Author Topic: No retirement  (Read 5068 times)

Offline yodal

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No retirement
« on: February 27, 2014, 08:38:50 AM »
I thought I'd post this to you guys and gals because I think the amount of knowledge in this group, continues to amaze me!
So here's my situation, I'm 51 years old, I have no retirement, no house, no land and no debt.
My wife and I have $12,000 in savings and I have a decent job.
What can I do to secure a future and not be a burden on our children in our ever advancing age?
I know nothing about investing, and I'm not so sure that is such a great idea. My wife and I were talking about this last night, and had no answers!
What do you guys think?

Offline NWPilgrim

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Re: No retirement
« Reply #1 on: February 27, 2014, 09:05:37 AM »
Many folks are in the same boat either explicitly as yourself, or implicitly by having retirement savings in paper instruments that may vanish or be confiscated in the near future (within 15 yrs).  And even durable property such as real estate or gold can be, and has been, confiscated.  We are in dangerous times when people are being bled white and then what they do put aside is at risk of loss by govt/Federal Reserve action.

All of us near "retirement age" need to prepare for being in your situation eventually.  In the immediate term I think finding ways to radically reduce your expenses so you can build up more and more savings and diversify how those savings are stored (tradeable goods,  land, PM).  This would include selling items, reducing number of vehicles, camping trips for vacations instead of a cruise, reducing electronic tethers/bills of cell phone, land line, internet, cable, etc.  And learning to repair more home items rather than tossing and buying new.

Another area is to find a way to extend your marketable skill set into services or goods that you can continue to perform in coming years. Preferably on your own.  Many people continue careers into their seventies and even eighties and others have continued doing more independent work such as writing, fine craftsmanship, etc. into their nineties. While the ideal is to be able to reduce the work load as we get older, we should still prepare for a rapacious govt that will find ways to take what we save on paper at least through inflation, manipulation/corruption and confiscation.

Bottom line is: plan for living within the means you can earn as you get older and which may not fit into your current work place anymore.

Offline CharlesH

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Re: No retirement
« Reply #2 on: February 27, 2014, 09:10:55 AM »
How old are your kids?  Do they still need financial support right now?  That would impact my thinking on the subject.  How much money do you all bring in and where are you spending it right now?
 
If it was me with the scenario you outlined and no additional information, I would probably focus first on real assets.  I would want some land and a home somewhere.  51 is not that old (I'm 50 so it better not be anyway!) so you would be able to spend many years on your land.  If it was rural or had the zoning to allow modest agriculture, it could also support some of your needs.  If you moved in now you could begin building yourself into the community so you have neighbors to depend on during rough patches in the economy or the country in general.  If you continued to improve it, using sweat equity as much as possible, it would presumably offer you a decent return when the time came to sell.  I am less leery of leveraging debt for real estate I am on anything else.  In this scenario I would be comfortable using debt to obtain a larger homestead.
 
Once I had a home in the scenario you outlined, I would start buying stocks in the form of mutual funds. If I could afford 10k a year into Roth IRAs for my wife and I that's what I'd do.  I would work the money into mutual funds slowly, over 12 months, just so I didn't kick myself if prices dropped as soon as I invested.  Once I had as much money in stocks as I had in cash (12k in each for this scenario), I would start putting half my money into each class for as long as possible.
 
Part of my money would be concurrently spent on my homestead, preferably on things that add value like building a garden or food forest, selecting some livestock like chickens or bigger.  A shotgun to take hunting and for defense, etc.
 
In a sky is the limit scenario for personal income, I would probably put anything left into precious metals.  Most people here seem to prefer silver, and I do buy that.  But I also like gold if you have the money because it definitely saves space (you convert more dollars into less ounces of gold than you do with silver).

Offline HawthorneCA

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Re: No retirement
« Reply #3 on: February 27, 2014, 10:21:07 AM »
You have no debt. This puts you in a much stronger position than you realize.  It's not too late to put aside for retirement.  You didn't say how much you make after taxes, but if your wife is on board, I would move to the smallest apartment I could stand, reduce expenses down to the bone (beans and rice), and save, save, save. 

Offline yodal

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Re: No retirement
« Reply #4 on: February 27, 2014, 10:53:39 AM »
[quoteHow old are your kids?  Do they still need financial support right now?][/quote]

Our kids are grown and on doing well on their own.

Quote
You didn't say how much you make after taxes

We make about $50k. But we also live in California...

Offline HawthorneCA

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Re: No retirement
« Reply #5 on: February 27, 2014, 12:08:43 PM »
Ugh, yep the cost of living is definitely higher in many parts of California.  Is there any way you could cut your living expenses back to $25,000 or $30,000 and bank the rest?  Then, as you're saving, study where you want to be located when you retire and go from there. 

