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Retiring to India at 37
2008-06-05 04:24:00 I found an interesting post recently on the Early Retirement forum by an Indian immigrant who is considering retiring in India at age 37. The poster asked several interesting questions, so I thought I would reproduce the post here (edited for clarity), and attempt to answer some of his questions.I am a 37 year old immigrant and naturalized US citizen. I am married, and have a 2-year old child. We have about $600,000 saved for retirement, with two-thirds of it in taxable accounts (tax-efficient index funds and low turnover funds), with roughly 75% equities and the rest in bonds/cash. About 34% of my investment portfolio is international. In addition, we have about $100K for our child?s college education, all in index stock funds, 65% US, 35% international. We hope to retire to India by end of this year. We don?t own a home anywhere in the world. However, we have investment real estate in India, which serves as a hedge against our purchase cost of a future home there. My first rea...
By: Retire To India
Generating income in early retirement
2008-05-18 05:08:00 One of the two major concerns for early retirees is how to generate enough income to live on until you are eligible to receive retirement income such as social security, pension or 401(k)/IRA distributions (The other major concern is health insurance, which I will cover in a separate post).As I show in my earlier posts on our Net worth, most of our savings are in tax-deferred retirement accounts. This is intentional, since we want to contribute as much as we can to tax-deferred accounts, to take advantage of the tax deferred growth and the tax deductions where possible. But this causes a problem: if we want to retire early, say at age 50, we have to have enough money in taxable accounts to live for at least 9.5 years, until we become eligible to take distributions from 401(k) and IRA accounts at age 59 1/2.As I mentioned in an earlier post, it is possible to make early withdrawals from retirement accounts without penalty. But clearly this is something you want to avoid, unless you r...
By: Retire To India
Is Early Retirement A Fantasy?
2008-05-11 07:00:00 When life or working conditions become difficult, many people fantasize about early retirement as a form of escape. Early retirement can be a reality if you have taken steps early enough to prepare for this. If you have the foresight and the discipline to set aside savings from your employment income and invested them wisely, ...
By: Resources zone
Early Retirement?
2008-05-05 16:43:00 Even if you are not close to early retirement age but think you may want to retire before 65, plan for it. It is difficult to plan for something 30 or 40 years away but if you are considering retiring before the age of 65 then you may need to save more than you already are. When you retire 10 years earlier, you are cutting down on 10 years of earnings, and compounding interest for any money you may have invested. Planning an early retirement in order to change careers or to take a less stressful lifestyle but still having some income is different than most people’s perception of early retirement. Though retirement does not mean that you are not doing any work or brining in any income. If you retire early but still have income you will not have to pay a penalty for most retirement or annuity plans. The withdrawal age is generally 59 ½. Seriously considering retiring early? Stagger your investments so that you are not penalized for withdrawing money early. The penalty can be as muc...
By: Urban Frugal
The opportunity cost of early retirement
2008-05-04 03:50:00 Adolescents have a sense of die-hard immortality that comes from having given no thought to their future. I realized that I wasn’t immortal when I was 21-22. This implied the full realization that my life span was finite although I hadn’t yet reached the sense of time that I have not that “old” people frequently ...
Why this early retirement blog continuously talks about cycling and cooking
2008-04-28 16:37:00 Financial independence comes from the combination of having enough money and spending sufficiently little so that interest from the former covers the expenses of the later. The biggest sources of personal expenses are generally Children Housing Transport Food Taxes Reducing expenses in these areas will make a much larger impact that token efforts such as using CFLs, turning the thermostat down, ...
Choosing a retirement plan for extremely early retirement
2008-03-19 15:26:00 Consumers are widely recommended to contribute around 15% of their paycheck to a retirement plan. The question whether to pick a ROTH IRA or a traditional IRA does not have a definite answer. For instance, it depends on whether one’s future [retirement] income is expected to in a higher tax bracket (ROTH) or a lower ...
Speaking to church groups, a £5 overpayment and early retirement!
