Just a thought as I just saw the announcement for “AchieveFlow” (retirement planning software) here on the forum:
The biggest mistake people make in retirement planning is that they look at TODAY, think 1,500 Euro / 2,000 USD per month will do me fine, and don’t consider that even at between 2-3% inflation prices will nearly double every 20-25 years (yes, it’s the old “compound interest trap” which is the source of “everything has gotten so expensive” that old people love to say).
So if you think the EQUIVALENT of TODAYS 1,500 Euro / 2,000 USD per month will do you fine, then plan to have about THREE TO FOUR TIMES as much each month in 40-50 years time
and that’s assuming inflation remains that low
and you live that long
and the Apocalypse hasn’t happened
Now I’m depressed
I keep a spread sheet and the goal is to get to a 6000 Euro income at retirement.
That sounds a lot, but it’s still 30 years away and I expect if I could live from 3000 Euro today, I would need to double that for inflation over 30 years, just to keep at the same level.
Recently I’ve discovered Jim Rohn, a personal development coach, on YouTube, with some interesting ideas around capital, and obtaining financial independence (freedom)…
How to Attain Financial Freedom
Thought his ideas might be pertinent to this discussion.
Another thing people do is think they will need 2x the income, forgetting that “usually” by the time they retire their expenses are considerably less than today (in most cases you will have paid off your mortgage for instance)
Or just buy FAANG shares!
…shouldn’t it be FAANNG… they fogot to include Nvidia
ah forget these calculation or stocks or whatever… just try to find a nice, rich and clever girl you can marry
Good luck, we are just dirty old programmers ! But still more promising than getting any serious money from a self-enriching pension fund.
As a developer you know that fast delivery, loads of quality features and cheap price wont go together.
Im afraid the same applies to this girl: if she thinks she needs to marry then probably because one out of three qualities is lacking…
Don’t want to spoil the fun but … dream on guys!
Worked for me
now I just have to make sure she doesnt divorce me
An interesting topic and one that one should definitely think about although for some of us older types it might be a bit too late! Im a professional accountant and Ive spent most of the last 30 years working for asset management companies of various types developing various types of investment tools.
The first observation Id make is to keep the planning simple - complex financial dont provide better accuracy over the long term. I have always used: 80% of current salary divided by the expected rate of return to get the capital sum. I compare this to the current state of my portfolio and its projected growth, if there is a short fall Ill increase my contributions over the next 12 to 18 months to bring it into line. Dont worry about inflation etc the growth in your portfolio over time plus you contribution will take care of that for the most part.