Will I Ever Be Able to Retire? – I’ve looked a lot on this blog about how much is needed for retirement and when to retire and all that stuff but what about me. Of course it would be great to be able to cut back and eventually retire from having to earn money but will I actually be able to do it?
Will I Ever Be Able to Retire?
I started my life very haphazardly when it comes to cash and through a number of mistakes I ended up in quite serious debt. I still carry some of that debt to this day but it lives in a debt management program which is paid off, interest free, on agreed terms with the creditors. I keep the payments up and the creditors are happy. It means that until that is 100% paid off I can’t really keep any savings, any extra money earned is supposed to go to pay off the debt and of course that is fine and the debt will be paid off sometime soon.
It means I will be starting at age 31 with pretty much nothing saved for retirement. If I plan to retire at 65 that gives me 34 years to amass an amount that will see me through to 100.
I try to ignore interest in the equation and work out the sums in todays money. Theoretically the interest will bring the cash up to the value of the day I retire, well in an ideal world.
Estimating that I would need $30k per year to live in retirement and with plans to live until 100 (that would be nice!) it means I would need (35*30,000) just over $1 million! Ouch! Of course I need to look at inflation and up that yearly $30k to match the corresponding increase in inflation which makes it even more difficult to calculate exactly!
Somehow that means I need to be trying to save somewhere along the lines of $31,000 per year to reach that sum. I don’t work for a company so i can’t expect matched contributions, I could enter into a retirement plan where the government matches some of the money and gives the cash a tax-free place to stay so of course the sums come down a bit then but I don’t like the idea of entering into the mine-field of retirement accounts, of course if I want to sensibly meet the goal, I will have to!
So, yes I will be able to retire but it is going to be a hard slog. On-top of retirement savings I will need to save general savings for life, pay taxes and try to live life as I do already.
Luckily in my line of work I may not need to retire, If things fall a little short I may find myself working onto 70 or beyond, of course health issues or even death could strike by then but I am trying to keep myself healthy and safe to try and avoid such things!
Will you ever be able to retire? (read our post of the same name here).
Thanks for reading