Hi Erin, thank you for another excellent video! I am part of the 57% who retired earlier than expected. Expected to and 65 and retired at 62. I am 12+ years into my retirement journey. I was always the sole wage earner. My wife took SS at 62 and I waited until FRA of 67. The amount of content available for retirement planning when I was younger was seriously lacking. Fortunately now all that has changed. Most of your viewers are likely much younger than myslef and have the opportunity to have the information to make the right choices and decisions. I pray they do so. I was fortunate enough to have always been an investor and interested in finances. I have been blessed beyond what I deserve given the lack of information. For all your younger listeners I would encourage them to listen and take your content to heart and most importantly, implement it. It's not difficult and it starts with the first step and stick with it! Thank you and keep up the good work Erin! I am confident you are making a difference!! Larry, Central Valley, Ca.
Thanks Larry! I hope you and your wife are having a wonderful retirement - even thought it started earlier than expected 😊 Erin from snowy Rhode Island
Larry, I’m also so happy to have found Erin’s channel. She’s very knowledgeable in the world of finance and explains everything in simple terms. I, too am hoping to retire when I turn 62 in 11 years. In addition to my company’s 21% gross pay contribution to my retirement, I’m maxing out my Roth. Thank you Erin for sharing your knowledge! You’re making a big difference! 🤗 ❤
@@strongheartfitness Wow. 21% gross pay contribution is fantastic, I am speechless. Depending on how long you've been with them and had that benefit, and maxing out your Roth, you are well on your way to being prepared to retire. Stay the course in the next 11 years and you should be in great shape! Larry, Central Valley, Ca.
As Erin has stated, Finance Is Personal. I listen to a few other financial experts. I pick and choose the advice given. I agree with paying off the mortgage before retirement. In my case, it’ll occur in the next 4 years. I agree with investing upwards of 15% towards retirement. I agree with no debt. I only want standing bills so that I can continue keeping most of my paycheck. What I need is a simple way to budget.
Retired a year ago at 59 because the stress from my job was very detrimental to my health. Yes it was at least 5 years too early and my IRA balances might not be as high as they could have been, but I'm SO glad I did this, zero regrets!
The stat about WHY people retire early was absolutely mind blowing 🤯 Also why i think physical health and financial health go hand & hand. Need to keep your pulse on both and keep both healthy and strong cuz at the end of the day no amount of money means anything if you dont have your health.
Have you seen the Boeing Aerospace study correlating life expectancy to retirement age? Only executives and self employed types live longer when working longer.
I hated my job/career, I was not good at it. I saved 50% of my salary from day 1 preparing for a layoff one day. 20 years later, I realized my potential investments growth will shadowed my annual earned income, my perspective towards earned income and work versus investments totally changed. I finally quit that job and found a lower pay easier job. Its now been 24 years after college and living with this same financial mentality the whole time. It's amazing how those 22%, 26%, 28%, 29% annual return years makes a tremendous difference in your portfolio net worth. Financially I am set at age 46.
This. I feel similar, but I’m too far in my career, high in salary, and close to financial freedom to pivot. I just need 6 more years to be free at 48.
@@SweetPotata10 Bro, if you still get the Sunday scaries and anxiety about the upcoming work week, rethink things for your mental health. Hopefully you've seen how fast your investments grew since 2013 or even 2019 like me. I left engineering and did something totally different. I work at home now and work is like a walk in the park that came with a 50% paycut.... totally worth it!
It’s too bad people don’t get excited about hitting financial goals. It seems they reserve their excitement for trips, houses, cars etc. Reaching financial independence is the gift that makes you smile when waking up and going to sleep.😁
Some people like to live life while they’re young..future isn’t promised…and some people don’t care what 70 years old looks like since what are you doing then anyway lol…sure, there should be a balance
That's because the goal is to be able to afford the trips, house and car. The money is simply the method to afford these thing. Put another way, people will be excited if they can do these things and it didn't cost them anything. They would be less excited if they had millions of dollars but still couldn't do these things.😊
@@WeBeatMedicare6969 I guess I’m saying that you should always enjoy your life but preparing for a life absent of requiring work would be the ultimate freedom. Consumer culture is mostly empty of any deep meaning by itself
We retired one and two years earlier than planned. When you retire and when you take SS are not the same issue. I’m a firm believer in delaying SS at least a few years for one member of a couple, unless you have a large portfolio. We did a split strategy with my wife taking early and me waiting till 70. In that way we minimize portfolio withdrawals and maximize Social Security, yet we both retired at 63. At 70 we will have enough SS to cover all basic expenses and the portfolio will be for discretionary expenses only. This also allows for a bucket strategy with a conservative bucket for the bridge years, and an aggressive portfolio for the future.
Such sage advice, Erin. Things change. Your energy level, ability to tolerate stress, desire to cope with office politics, a merger, a new supervisor. It is a great feeling to have the financial stability as we age to walk away on our own terms if needed.
Great video Erin! I had a very similar discussion with my wife recently. We are 50 and I told her that we will hit our financial goals by the time we are 55 and can retire then. She said 'woah, that feels too early!' I told her, realistically we may continue to work until 59 1/2 (when IRA removes penalty), but those 4+ years will feel pretty good knowing that we can have absolute choice of continuing to work or not. 😀
This is a good rule, Erin. Most people are far behind even the blue sky scenarios, no less planning for the unforeseen circumstances. It doesn't simply need to be forced early retirement; rather, you could also face a mid-life challenge (illness, loss of a job, etc.) that forces you off-track with your retirement goals. Being conservative, leaving buffer in your plan, will mean that you're not compounding the effects of a bad situation. One of my favorite sayings to life by: plan for the worst, hope for the best. I truly believe people would live longer, happier lives if they simply planned better. How much stress out there stems from finances? Just plan to live within your means and prioritize saving and investing. That cushion, the peace of mind it creates, will go a long way in life.
I unintentionally implemented the 5 year rule - sort of. I had planned to retire at 66, but pulled the trigger at 58. I did a careful financial review and was a bit surprised to find I was able to financially do it without any pain. The real question for a retirement decision when you have the means is: What makes you the happiest? No one can answer that question for you. I am completely confident that I made the right decision for myself and my family.
Great plan. I'm 28 and was planning on cutting my expenses if I was forced into retirement early. Looking at how likely that is to happen makes me definitely want to plan on retiring earlier than I want to.
7:01 This right here is what some people overlook. The stock market going up and down isn't the only concern. Your contributions and expenses can change dramatically along the way. Everything looks good until you are out of a job for more months than your emergency fund can cover.😱 Based on my own experience I am not a fan of Coast Fire. I'm either FI or I'm not. You can plan for the future but you can't predict it.
I agree with this 100%. My first plan was to retire/be financially independent by age 48. Bad stock market of 2008, bad investing decisions, Covid policies that resulted in me quitting my job and moving to another state and it just being too hard to save that much pushed my date back to age 55. I'm 53 and on track to retire at 55.
