Retirement

Now and Later: The Great Retirement Question

Over the last few months, I’ve read several articles that center around the idea that people should be saving every possible dime that they can for retirement. For example, Daily Finance recently had an article entitled Forget the 4% Rule: Retirement’s Common Wisdom Is Obsolete: The theory was simple: If you spent a maximum of …

The Different Meanings of Saving for Retirement

My parents and Sarah’s parents are roughly the same age. Their retirement-age experieces are much different than each other. My parents are both retired in the traditional sense. They have a limited fixed income made up of Social Security and some pension money. Their house and vehicles are long since paid for, and since their …

Categories: Retirement

How Important Is It to Start Early?

I get a lot of emails from people in their forties and fifties who are suddenly panicking about their retirement savings. Often, they don’t have any or they have very little, yet they still want to retire at age 65. At the same time, I also get emails from people in their twenties who are …

Help! I Don’t Know What Retirement Plan You’re Talking About!

Connie writes in: Roth, IRA, 401(k), 403(b), FERS, TSP – what on earth does it all mean? I know they all have to do with retirement savings, but it’s all just a word salad to me. This is going to be something of a “dictionary” post where I spell out, as simply as I can, …

Categories: Retirement

Review: A Commonsense Guide to Your 401(k)

Every Sunday, The Simple Dollar reviews a personal finance or other book of interest. Also available is a complete list of the hundreds of book reviews that have appeared on The Simple Dollar over the years. One common request I get is more discussion on the specifics of retirement plans. For me, whenever someone mentions …

Retirement Planning: Contributions & Debt Repayment Tips

A few weeks ago, I put out a call on Twitter and on Facebook for detailed posts that people would like to see. I got enough great responses that I’m going to fill the entire month of July – one post per day – addressing these ideas. On Facebook, Tyler wanted to know, “Should I …

Some Thoughts on the Long Term

A few days ago, Donald left a provocative comment on my recent article How to Get Rich Quickly!. Although I think his tone is a bit aggressive, he does bring up an interesting point: Yes this is good advice – work for 45 years, squirrel away your income the whole time, and when you are …

The Truth About Retiring at 65

In 1935, when the Social Security Act was passed by Congress and signed by President Roosevelt, the new law established a national retirement age of 65. At that age, people could begin receiving Social Security benefits and, in the minds of generations of Americans since, effectively set the psychological “retirement” age. There’s an important fact …

Categories: Retirement

How Long Is Your Long Run?

When I think about the long run, I’m usually thinking about what I would call “retirement.” It’s a state I hope to reach in my fifties or sixties or so where I can spend my time working on projects that may or may not result in any sort of financial gain, but simply projects that …

Which Retirement Plan Is Right for Me? Traditional IRAs Versus Roth IRAs Versus 401(k)s and 403(b)s

Kelly writes in: I’m reading about retirement and I see terms like Traditional IRA and Roth IRA and 401(k) thrown around without really explaining what they are or what the differences between them are. Do you have a summary of these plans and how they work? There’s no better time than the present to offer …

Categories: Investing, Retirement

Don’t Rely on Social Security

This is a message to all of those people under, say, forty out there. Don’t rely on Social Security for any part of your retirement. When you’re thinking about retirement, assume that you’re going to be paying your own way. That’s not a statement that a lot of people like to think about, but the …

Categories: Retirement

Review: The Smartest Retirement Book You’ll Ever Read

Every Sunday, The Simple Dollar reviews a personal finance book or other book of interest. Daniel Solin’s series of The Smartest X Book You’ll Ever Read have turned me off for their title alone, and thus, to this point, I’ve not read them. The title set off a big “questionable investment planning” warning light inside …

What Does an Extended Lifespan Really Mean in Terms of Retirement Savings?

Here’s a number for you. Half of all babies born in the United States this year will live to age 104 or older. In other words, when a person from that generation hits the typical “retirement age” of 65, they’ll still have 40 years of life left. Obviously, this represents a major change from where …

Categories: Retirement

Parental Responsibility and Retirement Savings

As I discussed yesterday in a pair of articles (this one and this one), I dream of a future where my children and I are completely financially independent from one another. I’m not dependent on them, nor are they dependent on me. The real question that both articles strive to answer, though, is where should …

Your Child’s College Fund vs. Your Retirement

One of the most common debates I hear about from people such as myself – twenty- and thirtysomethings with young children at home – is whether it makes more sense to save adequately for retirement or save adequately for their child’s college education. Quite often, young career folks (like myself) don’t have the means to …

Categories: Education, Retirement

The Case for Saving for Retirement Over Saving for a Child’s College Education

One of the most common debates I hear about from people such as myself – twenty- and thirtysomethings with young children at home – is whether it makes more sense to save adequately for retirement or save adequately for their child’s college education. Quite often, young career folks (like myself) don’t have the means to …

Categories: Education, Retirement

Making Retirement Savings Tangible

Monica writes in: The one financial thing I haven’t done for myself yet is start saving for retirement. The problem is that I don’t ever want to retire and if I imagine a situation where I actually am retired, I just don’t want to envision it at all. I just can’t convince myself to take …

Categories: Retirement

Review: The Retirement Savings Time Bomb… And How to Defuse It

Every Sunday, The Simple Dollar reviews a personal finance book or related book of interest. For a long time, I avoided reading this book. The title seemed unnecessarily fear-mongering and apocalyptic to me and that’s a subgenre of personal finance books that I really have no interest in. Personal finance has such a profound power …

Retirement or Education?

Chris writes in: We are friends with another couple that is around our same age, income level, status, and number and age of children. When I was mentioning to them that we were planning to pay off our car this year (leaving us with our mortgage and a small student loan) and the starting to …

Categories: Education, Retirement