2008-03-16 18:04:00 All Saints Church Mudeford Women's FellowshipOn 4 March I spoke for the third time to the Women's Fellowship at All Saints Church in Mudeford, just outside Christchurch. There were 26 there (including one gentleman who helps out with transport for their members) and I delivered my new-ish talk I Must Write That Down! (A Commonplace Book) which went well with this friendly bunch.The last time I had spoken there, I noticed later on that they had slightly overpaid me (£5 over the amount we had agreed). They were appreciative of the fact that I had pointed this out to them and we adjusted my fee this time to allow for this. Clubs and societies mainly derive their income from subscriptions, raffles, etc, and, as new members are not always easy to attract, every penny counts. I always stick to the fees and expenses that I have quoted.Years ago, a speaker in my area told me that he had just passed an audition for inclusion in a nearby county's WI Speakers List and had submitted details...
The Early Retirement Path
2008-03-03 16:33:00 In this guest post Tim from Canadian Dream: Free at 45 shares his path to early retirement at 45. If you like to read more about the road to early retirement you can subscribe to his RSS Feed here. I like to think of myself as fairly ordinary. To outsiders I seem to ...
Early Retirement?
2008-01-29 15:59:00 I really like my current job, but I just got my benefits package in the mail from The Seems and I couldn?t help notice the Early Retirement program. Depending on what job you have, after a certain number of years all employees of The Seems are available for a ?Golden Parachute.? A Golden Parachute is like a whole package of benefits that you get when you retire. Included are a rent-controlled apartment in Alphabet City or Who Knows Where (towns in The Seems) as well as Seemsian Security ? a monthly check to help buy food and clothes. For easier jobs like assistant Snooze Chef or Reality Checker, it takes like twenty years before you?re eligible for your GP. But for some of the very high-pressure positions like Case Worker and Fixer you can become eligible in ten years. So, I did the math, and I?m 13 now, which means at twenty-three I could be eligible for early retirement. I guess I?ll have to see what?s going on in the World at that time. If they really need me, of course I...
By: BeckerBlog
Ford to Offer Early Retirement Packages
2008-01-27 17:09:00 Although Ford trimmed its losses in 2007, the company is concerned about its outlook on sales for 2008. The company is offering early retirement packages to its current 54,000 hourly employees in attempt to replace current employees with lowered paid workers. Ford also stated that the company plans to trim salaried staff as well, maybe even by company layoffs in order to deal with the slowing economy.
Early withdrawals from Retirement accounts without penalty
2008-01-13 04:30:00 As I detailed in my previous post on our Net Worth, most of our investments are in retirement accounts, such as 401(k) and IRA accounts. We do this to take advantage of the considerable tax-deferral advantage provided by these accounts.I am often asked if it bothers me to "lock in" our money in such accounts where we won't be able to withdraw the money for many years. Normally money in 401(k) and IRA accounts can be withdrawn only if you are 59½ or more years of age. Any earlier than that, and you have to pay a 10% penalty. I want to explain in this post why this is not a big concern for me, since I am convinced that there are ways to access money early from these accounts penalty-free if it ever becomes necessary.First, some special cases: Most 401(k) providers allow for penalty-free hardship withdrawals in cases of genuine need, such as a medical emergency or disability. This is clearly not a good situation to be in, and shows the importance of having an emergency account and m...
By: Retire To India
3 Secrets to Early Retirement (and Life like a Nomad forever)
2007-10-21 16:26:00 Most people still believe that they are dependent on what Government pension plans or their previous company will provide for them when they are ready to retire. Or that they have to work until 65, 68 or even until they drop dead to the floor. That debt, cost of living and steady consumerism and expenses ...
