Wednesday, February 9, 2011

65, 67, or 72: What's the Age?

The other day I was checking our bank account when a side panel poll caught my interest. It asked where is better to retire, Wisconsin, Texas or a few others. I would think Wisconsin would be better - blue skies, green grass, tall trees. Anyway after clicking my choice a little box popped up that said Waco, TX was the first choice amongst USAA customers. Hmm, well since USAA is a bank based in Texas, I think the poll is a little biased. 

A long time ago, I received one of those emails where you answer all the questions and then forward it on and hope to get it back filled out with your friends answers. I guess that trend has passed - lol. Anyway one of the questions was "Where do you want to retire?" and the popular answers going around were Florida, California, and some place tropical. My favorite one however was when a friend responded HEAVEN! I have copied that answer plenty of times since then :D

Lately S and I have been wondering what we need to do in order to retire. (here on earth that is) We have decided to borrow money from one of our retirement accounts to pay for IVF. We can borrow at 2.5%. That is so low that our payments would be less than we already contribute per month. So our monthly contribution would just be lowered by the payment amount. We have all the paper work filled out and ready to mail, however we are holding on to it until it is really needed. Also, we can change the amount anytime - already we have twelve hundred or so to put towards it, and every dollar we can come up with in cash before the deadline will lower the amount borrowed. So naturally all the loan talk and savings has us revisiting our retirement plan.

As it stands we hope be be fully retired by age 65. Of course earlier would be better - LOL. Anyway we have 6% going to a pretax account, 5% after tax going to IRA's, and about 6% going into liquid savings. Obviously we don't meet the 20% recommendation but we did start in our twenties, so the money is starting to add up. Our original goal was to raise the risk in our pretax account and our contributions in increments. This year we had hoped to bump that up to 10%. Now I am not sure. I think less needs to go to liquid savings. We need to establish a better emergency fund and stop using it for vacations (ha, ha). I don't know, it is confusing. Especially since we are currently trying to fund something thirty years down the road and on one income. 


Becca B said...

Retierment? I can't even save for next week! we have nosavings, no rainy day fund and no "extra" income. We are facing haveing to put our house on the market for a short sale. Being "laid" off last year tottaly depleated our savings....I think you guys are in excellent shape!! Keep up the good work. I have to catch up, I guess I will be working until 85, unless I can sell a book!

Jamie said...

Wisconsin???? Just think of the winters there though...not ideal at all. I'd love to retire to Tennessee...its so beautiful there. You are on the ball...our finances stink.