Way down the road . . . what do you visualize as retirement?  How old do you
expect to be when you retire, and how do you plan to ensure that you will be
financially set to do what you want to do?  Do you plan on some sort of social
welfare, your own savings, investments, pension, etc?  Also, what do you hope
to do in retirement such as travel, volunteer work, other job???

14 responses total.

My retirement plans are not so far down the road.  We plan on retiring in 7
years.  What our vision of retirement is, that we will leave Ann Arbor and
move to the Pacific Northwest where our children and grandchildren are
settled.  We wil buy a house overlooking water (either the Pacific Ocean or
one of the Lakes) and I will continue either with a part time practice or
volunteer my services as a psychologist.  Jerry plans to either start doing
pottery full time and selling when he makes or continuing working as a
consultant part time.  We cannot imagine not doing something.  We plan to
travel a lot more, this time in the Pacific.  We are wildlife lovers and have
a lot of islands in the Pacific to explore.  We will "work" at something but
spend less time, until we are either physically or mentally unable to
continue.  
Since our children are grown, we have started putting every cent we don't
spend towards retirement, so we hope money won't be an issue.  We are also
finding ways to assure that catastrophic medical bills can be covered as well
as nursing home care, should that become necessary.  We recently lost my
mother after a very long, painful illness which required an extensive
continuim of care.  Fortunately, we live in a community where such care is
available, albeit at great expense.  Everyone coming close to retirement
should really be sure they plan on living ina community with good health care
for the elderly and be sure they will have the financial resources to cover
the care.  People live longer and longer today, but that means that medical
bills can be astronomical.

Audrey, reading your note makes me wonder how people know if they have enough
money to retire.  Does anyone know if there are published "rules of thumb"
for age vs planned retirement lifestyle?  

I guess my sub-conscious rule of thumb is that if your "nest egg" is 10 times
what you need per year, you should be able to make it because you should be
able to invest it and keep it approximately unchanging in terms of current
dollars.   ?    ?    ?

Well I work in a factory right now.  I do have a 401K there, I may be enough
when I retire, but I doubt it.  My generation knows almost absolutely nothing
about saving for a retirement.  If I do retire with the  money I would like
to have, My wife and I would like to buy one of the Monster Motor Homes and
travel the country.  We love being on the road.  I spent about three years
on the road travelling (i am a singer by trade) and there is no place like
the road.

About "the road," I agree.  I am planning a 3 week trip in early winter to
Death Valley, Calif, and back through as many ghost towns as I can find.
This won't be in a motor home, but if my new Windstar gets delivered before
I leave, it will be plenty roomy.

Re 2: People can do some reading/studying, or they can talk with someone
like me (a financial planning person).

Re 3: You will have plenty on which to retire if you use your 401k
to its best advantage.

Katie - what does a financial planner offer for retirement planning and what
kind of price range does it entail?

Usually the planner helps you to know how much to save, where (and
where not) to save it, how to defer or exempt your money from taxes,
how to keep up with inflation, how much of your principle you can
afford to spend later on, how to manage risk/reward, and all that.

Some planners charge by fee, some by percentage of assets managed,
some by commission on investments, and some by a combination of
two or more of the above.

How does a 401K factor into my tax return?  Can someone help me on this?

You don't have to enter anything on your tax return, if that's what
you're asking. Your W-2 will reflect your 401k deduction already.
 As far as the effect on your tax bite, it is considerable. Any $ you
put into the plan is $ you're not paying current taxes on. If you
put $100 away, you may only miss $65 from your check. Then you pay no
taxes on the growth until you withdraw the funds (or you turn 70 1/2
years ols).

I see..Thanks Katie.  My company just went to another plan for our insurance
deductions.  It's a P.O.P. plan.  (not sure what that stands for off hand)
It allows our insurance premiums to be deducted before our wages are taxed.
 I sure hope it will add up in the end.

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If possible, set aside a small amount monthly.  Even if it's peanuts.  You
will be amazed.  A $25 amount set aside today will be worth $54 in 10 years,
$117 in 20 years, and $252 in 30 years - that's assuming an 8% growth through
investments.  You probably can do in the 10-12% range.  (10% would turn it
to $436 in 30 years).

(You are too young to use a CD for an IRA, Valerie! You should have a 
mutual fund.)

I agree Katie.  There are alot of good mutuals out there yielding fairly high.
Right now my wife and I are looking to invest in some mutuals.  If I find
anything interesting I'll be sure to pass it along.

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