Here’s a fun little game to try on yourself and see how your finances are coming along. (… Depending on the answer, it might also make you feel really good about your savings efforts so far!) Suppose you were suddenly let go from your job. You find a new place to work, but it doesn’t pay as well. So in order to maintain your standard of living you decide you’re going to cut corners and completely STOP saving money for retirement. The big question: Would you still be able to comfortably retire when you want to? My Answer … (... Kind of a funny question to ask on a personal finance blog, right? ...) I tried this little experiment on our current retirement savings, and you want to know what I found out? We’d … [Read more...] about What If You Stopped Saving Money for Retirement?
Personal Finance
What is the Best Safe Withdrawal Rate for Retirement?
The 4 percent rule… It’s arguably one of the most highly debated figures in retirement planning. Since its inception in 1994 by Bill Bengen, it seems as though you can find just as many people who love it as those who hate it. Why so much fuss over one tiny, little number? Because of what it stands for! Planning your nest egg size using the right safe withdrawal rate figure can mean the difference between playing with fire during retirement or having 100% confidence that you’ll never run out of money. But if you pick a number that is too conservative, it can also mean the difference between trying to save up for a $2 million dollar nest egg instead of a $1 million dollar one. Obviously it would be great if we didn't have to … [Read more...] about What is the Best Safe Withdrawal Rate for Retirement?
Countering The Arguments Against P2P Lending
MMD: Today we have a mega guest post from fellow personal finance blogger ARB. Take it away! Hello, readers of My Money Design! I am ARB, the Angry Retail Banker! Over on my blog, I offer what I call “An Insider's Take On Retail Banking”, which means that between bouts of raging out and threatening my entire customer base with physical harm, I talk about both life as a branch banker and ways for you to maximize your banking relationship. I am here today to talk about absolutely none of that stuff. Before you all hit the back button on your browser and type “funny cat videos” into a Google search, know that I'd like to discuss an awesome form of passive income that I think doesn't get covered a whole lot. I'm talking about … [Read more...] about Countering The Arguments Against P2P Lending
How Much Do I Need to Save for Retirement? Probably Much, Much Less Than You Think!
When it comes to your retirement savings, how do you know when enough is enough? According to an article from CNBC, a global investment management firm surveyed investors and you know what they came up with? An average retirement nest egg of $2.5 million! That’s how much they believe it will take to have the same quality of life they’re enjoying today. As I found out first hand at a lunch outing with a friend, this sort of belief is all too common! But what if it’s not at all true? What if you really sat down and actually figured out how much do I need to save for retirement and concluded … … it could be much, much less! Perhaps you’re already a lot closer than you think! Here’s my lunch story … You Think … [Read more...] about How Much Do I Need to Save for Retirement? Probably Much, Much Less Than You Think!
A No-Brainer Way to Lower Your Bills – For Free!
One of my favorite blog series to follow along with is J Money's "Challenge Everything" series over at Budgets are Sexy. In case you don't know this one, basically what J does is take a different bill every month and tries to get it lowered. Or another thing he'll try is to look for some other side hustle to make a little extra money on the side. Collectively this ends up going into a special fund that he can do whatever he wants with when it's all done. So far he's done quite well with himself. At last count he was over $4,000 bucks! Lower Your Bills With a Little Help: I've always been a very big supporter of regularly auditing your budget and challenging your bills whenever possible. If there's one thing I've … [Read more...] about A No-Brainer Way to Lower Your Bills – For Free!
How a Backdoor Roth IRA Conversion Could Help Your Early Retirement Strategy
In the past I’ve talked before about how a 72t is a key part of my early retirement strategy. In case you’re not aware of what that is, a 72t is a special exception in the IRS rules that allows you to take money out from your 401k or IRA before age 59-1/2 and without facing that stiff 10% penalty (we’ve got a whole post about it here). For anyone looking to retire early, that’s a massive win! While that’s all fine and good, one of the things I like to make sure of when it comes to my money strategy is to always be searching for something better. Maybe an option with less rules or something that’s easier on your taxes? Lately as I was poking around the Early Retirement forum, I came across one such strategy that I felt is … [Read more...] about How a Backdoor Roth IRA Conversion Could Help Your Early Retirement Strategy
How a Good Asset Allocation Model Can Impact Your Financial Future
Assets allocation is just not one of those topics that most people find particularly sexy. Usually it’s the sort of thing that gets about as much attention as the instruction manual to your Blu-ray player. But as you’ll see below, it’s one of those parts of investing that you simply can’t ignore – largely because it can have a MAJOR effect on your finances and how long they ultimately last. The reason I wanted to bring this up is because of the roller-coaster of market activity lately. In case you haven’t checked your stocks or 401k balance in a while, there have been some pretty big up’s and down’s to the stock market. Sometimes the Dow index has been down as much as 300 points – that’s almost a 2% down in one day! How does … [Read more...] about How a Good Asset Allocation Model Can Impact Your Financial Future
Where to Park Your Rainy Day Savings for Growth Without Much Risk
We all know that part of a good, healthy financial well-being is to have a decent sized chunk of money set aside in your emergency fund or rainy day savings fund as some people call it. Some advisers tell us it can start off with as little as $1,000 (I believe that one is a Dave Ramsey thing). More commonly I see suggestions to have as much as 3 months, 6 months, even 12 months worth of living expenses set aside in easily accessible bank account. Fortunately for my wife and I we have done a pretty good job of building up our rainy day fund over the years to as much as $20,000! That’s a pretty admirable amount and it would easily cover around 4-5 months of our living expenses should anything awful ever happen to us. Back when we … [Read more...] about Where to Park Your Rainy Day Savings for Growth Without Much Risk
