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Let's talk retirement

Prairie_Girl

Prairie_Girl

New Member
So, I've spent most of my dayoff doing some research about how I'm going to distribute this years RRSP's contribs.
Who here is savings for their retirement?
At what age did you start? Or at what age do you plan to start?
How are you going about it? How much to you save, how aggressive are you.
Those of you who aren't in Canada, please feel free to reply too, I love to here about the different systems other countries have set up.
I'd also be interested to here from people who aren't saving.

anything else you think might be pertinent. I'm kind of new to this whole thing, and I just wanted to get an idea of what everyone else is doing.

My savings have been rather paltry this year, what with a job loss, a move across country, ANOTHER job loss (both of those wifey's). So I've been doing the bare minimum $25/cheque (so $50/month) into an RRSP savings account, which I will shortly be topping up to $500 and putting it into a rather risky mutual fund.

I also have 2% of my cheque taken off pre-tax and invested into my companies stocks, they match be $.50 to $1 up to 1%. However, my company paid out some serious cash (like 2 billion) in an Enron settlement earlier this summer, so our stock kind of sucks right now. So I'm going to increase my contribution to that because it will save me initial taxes off my cheque AND I'll be buying while it's low.

And if you're offended by me asking about your money/wanting to talk about money you can just hit your back button.
 
The difficulty in a thread like this one is that many people are reluctant to discuss investing because others may take the statements as a recommendation and most of us know that investments can go up OR down. I will ponder the topic a little and then post again.

Most investment specialists recommend diversification as it is near impossible to predict the exact performance of any category in investing. The age of a person is also important. Normally, older people are more conservative with their investments, and for good reason.
 
I think that we're all adults here, and mature enough to make our own decisions, and to realize that someone saying whatworks for them is NOT a guarantee it will work for everyone.
 
I have a retirement fund through work. I am currently 24 years old and started doing this as soon as I started work. the company will automatically put away 4% of your income for retirement, and after 5 yrs employment will match that 4% every year. You can choose to contribute more or not to contribute at all. I am in a mutual fund, moderate risk, through work.
 
I am currently retired and my investment style is probably different than those that are investing FOR retirement. That said, if I had it to do over again I would start saving and investing as young as possible. The power of "compounding interest" is unbelievable and time is the most important element. Putting a steady amount in investments is probably more important than a large $$$ amount now and then....and once more, the younger you start the more time there is for compounding.

http://www.morningstar.com/ is a good place for checking out mutual funds.
 
Here's what I do.

Ten percent of everything goes intoa high interest earning savings account (President's Choice Financial) at 2.15% interest. If there's anything left over at the end of month that also goes into that account (there always is) My plan is to save 6 months living expenses in that account, and which point I will switch that 10% to a non-registered mutual fund.
I also currently contribute $25 bi-weekling into a DISA (at .75 percent, BLAH!) once I get that to $500 I'm switching that into a registered mutual fund with an continuing contribution into that fund. Now thatthings have settled down a little bit financially however, that will be kicked up to 10% minimum. Then at the end of the year we'll make a lump sum of what we can afford (preferentially maxing our allowable limits out)
It's really important for me to make sure I have the best interest rate possible, but I absolutely refuse to lock into something at less than 4%, which means I won't be locking into anything anytime soon, I prefer to keep my lower risk investments in my high interest savings account.
I've got a fairly serious luxery at this point where I'm recently married, I have no children and no car payments. I pay 550/month in rent. I have a 10,000 student loan that I am putting EVERYTHING extra onto, and Caroline has a $5000 loan at a lower interest rate (mine's prime + 1, here's is .5%) so we pay $75 bi-weekly on that. I'm 21, Caroline's 28 and between the two of us we make around 66K a year (it's actually pretty evenly split to, I'm at 29K, shes 34K)
We're hoping to buy a house within the next year, and once we're settled in there, we will start buying rental properties, eventually we'd like Caroline to beable to work from home, with the rental business and her reikki practice. I love my career and can't see myself leaving my company anything soon.
Oh, I also make sure to buy all of my groceries @ a grocery store that gives me points towards free groceries with every purchase. I'm planning on getting a credit card shortly (refuse to apply for credit until I clear a few old things from my less organized days) that we will make every purchase with to get the points, and then pay it off immediately online.
OK, I just read that, I'm a huge geek. Sorry, money started out as my career, and turned into my favourite hobby.
muggle, what age did you retire at? I'm aiming to be able to "retire" at 55, meaning being able to live off of my pension and our rental properties, and then at 65 ish be able to get rid of the rental income and cash in the RRSP's.
 
This site will let you calculate the numbers with compounding interest.
http://www.math.com/students/calculators/source/compound.htm

For example. If you invest $300 a month for 35 years and get 9% interest you will end up with $889,454. Play around with the numbers and you will find that the biggest influence is the number of years although obviously the monthly amount invested and the interest received is also important..

Just seen your post. I retired at 55 and have been retired for many years. If I had it to do over again I would have worked for a few more years.
 
I really want to volunteer when I retire, I have an idea for starting a non-profit group that goes around to high schools educating kids about their money, answering their questions, and just teaching them things that I think I lot of 20-40 year olds wish they would have been told at 17-18.
 
Prairie_Girl said:
I really want to volunteer when I retire, I have an idea for starting a non-profit group that goes around to high schools educating kids about their money, answering their questions, and just teaching them things that I think I lot of 20-40 year olds wish they would have been told at 17-18.
Click to expand...
That's such a brilliant idea! But why wait until you retire?? If you're learning lessons now, but not start seeing some of the high schools in your region now? Or maybe start to draft a book for Canadian high school leavers. I think a lot of parents would like to pass on such advice to their kids but need it in a form that both parents and kids can understand.
 