My wife and I are younger and we plan to retire at 60. We are assuming a 6% return year over year so we can hopefully be pleasantly surprised and retire sooner than expected. Theres a lot of life that can happen in between though so if we aren’t pleasantly surprised, we will at least hopefully hit our goal.
Good video. I was one of those retire later than expected people. The pandemic made work less annoying....e.g. no commute with working from home...and also made retiring less appealing..e.g. I did not want to travel during the pandemic. So I ended up working an extra 18 months or so.
After watching the video "You (Probably) Won't Retire Early," I changed how I invest each month. I hadn't been contributing much to my taxable brokerage account before watching that video but now I have substantially increased the amount of money I put into it each month. I invest the money primarily in growth-oriented index ETFs rather than income-oriented ones. The reason for this is to minimize taxes and hopefully have it grow substantially in value when I sell my shares. I only want to pay long-term capital gains taxes when I sell the shares and I want to minimize taxes on dividends. I don't think I will have enough to retire five years early when I am five years before my planned retirement age but I am pretty confident I will have enough to retire three or four years early, in case I need to (assuming I live somewhat frugally).
This is the best retirement video I have seen in the last year at least! The statistics regarding being forced into early retirement were shocking to me. My mother was forced into early retirement, so this scenario hits hard for me. I’m going to adjust my savings to be even more aggressive. Thanks Erin!
The forced early retirement scenario is a shock to a lot of folks, and it's funny, cause like you, they know people it happened to, but it still surprises them... In today's ever accelerating world of cutting costs to make shareholders happy, plus AI looming over entire industries, the shock might become that one gets to work to retirement age...
@@dstevens518 Agreed! The statistics back up your idea, only 13% working to intended age of retirement (as I recall from the video). Better have a strong backup plan!
LOVE this video, excellent choice of topic. There's no greater frustration than planning and doing for decades, only to find out you came up short and screwed yourself. Can't go back in time to fix that. That's why I always plan conservatively, using lower expected return rates than normally quoted, a shorter time frame in case I'm pushed out early, and a more aggressive savings rate. I'd much rather err on the side of saving too much and having the problem of living lavishly in old age...lol. JL Collins says it best. He's spent every dime he's made as soon as he's made it, buying the things he wanted. The thing he wanted to buy the most was his financial freedom.
When I was in my late teens my father realized he hadn't been saving enough for retirement and began to think and talk a lot about it. He also realized his work might dry up and his main job could diminish in the next years. My brother and sister had already left the home. At the same time, there were a few large pensions that blew up and there was a strong debate going on about continuing social security. The result was I became extremely conscious that the only thing I could count on was my own planning and investing. I always planned on not getting anything from SS or a pension. 30 years later I have a healthy nest egg and, ironically, 20 years in a job with a pension. I still can count on social security too. Nevertheless, I'm very glad my father was open about what he was concerned about and steps he took to get on the right path. Now if I get a notice that it's time to leave the company, the finances will be the least of my concerns.
I wish I had better financial understanding as a youngster, though at 20 I had never seen 5,000 and couldn't save 5 cents! Rather than the 5 year rule, Once I hit 30 or so, I just saved/invested as much as I possibly could and finances allowed which is easier, and yields a lot more on the back end. I suppose I could retire whenever I want, but I like work, have plenty of vacation and have nothing better to do, so will keep on truckin.
Good points here. I was already planning on retiring early at 50, but reached FI at 42. I am 45 now and plan on this being my last year, and will retire at 46. I have been deeply planning the financial and emotional aspects of retirement, especially early retirement. A few factors were able to speed up my timeline: Housing prices increased over the past several years and salary increase from a promotion at work. I have been able to save much more of my income and I plan on selling my primary house and move into our vacation home, and the equity will be far more than expected.
The 5-yr rule makes a great deal of sense, because things don't really work out according to plans. I was targeting age 61 to retire but my company consolidated sites and closed down operations in our state when I was 57. Circumstances allowed me to retire (and work part time outside of my field for another year) as opposed to uprooting my family and moving a few states away -- I still had 1 child in high school and my wife had a job with a potential pension in the area.
This is great advice... We were always planning on retiring when the house is paid off, which will be in 3 years. I'll be eligible to retire next year... That was always our plan... Then there was a remodel a couple of years ago... Spendy, but should be paid off this year. We are replacing the roof now. Should be able to do that by next year... Then there was a huge family trip that apparently had to be done last year. Working hard to try to get that paid off by this year... Why all the rush to get it paid off this year? My wife (who retired several years ago) has recently let me know she REALLY wants me to retire when I can rather than when the house is paid off... (Or planned to pay the house of 2 years sooner. (it's already a 15)) I think we can do this, but it is now really stressful... I expect this whole next year to be really stressful as a result... I should have planned to be ready on the date I was eligible to retire, not when the house will be paid off... Then I would have been fine either way...
If it' stressful, don't do it! Compromise, split the difference. P.S. When you're retired, you won't be spending before you have the money. When you retire, you've got what you got. There's no picking up overtime etc.
Pleasr note that most people will throttle back the risk a little at 10years and a lot 5 years before retirement. So realistically the person retiring 5 years earlier in the example would have close to what they would have had if they retired as planned.
Those later working years are often the higher paying ones, too. Retiring early means even less money. And it's not like it has a lot less time to grow; if you retire at 65, that last year's contribution still grows well into your 80s-90s.
@8:03 "...sometimes I think I love my job……" Those words of yours Erin are my words. We could get off of the hamster wheel today which is a great feeling. But the main thing we are working for is to increase our nest egg. We are not exceptionally high wage earners but since we have our finances under control, we are able to save/invest a good amount of our income. And that my friends is hard to say no to. Our last 5 years before we retire could easily be worth an additional half million in our retirement savings. If the 5 years became 10, that is over a million.
Kudos for a job well done! Yes, it's a nice place to be, we're there too, and same deal, still making more, just like the idea of a bigger nest egg, more flexibility.
This happened to my wife. She was surplussed August of last year at 63 years old. She wanted to work until 67. Thankfully she had been investing in her 401k and had a pension that we rolled over in lump sum. We didn’t trust her company to manage her pension from now on. Also, thankfully the market has boomed since September and her investments have really taken off. But yes, this kind of thing happens everyday so be prepared.
David! I'm so sorry your wife was forced to retire early - but I am glad that she was a diligent investor! At least you were prepared! Look at it this way, more time for your daughters and your grandkids! 😊
Great video. I would like to work until im 70 and delay social security. However, as you said, we can't always control when we need to retire. It's always good to hope for the best and plan for the worst...I am also trying build up some forms of passive income so that I can have some income in retirement even if I don't work much.
I think financial independence is sort of murky territory. I could retire now at 42 and have enough to get by and survive for the rest of my life, I think. But it is hard to tell how much I will need for the rest of my life at this stage.
When I turned 40, I made a plan to be financially able to retire at 60. I'll be 61 this year and don't know when I'll retire. But it won't for a financial decision when I do. I'd say your suggesting in the video works in practice.
