[quote=AN]ER, all very good points and I agree to them all. I was actually the one who mentioned $2M and $100k/year. I actually mean $100k before tax, not after tax. $100k after tax would definitely make my retire that much more lavish.
Sure, the last 3 years, CDs might be paying ~3%, couple years before that, there were around 6%. If you have $2M and retiring today, you should be laddering your CD. I’m sure if you average CD rate over the last 10 years, it would be >5%.
I also totally agree about rental properties. I like to have my retirement fund more diverse. Which would also include rental properties. I don’t want to put all of my eggs in one basket.
I personally don’t care too much about all the expenses in individual categories. I’m more concentrated in total expenses. I keep track of all the big expenses, but all the smaller categories, like groceries, insurance, gas, etc, I just keep track of total monthly expense. I can always look up the details with Quicken or Mint, but they’re not something I look at every month.[/quote]
Hey AN,
Ah..yeah well $100k before tax should still be good for most people with no debt and having all cars and home totally paid off.
Definitely I agree about CD’s. I really wish I poured more money into them when they were paying 6% but then again hindsight is 20/20. Still, yeah, your probably right about average yields over 10 years but still….I know many retired people that have been nervous the past few years with such puny rates.
The thing about being retired is it causes you to worry more about pre-retirement. So you are really more sensitive to things like that. You don’t really stop and say…”oh well the average 10 year yield is X% so I don’t have to worry”. That isn’t the case at all. People are VERY worried and stressed about the low rates.
Definitely I think it’s really good to have great diversification in assets for retirement. For me that includes having a good chunk of assets outside of the USA. I know most Americans will never think like that but I could see the writing on the wall many years ago and started shifting part of my portfolio outside of the USA and it’s the best thing I could have done.
Another important strategy for me was getting residency status in other countries. You never know if the sh*t hits the fan in the USA in the future… I always thought it would be a wise idea to have permanent residency in another county as well as having a 2nd home in another country. I also feel really comfortable with that decision.
Yeah, I’m sure most people don’t detail each and every expense. I’m probably a bit anal about that. But once I got accustomed to doing that and entering them into Quicken at the end of every day or every few days it just became 2nd nature. I admit I don’t look at the charts too often but I do take a look at least twice a year to compare how my spending differs in each category throughout the year. Sometimes it’s really interesting.