By: nomad4ever
Planning For Your Early Retirement And Health Insurance Needs
2007-10-16 09:23:00 When can you say that you can retire? After operational hard for many years, if you have saved a great amount of money and cleared all your taxes other bills, and mortgages paid, you are prepared to formulate your strategy for early retirement and Health insurance. Planning your everyday expenditure in advance is a very tedious job. But the resources and details of companies that help you with
By: Retirement
Steps to Early Retirement
2007-10-15 14:35:00 There is certainly no shortage of opinions on the steps to early retirement. In this post I?m going to outline the steps that I will be following and feel are necessary to successfully retire early. Step 1Realizing that you Actually Need a Retirement Plan ? this sounds simple but it?s amazing how many people don?t have a real retirement strategy. Many people save for retirement but have no idea how they are doing or how close they are to retirement. I?ve talked to people who?s ?retirement strategy? is to work until 60 and then retire?but they have no idea of how much money they?ll need at 60, how much they?ll be receiving or how much they should be saving or investing. I think ?Realizing that you Actually Need a Retirement Plan? is the most important but often overlooked step in many people's retirement journey.Step 2Now that you know you need a real retirement plan you need to determine exactly how much money you?ll need each month and then add 10% to that number as a safety cushi...
An Early Retirement Update from QCash
2007-10-04 09:30:00 Since our last interview QCash, the guy who retired @ age 36 with a net worth of over $2 million, we have received a tremendous response from readers looking for more info on the early retiree. I've contacted QCash and he has kindly taken the time to write an update on his early retirement. Thank you ...
Early retirement planning with FIRECalc
2007-08-23 05:49:00 For those thinking about retiring early, two of the most frequently asked questions are the following: If I retire today with my current savings, how much can I safely withdraw each year?When can I retire with $40,000 yearly income (or another desired amount) if I continue to save at the current rate?FIRECalc is a simple web calculator that can help you answer these questions. FIRECalc makes one key assumption to answer these questions, namely, that the future can't be all that different from the past.According to the Wall Street Journal: To gauge your strategy's likely success, [FIRECalc] looks at investment returns since 1871. But the calculator doesn't use average historical rates of return. Instead, it analyzes what would have happened if you retired in 1871, in 1872, in 1873 and so on. It then calculates how often your strategy would have panned out historically.In other words, it uses historical data about the US stock and bond markets to calculate your odds of not running ...
By: Retire To India
Book review: Cashing in on the American Dream - How to retire at 35
2007-08-12 14:46:00 Cashing in on the American Dream: How to Retire at 35 by Paul Terhorst is one of the most well-known books on early retirement. I have heard about this book many times, especially on the wonderful Early Retirement forums, but never had chance to read the book until now. This book was written in 1988 and is out-of-print, so the best way to get a copy is at the library.Terhorst is a former accountant who retired at 35 in 1985 with a modest amount in savings and still continues to stay retired. He and wife Vicki are probably the best-known early retirees, and maintain a website that they still keep up-to-date with their latest adventures.Terhorst's book is in many ways reminiscent of the book Your Money or Your Life, published later in 1992, which I have mentioned before. Both books emphasize frugal living, and have a healthy disregard for the traditional corporate work ethic.Of the two books, Cashing in on the American Dream is more readable and less preachy, and contains more prac...
By: Retire To India
Book review: Cashing in on the American Dream - How to retire at 35
2007-08-12 14:46:00 Cashing in on the American Dream: How to Retire at 35 by Paul Terhorst is one of the most well-known books on early retirement. I have heard about this book many times, especially on the wonderful Early Retirement forums, but never had chance to read the book until now. This book was written in 1988 and is out-of-print, so the best way to get a copy is at the library.Terhorst is a former accountant who retired at 35 in 1985 with a modest amount in savings and still continues to stay retired. He and wife Vicki are probably the best-known early retirees, and maintain a website that they still keep up-to-date with their latest adventures.Terhorst's book is in many ways reminiscent of the book Your Money or Your Life, published later in 1992, which I have mentioned before. Both books emphasize frugal living, and have a healthy disregard for the traditional corporate work ethic.Of the two books, Cashing in on the American Dream is more readable and less preachy, and contains more prac...
