April 2008 Weddings
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Dear Community,
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Poll: Retirement
My current obsession is retirement savings. From charlesschwab.com, this is the amount you should be saving based on when you start:
| Age when saving starts | % of salary to save each year |
| 20-something | 10%-15% |
| 30-something | 15%-25% |
| Early 40s | 25%-35% |
| 45 and older | OUCH! See Play the Percentages: 45 and Older |
So, poll:
[poll]
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Re: Poll: Retirement
You did not include winning the lottery or finding a leprechaun which are the two things I am counting on.
LOL. Just kidding.
I don't see how I'll ever be able to save appropriately. I'm only saving 10% and I just started doing that. In the past I only did 5%. Its something DH and I have begun discussing doing more aggressively.
I wonder if there will be more homeless older people when I get to retirement age. There are so many people our age that would rather spend than save. That is going to impact our communities and the economy 30 years from now.
~~~MARRIED BIO~~~
Mine is touchy. I do have retirement from my previous jobs (that I'm vested in) but need to eventually move. Currently, I'm not saving personally because so much is being reinvested into the biz. My goal for this year: double our savings and start saving a % for retirement.
ETA: when I did save, I was 10% my contribution with a 7% match. I also controlled where I was investing and because I was smart with what stocks and bond areas, I just got the statement and I doubled my original investment since I didn't do too much high risk investment (many were low risk with a bit of high risk)
Those fall into 'whatever.' My list was getting too long, so I had to nix lottery. I hadn't thought of leprechaun, though. Good call! Hahah.
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I know how you feel because I was the same way when I started working - I felt like I made so little how could I possibly put some in savings, but with 401(k) they take it out pre-tax so it essentially lowers what they take out in taxes. You definitely get less each week, but over time you realize that it's essentially like cutting out the daily starbucks and making coffee at home instead. And the money adds up fast. With my first adult job that I invest in I didn't really pay attention to how much was in there but when we filled out the forms for the house I had to find out and I was really surprised to find out how much I had in there after about 2 1/2 years and how much Steve saved in his after 1 year.
I absolutely agree. There was an article on yahoo finance the other day about how only 43% (?) of working Americans are saving for retirement. Considering the state of SS, that's a scary number.
As far as contributions, I've found that I've just had to make the change and adjust afterwards. It's a pain redoing our budget, but it's funny the places you find to adjust when you're forced to.
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DO IT! No need to be embarassed. Compounding is your friend! Because most plans are before-tax contributions, you don't feel the full hit. Say you typically 60% of your gross pay check after taxes, health, etc, a $100 retirement contribution will only lower your net pay by $60.
Seriously, even if it's just 1% now, you'll thank yourself for it later. You can doooooo it!
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This is my case also
We save below our range.
We're in our 20's, and we each do 7% right now. DH has the option in his 401(k) to automatically increase 1% each year, so that way he can save more each year for retirement without really "feeling" the difference. I don't have a 401(k) right now because I just have 2 part-time jobs while in school, but we both have Roths. So that will have to do for now.
I have a 401(k) from working full time that I started when I was 21 and I had it for about 5 years. DH started his 401(k) when he was 24 and just graduated college.
It's based on when you started saving, though. So, if you started saving in your 20s and you're within that range, you're good!
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We thought about doing this too but in the end decided that we could actually do both and we've saved and went from $13k in debt to about $1,500 and on only 1 salary because Steve hasn't really worked since last January other than odd jobs here and there. You might consider contributing less, but still contributing some. We took it one card at a time, picked the highest balance and threw every cent we could at it until it was gone while paying the minimum on all the others and then so on and so forth. We'd be completely paid off by now (and we have the money in savings) but our mortgage lady told us not to pay the last 1 off just yet and to keep making payments until we go to sign on the house because its shows we can make payments on time every month.
I tend to agree with this approach, since I think you're less likely to start contributing again once you stop. I think Dave Ramsay is in the minority of financial advisors when it comes to stopping/postponing retirement contributions. Many others advise against it simply because you're losing out on an insane amount of compounding. But I know everyone has different things that work for them. Either way, good for you for working your way out of debt, Bethie!
Carrie, have you considered paying off your balance that you're carrying and then just using your credit card for random purchases (like gas or groceries) and paying that in full each month? You'd save yourself a heck of a lot of money in interest while still 'showing that you can make the payments'?
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~~~MARRIED BIO~~~
We did that for one of them because the balance was really small and its the card we do that with anyway just to keep our credit current. For the other one....we cut up the card because it was one we never used because of the high interest rate (we got it to balance transfer a couple cards at one point, didn't pay off the balance before the 0 interest period ended and yeah so it sucks) I have paid a LOT more on it than she recommended because I really want it to be gone so now it's got a much smaller balance but still about a grand. Since we only have about 4 months until we should definitely be in the house I'll be paying about 1/4 of the balance each month so we're still making progress and we're still paying on time each month.
Here's more of a breakdown by age:
http://www.schwab.com/public/schwab/research_strategies/market_insight/retirement_strategies/planning/play_the_percentages_20_something.html
This isn't the end-all, it's just one firms take, but I'd say the percentages are pretty consistent across the board.
Because your money will just compound, the sooner you start saving, the less you have to save each year. So, yes, in theory, you'll just have to save 10-15% each year if you started in your twenties. But, hey, the more you can save the better. Especially if you're not counting on SS.
There are tons of retirement calculators that can tell you how much you'll need to save for the lifestyle that you want. Here's just a couple:
http://cgi.money.cnn.com/tools/retirementneed/retirementneed_plain.html
http://www.bloomberg.com/invest/calculators/retire.html
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LOL I love your comment Gerrie!!!!!
Dave goes the highest he can for his bracket in his 401K and his company matches. He also automatically takes a large chunk of his bonuses and puts it into his retirement which his company also matches. He's doing well.
Me. I'll live off him. Haha.
I'm only kidding. I've never had a job that offered a retirement. I have a small IRA for now, and I plan on adding to it this year. We also have a pretty good ER fund and savings outside from the 401k. I need to get the ball rolling on my own retirement, and now. I'm just getting in the position to do so, I just got a promotion and a raise with a bonus package and the little start up i work for is about to get really really big. So exciting