# Retirement Financial Thought(s)



## Micheal

After a discussion with a "new" retiree I have to wonder just how much thought do individuals "really" give to any financial realities. I mean the realities such as the costs of health care, taxes, maintenance or replacement of _____(stuff we own), etc. and even inflation rising.

This new retiree turned 62 and decided that he was "owed", therefore he quit his job, started SS, arranged to start drawing on his 401K (only other source of income), and believes that between hunting, fishing, golf, and travel his world will be complete. 
May I add at this time that his wife (61) is still in shock and speechless; well just won't talk about "his" deciding to retire.... she still works.

So, in your thinking of retirement did you give any thought to any of the above mentioned concerns? Maybe have a money plan for the future, or maybe even got professional help in financial planning, etc.?????

Guess I'm asking just how much thought did you give "retirement"?


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## Solar Geek

DH hopes to retire in December of this year but based on his accumulated vacation will be paid until end of February. He will have been at the same company for 34 years when he retires and has a very decent pension.

Last fall, we called his company to talk to their retirement advisor and we also met with a tax guy we used to use when I was working. I had thought that we would have to live on his pension alone (which we are so lucky to have). 

Entered into the retiring analysis is that we have two girls, (21 and 22- had our kids late) --and now both have become engaged in the last four months. So we have two weddings to fund now, one this year in August and one probably early next year.

One girl graduated college and has her first real job and is moving to Michigan next week. She has been living at home with us between her internship ending and this job starting.

The other girl still has a year and a half of college as she changed majors from the sciences to business. Both girls fiancÃ©s have excellent jobs and make more money than we did till 5 years into careers. 

The problem for our analysis now is although we put aside a very generous budget for their weddings, all weddings cost more than you think. The older one, who just got engaged this last weekend, has some health and mental issues arising from the health problems, and has to be on our insurance under COBRA until she is covered by her new job. She is been to see four different types of doctors at very good facilities to finally try to pin down what might be wrong and causing her problems.

I tell you these details because all this has to enter into our analysis when you're going to retire and have children or elderly parents. Our house is paid for. We have no debt other than monthly that debt that we pay off each month. However we have some big expenses coming up and we have to buy a tractor or skidster-/ something along that line to handle our homestead. 

We have talked through all of the things we will be doing after retirement without any rose-colored glasses. We will need to and will continue to raise most of our food. We plan to add chickens. My husband would like to add goats; I'm not so certain.

We realized traveling to see our kids who now live 2 hours away from us and soon for one it will be eight hours, will eat into our budget and will cause us to need someone to help take care of the homestead when we are gone. We both have aging parents; mine needs help with us supporting her each month, his are in very poor health and have no monetary reserves and are fairly deeply in debt.
We built our homestead so that any or all of them could come live with us and have invited them to do so, but we are fairly far from good health facilities. Also they would like to keep their lives as they are. 

When we went to the advisor for financial advice, he laid out for us streams of income that we did not realize we would have as I had never counted on Social Security but I'm only three years away from pulling it. I also have a tiny pension that can start at age 60 (1 year away) which will more than cover the taxes on our homestead. I did the simple opportunity cost analysis which reassured me that would be no benefit to me to wait until 65 until I turn 82. Up until that time, I come out ahead by having added income. If I lived to be 82 I'll be thrilled I made it that far, and certainly will not have the homestead expenses that we have in these early years of beginning homesteading.

I am sure this is more than you ever thought someone would respond. However I think everyone has to enter into an analysis of where they are financially, where they will be financially after retirement, what taxes (income and property) can do to you and your nest egg, and what's happening with their family. In our case with our girls just starting into marriage and also with one still in college, elderly, ailing parents, we have to factor in cost for each of those situations.

It may be, and we have discussed this, that my husband works one more year to set our minds at ease. However the wear and tear on him commuting (he works out of town now 3 days/week), in my mind outweighs the benefit of the additional funds.


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## badlander

IMHO I think if most folks wait till they are financially stable to retire, they will work till they die. 

It's like having kids, if you wait to have them until you have the money to raise them, nobody would have kids.

The secret, I think, is to live within your means, pull in your belt and just do it when you feel it is time. We retired in January. Both in our early 60s. Health concerns were a factor. Also we have a dear friend who is suffering from a progressive disease who is slowly deteriorating before our eyes. He retired two years ago and has been going down hill steadily with no opportunity to really enjoy his retirement. We didn't want to go there and do that. We wanted a chance to do some things that we want to do while we are still able to do them.

No regrets.


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## notwyse

Well. If I had talked to a financial advisor they would of said...keep working girlie girl. This is how I did my math. Five more years till I can draw social security. Have a home played off. Am frugal. Have enough in bank to be equivalent to s.s. for ten years. Looked at my mother...crippled in a wheelchair at eighty three. I love to hike and am very physical. Do I have the funds to maintain that life style? Yes. Do I have years to waste building funds that will not improve my lifestyle? No. Decision made. The new health care laws help immensely.


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## kilgrosh

I'm not even close to retiring being only 32, and still have another 18 years of work ahead of me. Yup, only 18 years and I can retire at 50. Because of my parents current situation (very little savings but just enough to see them through) and the fact that I don't want to work my whole life, I met with a Certified Financial Planner this year. I highly recommend everyone to do the same, even if it costs you a few hundred dollars. 