By: Retire To India
It?s Early Retirement for Ricky Gervais
2007-08-01 22:22:00 Don?t panic! Our favourite British funnyman isn?t doomed to his pipe and slippers yet, but will be starring in Warner Bros new comedy Early Retirement. The movie, about a workaholic who quits his demanding job to spend more time with his family, is written by Mark Perez (Accepted, Herbie Fully Loaded) who pitched the idea ...
By: Product Reviews
Early Retirement Pitches
2007-07-22 00:00:00 Beware of sales pitches allowing early retirement which are based upon aggressive unrealistic annual returns without disclosure of the risks involved with such an aggressive strategy. As set out in the below NASD Investor Alert, following such a program may result in the depletion of your retirement nest egg if the broker is unable to meet the aggressive advertised annual returns. NASD Investor Alert See also the NASD charges against Citigroup regarding early retirement seminars in Charlotte, North Carolina for employees of Bellsouth. NASD News Release
Book Review: Retire Early? Make the Smart Choices
2007-07-02 01:00:00 I picked up a few books last week about early retirement and retiring abroad. In the next few weeks I will be posting a summary of each, with my notes on things I learned.The first book is Retire Early? Make the SMART Choices by Steven Silbiger. The first thing to note about this book is that "retiring early" here means electing to take social security benefits at 62 instead of waiting for full retirement benefits at the normal retirement age of 67 or later. I am always amused to see that retiring at 62 is considered "early" in most developed countries. (For comparison, retirement age in China is 50 for most women and 60 for most men. In India, 60 is the mandatory retirement age for most jobs; many state employees have to retire at 55 or 58.)As it turns out, more than half of this book is devoted to answering a single question: Is it better to opt for "early" social security benefits at 62, or to wait till the full retirement age of 67 (for those born after 1960)? The answer to thi...
By: Retire To India
Book Review: Retire Early? Make the Smart Choices
2007-07-02 01:00:00 I picked up a few books last week about early retirement and retiring abroad. In the next few weeks I will be posting a summary of each, with my notes on things I learned.The first book is Retire Early? Make the SMART Choices by Steven Silbiger. The first thing to note about this book is that "retiring early" here means electing to take social security benefits at 62 instead of waiting for full retirement benefits at the normal retirement age of 67 or later. I am always amused to see that retiring at 62 is considered "early" in most developed countries. (For comparison, retirement age in China is 50 for most women and 60 for most men. In India, 60 is the mandatory retirement age for most jobs; many state employees have to retire at 55 or 58.)As it turns out, more than half of this book is devoted to answering a single question: Is it better to opt for "early" social security benefits at 62, or to wait till the full retirement age of 67 (for those born after 1960)? The answer to thi...
By: Retire To India
Early retirement planning: case study
2007-06-23 14:56:00 Found this excellent thread at misc.invest.financial-plan about a 40-year old couple planning "semi-retirement" in 5-7 years and "full retirement" in 12 years. Their assets (net worth of about $1.5 M) and income ($240K-$260K) are well beyond ours, but I still found it very interesting.Some notes:Their current asset allocation is 70% US equities, 15% International, 10% Bonds, 5% Cash. The suggestion from the group is to increase bond holdings gradually, leading to a 60/40 split of stocks/bonds at final retirement.For the semi-retirement period, they plan to allocate $10K/year for health insurance premiums. The response from the group is that this is on the low side.Originally posted at Retire To India.
By: Retire To India
Early retirement planning: case study
2007-06-23 14:56:00 Found this excellent thread at misc.invest.financial-plan about a 40-year old couple planning "semi-retirement" in 5-7 years and "full retirement" in 12 years. Their assets (net worth of about $1.5 M) and income ($240K-$260K) are well beyond ours, but I still found it very interesting.Some notes:They contribute an astounding 50% of their gross income to retirement and college saving accounts.Their current asset allocation is 70% US equities, 15% International, 10% Bonds, 5% Cash. The suggestion from the group is to increase bond holdings gradually, leading to a 60/40 split of stocks/bonds at final retirement.They use FIRECalc to do Monte Carlo simulations on their retirement withdrawals, I tool that I too have played with a bit.For the semi-retirement period, they plan to allocate $10K/year for health insurance premiums. The response from the group is that this is on the low side. Related links: Early retirement planning with FIRECalc Originally posted at Retire To India.
