost 5-10 k. 

 

Since then she has felt the concequences of having a moron plan your estate.  She hired a lawyer to draw up her uncles estate of which she will get a lion's share.  Her lawyer's advice was contrary to the experts on talk radio and she believed the moron over me.  Now, the estate is dwindling before her eyes even before it gets divided. She will be lucky if she keeps a third of it!   After we take care of our estate, we will get the name of a good tax guy from the estate lawyer. I prefer to pay through the nose for the advice than pay through the nose to the tax man.  I am hopeing the first is much less than the second. 

 

You can't plan well without knowing what problems you will face and the best way to avoid them.

 

  

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Re: How much do you need for a comfortable retirement?

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@RonMesnardwrote:

@mj6966, yes it is the commute that is the killer!  I work from home on Fridays.  That helps.  I also have about a 60 mile RT commute that takes me over 2 hrs only because I am allowed to come in crazy early so I can leave early.  They want me here 8.5 hrs minimum.  If I start to work 30 minutes later I could add another hour or more to the RT commute.  There is dry cleaning but I am slumming on that these days. 

 

I am working past my goal only to play it safe.  I will never be able to land anything more than a MW job after I retire.  In IT they hate 50 year olds and despise anyone in their 60s.  At my last job I out worked 4 young programmers that is the only reason I finally got a permenant job.  When the head of NOAA's IT says you walk on water that is concidered a fact. It didn't matter I was 67 with that referance. 

If you are currently 67, I would suggest conversion of enough IRA money that doesn't put you in another tax bracket to a Roth IRA each year until you are 70.5 years old before being "saddled" with the RMD to minimize future tax consequences.

 

It is conforting to hear good planning make for a confortable retirement.  I do completely believe that.  It is the ones that don't plan and hope for the best that find themselves in rough water.


 

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Re: How much do you need for a comfortable retirement?

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@mj6966, yes it is the commute that is the killer!  I work from home on Fridays.  That helps.  I also have about a 60 mile RT commute that takes me over 2 hrs only because I am allowed to come in crazy early so I can leave early.  They want me here 8.5 hrs minimum.  If I start to work 30 minutes later I could add another hour or more to the RT commute.  There is dry cleaning but I am slumming on that these days. 

 

I am working past my goal only to play it safe.  I will never be able to land anything more than a MW job after I retire.  In IT they hate 50 year olds and despise anyone in their 60s.  At my last job I out worked 4 young programmers that is the only reason I finally got a permenant job.  When the head of NOAA's IT says you walk on water that is concidered a fact. It didn't matter I was 67 with that referance. 

 

It is conforting to hear good planning make for a confortable retirement.  I do completely believe that.  It is the ones that don't plan and hope for the best that find themselves in rough water.

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Re: How much do you need for a comfortable retirement?

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Love reading this stuff!  I started 401K years ago through employment.  Plus the required retirement program (State employee).  3 years from retirement I got to thinking seriously about it.  I figured up all the taxes, retirement contributions, etc. that I would no longer be paying, but benefiting from during retirement.  It was astounding.  Plus all the costs of working, like driving 60 miles/day.  My income is reduced, but still have plenty of money to live as we did before retirement, plus being able to save money independently.  I am actually getting more per hour now (retired) than what I was bringing home per hour working!  I cringe to ever think of going back to work, though I have kept my nursing license just in case.  Ya never know.  We have ditched cable (I have a garden and quilting fettish).  We manage on FireStick and Netflix.  Anything else hubby finds online.

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Re: How much do you need for a comfortable retirement?

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You think like I do.  I have to look for a job until I am either 70 or got 7 figures.  I hit that goal at this job so it is my last.  Working isn't bad it is the job hunting that is so very painful after 65.  I just assume not to live a meager retirement.  I plan to get a beach house and drink and travel a good deal.


@amayfi01wrote:$987,000 I need for RETIREMENT!!!!!

 

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Re: How much do you need for a comfortable retirement?

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if you have paid your home mortage and you are looking at ongoing repairs, you may qualify for free home maintenance services through your community.

 

You may be able to cash out you annuity if you have concerns about your wife outliving you.

 

Though your grandchildren may not have the income they expected, they should still contributing to household expenses.

 

Rather than buying a new car every few years, buy a vehicle that will last at least twice the years it takes to pay it off. Then you  will have several years without car payments.

 

if you are not traveling, look at a Medicare HMO that can provide Medicare Part A and Part B benefits plus prescription coverage at no additional cost and lower co-pays and deductibles. As an AARP member you already have vision coverage.

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Re: How much do you need for a comfortable retirement?

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To answer the question : If the person has debt free (mortgage auto loan),no dependent to support and no major health bills,plus depend how his /her life style then with 75,000.00 to have a comfortable retirement liife
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Re: How much do you need for a comfortable retirement?

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$987,000 I need for RETIREMENT!!!!!
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Re: How much do you need for a comfortable retirement?

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That would be "angels" not "angles" in case someone is wondering.  Smiley Happy  I think you need to plan that you will need as much income in retirement as you spend now. We are spending the same as we did when we were working. You won't get the full benefit that SSA tells you because you have to pay for Medicare Parts B&C. And at the end of the year, you may have to pay taxes on your social security. That was a shocker to me. Utilities are my biggest worry - heat, a/c, cable, internet, phone, etc. We moved to a rural area where most expenses are less except utilities. We had other expenses that you get when you move to a new house - curtains, chairs, etc. I spent 3 days in the hospital at $25,000, of which insurance paid 80% - my share $5,000. At least four months of the year we have low heating/ac bills. We're working on eliminating cable @ $140/month by utilitzing an Amazon Firestick.  We will eventually have to get rid of our Apple smartphones - not as much need for them in retirement. When one of our vehicles dies, we won't replace it. We're doing OK for the foreseeable, unknowable future. I'm SO grateful for an employer who encouraged retirement savings by bringing in a financial advisor once a year, whom we could consult with privately, by operating a 401k plan and by profit-sharing. Planning 15-20 years out for your retirement is essential. Putting money aside at the beginning of my career would have been the smartest thing I could have done. Can I start over?

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Re: How much do you need for a comfortable retirement?

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Some notes on taking RMDs.  Because your first RMD has to be taken the year you turn 70.5, you RMD divisor depends on your birthday.  For people born between Jan 1-Jun 30, the divisor will be 27.4 because you turn 70.5 in the same year you turned 70.  For people born between July 1 - Dec 31, they turn 71 in the same year they turn 70.5, so their RMD divisor is 26.5.  Make sure you use the right divisor.  Also, make sure you use the divisor on your IRA balances as of Dec 31 of the previous year you take the RMD, not the current balance at the time you take the RMD.  Otherwise you might be taking a low RMD and be fined 50%.  For example, if your IRA was worth $100K on Dec. 31, 2017 but the market had taken a dive and your IRA is worth 50K now, you still have to compute the RMD on the $100K balance for 2018.  Vanguard has an easy to use RMD calculator using you and your spouse's birthdate.

 

https://personal.vanguard.com/us/insights/retirement/estimate-your-rmd-tool

 

Some people use the time between retirement and RMDs to rollover some IRA funds to Roth IRA by rolling over only an amount that would keep them from moving up a tax bracket.  Then when RMD time comes around, there is less IRA balance to have to take an RMD on.  However, if you plan on rolling over IRA funds to a Roth IRA AFTER you start RMDs, the IRS requires you to take your full RMD plus rollover funds from your IRA .  It means that if your RMD is $50K and you want to rollover $50K to your Roth IRA, you will have to withdraw $100K from the IRA to do it.  You can not rollover your RMD.

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