She has been able to factor in other sources of income I didn't know about, explain loopholes in my pension plans (i.e. if I die, my wife gets nothing), and a host of other things. Most importantly she has helped me map out my life goals and how I can financially achieve them. She made up several scenarios that showed me where I would stand in retirement. For example: if I retired at 50, I would have enough income to maintain 89% of current living standards. If I retired at 50 and took up an income producing venture (market gardening, sawmilling, etc.), I could maintain close to 95% of current living standards. If I retired at 50 and got another job doing something I love and postponed drawing on my 401K until I was 57, I would achieve 100% of my current living standard and the likelihood of outliving my money was slim to none. 

This alone was more than worth it to hire a CFP. I now know that I can provide a good chunk of my kids college education, live a decent lifestyle, and still retire at decent age to enjoy life.

To even further help our financial lives out, my wife and I have agreed to slowly start downsizing. Each year we plan to remove or reduce items we think we can live without. This year, its cable TV. We are trying to see if we can use Netflicks, YouTube, and Apple TV to handle our TV watching fix. This would reduce our monthly budget by about $100 (HBO, Extended Cable Package) which would go towards paying down our debt faster. Next year, the plan is to have 3-4 raised beds and grow most of our summer vegetables, thus reducing our grocery bill. 

All in all, I am happy where I am heading and (please don't take offense) I'm learning from all the old people who failed to plan properly.


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## jwal10

We always put money away for our retirement and for the kids education. We used any available method that would accomplish that. My health dictated that we plan early. I started farming on the cheap and built aggressively but always had a stash. Borrowed early but then we were self supporting. When we had to retire early, all the assets were free and clear. Then a good city job with full benefits made it easy. We took advantage of everything available to save for retirement and savings for the kids educations or their start in life. Later there were funds to build income properties to have rents coming in for retirement. We all worked together as a family. Any one of the income streams is enough for us, all of them are enough for us and the kids and their kids and future kids. We all live simply but enjoy anything we really want, or do. Both kids are able to enjoy part time jobs and still not worry about money. DD lives in the family home in town. DS has his own cabin and enjoys his privacy here. We enjoy having him close. Daughter is just 10 miles away. DS and I are best buds and enjoy working together. I help him in his small lawn service, keeps me active and moving. He takes care of the family rentals and I help with a few other select properties. He also works 4 hours a day at the school. DD works at the same school about 2 miles from us. She is getting married on the 25th of July but all we need to do, is plant a few extra flowers for the wedding, she has saved for this day. It is a very modest wedding, a few things borrowed, It will be at the farm, by the pond. This was all set up years ago as a family event property. The little chapel has hosted 6 weddings before this, although she is hoping the weather is good so it can be outside in the gazebo. Her money will be spent on a 3 week honeymoon trip to the family Beach Cabin, down the coast to the California Redwoods and the wine country, east to Lake Tahoe, up to the family cabin at Wallowa Lake and then home. So we all, do, enjoy the benefits of planning....James


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## cricket49

Unlike many of you, we are 3-4 years away from retirement. I have been socking money away for years when all our friends buy bigger houses, nicer cars and enormous RV's. My husband and I are simple people who enjoy the cheaper things in life like hiking, camping (we have a tent), cycling and other outdoor activities. We are very active compared to most people are age. 

We bought our retirement land a few months ago and are excited about our next chapter.

Last year I set us up as a company in QuickBooks to tract our expenses. Most people have no idea what they spend. Later this year, I will have a full year of expenses and that will give us a clearer picture of what we will spend when we retire. Of course, medical will go up. We are almost debt free right now except for the house which will be paid off in 2 years. We live within our means. 

I have entered all our money into the Fidelity retirement planner and it states we will have enough money to retire soon and if we live up to age 90. I know this is only a tool but it does give me some comfort in knowing we might be successful. 

However, between pensions, 401K, and other savings accounts it still makes me nervous to take the plunge. We will take part time jobs at the beginning to make the transition easier mentally.


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## Ramblin Wreck

I think I thought it out, but you can never plan for all the "unknown unknowns", unless, as some pointed out above, you want to stay employed until you die.

My pension was funded for 30 years with 18% of my gross salary going into the fund. It provides more than enough for me to get by on and I even get small cost of living increases. The fund itself was at or over 100% funded as I approached retirement, but with the market crash in 2007, the fund dipped to the 85-90% range. It is slowly recovering now, thanks in part to a higher contribution rate for the current enrollees and employers. 

Health care is a slight concern, but as of right now, I get to keep the same insurance at the same rate as when I was working. That may change, but there is no indication it will at this point. I'm still several years away from Medicare eligibility, but I guess I could bridge it with some type of coverage if forced to do so. Thank God for good health though, regardless of any health plan.

I have had budget surprises since retiring, some good and some bad. 

On the good side, I was able to put the farm into a covenant, which reduced my taxes from over $5,000 a year to less than $2,000 per year. My county exempts older tax payers from paying school tax, partially at 65 and completely at 70. That will serve to reduce the property tax burden even more if I live to get there. If I don't, taxes will not be a concern for me.