I have mixed feelings about owning a home. Yes, you would own it, but you would also own the property taxes, the insurance, the maintenance, etc.  On the other hand, interest rates are ridiculously low and it wouldn't be a bad thing if you had debt on a house, but, buying a house would come at the expense of saving for retirement.  I don't know what part of California you live in, or if you even plan on staying in California when you retire.  Here in the Central Valley, a modest single family home goes for about $150,000 - $300,000.  If you and your wife worked really hard, you could probably have the house paid off by retirement age and maybe have a little left over but you would need to make sure that your retirement income is enough to pay your living expenses. 
Another option would be to purchase a duplex and live in one and rent the other out.  With a large enough down payment, the income stream might be enough to cover your mortgage, leaving you the freedom to save for retirement. 

The homestead idea mentioned earlier is probably not an option here in California.  Not if you want to get it completely paid off by retirement. 

There is always the option of remaining a renter.  In fact, many retired people end up in a rental situation as they age - no maintenance or upkeep = no stress. 

I don't know how familiar you are with Dave Ramsey, but I would recommend checking out a few of his books from the library.  I've found him to be really helpful.

Offline yodal

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Re: No retirement
« Reply #6 on: February 27, 2014, 12:32:56 PM »
We live in Grass Valley. It's in between Sacramento and Tahoe in the foothills. It's a really nice place!
We tried to live in a 5th wheel trailer on some property my wife's cousin has. But the busy body neighbors "reminded" us that your not allowed to have people living in a trailer for more than 90 days.
Frigin people...
Anyway, we found a rental that is on 5 acres and surrounded by an empty 100 acre lot. It's REALLY nice and the neighbors have become good friends, and it's 10 mins. from work.
I don't think we will buy anything, our credit isn't good enough to get a decent rate, and at the place we are at we can do anything we want with the land.
My wife hasn't worked in 4 years. I'm not sure she WANTS to work. And that's kind of a touchy subject at our house... :) But it sure would be helpful.

Offline HawthorneCA

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Re: No retirement
« Reply #7 on: February 28, 2014, 07:28:19 PM »
Grass Valley is a great area!  We're practically neighbors, I'm about 25 minutes south of Modesto.
At least neither one of us live in the uber expensive urban areas.  Trying to live in SF on your income would put you in the soup line every week!  We actually clear, after taxes, a bit less than you but fortunately like you, we live in an area where with mindful spending, it's not a hardship.
As for your wife not working, is she down with the frugal/homesteading lifestyle?  If so, it's possible that she can make more money by staying at home and figuring out ways not to spend money, than she would at a part-time or full time job.  It takes time and creativity to live on little income, if she's up for that challenge, which would include gardening and possibly raising a few chickens since you have acreage, I would consider that a job. 
Also, since she's not working and you work so close to where you live, you could easily get by on one car, which would mean only paying insurance and licensing on one vehicle instead of two.  And if there's a day where she needs to run errands, it would simply mean that she drives you to work and picks you up from work that day.  You would need to figure out what % of her possible income would be eaten up with transportation costs. 
I'm not trying to justify your wife staying at home, I'm just trying to look at the glass half full.  I'm a stay at home wife, although I work 9-15 hours a week from my house.  We actually have been able to save more with me not working full-time than we did when I was working a full time job out of the house.   

We eat healthy, home-cooked frugal meals, we have time to watch a movie or two a week, and we are in a really, really low tax bracket!  So even though our income went down, I feel like our quality of life went way up.  Not to mention the fact that my husband is a workaholic, sometimes even working out of the country and now that my 89 year old mother in law lives with us, it's become necessary that one of us be around to keep the household functioning properly.  With my daughter going off to college next Fall, I've been a bit antsy to maybe take on a part-time job outside of the house but I'm not sure that it would benefit us economically in the long run.  Especially since I probably wouldn't have the time or energy to grow as much of our fresh produce as I currently do.  I need to do the math on this.

Sorry for the ramble, I guess what I'm getting at, is that if both people in a marriage are committed to living frugally and have the same long-term financial goals, it may be cost effective to have one person in charge of the home front taking care of those time consuming chores (cooking from scratch, gardening, line drying laundry etc) that pay absolutely nothing but allow the household to function on a much smaller budget and footprint than a couple that has two full-time jobs and as a result, significantly higher expenses. 

On the other hand, if she could commit to working full time until you reach a preset financial goal, it might enable you to save enough for retirement and a house that you could buy with cash.  Once again, I have to recommend Dave Ramsey.  He has some great ideas to help the both of you work through your retirement planning and kudos to being completely out of debt.  This is a HUGE accomplishment!

