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until I did the Millionaire Next Door worksheet.
http://www.money.com/money/features/seven/710.html

I save the max 10% in a 401K (S&P 500) plan with a 6% match. I also max my IRAs every year (they are in stocks). I don't have credit card debt. I also purchase a couple stocks every year. I thought I was doing ok. I was surprised to learn that I spend more and save less than the avg. American.

What am I doing wrong. How much do I need to save? What did early retirees on this board do to be able to retire early?
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sillysally asks,

until I did the Millionaire Next Door worksheet.
http://www.money.com/money/features/seven/710.html

I save the max 10% in a 401K (S&P 500) plan with a 6% match. I also max my IRAs every year (they are in stocks). I don't have credit card debt. I also purchase a couple stocks every year. I thought I was doing ok. I was surprised to learn that I spend more and save less than the avg. American.

What am I doing wrong. How much do I need to save? What did early retirees on this board do to be able to retire early?


I retired in 1994 at age 38. The last 4 or 5 years I was working I saved about 50% of my gross income.

I took "Millionaire Next Door" test you mentioned and based on what I was earning in 1994 when I retired and I got a ratio of 1.55.

intercst
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Do you suppose when one computes one's assets for these purposes it's fair to include the imputed value of an inflation-adjusted pension? If I do that I certainly look a lot better than if I don't.

jtmitch
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I think that pension should make a big difference.

I also noticed that the value of one's home is not included. There should be some adjustment for the equity in one's residence.
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jtmitch asks,

Do you suppose when one computes one's assets for these purposes it's fair to include the imputed value of an inflation-adjusted pension? If I do that I certainly look a lot better than if I don't.

I definitely think it's fair to include an inflation-adjusted pension in your net worth.

The present value of a $40,000 per year inflation-adjusted pension for a 50 year-old is about $1 MILLION!!!!

intercst

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Visit financialengines.com.
It's a neat site. You can enter all the requested financial info., like your current savings, future savings, etc and it will calculate your financial future for you. Like when can you retire, how much $$ will you need, etc. The basic info if free. Can't hardly beat that.
I retired on 01/01/00. I don't have a whole lot of money by any standard, BUT I have ZERO debt. That's the key. About 5 years before I retired at 56, I started an agressive debt elimination program.
A bowl or rice & beans, a roof over your head, a sunny day and two good dogs. What else does a guy really need??
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I retired at 57 from college as a professor. The last 15 years I contributed the maximum into 403b and invested in the stock market with any excess cash. Not counting my pension I have a net worth now of around two million. The market has been great and I've been fortunate to pick some winners and cut loses on those whcih have not worked for me. It sounds to me that the thought I was doing ok message is depending on how long they have to retirement.
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