On the bad side (well kinda' anyway), I still have a mortgage, primarily because I had to purchase family land or else see it lost to non family members. I also bought some adjoining property that came up for sale, but it was 300 feet from my house and right in my line of sight. While I hated to extend my mortgage, I'm still glad I bought the property.

So in the future, if I live to get there, I should see a budget boost when the mortgage is paid off in about five years. At some point, and I haven't decided when, I will also take social security, and that should be a shot in the arm for the budget. I'm still several years out from eligibility, so I've got time to mull it over.

The one thing that probably worries me most financially (and I truly worry about very little given the Grace I've already received) is inflation. I guess if we get a huge run up in prices, I'll just stay home and have a big garden. I like my home and I like gardening, so that is not a bad prospect at all.


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## Bentley

There are several keys to being able to retire early; 1. Education, 2. Find a decent job (keep searching...move if necessary), 3. Live within your means, 4. Never borrow money for toys, 5. When you must borrow (such as for a home) do the shortest term possible.(my biggest single money mistake was not doing a 15 year mortgage early). 6. Always, always, always put a minimum of 10% of salary into savings and maximize an employers 401k match. As early in life as possible, begin a Roth. And lastly, make a good decision on your spouse, and stay married. Very few divorcees get to retire early if at all.
It takes a lot of planning to be able to retire early, but two things are critical; 1. Get that home paid for (15 year mortgage), and figure out how to have and pay for health insurance.
For a comfortable early retirement it used to be that a million dollars was required. Today that number is a minimum of $1.5 million. By 2020, that number will be at least $2 million.
Now, can a couple get by on less? Of course. A pension and social security will take the place of a big chunk of that $1.5 million. Just do the math...and then do the math again. 
I started saving 6% at age 21, and I slowly increased that over the years to over 20% in the ten years before I retired. My employer matched dollar for dollar up to 6%, which was huge! Then I took a consulting job for several years just to pad the savings. Have been retired since 2012 and start social security next year. Things have mostly worked out for us, but it hasn't always been easy. And most importantly, love God and thank Him for all things. Don't allow idols to enter your life.


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## COSunflower

I started preparing to be able to support myself (just in case) and retirement at age 32. Thank God that I did as I went thru a divorce 9 years ago but still was able to retire debt free this year at age 60. It was hard and I always lived frugal while my friends were out having fun and buying expensive "toys" but it paid off as I just retired and most of THEM tell me that they don't know if they will ever be ABLE to retire because of all the payments for those toys and not having planned and saved.


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## cricket49

COSunflower said:


> I always lived frugal while *my friends were out having fun and buying expensive "toys"* but it paid off as I just retired and most of THEM tell me that they don't know if they will ever be ABLE to retire because of all the payments for those toys and not having planned and saved.


Anyone can have fun without all the toys. We do.

"The best things in life are free" :dance:


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## TnAndy

Bentley said:


> 5. When you must borrow (such as for a home) do the shortest term possible.(my biggest single money mistake was not doing a 15 year mortgage early).


Any mortgage can be made into any term you want simply by paying ahead. We had a 10 year mortgage on our first house, and paid it off in 7. Had a 20 year on the second place ( land only, first house paid for the cost to build the second ), and paid it off in 9 years. 

What I would actually advise is, all other things being equal ( points/etc ), get the LONGEST mortgage period, with the lowest payment amount you can. That way if you do step in a hole in life and can only make the normal payment for a while, you are committed to less payment, and less likely to loose your home......then have the personal discipline to pay is off as soon as possible. The EARLY money paid on a mortgage is the important money....it knocks down the total interest paid the most.


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## Molly Mckee

I find it hard to believe how many people retire with mortgages, car payments, credit card debt. Somewhere between 1/3 and 1/2 of the retired friends of ours still have mortgages. They have no problem expecting to retire, stay in debt, and travel. Many are broke because they are "helping" their 50 year old kids and grandkids. Those kids are not going to be able to help their parents when they run out of money. 

It seems to me that planning for retirement includes getting the mortgage paid. You can't expect to be spending other people's money forever. I think many of our contemporaries have been bailed out by their parents saving, but there will be noting left for their children.


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## mnn2501

Molly Mckee said:


> I find it hard to believe how many people retire with mortgages, car payments, credit card debt.


Amen. I'm not retired yet (only 58), but unless something forces me to retire earlier, the mortgage will be paid off and we'll have 2 newer vehicles also paid off before I do, and no CC Debt (very little now). We'll also have a healthy bank account, as well as 401K's we've both been contributing to for a while now.


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## mnn2501

TnAndy said:


> Any mortgage can be made into any term you want simply by paying ahead. We had a 10 year mortgage on our first house, and paid it off in 7. Had a 20 year on the second place ( land only, first house paid for the cost to build the second ), and paid it off in 9 years.
> 
> What I would actually advise is, all other things being equal ( points/etc ), get the LONGEST mortgage period, with the lowest payment amount you can. That way if you do step in a hole in life and can only make the normal payment for a while, you are committed to less payment, and less likely to loose your home......then have the personal discipline to pay is off as soon as possible. The EARLY money paid on a mortgage is the important money....it knocks down the total interest paid the most.


