Author Topic: 39 and trying to get sorted  (Read 606 times)

FD2004

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39 and trying to get sorted
« on: December 26, 2018, 08:17:58 AM »
Found this community and idea a little late in the game and I've made a lot of mistakes along the way.  I'm trying to make up for these.  Here is my situation:

39 single, no kids
$2600 a month take home salary
Half of insurance is paid $250 a month
Cell phone paid
Able to live on site rent and utility free
3%match on a simple ira

Bills (Monthly)
$55 internet
$89 renters, car and umbrella insurance
$525 car payment (5 years left)
$250 health insurance

Bills (Annually)
$450 license plates
$300 gym membership


Savings (Monthly)
$114 Simple IRA (company match)
$458 Roth IRA
$300 Betterment
$250 HY Saving Account (2.20)

This leaves $675 for all other expenses.

Savings so far:
$60,000 in an old 401k
$33,000 Roth IRA
17,000 Simple IRA
$1500 Betterment
$1600 HY Savings
$5000 in checking (not really savings)

Also, when I retire my expenses will grow quite a bit (housing, cell phone, health insurance), so I have no idea how to really set a goal number for retirement.

Any thoughts? Thanks for reading.






Chrissy

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Re: 39 and trying to get sorted
« Reply #1 on: December 26, 2018, 02:11:37 PM »
You have $118k which is a really good start!  And, you take home $31k/yr with no rent, utilities, or phone, so you should be able to save like a mad man.

The key to figuring out how much you'll need in retirement is:  EXPENSES.  First, what are your expenses right now?  Your post is vague.  Drill down into the specifics.  Track it.  Groceries?  Eating out?  Toiletries?  Clothes?  Parking expenses?  Entertainment?  Gifts?  Gasoline?  If you use a credit or debit card when paying, you already have this data.

Once you have those numbers, figure out the average rent and utilities in the area you intend to retire.  Health insurance is trickier, but you'll likely be on an ACA plan with subsidies.  Easy to research, but the plans are location-dependent.

I'll throw you a number for unlimited cell plans right now:  they can be found for $30/mo through an MNVO or something like Sprint's Kickstart plan.

Want to do anything special in retirement?  Have a dream of owning a horse?  A sailboat?  Building a kit plane?  Rebuilding a classic car?  Seeing some exotic locations?  Well, figure out how much that'll run you and add it into your expenses.

Okay, once you have a rough idea of your ANNUAL retirement expenses, multiply by 25.  There's the number you need to retire.  The lower your expenses, the lower your goal number, AND the faster you can contribute money toward it.

My thoughts are 1) max your Simple IRA if you're not already, and 2) your car payment is bonkers.  That's probably your biggest expense right there, and, therefore, a big hurdle to retiring.

Given your current numbers, I'm betting you're about 20-25 years from a lovely, well-funded retirement.  Remember, most people retire into poverty, so having retirement savings is already a triumph.  If you can cut expenses to save a LOT ($15-20k/yr), and earn more (side gig?) even for a little while, you could probably get that down to 10-15 years.  It might seem far off now, but who do you know who retired at 49 years old without winning the lottery?  Probably no one.
« Last Edit: December 26, 2018, 02:13:36 PM by Chrissy »

marty998

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Re: 39 and trying to get sorted
« Reply #2 on: December 26, 2018, 02:24:44 PM »
What kind of car do you drive? You have $32,000 left of payments to make on it - that is a pretty big millstone around your neck.

What are your options for getting out of that?