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Author: Donna405 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 1491  
Subject: Re: Newbie to this Retirement Board Date: 10/9/2012 9:16 PM
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Astroe kindly invited me to join this Board and add my 2 cents worth. First, I would like to refer you to a post I made on the Retire Early Liberty Edition Board: http://boards.fool.com/right-now-ss-is-70-of-my-monthly-inco...

Secondly, when I was your age, I started seriously planning for retirement. I did not even start planning until joining a international company in 1992 at the age of 47, almost 48. I immediately signed up for the 401(k), although I could not start contributing until 3 months had elapsed. I contributed 3% and my company matched 3%. Everytime I received a raise, I figured the percentage of the raise and added that to my contributions.

When I left the company (due to downsizing) at the age of 54, I had accumulated a nice little nest egg. However, I was not too happy with the way the Plan Administrator was handling my money, overall. Since I started my own company, I rolled over the 401(k) to the SEP-IRA of my company (SubChapter S Corp.)established through Fidelity, and began placing 15% of my salary into the SEP-IRA every year. (Now, I can increase that to 25%, and have started doing so for 2012.) Although I collected SS, I continue to work about 10 hours per week. Due to the fact that my hourly rate is comfortably high, I can get away with it. I live on my SS, and save about 1/2 of my monthly pay (in my Credit Union in a liquid savings account as a E-fund), and play with the rest (travel, nice lunches or dinners with friends, etc.)

The most important thing I did, as stated in my post on the other board, was learn to live comfortably on $1500 per month, net, which is what I guestimated my SS income would be (after all deductions from my SS funds), and I accomplished that handsomely. I pay my CC bills in full each month, along with the HELOC on my condo, utilities, auto upkeep, food (and I eat well), Long Term Care Insurance, all other insurance, etc. In SC, once one reaches 65, our property taxes go down a bit, so that saves me money. I have a 1994 Volvo 940 which is in great running condition, and I have no intentions of trading it until it dies a natural death (hopefully, not for another 7 or 8 years.)

This is a great time for you to learn to live on what your income will be when you retire. Don't forget to deduct what your Medicare and PartD Prescription coverage will be (guessing) as they are deducted from your gross SS check.) Once you learn to do that, you can save the excess and you will certainly feel far more financially secure. Retirement is WONDERFUL!!! You can spend time with dear friends or just be a hermit at home when you feel like it. Me? I sleep until 10:30 AM, although I am a nightowl (always have been), and don't usually go to sleep until 2:00 AM.

Who knows, you might want to go into another field when you start collecting SS, as you will have that money each month, and can think of what you really would like to do. 66 years of age is young. My father did. He worked until he was 88 years of age, and I will probably do the same, good Lord willing. I love to feel constructive, and also like making the extra money, as well as using my brain. I find my friends who completely quit working are having problems with their memory, they are not socializing as much, and their health is not as good.

Good luck,

Donna
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