*Exactly* my philosophy. We took out a 30 year loan on the premise that if either one of us was laid off, the other could easily make the payment, then since we both had/have jobs are paying it off in what should be 12 years by paying extra on the principle every month. Smart way to do it!


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## TnAndy

Couple we knew moved here in their mid 60's, bought a house with a 30 year mortgage ( talk about an optimist ! ). He died last year, late 70's. She still has 15 years on the mortgage. Unbelievable.....


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## Kevingr

We're taking it to another extreme. Not only will we be debt free but we won't have any utility bills. We're still in the early planning stages but we're selling the current place and will pay cash for new land and house. But that house will be off grid entirely. I don't want to be in my 80's and not able to afford the utilities. And, I'm certainly not betting my future on the stock market, yes, it plays a role, but a very small one.


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## cricket49

TnAndy said:


> Couple we knew moved here in their mid 60's, bought a house with a 30 year mortgage ( talk about an optimist ! ). He died last year, late 70's. She still has 15 years on the mortgage. Unbelievable.....


I have friends my age who just bought 5 acres, a new barn and a new house. New mortgage and financed to the hilt. Sucked up all their savings.

What is wrong with people? Can't they look 5 or 10 years in the future and know whether a discussion is smart? 

We will be building our house in a few years but plan to pay everything with cash. We bought our land this year with cash. However, we do not touch our retirement or investment money.


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## jassytoo

We planned our retirement for years. We had our kids young so the third and last son graduated from college when we were in our 40s. We paid off the house and remained debt free from then on. Socked away as much as we could and bought any big ticket items we would need. DH retired at 60 ( compulsory) from his job but got another and semi retired from that at 67. He still works two days a week and enjoys it. After three years we so far have not had to tap into our retirement money. We have always lived frugally so we are not noticing any difference in our finances yet. DH is 70 now so we will have to start taking distributions from the 401K and IRA. Not real happy about that as they are making money for us. I do worry about the unknown sometimes. Future medical bills etc.. but not much I can do about that except try and stay healthy. I suppose at some time we'll have to let go of the homestead but right now we are enjoying raising our own food and our little farm.


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## mnn2501

jassytoo said:


> DH is 70 now so we will have to start taking distributions from the 401K and IRA. Not real happy about that as they are making money for us.


Just because you have to pull it from your 401K/IRA doesn't mean you can't reinvest it in a regular stock/bond account or even a savings account, gold or silver, or even stuff it into your mattress.


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## Nevada

mnn2501 said:


> Just because you have to pull it from your 401K/IRA doesn't mean you can't reinvest it in a regular stock/bond account or even a savings account, gold or silver, or even stuff it into your mattress.


I think silver is a terrific way to invest right now. In fact I'm doing it myself. I can't afford to buy enough silver to corner the market but I buy a few bars whenever I have a few bucks to invest.

I think my reasons for silver are sound, although you might not agree. While silver normally tracks gold to a large extent, I have reason to believe that silver will out-perform gold. In fact, I have reason to believe that silver bar might even go up even if gold doesn't. Here's why I say that.

1. While I know that a lot of you are skeptical of advice from the government, and even more skeptical of advice from scientists, the USGS has projected that silver will be "extinct" by the year 2020 without a major correction in value. I can't think of another time when a government agency stuck it's neck out on the performance of a commodity before. And 2020 is only about 5 years away, which isn't too far out to prepare for it.

Of course the word "extinct" hardly applies, since silver will still exist. But silver will become expensive. Some industrial uses for silver will substitute for other materials, and silver recovery from electronic scrap will be much more aggressive. But regardless of what it might look like, price projections are in the hundreds of dollars per ounce, while it's only $20/ounce today. That's a huge investment opportunity, even if it only reaches $80 or $100 per ounce.

2. Silver speculators usually trade "paper silver." In other words, they trade bullion certificates from recognized bullion dealers to avoid the cost of taking delivery on metal bars. That's smart of your intention is to buy gold or silver and then unload it in days, weeks or months when the price rise is met. You just buy and sell the bullion certificates as if they were stock certificates.

But many people in the precious metals business are skeptical that the bullion that's supposed to be backing the certificates actually exists. Some believe that there will be a run on certificates where investors will demand delivery of the metal. If they can't deliver the silver as promised the system will collapse, exposing the silver market as having a much smaller supply than is believed exists today. People holding silver bar will be in a good position.

3. Inflation will eventually catch up to us. When that happens holding silver will more than beat inflation.

4. A lot of people holding silver bar got in at around $30 to $35/ounce, while it's trading for more like $20/ounce. Financial experts are recommending that you don't need precious metals in your investment portfolio, since the economy is apparently recovering. I think the precious metals specialists want to amass silver at a low price for the next run-up. When silver doubles in price again they will tell you that you MUST have precious metals in your investment portfolio. This repeating pattern of advice is a scam to get you to buy high and sell low. Don't fall for it. This is a buying opportunity.

I could go on, but you get the idea. Just buy silver bars as you can afford them and keep them in your sock drawer. You won't be sorry.


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## TnAndy

I bought a few wheelbarrow loads at 5-6 bucks/oz. And I agree, the upside potential from here is quite high.


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## Nevada

TnAndy said:


> I bought a few wheelbarrow loads at 5-6 bucks/oz. And I agree, the upside potential from here is quite high.


