What Would I Sacrifice for Retirement?

The following is a staff writer post from MikeS.  He is a married father of 2.  So, with the cat, he ranks number 5 in the house.  He loves numbers and helping people. Please leave any questions or comments below for either Mike or Crystal. That’s the question I started asking myself after reading this article.  The article discusses how forgoing cable, average bill $80, could amount to a million dollars saved over the course of 50 years.  So, naturally I began to think what I was willing to sacrifice in order to retire. Current Expenses I think I would be hard pressed to cut any of my current expenses in order to increase my retirement savings.  I currently contribute 7% to my 401k, 6% to a traditional 401k and 1% to a Roth 401k.  My employer matches the 6% and kicks in an additional 2%.  That’s a total of 15%.  In addition to that, I began contributing to an HSA (health savings account) this year. In total, between my contributions and my employer’s contribution, I am saving $6,550.  I only anticipate needing around $3,000 to cover medical expenses this year, assuming this year was like last year.  That means … Read more

Roth 401K versus Traditional 401K

The following is a staff writer post from MikeS.  MikeS is a married father of 2.  So, with the cat, he ranks number 5 in the house.  He loves numbers and helping people. Please leave any questions or comments below for either Mike or Crystal. I am happy to say that I am increasing my retirement contributions starting in January.  As I outlined previously, I was changing my company benefits for next year.  With those changes, I also analyzed how my take-home pay was going to be impacted and whether I needed to adjust my federal income-tax withholdings.  Since, I was setting aside a larger amount of money pre-tax via the HSA; I was able to increase my deduction number. This has enabled me to increase my retirement plan contributions so I can afford to retire quicker or use my accounts for something like annuities in the future.  My first thought was simply to increase my 401k contribution by 1%.  But then I realized that I had another option, I could contribute to my Roth 401k.  So which one to choose?  This presented a problem, a nice problem to have for sure. The Difference Between a Roth 401k and Traditional … Read more

10 Rules to Eliminate Debt Revisited

personal finance rules 10

One of the first things I did after starting this site was to create an anchor around which to build it – I called it 10 Rules to Eliminate Debt and Change Your Life. It was billed as a way to not only get ahead, but if you are willing to follow all of them, to get beyond. Get Beyond What? Well, the main thing I knew I needed to do for myself, and to teach others to do for themselves, was to rewrite or reject conventional wisdom. If you buy into the traditional “retirement” or money advice, you will work until your 72, or if you wait until next year, the magazines will tell you the retirement age is now 75. Realizing that most money advice comes from people that want your money, not to help you keep your money, is one of the tenets this site is built upon. It may seem ironic that I wrote a set of rules for a site built on breaking rules, and I admit that, but it is what it is. Life is made of rules. Which ones you choose to follow will dictate everything. This site was and is geared towards … Read more

I Don’t Care if My Wife Hits the Lottery

The following is a staff writer post from MikeS.  He is a married father of 2.  So, with the cat, he ranks number 5 in the house.  He loves numbers and helping people. Please leave any questions or comments below for either Mike or Crystal. No surprise there right?  Why would I mind if my wife hit the lottery?  She does not play the lottery, so let me explain what I mean.   When I was an insurance agent and I was discussing life insurance with my clients, I would frequently hear that phrase. “I don’t want my wife to hit the lottery if I die.”  Husbands would be afraid that their wives would receive too much money.  That by receiving the life insurance benefits, that their wives would be too well off. I would try to reason with them as to the amount of coverage that was appropriate, but it was usually to no avail.  This is probably why I am no longer an agent.  My gut reaction was always, “Who cares, you are no longer around.”  What does it matter if you leave your wife in a nice position after you are gone?  I am going to discuss the … Read more

How I Spent My Inheritance

The following is a staff writer post from MikeS.  MikeS is a married father of 2.  So, with the cat, he ranks number 5 in the house.  He loves numbers and helping people. Please leave any questions or comments below for either Mike or Crystal. Overall, I have made significant progress on my finances in 2013.  I am in a much more secure position now, than when the year began.  This is primarily due to large (to me at least) infusions of cash I received during the year.  The infusions came in 2 big waves, the first in the March/April time frame and the last coming in December.  The first wave was a combination of a performance bonus from work and the second was part of the inheritance I received from my mother’s estate.  The second was the remaining amount from the inheritance.  In total, they represented almost half of my normal annual salary.  Naturally, I was curious to see how it all ended up being allocated. Debt First up, I eliminated three debts.  The first was leftover medical expenses from when my son was born back in 2011.  I had hoped that I would be able to pay off … Read more

Redefining Retirement

retirement wishes

I think it’s apparent to most that retirement has been redefined, and is continuing to be redefined every generation. Depending on who is doing the redefining – the worker or their boss – you will see two vastly different pictures of what retirement means. If you poke around the web, especially the blogs of Gen X and Gen Y, you will see an interesting dichotomy – people who say they want to work forever, but not at a traditional job. They want to work a high-wage job for 10 years and save up enough to “semi-retire” and work on projects, both income-generating and philanthropic. This is a form of redefining retirement. Unlike the traditional definition that comes to most of our minds, an early retiree today would likely continue to exchange some of their time in “retirement” for income. This may be because they need to, because they have a passion for using their skills and talents to earn, or they want to leave a lump sum to their heirs.   How are the “job creators” redefining retirement? They are using grandfatherly old men like Sam Watterston to reinforce the message that “things are different” these days. Retirement may not … Read more

The Best Investment for 2012 is YOU

A lot of people are wondering what the best investment will be for 2012. If you are afraid of uncertainty and want a guaranteed return, then the best investment you can make is investing in yourself. I’m no economic expert, but with what is going on in Europe with the Euro crisis, and our own unsustainable levels of debt in the United States, I cannot envision a scenario where 2012 is a good year to invest in equities. We are not going to suddenly find a way to pay off our national debt. We will likely see the US dollar become stronger, which will weaken our export markets, leading to deflation and the devaluation of our currency. So what do I mean by investing in ourselves? The easiest way to do this is paying off your debt. If you have $20,000 in credit card debt at 10% interest, paying off that is a guaranteed to earn you 10%. It is highly unlikely that you could put that money somewhere else that will earn you more than that. This is because debt is like a negative investment. It makes no sense to be piddling your money into an IRA earning 5% … Read more