Im 43, semi retired and self employed. If i included an inheritance i'm likely to get i could retire fully. I'm disabled so i always knew it would be likely for me to need to work part time. My uk state retirement age is 70 and my life expectancy is late 50s early 60s. Some days i feel like i want to fully retire but most of the time i strive to keep saving for when i don't have the choice. Its a fine line.
I feel fairly good about my trajectory toward retirement, but its those unknowns and out-of-my-controls that keep me up at night. I do think that as people live longer and social security ages for withdrawals accordingly increase, our society has to become more open or incentified to hiring and employing older people. Whether those are private jobs or jobs in the government sector. I appreciate learning about different tactics or ways of thinking that I might not be aware of. This 5 year rule is a great example.
I like this thinking for traditional and close-to-traditional retirees. It's kind of hard to apply for very early (FIRE and FINE movement folks). If someone is saving as much as they can now, there isn't really anything to move back by 5 years, but I suppose they could look at their desired lifestyle and see what it would take to cut expenses down by 34%.
Statistically, the average life expectancy for a man in the US is only 73 years old. Most men (and many women) don't want to wait until 67 to retire because they don't want to die less than a decade after retirement.
I hope you are joking, because you are dead wrong(pun intended). Average life expectancy needs to be calculated from your current age! Ask any 74 or older person what their life expectancy is, it is obviously not 73! Look up the statistics, based on your present age not age 0 when you are born. If you are in your 60’s your life expectancy will be somewhere in your 80’s not 73.
Excellent video, again. Thought I would retire at 67, but ended up being 62. Luckily my SS was enough to meet our expenses along w/part-time work. Now that my wife has retired, I no longer work p/t and we haven't needed to touch our IRA's, but if we did need to, an extra five years of increased savings would have been nice!
I'm not doing the '5 year rule persay' but I'm doing more than coastFIRE version of it. I'm working my butt off now, because my goal is that around 40-42 I'll hit coastFIRE, then I have that freedom to decide 'when is enough' because that doesn't mean I'm going to stop investing in my retirement accounts, just that I won't have to, which enough of a freedom for me.
What’s your day job Erin? Since you have a good handle on finances, you must work in the financial world. Keep spreading the word on needing to take an active role in our own finances!
Due to a divorce, my financial goals have dramatically changed.. I was the architect of the big picture financially.. since that’s no longer applicable.. doing new goals has been different. It’s more basic than advanced than what I anticipated, but being realistic in my expectations gives a light to the end of the tunnel that’s for sure. I will say, being in step 7 in Dave Ramsey’s system gives clarity. And I give God all the glory for the blessing’s he has given
I Really enjoyed the presentation Erin, the timing of this video is interesting for me i had planned to retire this month initially at 59.5 years young, although I've really come to appreciate the career that i have, with a low stress environment & commute time that is minimal, paid leave is abundant, benefits are good, comradery is enjoyable, financially we (my wife and I) are fine although i would like to have a solid plan for what to do with all the extra time once retired, the next retirement milestone to evaluate will be at age 62 for myself.
My plan is to fully retire at age 65, which is ten years away. I've reached my numerical goal so I'm ready in case I have to go sooner. Inflation is an additional factor that has me continuing to work and save. I will gradually reduce work hours so I can ease into retirement over the next ten years.
My goal is to retire before 62. By that I mean retire from our careers. We can then do whatever we want. Something low stress to keep us active into our golden years. People who live long tend to exercise their mind and body regularly.
Good video Erin! I developed Cervical Disc Degeneration Disease at 50 in 2006. I knew my time working was limited because of the pain. I saved and invested every penny I could, By the beginning of 2013 I was done working due to pain. My wife worked another three years. Fortunately our investments worked very well for us. We started retirement with five years of cash and plenty left in equities to grow. No worries about sequence of returns risk with the cash cushion. Stocks have performed nicely. Motherhood is keeping you looking good!
I’m so sorry about the pain you experience, but I am happy to hear you are secure from a financial standpoint. I hope you and your wife are still able to enjoy a lovely retirement 😊 And you are too kind, motherhood has turned me into an exhausted zombie 😂 I have aged more in the past five months than I have in the past five years.
@@ErinTalksMoney It’ll get better! We’re grandparents now with three grandkids aged six and five year old twins. They’re exhausting but keep us young. God Bless your family!
Great advice. A corollary point: plan to pay off your mortgage by that 5 year mark too. I’m actually an advocate of paying off even sooner because the relief is immense. But I know that running the numbers it often makes sense to invest instead of making extra mortgage payments. You absolutely do not want to be in a situation where you’ve quit work and still have mortgage payments though. My $0.02
I fully agree with having no mortgage before retiring. My question to you is: Is the relief really that much from being mortgage free? You still have taxes and insurance to pay and you could easily lose your house for failing to pay the taxes. I just don’t see my relief being all that much when my property taxes are half of my mortgage payment. I’m not disagreeing with you, I just personally don’t fully understand when people talk about the relief they feel from being mortgage free.
@@cody5596 So let’s turn that around for a second: if I told you that you could start paying only half of your mortgage payment, would that reduce your stress and free up money to do other things with? (Yes) But the real key is once you are in retirement. If we assume that some of your annual expenses will need to be paid from your retirement nest egg, that means that every month your portfolio has to generate money for the mortgage. When the market is down, you still have to take money out for the mortgage. (Yeah, there is the 3 bucket plan to mitigate market volatility, but you get my point.) Because we retired unusually early, we didn’t pay off the house until a few years after. That cut in expenses once we did was a very big relief.
Ok, I think I understand better now. I was under the assumption people get a big relief because they wouldn’t be worried about losing their house anymore. I guess I should shift my thinking into just reducing your expenses is what would give you the relief. Thank you for clearing that up for me!
yeah, no. My mortgage is 2.375% fixed, so there is absolutely no compelling reason for me to pay off my mortgage before retirement. What stresses me out is the opportunity cost lost by keeping all that equity in the home sitting at 3.58% appreciation versus 10% broad index. If you've quit work to retire, you would obviously plan for the fact you need retirement income sufficient to cover the mortgage costs in retirement, just like you'd need to factor in having enough retirement income to pay rent if you decide to sell the home and rent.
@@cody5596 yeah, I agree, it's overblown and overstated argument. If your mortgage payment is automatically paid, I find it difficult to believe there is stress in that. My stress is opportunity cost in paying off the mortgage when I could be doing so much better in broad based index fund or etf, given my mortgage rate. Paying monthly mortgage is no different than having to pay rent, it's still a monthly bill. If you get a hole in your roof, you're gonna have to pay for that and where are you going to tap the money to fix that? HELOC, refi, credit card, withdraw from savings earlier, etc? I have to say, i'm probably just going to sell the house and rent once my spousal anchor retires, because the stress to me isn't the mortgage, but home ownership in general and sitting on underperforming equity appreciation.