Then you've been holding silver for 10 years or more.


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## jassytoo

mnn2501 said:


> Just because you have to pull it from your 401K/IRA doesn't mean you can't reinvest it in a regular stock/bond account or even a savings account, gold or silver, or even stuff it into your mattress.


You're right. We will be reinvesting it as we take it out. Hopefully we won't need it for a few years yet.


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## TnAndy

Nevada said:


> Then you've been holding silver for 10 years or more.


Converted my IRA out of paper in 2005/06. Price varied between 5.50 and 6.25/oz at that time. I'd bought some below 5/oz in the years before, but that was my big purchase.

I fully expect to see 100 buck silver in the years ahead.....for all the reasons you point out. The more you study silver, the more you understand what a critical metal it is...the modern world simply can't run without it.....it's use as money is way down the list. 

It was the dirt cheap, bargain of the century when it was under 10, but it's still a great investment at 20.


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## Nevada

TnAndy said:


> I fully expect to see 100 buck silver in the years ahead.....


It's amazing that we can predict an investment growing by 4X, or even 5X, with no push-back from anyone.


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## TnAndy

No, it's quite understandable. Several reasons.

1. Lot of folks are merely getting by.....they don't have any extra, or in some cases, aren't willing to look in their spending for, anything to invest. Take cell phones, for example. I don't know of anyone but me that doesn't own one. $40 to several hundred/month for them because society has convinced us we "have to have one", when in fact, we don't.

2. Folks have been 'educated' by financial advisors, stock brokers, heck the FED itself, to think that investing in paper promises is the only way to go.....stocks, bonds, CD's, etc.....all promises in paper, and mostly denominated in the dollar.

The handwriting is on the wall....the dollar is on the way out as the world reserve currency, ( as happened to the British, the Spanish and the Dutch before us ) and folks caught with paper promises denominated in dollars are going to see that paper wealth vanish....but they aren't convinced of it yet, since it hasn't happened in their life time. 

When it finally is obvious to everyone, the rush to hard, liquid assets will push silver and gold to the moon in dollar terms. Unfortunately, it won't be so much a gain for those who bought in early ( converting back to dollars to go to Walmart, one will simply find the prices of everything on the shelf has also skyrocketed )as it will be a loss for those stuck with a pile of paper trying to convert to a real asset. 

I think the best holders of precious metals will be able to say is what money they put in them held it's value while paper lost even bigger than is has over the last 10-20 years.

I use the "gallon of gasoline" example all the time. When I started driving back in the early 60's, gasoline was 25 cents/gallon. It still is. A silver quarter would buy a gallon of gas at the pump then, and a silver quarter (converted to paper dollars: $3.78) will buy a gallon of gasoline today.

Your purchasing power was preserved with silver, but lost by a factor of 12x in paper.


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## corynski

At 76 years of age, I hope I live long enough to see the end of the dollar, and I think we are now very close. In the late 60's I worked for Wells Fargo Bank in San Francisco and decided to learn what a 'currency devaluation' was, since the British just had a Pound Sterling devaluation. Just a few short years later, with the price of gold and silver soaring, Nixon devalued the dollar by shutting the gold window, and yet the dollar is still around, 40 some years later, worth only pennies on the original dollar. And Franz Pick reminds us that there has never been a paper currency that didn't go belly up, it's value destroyed from over issue. Today the U.S government is trillions of paper dollars in debt, more than can ever be repaid. Which leads me to my point......

Pre-1964 silver coins (Junk silver) is my guess for use as barter following a currency collapse, unless our government confiscates said metal coins, in which case we will be so far from our Constitution's requirement that 'only gold and silver shall be used for money' that we should be up in arms by then. Our nation's debt is now terminal, skyrocketing in an exponential rise straight into the stratosphere. If basic prices start changing daily, that will be the sign of the end of our currency.

If such a collapse is a countrywide collapse, a new, gold-backed currency is somehow quickly brought forth. But the American Dollar has been a leading World Bank currency, especially required for the purchase of oil, which now will affect all of the countries of the world, it will be a significant event. The timing of such an event is near impossible to predict, as the Fed Reserve Bank has many tricks to keep themselves in power, and the dollar afloat. 

Simply watch the rate of change of the dollar. If it keeps losing value, get out of debt, and build up reserves of food and supplies, and head for a refuge in the backwoods. I've gotten to know my neighbors here and I feel fairly safe at the end of my road, with five acres of firewood, a cellar and spring water. You can look up the German Inflation of 1921/1924 to learn the details........

Unfortunately, my conclusion is that our 'representatives', our 'leaders', have sacrificed us, the 'people'', in their efforts to increase their own stature, and their bank accounts. They've sold out the middle class...... in favor of the bankers.

So, back to the topic, 10 years ago I left my Lake Worth nest, and retired to east Tn on 5 acres near Lancing, with a stream and spring, and I'm gardening and relaxing and puttering and so forth. But first you must get out of debt!

corynski


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## Nevada

corynski said:


> If such a collapse is a countrywide collapse, a new, gold-backed currency is somehow quickly brought forth.


