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12-06-2020, 08:15 AM
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Join Date: Jan 2012
Location: Lloydminster
Posts: 50
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Required retirement nest egg
My post yesterday regarding a franchise opportunity got me to thinking hard about risking a portion of my retirement portfolio. Which lead me to wondering what a good retirement nest egg should look like. Tough question I suppose considering that there’s so many factors that vary between individuals. No doubt it’s something many of us have pondered. So many factors such as age of retirement, part time work during retirement, mortgage free or not, desire to travel, etc, etc. The 4% rule has been floating around for a number of years. Tough economic times and uncertainty are making it even more difficult to make these decisions. What’s everyone’s thoughts? 1 million, 2, 5?? Would sure be nice to retire early to enjoy life a bit more with a part time gig for extra play money.
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12-06-2020, 08:20 AM
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Join Date: May 2007
Location: Edm.
Posts: 5,278
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Whats the 4 % rule
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12-06-2020, 08:31 AM
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Join Date: Dec 2013
Location: In your personal space.
Posts: 4,789
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The first 2 things you should do in my opinion is figure out your cash burn rate and look at your family history and get a realistic life expectancy. Once you get these you can calculate what your savings should be. Then add a slush fund for extras such as holidays, toys, new vehicles, and home repairs. Some people factor in gains on these savings but since I am not a fan of risk I keep that number at 0 or the current rate of inflation.
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When in doubt, use full throttle. It may not improve the situation, but it will end the suspense.
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12-06-2020, 08:32 AM
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Join Date: Dec 2013
Location: In your personal space.
Posts: 4,789
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Quote:
Originally Posted by -JR-
Whats the 4 % rule
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Take out 4% of your savings yearly and you should be good for 25 years of retirement.
__________________
When in doubt, use full throttle. It may not improve the situation, but it will end the suspense.
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12-06-2020, 10:06 AM
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Join Date: Dec 2012
Location: At the end of the Thirsty Beaver Trail, Pinsky lake, Alberta.
Posts: 25,464
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Quote:
Originally Posted by Bergerboy
Take out 4% of your savings yearly and you should be good for 25 years of retirement.
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Yup or more then work towards a pension for life or two and start early then in your mid 50's or earlier your mortgage free etc then just sit back and do what you want when you want.
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Be careful when you follow the masses, sometimes the "M" is silent...
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12-06-2020, 02:32 PM
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Join Date: May 2007
Location: Edm.
Posts: 5,278
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For me fire was an interesting read but at the same time its just talk talk talk.
Would be nice to read how much a guy needs if he retires at 55,60 and 65 if all his depts are paid for is it $500,000. $1,000,000. $1,500,000.
I think the average guy dies around 80 -85 if Cancer or a hart attack does not get him.
What age do we stop be active, or loss interest in some of our expensive hobbies.
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12-06-2020, 02:53 PM
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Join Date: May 2007
Location: Central Alberta
Posts: 21,399
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Quote:
Originally Posted by Bergerboy
Take out 4% of your savings yearly and you should be good for 25 years of retirement.
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Question being interest rates, they've been near zero for a couple of decades, kind of throws a wrench into the theory.
Grizz
__________________
"Indeed, no human being has yet lived under conditions which, considering the prevailing climates of the past, can be regarded as normal."
John E. Pfeiffer The Emergence of Man
written in 1969
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12-06-2020, 03:32 PM
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Join Date: Jun 2007
Posts: 967
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Quote:
Originally Posted by Grizzly Adams
Question being interest rates, they've been near zero for a couple of decades, kind of throws a wrench into the theory.
Grizz
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If you were just relying interest on for returns, 4% drawdown hasn’t been applicable for a while. But if you have a good chunk invested on the conservative side, I have read that it is a conservative number.
Who knows ?
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12-06-2020, 08:38 AM
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Join Date: Jan 2009
Location: Brooks
Posts: 2,254
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retirement funds
I've been thinking the same thoughts for some time now too. Bordering 60, and thinking I'm OK to retire, but what will a dollar be worth in a few years? I have coffee with guys who set up in different ways. ONe was self employed, and thinking he sold out with a good nest egg, only to realize that money value at the time, is not worth nearly as much twenty years into retirement. When he retired the average wage was ten or twelve bucks and gas was still under a buck a gallon.
A few of the others worked for companies with good pension plans. They live comfortable, but not extravagent. They had moderate investments and savings that give them heart flutters every time the market takes a dive.
The feds will serve up enough pension to keep you alive, but that's about it, and assuming you have your own house mortgage free.
I think it all comes down to your personal style of living and how much you need to feel comfortable. People that have been happy to live paycheck to paycheck without saving, always seem to get by, even though they are waiting for the postman to deliver their next government pension check.
Myself, I have considerable savings (split between cash and investments) and a bit of land purchased, with everything paid for. I refuse to be one of those waiting for the mailman.
I know this doesn't answer the OP's question, but this isnt a specific number to look for. What will you need to support your style of living?
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"a gun without hammers is like a spaniel without ears!"