It appeared that my employer retired early and so I also retired at 58! But it did work out for me. I then worked as a consultant for a couple years for triple my pre-retirement salary. And I didn't spend it but invested it so I'm OK now. I know now I was underpayed before retirement. I guess I'm too agreeable to be rich. I'm 74 now with NW >$500K and no debt. I spend about 1/3 of my retirement income.
As someone who has just retired at 61 what I have learned along the way and wish I had someone in my life in my 20’s that would have said go balls to the walls on saving and investing until life gets in the way . Hopefully by then you would have made it to your first 100k and then the compounding really takes over from there . Plenty of rough roads to travel along the way but the earlier you start your journey the easier it can be .
How many years did you save before retiring and what percentage of your income did you save? I’m asking people with similar comments as you due to my wife and I being relatively young and being concerned about our savings progress.
@@cody5596 If you can consistently do 20% you would be in good shape but if you can do more while you are young and invest the money that will pay off long term when life punches you in the face along the way because it will and the more you can invest now the better you will be prepared . We saved inside a 401K and did 15-20 consistently .
I'm 73 and still working a reduced schedule, because I want to work. And many of my friends near to my age are still working. So i really don't believe that 50% of people retire earlier than expected.
Great video as usual. But I always see retirement videos about people leaving their jobs, but as a business owner, Id love to see some videos about when and what do business owners do about retiring when everything (employees compensation packages ie paycheck and fringe benefits, clients, funders, etc. ) all depend on you to work forever to keep the business' alive and well. What do you do about retiring when you are the brand and the business but you’re not a Jeff Bezo or Bill Gates where you can afford to hire the best of the best people to keep the ship afloat when you wanna eventually cruise on out of what you’ve built
Might make for a few good videos 😊 I have two businesses - this TH-cam channel, which let’s face it exists as long as I’m willing to make videos and as long as others are willing to watch. However, my day job, as the business owner, I am trying to implement people who can fill my role - I try to systematically create processes that are NOT dependent on any one individual. Everyone is replaceable in my eyes, including myself - which is essential if my goal is to one day sell the business. Which it is. Maybe in 10 years time…maybe in 20 years time. But I want to create a business that is not 100% dependent on me.
Thanks for this video, Erin. Top tier thought provoking content. The facts and the visual aids, charts and tables, really helped me move the needle forward in terms of my retirement planning
Given that I was thinking I might retire early in about 5 years, it might be too late to heed this advice. If I retired today, I probably wouldn't be okay.
The analysis of 2.7M at age 67 to 1.8M at 62 seems off. The reason is because you're not going to stop investing at 62, you're going to continue to invest, without $5K contributions, and with a smaller slice investing in equities ie 80% @ 8%. The other 20% can be converted to fixed income to use as income. Given this, wouldn't the return at 67, retiring at 62 be much higher than 1.8M? Not as high as 2.7M, but higher than 1.8M.
Erin - Nice video. But, who are you? What are your credentials / experience for talking about finance? Why should any of its pay attention to your videos?
Sometimes we don't take the uncertainty into account. Every "retirement projection" is always positive and assume you're going to live that long. 67 is the new retirement age? My father in law health is bad and cant do much with his retirement. He had all these plans. His wife got dementia and is now in a nursing home. Not saying saving isn't important but ypu need to live life while you can. Your not promised the jext day.
Thanks! Your info is very helpful & I wished I learned this earlier but alas, neither TH-cam nor internet when I was your age…. Any idea what covered vs uncovered basis means to taxes? I got into a mutual fund in the early 90’s that changed in ~2010/11 & my holding identifies both basis mentioned above.
I figured you would try to retire earlier considering some of your financial history you've shared on the channel. Now I'm trying to remember if you ever made a video on this before...
😂 - the new home of that fiddle is in the corner! But I have 5 more videos with it in the original spot to release still. It will depend on what order I release the videos in, it might bounce around a bit, but the corner is the new spot.
there's no such thing as retiring earlier than expected unless its a decision made for you because of events or circumstances out of your control. When you retire should be a purposeful decision, not something that just pops up out of the ether. There is no right or wrong when you decide to retire, and getting caught up in all this FIRE nonsense or retire early nonsense isn't useful and can be demoralizing. Figure out when you want to retire, do the math, if the math don't fit, then you have to change the variable(s) until the math works.
The Great Reset says we will all own nothing and be happy about eating bugs. That is if we are all so stupid to continue playing the same game as the others.
Another good reason to abide by this rule is not only the timeline consideration of not knowing when you might get "retired", but also to guard against less than expected or optimal rates of return. The next few decades might bring a recession or two, moribund market performance, or another global pandemic/war to crater your expected returns. Or you might have a personal health crisis or big ticket emergency to throw your planned investments for a loop. Control the things you can control, which is how much you make, spend, save, and invest. The rest is up to luck. Tip the odds in your favour, don't give bad luck a lot of room to operate. th-cam.com/video/MfUm1E1ZQtU/w-d-xo.html
Hi Erin, thank you for another excellent video! I am part of the 57% who retired earlier than expected. Expected to and 65 and retired at 62. I am 12+ years into my retirement journey. I was always the sole wage earner. My wife took SS at 62 and I waited until FRA of 67. The amount of content available for retirement planning when I was younger was seriously lacking. Fortunately now all that has changed. Most of your viewers are likely much younger than myslef and have the opportunity to have the information to make the right choices and decisions. I pray they do so. I was fortunate enough to have always been an investor and interested in finances. I have been blessed beyond what I deserve given the lack of information. For all your younger listeners I would encourage them to listen and take your content to heart and most importantly, implement it. It's not difficult and it starts with the first step and stick with it! Thank you and keep up the good work Erin! I am confident you are making a difference!! Larry, Central Valley, Ca.
Thanks Larry! I hope you and your wife are having a wonderful retirement - even thought it started earlier than expected 😊 Erin from snowy Rhode Island
Larry, I’m also so happy to have found Erin’s channel. She’s very knowledgeable in the world of finance and explains everything in simple terms. I, too am hoping to retire when I turn 62 in 11 years. In addition to my company’s 21% gross pay contribution to my retirement, I’m maxing out my Roth. Thank you Erin for sharing your knowledge! You’re making a big difference! 🤗 ❤
@@strongheartfitness Wow. 21% gross pay contribution is fantastic, I am speechless. Depending on how long you've been with them and had that benefit, and maxing out your Roth, you are well on your way to being prepared to retire. Stay the course in the next 11 years and you should be in great shape! Larry, Central Valley, Ca.
As Erin has stated, Finance Is Personal. I listen to a few other financial experts. I pick and choose the advice given. I agree with paying off the mortgage before retirement. In my case, it’ll occur in the next 4 years. I agree with investing upwards of 15% towards retirement. I agree with no debt. I only want standing bills so that I can continue keeping most of my paycheck. What I need is a simple way to budget.
Retired a year ago at 59 because the stress from my job was very detrimental to my health. Yes it was at least 5 years too early and my IRA balances might not be as high as they could have been, but I'm SO glad I did this, zero regrets!
