Well, I’m only in my mid 30’s. So, I haven’t bothered to look at my Retirement accounts. I have this notion that one day they will return back on a positive note. I think Shtinkykat has got me thinkin’ about my retirement. (Thanks! – lol!)
So, I decided to check my accounts and gasped. Okay, well I was expecting a big drop. And I was right. Well, it stung a bit. I may only have $13,000 in my account(s) and I lost $5,000; leaving me with a grand total of $8106! Geesh!. Actually its my dang AIG Valic account! Losing approximately 23% per quarter. I know, the name says it all and I should have changed its allocations loooooooonnnnnnnnggggg ago. Especially since they are probably partying on my funds.
My TIAA-CREF account is wonderful. Have only lost approx. 7% per quarter. I can hang with that!
Anyhow, I finally changed my AIG Valic asset allocations to a fixed account earning a guaranteed 3%, possibly 3.75%. I can live with this change. I really should have done it long ago! I don’t longer contribute to that account. Stopped that awhile back when I opened my TIAA-CREF account. I would role it over, but I have a loan balance with AIG Valic. Ya, one day I will pay it off, but its on the bottom of the list because of the low interest rate.
Then this got me thinking about my 401b, IRAs, Real Estate, and other types of investment accounts. Arising questions like: how am I to fund my 401b and fund an IRA, too? I have an IRA with $0 balance through ShareBuilder/ING. And another question like: am I up to par on my savings?
Time to check into CNN Money’s online Retirement Calculators. Of course, I chose the one labeled, Can You Retire Early? The senerio is to: See how much you should already have if you want to retire by age 60. Plugged in my numbers and found out that, at this time, I need $104,000 if I want 80% of my annual retirement income. That would mean I am standing -$96,894. Hmph…
Now remember to plug in the “current salary” with notion as to what you want your 80% retirement income to be. I did use my current salary and would be okay w/ 80% of that. At least for this exercise. So, boost it up to approx $96,000 if you plan on having $75,000 as your 80% or whatever X number you put in.
Okay, so that is not my case, right now. What about seeing, What I Will Need to Save? Plugged in my numbers, again. I need to save $10,205 per year at a savings rate of 15.7%.
I figured the numbers: I am of course short. I realized that I currently save 4% of my income. That is a no-no. Need to boost.
If I want to meet these #s then I need to put approx. $400 away per month. Sounds like a lot, right? But, I see it this way. I will gradually increase these funds. Today, I elect to raise my contributions +$50 bimonthly. And will continue to do so at intervals. Remember, we are paying down our debt. Which means I can increase my contributions to my retirement account.
Then, when I get to a greater point, its time to look at investment options. Like real estate. It is soooo affordable in our area and it bums me that I can take advantage of that! Thanks to my past debt! But, its okay…that is why I am doing all this (blogging, etc…) to GET OUT OF DEBT! Then, I will take advantage of bigger investment options. 🙂
So, I leave you with these questions:
Hi there-a very insightful post, giving much food for thought.I’m currently not contributing to a pension, as we are on 1 income and paying down debt. I’ll have to address the issue soon though! Wishing you a lovely weekend my dear!
Hi Christine, after the last few months I’m not sure that we can ever rely on retirement accounts again.
Anyway, you’re heading the right way now – paying down debt, looking for alternative income streams and increasing your earnings potential – the only way is up
Since you are only in your 30s, I definitely would not go for fixed income products. 3% Probably won’t even keep up with inflation, so basically you won’t be gaining anything by investing in this asset. Some people think buying stock funds is stupid right now, but I really think it’s the only way to go if you’re under 40.
@ sharon rose: thankx. I know its hard to save for retirement, but I thinks its something to highly consider. Especially as a women cuz we live longer years.
@ no more spending: True, true. I am with you on that, but I would at least like to be as prepared as I can. 😉
Try, try again. lol!
@ stephanie: I understand your concern. At this time, it is a momentary switch. I will reallocate when the market picks back up for this particular AIG account. However, this account with AIG has never performed well even after reallocating a time or two. I just don’t like the company. It will be nice to roll it over to my CREF account in the future.
I do thik you are right about buying stocks. I am trying to think of what people will consume steadily once the market pics back up. Once I figure, then I should buy up for hopefully future gain. 🙂
I am with you on the not really looking at our retirement accounts long & hard. We moved our funds back in September to something a bit more stable. I also agree with no more spending – dh and I decided long ago that we will not plan on having any money coming from any direction. That is why we are really thing to get debts paid off. Then we will start to 'hide in the mattress' program! haha
Good job in your progress, it didn't go up – that is a definate plus in my book!
Unfortunately the time to have moved into a fixed return investment was about 9 months ago. I missed that boat too. I hope you are able to recover, I’m a similar age and behind in the race too. I didn’t start retirement savings until 2005 and I only save 8%. I’m trying to ramp that up this year and my employer has retirement program that will hopefully help me catch up. It’s hard to save for something 30 years away when there are so many expenses now.
yeah, checking your accounts like that sure IS scary at times! i wouldn’t do it myself, but i’m too addicted to following it 😉
i guess knowing that you won’t be touching it soon does help out. just hoping we’ll see the rollercoaster start to go UP now as much! imagine that? sexyyyyyyyyy.
Hey Christine–excellent post! I think you are doing a fab job btw with everything. I know this subject is one I am not well versed in. I hope to start really thinking more about this later this year. Good luck with it all.
Y’know, it must be one of those weeks because I simply can’t bring myself to test those calculators and I’m normally all over them! Oh well, try again next week… 🙂