The Money Mustache Community
Around the Internet => Antimustachian Wall of Shame and Comedy => Topic started by: TonyV. on December 28, 2017, 09:07:02 AM
-
http://www.msn.com/en-us/money/retirement/what-a-comfortable-retirement-costs-in-each-state/ss-BBH2JBp?ocid=HPCDHP#image=2
This is an article from GoBankingRates that I came across on MSN. They list what a "comfortable" retirement costs in each state according to average living costs. Now, I'm not opposed to the "thinking" behind this, I just find it misleading.
Take the first one for example, Mississippi.
Cost of living- $37,750
Amount needed to retire- $755,000
Sounds logical... But their example is only suppose to cover 20 years!
Does anyone else agree that $755,000 should basically cover an infinite amount of years? I mean, $37,750 a year is a 5% withdraw rate. I know 4% is the ultimate "goal", but that's also being conservative, right?
I mean, I guess these figures make sense if you're keeping your nest egg in a savings account, but who keeps $755,000 in a savings account? lol
-
They literally multiplied 37,750 times 20.
And they feel qualified to write an article about how much it costs to retire.
-
They literally multiplied 37,750 times 20.
And they feel qualified to write an article about how much it costs to retire.
Absolute incompetence.
-
They literally multiplied 37,750 times 20.
And they feel qualified to write an article about how much it costs to retire.
This isn't even some random website. It's MSN MONEY. How did this make it past an editor?!?!?
-
In years gone by when interest rates were higher, how often did you hear of retirees who would lock up all of their savings in various deposit accounts, earning 5-8% interest, having it taxed and then living off the remainder?
Then they would dip into the principal at various times to buy a new car, or go on holiday or gift money to their grandkids.
That's how most people still write about old people's retirement money. But with interest rates at near nothing, living off interest (and not having capital grow) is no longer viable.