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12-06-2020, 08:49 AM
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Join Date: Nov 2014
Location: Parkland
Posts: 1,659
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I'm too busy trying to hide what I have now from the great reset. May sell off the excess properties so I don't lose those as well.
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I take everything with a grain of pepper, I'm just different that way.
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12-06-2020, 09:30 AM
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Join Date: Feb 2009
Location: Sunset House
Posts: 1,273
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May want to ask Freeland how much of your savings she’ll need to fix the economy. She’s looking for ideas on how to unlock people’s savings.
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12-06-2020, 10:05 AM
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Join Date: May 2007
Location: Central Alberta
Posts: 21,399
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Quote:
Originally Posted by cody j
May want to ask Freeland how much of your savings she’ll need to fix the economy. She’s looking for ideas on how to unlock people’s savings.
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Might just be time to take your money and stash it in your mattress., preferably in gold.
Grizz
__________________
"Indeed, no human being has yet lived under conditions which, considering the prevailing climates of the past, can be regarded as normal."
John E. Pfeiffer The Emergence of Man
written in 1969
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03-06-2024, 08:50 PM
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Join Date: Nov 2007
Posts: 1,338
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Quote:
Originally Posted by cody j
May want to ask Freeland how much of your savings she’ll need to fix the economy. She’s looking for ideas on how to unlock people’s savings.
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I think within the next 15 years the TFSA will no longer be tax free. Once the average saver starts to have 200 to 300 thousand sitting in there, the govt is going to start getting really antsy to get their hands on that.
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12-06-2020, 02:49 PM
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Join Date: May 2010
Location: edmonton
Posts: 3,920
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Quote:
Originally Posted by HalfBreed
I'm too busy trying to hide what I have now from the great reset. May sell off the excess properties so I don't lose those as well.
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home equity tax coming soon
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12-06-2020, 05:35 PM
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Join Date: Feb 2010
Location: In the woods
Posts: 9,138
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I’m a ways off and am already saving but I can tell you ain’t no way I will come close to that number. I’m lucky as my job has a pension and am putting pretty close to the same away in a separate account as work takes away for the pension. Thank goodness my back up plan is to win the powerball.....
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You can’t truly call yourself peaceful unless you’re capable of great violence. If you’re not capable of violence you’re not peaceful, you’re harmless. Important difference.
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12-06-2020, 05:52 PM
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Join Date: Jun 2007
Location: Ft. McMurray
Posts: 39,008
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Retired for almost a year now, Union pension, and the Government thing as well as our investments and savings keep us living the way we like to .
Cat
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Anytime I figure I've got this long range thing figured out, I just strap into the sling and irons and remind myself that I don't!
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12-06-2020, 05:52 PM
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Join Date: May 2007
Location: Edm.
Posts: 5,278
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T Bark I know where you are coming from . I am 60 now and my numbers say I can retire this month easily ,but its so hard to let go after working 45 years .
Money gets better every year.
The sad truth is ,we will not live long enough to enjoy it all .
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12-06-2020, 05:59 PM
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Join Date: Jan 2009
Location: Brooks
Posts: 2,254
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retirement
I guess the other factor is WHEN you want to retire. For some reason, I cant think of myself preserving my sanity without having somewhere to go everyday. As long as I dont require doing anything unreasonably physical as I get closer to 60-65, the more I dont think of it as being "old"!
Some of these "old" people you see working are not necessarily doing it because they have to, but rather because they enjoy going to work everyday.
The way I currently live (assuming I can quit buying more guns) I could retire very comfortable with a million. Never been a big traveller, and only enjoy going if I have good company. My land for camping and recreation is 3 hours away, and once I get there, I am pitted in for quite some time before going anywhere substantial, so hopefully fuel will not be a huge issue.
I met a young fellow from Norway one spring at a bear hunting camp. He announced to all that he could live off his savings for the rest of his life. Assuming he died tomorrow
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"a gun without hammers is like a spaniel without ears!"
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12-06-2020, 05:53 PM
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Join Date: Dec 2009
Location: Spruce Grove, AB
Posts: 3,053
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After being retired for approx 11 yrs I can tell you that it takes a lot more than most people think. Those that think part time work could help are correct except what happens if you get sick or get laid off late in life & can't get back working. The longer you work, the smarter you invest & the longer you invest & you & your significant spending habits all factor in. I highly doubt there is a one fits all answer.
Sent from my SM-A520W using Tapatalk
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12-06-2020, 05:59 PM
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Join Date: Jun 2007
Location: Ft. McMurray
Posts: 39,008
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Quote:
Originally Posted by skidderman
After being retired for approx 11 yrs I can tell you that it takes a lot more than most people think. Those that think part time work could help are correct except what happens if you get sick or get laid off late in life & can't get back working. The longer you work, the smarter you invest & the longer you invest & you & your significant spending habits all factor in. I highly doubt there is a one fits all answer.
Sent from my SM-A520W using Tapatalk
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I have had several job offers and suggestions.
My answer is always the same " if I wanted to keep working I would have!"
Many did not believe that I would ever retire, but I had set a date 5 years ago, and held to it!
Cat
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Anytime I figure I've got this long range thing figured out, I just strap into the sling and irons and remind myself that I don't!
