Infographic: How to Plan (Pay) For Your Retirement by Mark Johnson

Going to retirement someday? Here are some fact you might need. This infographic from Mark Johnson compiles statistics and advice from the experts on what actions you should be taking if you are going to retire using using your own nest egg. He has also included a list of his sources so you can do a little checking of your own. Of course, the piece of advice I thought to be wisest...SPEND LESS THAN YOU EARN! Other key points:

• Avoid acquiring more debt and pay off high interest debts first.
• 36% of income should be used to pay off debt. And 28% of total pre-taxed income should be going toward your mortgage.
• Take care of your IRA and 401k plans. 
• 10% of your income should go to an IRA or 401k retirement plan.
• Plan to have saved 8x your yearly income by the time you retire.

What would you add to this infographic if you had a say? Here it is...only on Retire In Style Blog. Take a look!

How to Retire...Live on LESS Than You Have

Bocci Ball with friends...cost $-0-

Did you know:

• The good news about retirement cost: ....spending typically peaks when you're in your forties and fifties (the big exception: health care). After age 75, the dropoff is especially steep. (CNN Money)

• The bad new:  If you don't live beneath your means when you are young YOU MAY NEVER RETIRE!  (Retire in Style Blog)

• The cold truth:  You need to focus on what will actually help you keep cost down and not get caught up in a penurious way of living.  (Retire in Style Blog)

• Live debt-free. – Financial debt causes stress and heart ache.  Live a comfortable life, not a wasteful one.  Do not spend to impress others.  Do not live life trying to fool yourself into thinking wealth is measured in material objects.  Manage your money wisely so your money does not manage you.  Always live well below your means.  Read The Millionaire Next Door (27 Healthy Habits of Happiness)

Goodness sakes...I discovered that I am not the only one that thinks that retirement not only possible but can actually be fun.  Good news for a change.  In an article published by CNN Money: Live well on less, 6 ways to save in retirement, one of my favorite bloggers, Bob Lowry, shared his story about retiring 10 years earlier than planned.  He shared the keys to the good retirement...simply live well on less money.  In fact, I think it is main component in finding out "How to Retire".

I cannot tell you how many people have told me that they needed at least $xxx,xxx or much more a year to retire on comfortably.  A man I played golf with in Florida several years ago was delaying retirement for three years so he could pay for a wedding for his daughter that cost more than the value of his house.  He just didn't see how he could get along without a condo in Florida and beautiful house in Georgetown.  It was so over the top that I could not relate to what he was talking about.  He was the perfect example of the bad news...if you live beyond your means now, you will NEVER retire.  Face up to it because it is the truth!

My mother said that you cannot save much while your children are at home...the minute they leave the nest you need to sock it away to the max.  Save as much as you can when you are young and save more when the nest is empty.  It will pay off for you I think.  I know it did for us.

The good news is, if you have lived just a little under your means and saved as you went along, retirement is not going to be dull or poor or dreadful.  Retirement is going to be a lot of fun and you will wonder how you ever found time to work. 

In my world the joy is not in what I have.  Like the Lowry's we live beneath our means.  Oh, we spend money but we accumulate extra every month so we can enjoy a vacation occasionally.  We are fortunate.  We enjoy each others company and time with family and friends.  Most of what entertains us is not expensive.  We make trade offs if we like something more costly.  For example, we like cable TV so we do not go to movies or to live entertainment very often.  We cannot justify doing both.

This is how we live beneath our means:

1. We eat out but use coupons or eat at happy hour.  We love the crowd and being around young people so we go at the busiest times.  I think we would do it even if it didn't cost less.
2. We travel but we own a timeshare we bought many years ago and use the time or bonus time to make the trips at a very reasonable rate. For example, we use timeshare bonus time in Palm Springs for around $60 a night.  (Worldmark by Wyndham).
3. We always travel on the shoulder of the season.  That is the time very late or early in high season.  Travel is cheaper and crowds are less.  You should check into this!
4. We have found ways to "co-op" with our family, sharing cars, garden tools, garden bounty, bulk purchases and even our condos or homes so we can own things we would not have been able to afford.  For example, my husband I kept our old Subaru for the whole family to use and they reciprocate generously.
5. We are still using the same furniture we bought when our children were small.  In this case we spent more to begin with.  We always buy really good quality and depend on the classic style to last...hopefully forever.  As we grow older we need less so even when the good furniture goes away we are not necessarily replacing it.
6. We do not scrimp on health care or insurance because we know that major illness would break us in the end.  We spend money to save money in the end.  This can require sacrifice but it makes good sense.
7. We golf but also do it within reason.  Again, coupons/discounts from golf.now, etc, help a lot. 
8. I cook from scratch...99% of the time.  Prepared food is very, very expensive and a good curry or tortilla soup is much tastier if it is prepared with your own hands.
9. We entertain at home...I love it and we can have friends for dinner more frequently.
10. We do buy new clothes and a few every season.  But, by buying off season, we get things for less and still dress nicely.  (Dressing shabbily makes you look and feel very old!)  I never go shopping in a better clothing store without a coupon or member discount.  Most stores have a mailing list for customers.  They send store coupons to their faithful customers.  Sign up for these...it can help quite a bit.

