How To Retire With $$$$$$

[Lon]

I guess I am old enough and sufficiently qualified to be a little preachly and give some advice to the more youthful on "Forum Garden" that one day hope to retire comfortably.

It's simple. Live beneath your income. You have lots of choices when it comes to those items in your life that are major financial outlays, housing and automobiles. Irrespective of your income, you can choose to drive a Beemer or a Chevy Nova. You have similar options with housing.
Develop the disipline to Save/Invest first and then Spend. If you Spend first, there will never be anything left to Save/Invest. Finally----take at least 10% of you gross income before taxes and Save/Invest. Then----don't touch it-----leave it alone until you retire.

[persephone]

I might get round to being able to do this once I've been qualified for a few years and paid off the massive debts I've accumilated by going to Uni (not as big as a student who has to pay tuition etc), but I've never been in debt in my life and right now it seems like there's no end to it and....

Guess you might get the idea I'm a little stressed with it all right now.

[Erinna1112]

I guess I am old enough and sufficiently qualified to be a little preachly and give some advice to the more youthful on "Forum Garden" that one day hope to retire comfortably.

It's simple. Live beneath your income. You have lots of choices when it comes to those items in your life that are major financial outlays, housing and automobiles. Irrespective of your income, you can choose to drive a Beemer or a Chevy Nova. You have similar options with housing.
Develop the disipline to Save/Invest first and then Spend. If you Spend first, there will never be anything left to Save/Invest. Finally----take at least 10% of you gross income before taxes and Save/Invest. Then----don't touch it-----leave it alone until you retire.

This is such great advice. Limit (or eliminate) use of credit...if you can't pay for it, you can't afford it. Pay yourself first. HAVE A PLAN. "Budget" is not a bad word.

Ha..regarding that last...it's amazing how much money I "found" when I started writing down a budget. It's on paper, not just in my head. I do it during the last few days of the month, for the month to come. I know how much I have coming in...I allocate every dime of it, before it comes in. It's all accounted for. The leaks in the cashflow that were plugged by this action were amazing. Something like 30% of my income. Ouch.

Another thing I do is use cash for day-to-day transactions. I have a set amount for several categories - grocery (which includes toiletries, cat stuff, and cleaning supplies, since I buy them all in one store), entertainment, eating out, clothing for me, clothing for my son, school lunch money for my son. I have an envelope for each category that I keep in my wallet. Every Monday, I go to the bank and withdraw cash for that week's "envelope money." The amount for each category was determined when I wrote the budget. So, I put the allocated amount in each envelope and when I purchase something in that category, I use the money in the envelope. I never use "grocery" money for "my clothing"....that money stays in that category. Then, when the money in the envelope runs out, there is no more spending in that category until the time comes to refill the envelope. Great way to control spending.

[Jack Sprat]

if you can't pay for it, you can't afford it.

Good advice. My last car loan was in 1968. I paid off my mortgage in 1984 (adding $50 a month towards the principle). I retired at 54 with sufficient invested to maintain my life style even with 5% inflation, which we have not had in more than 15 years now.

Even today, at 58, I live on the income from my part time job, saving my pension and investment income. We go out to eat once a week, purchase only what is on sale, do not smoke or drink (and have not, ever). Every five years I do a reverse budget: we save all receipts and jot down all we spend to record all expenses for a full year. It makes you aware of where your money is going, and you certainly watch what you spend. It is far more meaningful than a direct pre-planned budget. We have 70 categories of expenses from dairy, vegetables to tolls and parking, cat food, and capital purchases.

[Erinna1112]

Jack - sounds like where I want to be when I get to 58 (closer than I want to be). I'm making a plan for it now...can't start planning for it any later. I'm impressed...inspired...enthused. HA...just ask my sister HOW enthused. I get a bit over-the-top sometimes. Have to be careful about that.

[rhiebert-fg]

First, all your posts reminds me of what I read in a book about "The Richest Man In Babylon" when I was still single. It was the basis for me being able to save enough to puchase building lot for our first house and pay cash for my first car.

On the negative side, the most dangerous thing, in my opinion, to short circuit a timely retirement is the "What If". Haven't we heard of the annoying lines, "Save x amount of money per month and when your "y" you'll have a million". I must admit most of the time I'm caught up with cutting back sufficiently to have a surplus instead of looking and working ways to increase the income side of the equasion. When I'm on track with being positive, I love to think and do what I love the most, which is to work with the Amsoil topic. (lubedealer.com/hiebert).

[observer1]

Now that I've finally paid off my car, I've been doing a lot of thinking about how to save up, myself! Pretty much along the same lines. Next time I need a car, I'm going to look at the low-priced used ones. Who do I need to impress?? I can't get a credit card, because they won't OK one for me, although I keep getting mail from all the different cc companies, saying I'm pre-approved... yeah right!! But if I don't have a cc, that's just less in debt I am, right?? Right now, my head's finally above water & I'm LOVING it!! Time to start saving up now.