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12-06-2020, 06:01 PM
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Join Date: Jul 2014
Posts: 1,952
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Seen a lot of guys work until they are damn near dead. Won’t be me. Remember inflation is roughly 2% a year and you going to spend drastically less money when your 70 plus.
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12-06-2020, 06:07 PM
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Join Date: May 2011
Location: Edmonton
Posts: 1,517
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Mistake i made was i retired a bit to late. Didnt need to work but kept going. Downsized my business by quite a bit but still worked.
Finally retired and about a year later a massive heart attack put a kibosh on enjoying retirement.
If you can retire dont hold off till you get sick and cant enjoy it much, or worse. Retired friends used to tell me that but i kept working. Just saying.
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12-06-2020, 06:29 PM
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Join Date: May 2007
Location: Fort Sask, AB
Posts: 4,989
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True dat JR,
At highest earning potential right now and tough to walk away.
As my #’s are good, my Co pension for life isn’t very good, as I’m only a 10 yr man with my current O & G Co.
But add it all up and I wouldn’t starve.
Just with good jobs at a premium right now, and then there’s the challenge of a new project too.
3-4 more years to tuck a bit more away won’t kill me, I hope.
TBark
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12-06-2020, 07:32 PM
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Moderator
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Join Date: Aug 2012
Location: Wheatland County
Posts: 5,881
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Very difficult decision for sure. Remember fast go, slow go, no go. Need enough to enjoy retirement, yet not wait too long. Saved like crazy my whole life, hope to work another decade. Did buy a boat though, trying to enjoy the journey some along the way.
A decent portfolio should yield 6% net, just need enough cash set aside to use when the markets tank. It's a great plan, but I haven't tried to execute it yet
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12-06-2020, 08:02 PM
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Join Date: Jun 2007
Location: Fort Saskatchewan
Posts: 628
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According to this research paper every year worked after 55 take 2 years off your life expectancy. I have always put 57 in my mind as the time to retire. My dad pulled the pin at 57 and has a decent pension, was able to travel and enjoy his grandkids while somewhat "young". He is now 76 and I can see over the past couple years his energy levels, mental capacity, deminish drastictly. He is still happy and content but would rather hang at home than travel or do anything else. I'd rather have 20 years of nice retirement than work my balls off only to croak a few years later. Definately don't want to be the richest guy in the graveyard.
https://faculty.kfupm.edu.sa/COE/gut...sc/Retire1.htm
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12-06-2020, 08:18 PM
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Join Date: Jan 2014
Location: Edmonton
Posts: 6,157
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Well don’t you worry about your savings now guys, our glorious finance minister is looking for ideas how to relive you off your savings....
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12-06-2020, 08:50 PM
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Join Date: Sep 2008
Location: Edmonton Alberta
Posts: 9,947
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Quote:
Originally Posted by cranky
Mistake i made was i retired a bit to late. Didnt need to work but kept going. Downsized my business by quite a bit but still worked.
Finally retired and about a year later a massive heart attack put a kibosh on enjoying retirement.
If you can retire dont hold off till you get sick and cant enjoy it much, or worse. Retired friends used to tell me that but i kept working. Just saying.
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Nailed it
Retire and enjoy yourself. Be satisfied. Decide on an age and do it. Dont trade years for bucks. Its a poor trade.
There is no magic age. Everyone is different.
__________________
When you are born, you get a ticket to the Freak Show.
If you are born in Canada, you get a front row seat.
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12-06-2020, 09:35 PM
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Join Date: Jan 2013
Location: Sylvan Lake/South Calif.
Posts: 3,465
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Retired with 38 years of service, got out at age 55 with 70% indexed pension, the Mrs had 35 years of service with the same pension plan, we both max'd out our RRSP's and now TFSA's and she still has a few rental properties, we have 0 debit and 2 b-new vehicles, we live in a small 3 b-room townhouse condo and our cost of living in Sylvan is very reasonable.
Some of the best advice we got was to see a financial advisor 12-15 years before we planned to retire, we both had/have a plan and invested wisely.
On December 31, it will be 10 years of enjoying Freedom 55. The Fed's keep sending me a monthly cream cheque that goes into the mattress, if you haven't got a solid financial plan that should be your priority.
D.
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Z-z
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12-07-2020, 12:11 AM
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Join Date: Jun 2010
Location: Edmonton
Posts: 1,243
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Quote:
Originally Posted by cranky
Mistake i made was i retired a bit to late. Didnt need to work but kept going. Downsized my business by quite a bit but still worked.
Finally retired and about a year later a massive heart attack put a kibosh on enjoying retirement.
If you can retire dont hold off till you get sick and cant enjoy it much, or worse. Retired friends used to tell me that but i kept working. Just saying.
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Quote:
Originally Posted by huntinstuff
Nailed it
Retire and enjoy yourself. Be satisfied. Decide on an age and do it. Dont trade years for bucks. Its a poor trade.
There is no magic age. Everyone is different.
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These are my sentiments exactly. I'm focusing way more on retiring "healthy" than "wealthy". As long as my family and I have our health, we plan on making the best of it as long as we can. Material wealth will never trump experiences for me.
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