Same story, 7 years ago at 56-1/2! Enjoy!!!
The stat about WHY people retire early was absolutely mind blowing 🤯 Also why i think physical health and financial health go hand & hand. Need to keep your pulse on both and keep both healthy and strong cuz at the end of the day no amount of money means anything if you dont have your health.
I totally agree with that!
Have you seen the Boeing Aerospace study correlating life expectancy to retirement age? Only executives and self employed types live longer when working longer.
I hated my job/career, I was not good at it. I saved 50% of my salary from day 1 preparing for a layoff one day. 20 years later, I realized my potential investments growth will shadowed my annual earned income, my perspective towards earned income and work versus investments totally changed. I finally quit that job and found a lower pay easier job. Its now been 24 years after college and living with this same financial mentality the whole time. It's amazing how those 22%, 26%, 28%, 29% annual return years makes a tremendous difference in your portfolio net worth. Financially I am set at age 46.
This. I feel similar, but I’m too far in my career, high in salary, and close to financial freedom to pivot. I just need 6 more years to be free at 48.
@@SweetPotata10 Bro, if you still get the Sunday scaries and anxiety about the upcoming work week, rethink things for your mental health. Hopefully you've seen how fast your investments grew since 2013 or even 2019 like me. I left engineering and did something totally different. I work at home now and work is like a walk in the park that came with a 50% paycut.... totally worth it!
It’s too bad people don’t get excited about hitting financial goals. It seems they reserve their excitement for trips, houses, cars etc. Reaching financial independence is the gift that makes you smile when waking up and going to sleep.😁
Some people like to live life while they’re young..future isn’t promised…and some people don’t care what 70 years old looks like since what are you doing then anyway lol…sure, there should be a balance
Because there’s a delayed gratification that’s more intense than a trip or a thing.
That's because the goal is to be able to afford the trips, house and car. The money is simply the method to afford these thing. Put another way, people will be excited if they can do these things and it didn't cost them anything. They would be less excited if they had millions of dollars but still couldn't do these things.😊
Meh, as someone who has reached some financial goals, getting to _use_ the savings is way more exciting emotionally
@@WeBeatMedicare6969 I guess I’m saying that you should always enjoy your life but preparing for a life absent of requiring work would be the ultimate freedom. Consumer culture is mostly empty of any deep meaning by itself
We retired one and two years earlier than planned. When you retire and when you take SS are not the same issue. I’m a firm believer in delaying SS at least a few years for one member of a couple, unless you have a large portfolio.
We did a split strategy with my wife taking early and me waiting till 70. In that way we minimize portfolio withdrawals and maximize Social Security, yet we both retired at 63.
At 70 we will have enough SS to cover all basic expenses and the portfolio will be for discretionary expenses only. This also allows for a bucket strategy with a conservative bucket for the bridge years, and an aggressive portfolio for the future.
This is so true. I planned to retire at 60 and got laid off at 58. Luckily, my numbers worked, but I know a lot of people who got caught short.
Such sage advice, Erin. Things change. Your energy level, ability to tolerate stress, desire to cope with office politics, a merger, a new supervisor. It is a great feeling to have the financial stability as we age to walk away on our own terms if needed.
My three favorite channels: Erin Talks Money, Stock Brotha, & How Money Works. Make my week complete! 🔥 🔥 🔥
Great video Erin! I had a very similar discussion with my wife recently. We are 50 and I told her that we will hit our financial goals by the time we are 55 and can retire then. She said 'woah, that feels too early!'
I told her, realistically we may continue to work until 59 1/2 (when IRA removes penalty), but those 4+ years will feel pretty good knowing that we can have absolute choice of continuing to work or not. 😀
This is a good rule, Erin. Most people are far behind even the blue sky scenarios, no less planning for the unforeseen circumstances. It doesn't simply need to be forced early retirement; rather, you could also face a mid-life challenge (illness, loss of a job, etc.) that forces you off-track with your retirement goals. Being conservative, leaving buffer in your plan, will mean that you're not compounding the effects of a bad situation.
One of my favorite sayings to life by: plan for the worst, hope for the best. I truly believe people would live longer, happier lives if they simply planned better. How much stress out there stems from finances? Just plan to live within your means and prioritize saving and investing. That cushion, the peace of mind it creates, will go a long way in life.
I unintentionally implemented the 5 year rule - sort of. I had planned to retire at 66, but pulled the trigger at 58. I did a careful financial review and was a bit surprised to find I was able to financially do it without any pain. The real question for a retirement decision when you have the means is: What makes you the happiest? No one can answer that question for you. I am completely confident that I made the right decision for myself and my family.
Great plan. I'm 28 and was planning on cutting my expenses if I was forced into retirement early. Looking at how likely that is to happen makes me definitely want to plan on retiring earlier than I want to.
Listening to you talk lowers my blood pressure better than medication 😎
😂😂
7:01 This right here is what some people overlook. The stock market going up and down isn't the only concern. Your contributions and expenses can change dramatically along the way. Everything looks good until you are out of a job for more months than your emergency fund can cover.😱 Based on my own experience I am not a fan of Coast Fire. I'm either FI or I'm not. You can plan for the future but you can't predict it.
Facts spoken right there!
I agree with this 100%. My first plan was to retire/be financially independent by age 48. Bad stock market of 2008, bad investing decisions, Covid policies that resulted in me quitting my job and moving to another state and it just being too hard to save that much pushed my date back to age 55. I'm 53 and on track to retire at 55.
That’s fantastic! If you don’t mind sharing, when did you start saving and what percentage of your pretax income did you save?
My wife and I are younger and we plan to retire at 60. We are assuming a 6% return year over year so we can hopefully be pleasantly surprised and retire sooner than expected. Theres a lot of life that can happen in between though so if we aren’t pleasantly surprised, we will at least hopefully hit our goal.
Erin posts a video. I watch it.
Good video. I was one of those retire later than expected people. The pandemic made work less annoying....e.g. no commute with working from home...and also made retiring less appealing..e.g. I did not want to travel during the pandemic. So I ended up working an extra 18 months or so.
After watching the video "You (Probably) Won't Retire Early," I changed how I invest each month. I hadn't been contributing much to my taxable brokerage account before watching that video but now I have substantially increased the amount of money I put into it each month. I invest the money primarily in growth-oriented index ETFs rather than income-oriented ones. The reason for this is to minimize taxes and hopefully have it grow substantially in value when I sell my shares. I only want to pay long-term capital gains taxes when I sell the shares and I want to minimize taxes on dividends. I don't think I will have enough to retire five years early when I am five years before my planned retirement age but I am pretty confident I will have enough to retire three or four years early, in case I need to (assuming I live somewhat frugally).
This is the best retirement video I have seen in the last year at least!
The statistics regarding being forced into early retirement were shocking to me.
My mother was forced into early retirement, so this scenario hits hard for me.
I’m going to adjust my savings to be even more aggressive.