That's not going to happen. I don't believe that our government has the gold we're led to believe it has. I also don't believe that a lot of the bullion certificates being traded today are backed by existing metal. What that means is that we're pretty much stuck with the dollar, regardless of what it might be worth.



corynski said:


> Simply watch the rate of change of the dollar. If it keeps losing value, get out of debt, and build up reserves of food and supplies, and head for a refuge in the backwoods.


Inflation will be our answer to debt. It's a cyclic thing. When times are bad the government has to spend to keep things afloat, which creates debt. When times are better they let inflation loose to dwarf debt. People don't mind because their paychecks are bigger and their homes are worth more.

America is going to make it. We have 4 or 5 more difficult years to go, but we'll survive. But owning real estate and metal is what you need to benefit from inflation in the coming years.


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## motdaugrnds

I never took the time to plan for any type of retirement. I was a single parent who chose never to take another chance with marriage; so keeping myself and child housed, clothed and fed was about it. Even as I managed to get thru a real nice education, my professional career had nothing to do with making money; and I never made enough to "get ahead" financially (even made my own clothes).

When I retired I was in the middle of caring for a sick mother whose finances did good to provide for her meds and dietary requirements. So I created this 6-acre homestead by the sweat of my body. This all turned out to be a blessing to me and a walk by faith all these years has taught me not to rely on what most people rely on, i.e. money. Thus, my retirement is full of laughter (even thru the trials) and the knowledge that my Heavenly Father loves me and will provide all my needs....and He has always done just that! Check out my website.....


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## corynski

Hello Nevada, you said, "That's not going to happen."

And you may well be right. I'm holding on to the theory that we do still have gold in Fort Knox, even if that has become highly questionable, and that it's not now in China's vaults.

Regarding your comment that "America is going to make it. We have 4 or 5 more difficult years to go, but we'll survive.", I find it hard to imagine America in 5 years. We're at the end of a 80+ years of rising stock markets and depreciating currency values, the dollar has been heading down since 1940, so I can imagine any number of likely grim scenarios, many much worse than the 1930's. And I have read the history of the 1890 French and the German 1923 currency collapses, I wouldn't want to be in a city if the ATM's and phones stop working, or the gasoline pipeline gets tied up, and the countryside likely would be dangerous too. But I have a spring, I know my neighbors and I know the lay of the land around here, so who knows what could come of it all. I definitely agree land and some silver or gold is essential.


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## Shrek

When in my early 20s and just getting well rooted into my career (1984 to 1985) when some of the older engineers and techs who took me under their wings congratulated me on becoming eligible for the company savings plan and they told me "for every dollar I put in savings, the company put in a dollar", they all laughed at me because I said " Cool. I went to college 50 miles from home and my parents are letting me to continue living at home until I can clear enough to pay for my own apartment instead of paying them my room and board. I bet they will be cool with me keeping out enough to pay my room and board and gas to work and put the rest into savings so I can double my salary. Its not like putting all my pay in savings will leave me broke since I do CB radio and TV repair in my garage apartment at their place."

After the laughter subsided and my "work fathers and mothers" first explained to me that I could only put up to 10% of my after tax net pay into the savings plan and for the first 5 years the company only matched 3% and then increased the match by 1% each year until the company would match my 10% and then they (especially my work mothers ) explained that although my parents let me rent the rooms above the garage at a reasonable rate, all parents want their kids off and away asap.

For the rest of my career I ran thoughts that my work parents told me past my mother and father and thoughts I got at home past my work parent mentors.

Along the way I did savings plan investments, company stock purchases, payday savings bond purchases, sideline businesses, company paid tuition classes to increase my base salary and in relation my salary.

I also brown bagged my lunch and drove the same vehicle year after year as my work mentors as others my age laughed at me for only "going out on the town" once every month or two and even then it was just an outing to a nearby bar or a concert.

Younger folks now are even more obtuse than those who ridiculed me for eating my home made brown bag lunches and driving the same vehicles I had during my career when I explain how I decided I wanted to do my time while I was young enough to shave time off of my retirement age so I could retire at 45 to 50 with enough to comfortably live for 25 years or so and always set my goals on a low seven figure retirement asset package.

When the kids tell me that my life plan doesn't sound like fun, I remind them it wasn't fun when I embarked on the life plan when I was 23 or so and that it was simply my life plan to live Life.

I then remind them I am still living a comfortable Life and those old vehicles my contemporaries laughed at me for driving year after year are now the daily use classic vehicles that both those who ridiculed me of in the day and they themselves now want me to sell to them however just as my mentors with 1950s and 1960s classic car assets that once were their year to year transportation, my old vehicles are now my vehicles and assets.


Proper planning for retirement begins during ones "young turk" years and while financial savings are a facet, acclimation to frugality and as all my mothers and fathers drilled into me, small but logical investments in land because they will never be making more of that.

Almost 15 years into my retirement, I often find myself chuckling at the fact that I never quite reached the low seven figure amount in my retirement package, but I reached enough to pay the bills and along the way have maintained my vehicles, bought a little land and although my mother would love to have me move back into my apartment over the garage, I am content living in my small house on my acreage five miles away , using it as part of my workshop space and visiting with her when I finish any tasks in the age gone by apartment turned work area at her house in between my normal visit times with her.