Living beneath your means can be a very tricky balance.  You really do need to focus on what will actually help keep costs down and not get caught up in a penurious way of living.  Pinching your pennies at the cost of making friends and family miserable is not a good way to live.  The trick is, save without anyone even realizing what you are up to.  I think that if you knew us you would not guess we were being careful...at least not to the point that it grated on your nerves.  Not everything has to be cheap or on sale or second hand.  We keep our life enjoyable even on a budget!

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Related articles

• Just a Few Good Reasons to Retire by Erik Braunitzer (retireinstyleblog.com)
• 4 Ways to Maximize Your Retirement Income (money.usnews.com)

• Twenty-seven Healthy Habits of Happiness  from Marc and Angel Hack Life

Managing Retirement Savings...after retirement!

Image by Always at Home via Flickr
WHAT THE EXPERT SAYS
I was reading an article published in U.S.News.com called "6 Easy Ways to Increase Retirement Saving".  We all know that saving, saving, saving is the best way to go.  The author of the article, Kimberly Palmer, had some good suggestions for saving even if you are a freelance or a student.  She also had suggestions on how to choose a low fee program that would save you thousands of dollars when it came time to cash the savings in.  I think you should take a look at her article.
OUR CHOICES FOR MANAGING RETIREMENT SAVINGS
My husband has reached the age when he must take part of that pre-taxed money we saved all those many years ago.  As we both know, we will pay the consequences/taxes now.  The question is:  Is the cup half empty or half full?  Even though we must pay more in taxes this year we are going to go with the half full plan.  For this first year at least we will spend some of the money on a 50th wedding anniversary trip.  We both know that using our savings for frivolous things is not a good idea.  However, in our case we do not live on our savings or income from our savings.  We will have a discussion for taking out IRA money will our stock broker and decide when to do it next year.  Trends in the market will help us make that decision.
USING COMMON SENSE WHEN MANAGING RETIREMENT SAVINGS
My husband does what Ms. Palmer suggested and saves even now.  We continue to set a goal for a trip or a new piece of furniture...the habits we formed as young people still serves us well.
Although Ms. Palmer did not mention it, I might also suggest that you invest in a vacation plan for the future!  If you do this, you will guarantee yourself some travel even if you retire with less than you expected.  We invested in a good solid time share type of plan.  In our case the time is not set for a week or a certain place.  We bought into a company that offers the whole line up of resorts and is very desirable in the timeshare exchange world. Using this retirement tool will make your "advanced" years a lot more fun.
We made most of that period of time between our children flying the nest and retirement.  We were both working and we saved like crazy using as much pre-taxed money as the law allowed.  My mother often said that saving for retirement was much easier during the post child rearing time.  Boy was she right.  We took advantage of that time and actually on many occasions saved until it hurt!  It was fun.  We used other strategies that also came to bear on what we have now.  There were things we did and did not do...

• We did not buy a bigger house when the children left and we had more disposable cash. We did, however, make sure that the right amount of money was invested in real estate.  That has turned out to be very important.
• We did not upgrade the car or even our furniture.  The life style remained very constant.
• Our cars were bought when we needed them...the emphasis being on NEEDED!
• While we did travel at least once a year we did not go nuts with it.  I know we could have afforded some really upscale travel at that time but we had a goal in mind.  We used business trips as vacation time even though one or both of us had to work.  We were educators so these were very modest trips.
• Our children graduated from college with no debt so we did not need to continue to support them.  That sacrifice has paid off over and over!
• We had our savings removed from our pay before taxes so we never saw the money.  
• We invested in a variety of different types of mutual funds and stock for IRA savings.  You MUST find an investment counselor or stock broker you can trust,
• When we retired, we decided to take our retirement in such a way that the surviving spouse would continue to get the income.  This frees our mind to enjoy the money we do use.

CONCLUSIONS
So, given our decisions both past and present, we are giving ourselves this one wonderful big and expensive vacation!  We will use that vacation investment in a timeshare I talked about earlier.  That frees up a lot for the frills that we always thought might be fun.  Oh, and I did spend a lot on clothes.  I don't know how we could have anymore fun than we have in the past but I will let you know.  It is nice to know that we gave ourselves the opportunity...we are very grateful.
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