Thanks Erin!
The forced early retirement scenario is a shock to a lot of folks, and it's funny, cause like you, they know people it happened to, but it still surprises them...
In today's ever accelerating world of cutting costs to make shareholders happy, plus AI looming over entire industries, the shock might become that one gets to work to retirement age...
@@dstevens518 Agreed!
The statistics back up your idea, only 13% working to intended age of retirement (as I recall from the video). Better have a strong backup plan!
LOVE this video, excellent choice of topic. There's no greater frustration than planning and doing for decades, only to find out you came up short and screwed yourself. Can't go back in time to fix that. That's why I always plan conservatively, using lower expected return rates than normally quoted, a shorter time frame in case I'm pushed out early, and a more aggressive savings rate. I'd much rather err on the side of saving too much and having the problem of living lavishly in old age...lol.
JL Collins says it best. He's spent every dime he's made as soon as he's made it, buying the things he wanted. The thing he wanted to buy the most was his financial freedom.
When I was in my late teens my father realized he hadn't been saving enough for retirement and began to think and talk a lot about it. He also realized his work might dry up and his main job could diminish in the next years. My brother and sister had already left the home. At the same time, there were a few large pensions that blew up and there was a strong debate going on about continuing social security. The result was I became extremely conscious that the only thing I could count on was my own planning and investing. I always planned on not getting anything from SS or a pension. 30 years later I have a healthy nest egg and, ironically, 20 years in a job with a pension. I still can count on social security too. Nevertheless, I'm very glad my father was open about what he was concerned about and steps he took to get on the right path. Now if I get a notice that it's time to leave the company, the finances will be the least of my concerns.
I wish I had better financial understanding as a youngster, though at 20 I had never seen 5,000 and couldn't save 5 cents! Rather than the 5 year rule, Once I hit 30 or so, I just saved/invested as much as I possibly could and finances allowed which is easier, and yields a lot more on the back end. I suppose I could retire whenever I want, but I like work, have plenty of vacation and have nothing better to do, so will keep on truckin.
Good points here. I was already planning on retiring early at 50, but reached FI at 42. I am 45 now and plan on this being my last year, and will retire at 46. I have been deeply planning the financial and emotional aspects of retirement, especially early retirement. A few factors were able to speed up my timeline: Housing prices increased over the past several years and salary increase from a promotion at work. I have been able to save much more of my income and I plan on selling my primary house and move into our vacation home, and the equity will be far more than expected.
The 5-yr rule makes a great deal of sense, because things don't really work out according to plans. I was targeting age 61 to retire but my company consolidated sites and closed down operations in our state when I was 57. Circumstances allowed me to retire (and work part time outside of my field for another year) as opposed to uprooting my family and moving a few states away -- I still had 1 child in high school and my wife had a job with a potential pension in the area.
This is great advice... We were always planning on retiring when the house is paid off, which will be in 3 years. I'll be eligible to retire next year... That was always our plan...
Then there was a remodel a couple of years ago... Spendy, but should be paid off this year.
We are replacing the roof now. Should be able to do that by next year...
Then there was a huge family trip that apparently had to be done last year.
Working hard to try to get that paid off by this year...
Why all the rush to get it paid off this year?
My wife (who retired several years ago) has recently let me know she REALLY wants me to retire when I can rather than when the house is paid off... (Or planned to pay the house of 2 years sooner. (it's already a 15))
I think we can do this, but it is now really stressful... I expect this whole next year to be really stressful as a result...
I should have planned to be ready on the date I was eligible to retire, not when the house will be paid off...
Then I would have been fine either way...
If it' stressful, don't do it! Compromise, split the difference.
P.S. When you're retired, you won't be spending before you have the money. When you retire, you've got what you got. There's no picking up overtime etc.
Pleasr note that most people will throttle back the risk a little at 10years and a lot 5 years before retirement. So realistically the person retiring 5 years earlier in the example would have close to what they would have had if they retired as planned.
Those later working years are often the higher paying ones, too. Retiring early means even less money. And it's not like it has a lot less time to grow; if you retire at 65, that last year's contribution still grows well into your 80s-90s.
That’s pretty much the exact plan that I’ve had and so far it’s worked out beautiful there’s even far more benefits than you mentioned
@8:03 "...sometimes I think I love my job……"
Those words of yours Erin are my words.
We could get off of the hamster wheel today which is a great feeling. But the main thing we are working for is to increase our nest egg. We are not exceptionally high wage earners but since we have our finances under control, we are able to save/invest a good amount of our income. And that my friends is hard to say no to. Our last 5 years before we retire could easily be worth an additional half million in our retirement savings. If the 5 years became 10, that is over a million.
Kudos for a job well done! Yes, it's a nice place to be, we're there too, and same deal, still making more, just like the idea of a bigger nest egg, more flexibility.
You'll retire when time is more important than money.
This happened to my wife. She was surplussed August of last year at 63 years old. She wanted to work until 67. Thankfully she had been investing in her 401k and had a pension that we rolled over in lump sum. We didn’t trust her company to manage her pension from now on. Also, thankfully the market has boomed since September and her investments have really taken off. But yes, this kind of thing happens everyday so be prepared.
David! I'm so sorry your wife was forced to retire early - but I am glad that she was a diligent investor! At least you were prepared! Look at it this way, more time for your daughters and your grandkids! 😊
Great video. I would like to work until im 70 and delay social security. However, as you said, we can't always control when we need to retire. It's always good to hope for the best and plan for the worst...I am also trying build up some forms of passive income so that I can have some income in retirement even if I don't work much.
I think financial independence is sort of murky territory. I could retire now at 42 and have enough to get by and survive for the rest of my life, I think. But it is hard to tell how much I will need for the rest of my life at this stage.
"Get by and survive" isn't what you want to do for 40 or 50 years. Ten more years and your money will double.
When I turned 40, I made a plan to be financially able to retire at 60. I'll be 61 this year and don't know when I'll retire. But it won't for a financial decision when I do. I'd say your suggesting in the video works in practice.
Engagement comment for Erin, keep up the great work.
Im 43, semi retired and self employed. If i included an inheritance i'm likely to get i could retire fully. I'm disabled so i always knew it would be likely for me to need to work part time. My uk state retirement age is 70 and my life expectancy is late 50s early 60s. Some days i feel like i want to fully retire but most of the time i strive to keep saving for when i don't have the choice. Its a fine line.
I want the option to retire at 61/62 years old. But I might work as long as I can after that age, but in a job I love.
I feel fairly good about my trajectory toward retirement, but its those unknowns and out-of-my-controls that keep me up at night.
I do think that as people live longer and social security ages for withdrawals accordingly increase, our society has to become more open or incentified to hiring and employing older people. Whether those are private jobs or jobs in the government sector.
I appreciate learning about different tactics or ways of thinking that I might not be aware of. This 5 year rule is a great example.
I've never heard this topic. Great Job Erin. This topic should be an entire industry of finance.