Retirement should never be viewed as the no work period at the end of ones life. Rather it is the relaxed labor requirement work environment with more flexibility of directional options we all construct to keep ourselves content with the activities we find enjoyable and the knowledge that we were able to pass out of the rat race phase of our lives hopefully leaving a financial overhead void behind large enough for two or three young turk grade employees to fill on our transition to the environment of our choosing and planning.


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## Cabanaboy1313

Actually doing fairly well. Plan on retiring at 58, I just turned 50. I started collecting a small pension this month since turning 50. I will get a much larger pension at 58 and some social security at 62. Me and the Gal paid Cash for the Homestead. I will have a chunk of change when we sell the main house in 8 years and move in full time at the Homestead. All the cars and the Harley are paid for. We are paying cash to do the upgrades to the homestead. Only other big ticket item we have in our future is a sailboat. My Gals finances are a little bit week but she did pay for the homestead. I am the one spending the money to fix it up. Will end up spending more to fix it up than we spent purchasing it. But then again the Homestead is our Vacation/Retirement place. I don't think we can out live our retirement finances. I did have an interesting read in the Atlantic magazine. "Why I Hope to Die at 75". It's long but worth the read. http://www.theatlantic.com/features/archive/2014/09/why-i-hope-to-die-at-75/379329/


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## Toga1116

Retiring from military in 4 years at 38 years old as an E-8 at least. Just bought a $198k homestead on 20+ acres..which we won't move into until I'm out of military. In the mean time, it sits empty. We can rent if we need to. Hoping to make all major purchases (tractor/implements, tools ect) before we move up there. Only debt is the house. We couldn't wait to save enough money to purchase outright or build. Plus, we wanted to get started immediately before the kids are grown (all vacations on the homestead). We still have about $30k in savings that will go towards tools/equipment/implements/whatever else is needed. Looking to make it happen all on $2400/mon after taxes. Won't have much left after mortgage, all types of insurance, utilities, food, and fuel. Both wife and I can work part-time or full-time as needed, but we'd rather spend our time on the homestead fulltime so we can homeschool our two kids and work the land. Hoping to make a few extra bucks by growing/selling at farmers market and a home based leather business. Crossing fingers. Thoughts on homesteading on $2400/month minimum?


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## Nevada

corynski said:


> Regarding your comment that "America is going to make it. We have 4 or 5 more difficult years to go, but we'll survive.", I find it hard to imagine America in 5 years. We're at the end of a 80+ years of rising stock markets and depreciating currency values, the dollar has been heading down since 1940, so I can imagine any number of likely grim scenarios, many much worse than the 1930's. And I have read the history of the 1890 French and the German 1923 currency collapses, I wouldn't want to be in a city if the ATM's and phones stop working, or the gasoline pipeline gets tied up, and the countryside likely would be dangerous too. But I have a spring, I know my neighbors and I know the lay of the land around here, so who knows what could come of it all. I definitely agree land and some silver or gold is essential.


If I understand you correctly, you believe that the US currency will collapse because we've seen steady inflation for 80 years?

People actually like inflation. They get big raises, their homes grow in value, and their retirement accounts grow. The only time we saw deflation in recent history was during the great depression, but people weren't celebrating the value of the dollar going up. For nearly everyone alive today, sustained inflation is all we've known. I don't see it as an indicator that the currency or economy is on the verge of collapse.


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## kilgrosh

Toga,
running a homestead on $2400 is doable, it all depends on how high of a quality of life you want. Personally, I would plan on one of you, wife or yourself, working a part-time job to add to that bottom line. Also, take the next 4 years to develop the homestead to be income producing in some fashion. Selling hay, raising pigs or chickens, renting the fields, firewood sales, whatever you can start now that you can build up into a viable income stream is what I would do. This is just me, but $2400 is too tight in my book for the type of living I want. Best of luck and thanks for your service.


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## Nevada

kilgrosh said:


> Toga,
> running a homestead on $2400 is doable, it all depends on how high of a quality of life you want. Personally, I would plan on one of you, wife or yourself, working a part-time job to add to that bottom line. Also, take the next 4 years to develop the homestead to be income producing in some fashion. Selling hay, raising pigs or chickens, renting the fields, firewood sales, whatever you can start now that you can build up into a viable income stream is what I would do. This is just me, but $2400 is too tight in my book for the type of living I want. Best of luck and thanks for your service.


Trust me, if you have a retirement income of $2,400/month you're way above the curve.

Average annual SS income for men is $16,295 ($1,357/month), while average annual SS income for women is $11,999 ($1,000/month). Only about 30% of retirees have private retirement income or 401K savings to draw from.

http://money.usnews.com/money/retirement/articles/2014/01/27/how-seniors-are-paying-for-retirement

Figure it from there.


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## notwyse

And of course... Defining a homestead is subjective. Some folks think it means to be entirely self sufficient.... Some don't. Perhaps if you know that and fill us in you might receive better info...


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## Nevada

notwyse said:


> And of course... Defining a homestead is subjective. Some folks think it means to be entirely self sufficient.... Some don't. Perhaps if you know that and fill us in you might receive better info...


My purpose in building a homestead in 2006 was to live mortgage-free, so I could live on a shoestring if I had to in the depression I saw on the horizon. I suppose there are a lot of definitions of homestead, but I never considered a homestead to be something that might be a money pit.


