Tag Archives: early retirement

#Retirement Planner Recommends 2-3 Yrs of Living Expenses for #Retirees!

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We got up at 5:30 am on Saturday morning to attend a retirement planning seminar. The most important advice imparted by the speaker was the following: Retirees should have 2 – 3 years worth of living expenses stashed away for emergencies! Why? The reason is that it takes 3 years (on average) to recover from a bear market. What is a bear market? Think back to the Autumn of 2008, when the stock market dropped 50% over a 6 month period of time from September 29, 2008 to March 5, 2009. That was the beginning of the bear market. The speaker said that it usually takes about 3 years for the economy to recover from a bear market. Therefore, it is crucial to retirees’ survival to have 2 – 3 years of living expenses to pay bills, and stay afloat. If a retiree has to spend down their retirement accounts to pay bills, they may have to sell stocks or mutual funds at depressed prices. In farmer parlance, that is called “eating your seed corn.”

Where To Stash Emergency Fund?

When saving for the emergency fund, the speaker advised safe bank accounts insured by the FDIC. Brick and mortar banks pay less interest than online banks, but pre-retirees and retirees are most likely more comfortable with brick and mortar banks. It is reassuring to know we can reach our brick and mortar bank in a few minutes, and access our funds.

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5 New Rules for Early #Retirement! #retire #retireinspired

Photo Courtesy: www.searchamelia.com

Honestly, who doesn’t want to retire early?! Very few of us are actually doing what we love everyday. Career and business choices are largely dependent on the local economy, and demand for your services or product. If you do have an opportunity and/or desire to retire early, click here for 5 new rules to prepare for early retirement! For 9 Ways to Build Wealth in Your 50s, click here.

We have discovered that the easiest way to save for retirement is not to earn more money, but to reduce current expenses. Look at every bill you have and ask if there is a way to reduce it. Call the company and ask if there is a discount for seniors. We just purchased a laptop PC from Dell, and they offered a discount for members of AARP! Do you actually watch all of the channels in your cable package? We saved $25 per month by eliminating HBO from our cable package. We saved $200 per year by increasing our car insurance deductible to $1,000. We cancelled Sprint long distance because they charged $6.95 per month for a service charge, plus Federal/State/County/Local taxes/fees on top of the $6.95. So, even if we made no long distance calls, we were charged fees every month! Look through all of your expenses to find ways to decrease them!

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