I like this thinking for traditional and close-to-traditional retirees. It's kind of hard to apply for very early (FIRE and FINE movement folks). If someone is saving as much as they can now, there isn't really anything to move back by 5 years, but I suppose they could look at their desired lifestyle and see what it would take to cut expenses down by 34%.
Fantastic video! Wow the vast majority retire for reasons beyond their control. A good reason to start planning for retirement sooner than later.
Statistically, the average life expectancy for a man in the US is only 73 years old. Most men (and many women) don't want to wait until 67 to retire because they don't want to die less than a decade after retirement.
Exactly why my goal is around 56ish. I can't imagine getting into retirement in mid to late 60s and then having so little time to really enjoy it.
I hope you are joking, because you are dead wrong(pun intended).
Average life expectancy needs to be calculated from your current age!
Ask any 74 or older person what their life expectancy is, it is obviously not 73!
Look up the statistics, based on your present age not age 0 when you are born.
If you are in your 60’s your life expectancy will be somewhere in your 80’s not 73.
Excellent video, again. Thought I would retire at 67, but ended up being 62. Luckily my SS was enough to meet our expenses along w/part-time work. Now that my wife has retired, I no longer work p/t and we haven't needed to touch our IRA's, but if we did need to, an extra five years of increased savings would have been nice!
Really interesting and surprising statistics about how few retire when they plan to! Thanks for talking about them
I'm not doing the '5 year rule persay' but I'm doing more than coastFIRE version of it. I'm working my butt off now, because my goal is that around 40-42 I'll hit coastFIRE, then I have that freedom to decide 'when is enough' because that doesn't mean I'm going to stop investing in my retirement accounts, just that I won't have to, which enough of a freedom for me.
I'm Little late for your 5year rule.
I'm 63 working till 67.
Very interesting will use your info.
Thanks
What’s your day job Erin? Since you have a good handle on finances, you must work in the financial world. Keep spreading the word on needing to take an active role in our own finances!
Preparing early yes. Working until you are too old to have the experiences you want in life, no.
Due to a divorce, my financial goals have dramatically changed.. I was the architect of the big picture financially.. since that’s no longer applicable.. doing new goals has been different. It’s more basic than advanced than what I anticipated, but being realistic in my expectations gives a light to the end of the tunnel that’s for sure.
I will say, being in step 7 in Dave Ramsey’s system gives clarity.
And I give God all the glory for the blessing’s he has given
I Really enjoyed the presentation Erin, the timing of this video is interesting for me i had planned to retire this month initially at 59.5 years young, although I've really come to appreciate the career that i have, with a low stress environment & commute time that is minimal, paid leave is abundant, benefits are good, comradery is enjoyable, financially we (my wife and I) are fine although i would like to have a solid plan for what to do with all the extra time once retired, the next retirement milestone to evaluate will be at age 62 for myself.
Join my church, I can help you get rid of as much time as you like!
My plan is to fully retire at age 65, which is ten years away. I've reached my numerical goal so I'm ready in case I have to go sooner. Inflation is an additional factor that has me continuing to work and save. I will gradually reduce work hours so I can ease into retirement over the next ten years.
My goal is to retire before 62. By that I mean retire from our careers. We can then do whatever we want. Something low stress to keep us active into our golden years. People who live long tend to exercise their mind and body regularly.
Good video Erin! I developed Cervical Disc Degeneration Disease at 50 in 2006. I knew my time working was limited because of the pain. I saved and invested every penny I could, By the beginning of 2013 I was done working due to pain. My wife worked another three years. Fortunately our investments worked very well for us. We started retirement with five years of cash and plenty left in equities to grow. No worries about sequence of returns risk with the cash cushion. Stocks have performed nicely.
Motherhood is keeping you looking good!
I’m so sorry about the pain you experience, but I am happy to hear you are secure from a financial standpoint. I hope you and your wife are still able to enjoy a lovely retirement 😊
And you are too kind, motherhood has turned me into an exhausted zombie 😂 I have aged more in the past five months than I have in the past five years.
@@ErinTalksMoney
It’ll get better! We’re grandparents now with three grandkids aged six and five year old twins. They’re exhausting but keep us young. God Bless your family!
Yours too 💙
Great advice. A corollary point: plan to pay off your mortgage by that 5 year mark too.
I’m actually an advocate of paying off even sooner because the relief is immense. But I know that running the numbers it often makes sense to invest instead of making extra mortgage payments. You absolutely do not want to be in a situation where you’ve quit work and still have mortgage payments though. My $0.02
I fully agree with having no mortgage before retiring. My question to you is: Is the relief really that much from being mortgage free? You still have taxes and insurance to pay and you could easily lose your house for failing to pay the taxes. I just don’t see my relief being all that much when my property taxes are half of my mortgage payment. I’m not disagreeing with you, I just personally don’t fully understand when people talk about the relief they feel from being mortgage free.
@@cody5596
So let’s turn that around for a second: if I told you that you could start paying only half of your mortgage payment, would that reduce your stress and free up money to do other things with? (Yes)
But the real key is once you are in retirement. If we assume that some of your annual expenses will need to be paid from your retirement nest egg, that means that every month your portfolio has to generate money for the mortgage. When the market is down, you still have to take money out for the mortgage. (Yeah, there is the 3 bucket plan to mitigate market volatility, but you get my point.)
Because we retired unusually early, we didn’t pay off the house until a few years after. That cut in expenses once we did was a very big relief.
Ok, I think I understand better now. I was under the assumption people get a big relief because they wouldn’t be worried about losing their house anymore. I guess I should shift my thinking into just reducing your expenses is what would give you the relief. Thank you for clearing that up for me!
yeah, no. My mortgage is 2.375% fixed, so there is absolutely no compelling reason for me to pay off my mortgage before retirement. What stresses me out is the opportunity cost lost by keeping all that equity in the home sitting at 3.58% appreciation versus 10% broad index. If you've quit work to retire, you would obviously plan for the fact you need retirement income sufficient to cover the mortgage costs in retirement, just like you'd need to factor in having enough retirement income to pay rent if you decide to sell the home and rent.
@@cody5596 yeah, I agree, it's overblown and overstated argument. If your mortgage payment is automatically paid, I find it difficult to believe there is stress in that. My stress is opportunity cost in paying off the mortgage when I could be doing so much better in broad based index fund or etf, given my mortgage rate. Paying monthly mortgage is no different than having to pay rent, it's still a monthly bill. If you get a hole in your roof, you're gonna have to pay for that and where are you going to tap the money to fix that? HELOC, refi, credit card, withdraw from savings earlier, etc? I have to say, i'm probably just going to sell the house and rent once my spousal anchor retires, because the stress to me isn't the mortgage, but home ownership in general and sitting on underperforming equity appreciation.
It appeared that my employer retired early and so I also retired at 58! But it did work out for me. I then worked as a consultant for a couple years for triple my pre-retirement salary. And I didn't spend it but invested it so I'm OK now. I know now I was underpayed before retirement. I guess I'm too agreeable to be rich. I'm 74 now with NW >$500K and no debt. I spend about 1/3 of my retirement income.