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## kilgrosh

Nevada, I know that most people rely on SS for retirement, which is a whole other discussion for a later time.  Thankfully, I'm not one of those people!


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## corynski

Hello Nevada, you said:

"If I understand you correctly, you believe that the US currency will collapse because we've seen steady inflation for 80 years?

People actually like inflation. They get big raises, their homes grow in value, and their retirement accounts grow. The only time we saw deflation in recent history was during the great depression, but people weren't celebrating the value of the dollar going up. For nearly everyone alive today, sustained inflation is all we've known. I don't see it as an indicator that the currency or economy is on the verge of collapse."

True, people may like inflation when it 'appears' to be working in their favor, but it's when inflation hits the galloping stage and wages and salaries can't keep up, such as now for a hugh percentage of the population. And there was deflation from about 1870 to 1900 that went smoothly. But borrowing from the future starts to feed upon itself until the whole country is in debt. And the government is in debt beyond it's ability to pay the debt down. To maintain positive inflation requires an exponential rise in debt and phony currency. I mentioned France and Germany since both experienced runaway inflations and so we know it can happen. 

The situation in the United States is somewhat different, since we sent our dollar around the world, and now the world in indebted to a degree that can't be sustained. The problem in it's simplest terms is that the money changes value (depreciates) faster than it can appreciate because fewer and fewer borrowers earn enough to pay back their borrowings. It's fascinating right now as the dollar is skyrocketing and gold and silver are collapsing, in apparent disregard for the laws of economics, but wait a few months, we'll see the change&#8230;&#8230;


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## corynski

Neveda,

I just stumbled across a curious thing, a copy of the Sears Roebuck catalogue dated 1897, which is quite revealing. This was the end of the long deflationary period that began following the Civil War, around late 1860's, the end of the Civil War 'Greenbacks' inflation. Anyway, the prices are what I'm getting to, the low, low prices which seem impossible. Then followed the inflationary years just prior to WWI and the beginning of the Federal Reserve Bank. Here's a few examples of the prices, from a catalogue of over 700 pages:

22 cal. rifle.... $9.72
Colt Army Double Action Revolver ..... $13.75
Mandolin ...... $9.90
Rocking Chair ..... $2.55
Sewing Machine ..... $22.50
Horse drawn Buggy ... $29.90
Men's Western Saddle ..... $8.00

Apparently, deflation of wages and materials made money worth much more.

charley


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## Nevada

corynski said:


> Apparently, deflation of wages and materials made money worth much more.


Of course. That's why deflation is. Nobody can deny that deflation makes currency worth more.


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## corynski

My point being, why do you think inflation can continue indefinitely? Eventually the money changes value faster than you can spend it, and society can't function that way. You go to lunch and by the time you finish your meal, the price has gone up.

Anyone homesteading today must figure on money trouble in the future, there doesn't seem to be a place for optimism, to my mind. 

charley


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## Nevada

corynski said:


> My point being, why do you think inflation can continue indefinitely? Eventually the money changes value faster than you can spend it, and society can't function that way. You go to lunch and by the time you finish your meal, the price has gone up.


Steady inflation over a long time doesn't necessarily lead to hyperinflation. Hyperinflation is usually associated with a disruption in government functions followed by an inability to reorganize and collect taxes. We see hyperinflation after lost wars and regime changes.


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## frogmammy

corynski said:


> Neveda,
> 
> I just stumbled across a curious thing, a copy of the Sears Roebuck catalogue dated 1897, which is quite revealing. This was the end of the long deflationary period that began following the Civil War, around late 1860's, the end of the Civil War 'Greenbacks' inflation. Anyway, the prices are what I'm getting to, the low, low prices which seem impossible. Then followed the inflationary years just prior to WWI and the beginning of the Federal Reserve Bank. Here's a few examples of the prices, from a catalogue of over 700 pages:
> 
> 22 cal. rifle.... $9.72
> Colt Army Double Action Revolver ..... $13.75
> Mandolin ...... $9.90
> Rocking Chair ..... $2.55
> Sewing Machine ..... $22.50
> Horse drawn Buggy ... $29.90
> Men's Western Saddle ..... $8.00
> 
> Apparently, deflation of wages and materials made money worth much more.
> 
> charley


And from some info I found a factory worker at a shoe factory earned between 22 to 33 cents per HOUR.

It is ALL relative.

Mon


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## corynski

Nevada, you said "Steady inflation over a long time doesn't necessarily lead to hyperinflation." I don't think that is true, as I read that there has never been a paper currency to survive exponential inflation. 

Inflation feeds upon itself, such as the inflation we're experiencing, as government officials rarely allow the total indebtedness of the nation to decrease. The money increases faster and faster relative to time, until it changes faster than than we can deal with it, i.e. wages, prices, everything changes ever and ever faster. Debt increases exponentially, as is explained here:

"If U.S. National Debt is Growing Exponentially. . .

If the debt is growing exponentially according to the exponential growth equation D = Cekt where D is the debt at time t, C is the debt at time t=0, and k is a growth constant, then debt is growing in the same way as money compounded in a bank.- There will be a fixed doubling period (See Rule of 70) and inevitably the debt will become unmanageably large.

http://www.mathmotivation.com/money/usdebt.html


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