Bonnieblue2A

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Re: No retirement
« Reply #8 on: February 28, 2014, 09:15:09 PM »
We live in Grass Valley. It's in between Sacramento and Tahoe in the foothills. It's a really nice place!
We tried to live in a 5th wheel trailer on some property my wife's cousin has. But the busy body neighbors "reminded" us that your not allowed to have people living in a trailer for more than 90 days.
Frigin people...
Anyway, we found a rental that is on 5 acres and surrounded by an empty 100 acre lot. It's REALLY nice and the neighbors have become good friends, and it's 10 mins. from work.
I don't think we will buy anything, our credit isn't good enough to get a decent rate, and at the place we are at we can do anything we want with the land.
My wife hasn't worked in 4 years. I'm not sure she WANTS to work. And that's kind of a touchy subject at our house... :) But it sure would be helpful.

If she gardens, or is willing to learn it sounds as though money could be saved on food bills through some home food production/preserving. It sounds like you could even do some small backyard livestock for eggs/meat or milk.  Even working part-time in an area in which she has interest would allow her to contribute to a self-funded ROTH IRA towards her retirement.  It could even be something home based.

Offline yodal

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Re: No retirement
« Reply #9 on: March 01, 2014, 08:29:46 AM »
Quote
We're practically neighbors, I'm about 25 minutes south of Modesto.
We should BBQ! ;)

We live pretty frugal. We only go out to eat once a month, and she cooks some good inexpensive meals, does all the house hold chores.
She use to love gardening, but something in her attitude has changed. We read the Back woods home mags. and other homesteading mags. But she doesn't really care about that anymore. I'm not sure what happened, but it kind of sucks! So I do the gardening. I'm not very good at it yet, but getting better! I mentioned that I wanted to get a few chickens this spring and her comment was, your on your own, I don't want to deal with them. She use to love our old chicken!
As far as canning goes, I asked for a pressure caner for my birthday last year and when she got it for me, she said I'm on my own with that too. It's frustrating... But I'll do it.

Offline Louisiana Suvivor

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Re: No retirement
« Reply #10 on: March 01, 2014, 04:54:53 PM »
I once lived in river bank. I'd move and make the retirement work. Small piece of land and a small house.

Offline fred.greek

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Re: No retirement
« Reply #11 on: March 01, 2014, 05:55:02 PM »
If the wife keeps indicating "you're on your own" with aspects of living, you may have more pressing problems than investment, retirement, or long-term sustainability…

... you may need to concentrate there...

Offline mountainmoma

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Re: No retirement
« Reply #12 on: March 01, 2014, 06:45:01 PM »
She may just be worn out, or have a kind of low grade ill (chronic fatigue, lyme, other hard to diagnose) or at least no longer with the energy and stamina she once had. Doesnt matter for the purposes of this discussion ( I have Lyme, the "you dont look sick to me, you're just lazy" illness...so I know things like this are possible)

I have no retirement and very little debt. I do have a house, but that can go away, one good fire and the land rezoned to wilderness, ya never know. So, seems to me that knowing how to live on little to no money and building up what little skills I can is bound to serve me well. And, making sure to have the food stores built up, not just for disaster, but there can come a time where money inputs are too low to live on and that can help get thru those times

Offline mountainmoma

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Re: No retirement
« Reply #13 on: March 01, 2014, 07:47:04 PM »
here's the whole thread on prepping AS retirement

http://thesurvivalpodcast.com/forum/index.php?topic=8886.150

Offline viking

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Re: No retirement
« Reply #14 on: March 02, 2014, 05:47:32 PM »
 :popcorn:

Offline yodal

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Re: No retirement
« Reply #15 on: March 03, 2014, 07:55:22 AM »
Thanks for the link mountainmoma. That was pretty eye opening.

Quote
If the wife keeps indicating "you're on your own" with aspects of living, you may have more pressing problems than investment, retirement, or long-term sustainability…

I think the problem is she wants to move closer to her son. He lives in Maryland. And it's just not a place I want to be. All of the rest of our family lives hear here in Ca. We have a support group here. I told her to go visit her boy. But he's just to busy for company. He rarely calls her back when she call or texts him. He just doesn't put any effort into communicating with her. It's pretty sad. So she gets depressed..

I'd consider moving somewhere else. But I'm not going to move from one communist state to another! And that means starting over with everything! Job, friends, support group, ect...

She agrees that we should prep. But when I suggest things that would be helpful to the cause, she just rolls her eyes and tells me I'm being paranoid.

Sorry for the rant.. I got off topic...  :o

Offline Duc1

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Re: No retirement
« Reply #16 on: March 05, 2014, 08:00:49 PM »
It sounds like you're not in too bad of shape with no debt.   Start saving money.  It's not place to tell you where, each individual has to take responsibly and determine what's best.  Start reading, everything, these posts, magazines, books, you'll figure out a plan.  In the mean time, keep the surplus in savings.  Good luck.