Kookamoor said:
That's such a brilliant idea! But why wait until you retire?? If you're learning lessons now, but not start seeing some of the high schools in your region now? Or maybe start to draft a book for Canadian high school leavers. I think a lot of parents would like to pass on such advice to their kids but need it in a form that both parents and kids can understand.
Click to expand...

actually, it's something I want to talk to my HR department about, I think it would be something that would work really well with people from my center (call center) as most of us are young and not that far from high school and were pretty much in that situation not that long ago.
 
As a teacher, I'll get a good pension package after my years of hard work. Maybe social security will be around, but I'm not banking on it. I have $100.00 a month that is taken from my checking account that goes towards mutual funds. A company pools the money of small investors(such as myself) and invests the funds in different stocks. Right now, $50.00 goes to safe investments, companies that have been around al ong time. The other $50.00 goes to start up stocks, companies that will either hit it big, or fold and fail ingloriously. I've been doing this for four years now and have around 200 stocks in my portfolio per safe account and "risky" accounts. If things go well, I'll get social security, teacher retirement, and money from this private account. At worst, I'll get two out of the three.
 
Prairie_Girl said:
I really want to volunteer when I retire, I have an idea for starting a non-profit group that goes around to high schools educating kids about their money, answering their questions, and just teaching them things that I think I lot of 20-40 year olds wish they would have been told at 17-18.
Click to expand...

That would be a good thing. Knowledge about money and economics in general is dismally low here in the states.:rolleyes:
 
even if we could just educate kids to not apply for all those cards when they hit uni as it hurt their credit, to pay their balance off in full or AT LEASE the minimum. If used properly, credit cards can help kids create a credit history that will help them forever, if not, it can haunt them forever. Also, for those kids who aren't going on to uni/college, tell them to start saving immediately because it will save them so much money in the long run.
 
I'm not saving much right now. It isn't that I don't want to, it's just that my money is forced to go elsewhere (bills bills bills). My primary job provides me with a crappy little pension. A lot of my co-workers are depending on that to support them in their old age :eek:. I want to say that has about $5k in value right now, but I'm honestly not sure (I'm at work without any of my financials). I also have a small retirement account that takes 7.5% of my secondary job's pay and some stock options from a secondary job. I'd guess I've got a few thousand dollars from those two sources as well. Tom has just about the same retirement "savings" that I do.

Ultimately what I do have right now is a house. I'm twenty-five and I own my own home. We've probably got about $20k in equity from the repairs we've done (thus the bills bills bills) and the rise in property values. We estimate that we'll be done paying the bills for repairs within a year. We plan to live in this house for another five years or so, build some more equity and then use its sale to build a larger, environmentally friendly home in a more rural neighborhood. Our goal is to start putting away 5% of my income within the next year and a half. We haven't decided how we are going to invest that yet. We're also looking at Tom getting a new job within the next six months. He will be required to put away a certain ammount (7.5% I think) and he will receive a very generous pension plan on top of it.

While I certainly wouldn't classify us in "great" shape, I do think we are doing well for people our age. Most of my friends are in rented appartments and living from check to check. We have a house and a plan, which I suppose is better than nothing.


Besides, like StillILearn, I can always sell my books. I've got tens of thousands of them...
 
SFG75 said:
As a teacher, I'll get a good pension package after my years of hard work. Maybe social security will be around, but I'm not banking on it. I have $100.00 a month that is taken from my checking account that goes towards mutual funds. A company pools the money of small investors(such as myself) and invests the funds in different stocks. Right now, $50.00 goes to safe investments, companies that have been around al ong time. The other $50.00 goes to start up stocks, companies that will either hit it big, or fold and fail ingloriously. I've been doing this for four years now and have around 200 stocks in my portfolio per safe account and "risky" accounts. If things go well, I'll get social security, teacher retirement, and money from this private account. At worst, I'll get two out of the three.
Click to expand...


Ah, you are lucky. Our govt. phased out the pensions for retired teachers just before I started teaching. We have superannuation now, which will not give me enough to live on when I retire. But I am optimistic. :p I plan to buy a few houses one day and when I retire, I will seel the most expensive one and use the money to pay of the other two and then I will be able to live off the rents. :) Now all I have to do is get the money to buy the houses. ;)
 
Billy said:
Ah, you are lucky. Our govt. phased out the pensions for retired teachers just before I started teaching. We have superannuation now, which will not give me enough to live on when I retire. But I am optimistic. :p I plan to buy a few houses one day and when I retire, I will seel the most expensive one and use the money to pay of the other two and then I will be able to live off the rents. :) Now all I have to do is get the money to buy the houses. ;)
Click to expand...

You can use the equity in your home to get the cash you need to buy investment properties. There are tons of books out there that tell you how. Just be careful of the ones that promise easy wealth with OPM-other people's money-check the laws of your area and read more than one author.
 
Prairie, and anyone else :), this is another site for calculating savings and compounding interest. Once more I will emphasize the importance of starting investing/saving at a young age. Example:

$500 a month at 10% interest for 30 years = $1,031,422

$250 a month at 10% interest for 40 years = $1,387,588

The longer time frame will result in more money even if investing half the amount.
The longer you can invest/save the better off you are. Do your own calculations.:)
http://www.forbes.com/tools/calculator/how_saving.jhtml
 
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