I think that’s a sound strategy. Nice video. And how is your baby doing? You are in for some wondrous times there.
Erin, I always learn a lot from your videos. May I ask- what do you do for your day job?
As someone who has just retired at 61 what I have learned along the way and wish I had someone in my life in my 20’s that would have said go balls to the walls on saving and investing until life gets in the way . Hopefully by then you would have made it to your first 100k and then the compounding really takes over from there . Plenty of rough roads to travel along the way but the earlier you start your journey the easier it can be .
How many years did you save before retiring and what percentage of your income did you
save? I’m asking people with similar comments as you due to my wife and I being relatively young and being concerned about our savings progress.
@@cody5596 If you can consistently do 20% you would be in good shape but if you can do more while you are young and invest the money that will pay off long term when life punches you in the face along the way because it will and the more you can invest now the better you will be prepared . We saved inside a 401K and did 15-20 consistently .
The problem is most people dont have that much extra income to save.
Erin !
Excellent advice - great content as usual.
I'm 73 and still working a reduced schedule, because I want to work. And many of my friends near to my age are still working. So i really don't believe that 50% of people retire earlier than expected.
Great video as usual. But I always see retirement videos about people leaving their jobs, but as a business owner, Id love to see some videos about when and what do business owners do about retiring when everything (employees compensation packages ie paycheck and fringe benefits, clients, funders, etc. ) all depend on you to work forever to keep the business' alive and well. What do you do about retiring when you are the brand and the business but you’re not a Jeff Bezo or Bill Gates where you can afford to hire the best of the best people to keep the ship afloat when you wanna eventually cruise on out of what you’ve built
Might make for a few good videos 😊 I have two businesses - this TH-cam channel, which let’s face it exists as long as I’m willing to make videos and as long as others are willing to watch. However, my day job, as the business owner, I am trying to implement people who can fill my role - I try to systematically create processes that are NOT dependent on any one individual. Everyone is replaceable in my eyes, including myself - which is essential if my goal is to one day sell the business. Which it is. Maybe in 10 years time…maybe in 20 years time. But I want to create a business that is not 100% dependent on me.
Able to retire but keeping working for health insurance
Thanks for this video, Erin. Top tier thought provoking content. The facts and the visual aids, charts and tables, really helped me move the needle forward in terms of my retirement planning
That makes me so happy to hear!
Given that I was thinking I might retire early in about 5 years, it might be too late to heed this advice. If I retired today, I probably wouldn't be okay.
The analysis of 2.7M at age 67 to 1.8M at 62 seems off. The reason is because you're not going to stop investing at 62, you're going to continue to invest, without $5K contributions, and with a smaller slice investing in equities ie 80% @ 8%. The other 20% can be converted to fixed income to use as income. Given this, wouldn't the return at 67, retiring at 62 be much higher than 1.8M? Not as high as 2.7M, but higher than 1.8M.
Retiring early on your own terms and not because you were forced to is key for reaching financial independence.
Great share!
Hey Erin would to hear your take on the 401Kids 500 a year plan. I know it’s not in place yet but would make for a great video!
This is definitely something to keep in mind. Great point!!
Erin - Nice video.
But, who are you? What are your credentials / experience for talking about finance? Why should any of its pay attention to your videos?
Sometimes we don't take the uncertainty into account. Every "retirement projection" is always positive and assume you're going to live that long. 67 is the new retirement age?
My father in law health is bad and cant do much with his retirement. He had all these plans. His wife got dementia and is now in a nursing home.
Not saying saving isn't important but ypu need to live life while you can. Your not promised the jext day.
Loved the video - a great concept! I wish I had known about that 15 years ago!!!
Wise video
Thanks! Your info is very helpful & I wished I learned this earlier but alas, neither TH-cam nor internet when I was your age….
Any idea what covered vs uncovered basis means to taxes? I got into a mutual fund in the early 90’s that changed in ~2010/11 & my holding identifies both basis mentioned above.
Good advice. Thank you!
Hi Erin - Great video! What is your full time job?
I figured you would try to retire earlier considering some of your financial history you've shared on the channel. Now I'm trying to remember if you ever made a video on this before...
Thank you for making this content!
I’m planning to retire when I’m 52 yo, if everything goes as planned. But I’m open to work until 55 :)
I see that your houseplant has served its' time-out in the corner and is back in your good graces.
😂 - the new home of that fiddle is in the corner! But I have 5 more videos with it in the original spot to release still. It will depend on what order I release the videos in, it might bounce around a bit, but the corner is the new spot.
A day job, a YT channel, oh, and A KIDDO! Yeah, I'd say you're busy!
I drastically underestimated how much work a kiddo was! 🤯
Especially the first one, the second is easier
@@randolphh8005 As guys, I don't think we can ever, EVER, say that!
Great advise❤
Thanks for the video!
I would love it if I could retire earlier than expected because I want too but not for health reasons or any other negative reasons.
there's no such thing as retiring earlier than expected unless its a decision made for you because of events or circumstances out of your control. When you retire should be a purposeful decision, not something that just pops up out of the ether. There is no right or wrong when you decide to retire, and getting caught up in all this FIRE nonsense or retire early nonsense isn't useful and can be demoralizing. Figure out when you want to retire, do the math, if the math don't fit, then you have to change the variable(s) until the math works.
Erin, your videos are full of too much good information, otherwise your channel is 10/10.
JK, You're killing it; I'm just slow.😊
😂 Thanks for watching!
❤❤❤
🙏
The Great Reset says we will all own nothing and be happy about eating bugs. That is if we are all so stupid to continue playing the same game as the others.
If $ 7500 a month is it mean Middle Class .
20 years old giving retirement advise... priceless.
Almost 40 years old 😉
You sound and look twenty something with a much mature financial brain. @@ErinTalksMoney
@@ErinTalksMoney40 years YOUNG!
@@ErinTalksMoney Consider it a compliment then I must be old. You look very young to me.
Just dump it all in the market baby stonks only go up to infinity
I found out I was saving too much so I stopped. I was projecting 2 to 5 million by 60.
Erin, you look so young - I bet you are never going to turn 50.
I’m currently letting a couple women financially dominate me. It’s not great financial planning but it sure is fun.
Most people commenting on here are lying through their teeth. The first liar doesn't stand a chance. 😂😂
Proof you should be enjoying and living life as you go...don't wait on that bucket list... check it off ass you go!🤑😁🦾
Another good reason to abide by this rule is not only the timeline consideration of not knowing when you might get "retired", but also to guard against less than expected or optimal rates of return. The next few decades might bring a recession or two, moribund market performance, or another global pandemic/war to crater your expected returns. Or you might have a personal health crisis or big ticket emergency to throw your planned investments for a loop. Control the things you can control, which is how much you make, spend, save, and invest. The rest is up to luck. Tip the odds in your favour, don't give bad luck a lot of room to operate.
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