By: Retire To India
Roth IRA conversion during early retirement
2007-06-20 05:11:00 Many people convert their Traditional IRAs to Roth IRAs due to the favorable tax treatment given to Roth IRAs. Under current law, money held in a Roth IRA is completely free from all future federal and state taxes. This is especially attractive if you believe that you will be in a high tax bracket during retirement, or if you expect the tax rates to go up in the future. You pay tax during the conversion process, in effect trading current tax payments for a reduction in future tax liability.There is one group of people for whom Roth conversions are especially attractive -- early retirees who are living off the savings in their taxable accounts. This is especially true if you plan to retire abroad. Since your income is likely to be lower during early retirement years, it would be an ideal time to covert your Traditional IRAs to Roth IRAs. If planned properly, this can save a considerable amount in overall taxes. What if your retirement savings are not in an IRA, but in another type of...
By: Retire To India
Roth IRA conversion during early retirement
2007-06-20 05:11:00 Many people convert their Traditional IRAs to Roth IRAs due to the favorable tax treatment given to Roth IRAs. Under current law, money held in a Roth IRA is completely free from all future federal and state taxes. This is especially attractive if you believe that you will be in a high tax bracket during retirement, or if you expect the tax rates to go up in the future. You pay tax during the conversion process, in effect trading current tax payments for a reduction in future tax liability.There is one group of people for whom Roth conversions are especially attractive -- early retirees who are living off the savings in their taxable accounts. This is especially true if you plan to retire abroad. Since your income is likely to be lower during early retirement years, it would be an ideal time to convert your Traditional IRAs to Roth IRAs. If planned properly, this can save a considerable amount in overall taxes. What if your retirement savings are not in an IRA, but in another type o...
By: Retire To India
UK investment bankers plan early retirement
2007-05-31 13:20:00 More than one-third of UK investment bankers expect to retire before they reach 50, research has found. A survey of 2,000 bankers conducted by financial recruitment site eFinancialCareers.com, found that majority (40%) of respondents planned to retire between the ages of 45 and 50, while a quarter planned to quit work aged 40 to 45. Polls conducted across continental Europe, Asia and Australia revealed that German bankers have similar retirement expectations, however in France, The Netherlands, Luxembourg and Switzerland the proportion of bankers expecting to work until their 50s increased substantially. In Asia 46% of respondents expected to work past 45, while in Australia, three in 10 expect to retire between 40 and 45, and 40% expect to retire before 40. Sarah Butcher, editor of eFinancialCareers.com, said: ?A high-flying career in banking followed by an early opt-out is still an option for many bankers. However, our poll shows a significant desire for staying in longer...
Early Retirement: The CASH FLOW Model
2007-03-14 11:00:00 I did a retirement scenario after reading “Why Swim with the Sharks“, now after reading “Stop Working: Here’s how you can!“, I’m going to do another analysis based on the CASH FLOW model like Derek Foster has implemented at the young age of 32. Based on my Retiring Early article - The Expenses, I determined that ...
Is Early Retirement A Fantasy?
1969-12-31 19:00:00 When life or working conditions become difficult, many people fantasize about early retirement as a form of escape. Early retirement can be a reality if you have taken steps early enough to prepare for this. If you have the foresight and the discipline to set aside savings from your employment income and invested them wisely, ...
Is Early Retirement A Fantasy?
0000-00-00 00:00:00 If you have the foresight and the discipline to set aside savings from your employment income and invested them wisely, perhaps you stand a good chance to do whatever you want to do whenever you want to do it.
By: eArticle Submit
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