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peace4

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  • All Dividend-Growth Investors Are Not Created Equal [View article]
    I am so glad you wrote this fine article. In my lifetime, I have been rich and poor and rich and poor again and again, so I have been in all four categories and know them well from experience. And like you, I always worry about the folks in the last two categories.

    You have focused your articles on the income side of retirement planning and that is certainly important for Seeking Alpha which is also mostly concerned with the income side of things. But your concern about the folks with low income has an answer that works for retirement planning. What I know from my travels through life along the the rich and poor spectrum, is that the outgo is just as important as the income. It is a yin and yang thing. Rich folks know this mostly intellectually, but poor folks who live sustainable lifestyles, know it through and through by experience. That is really knowing.

    Back in high school I read the book by Henry David Thoreau who did a year of experimenting with simple living and he influenced me to maintain simple living as a main theme in my life ever since. Here on Seeking Alpha, we focus on the percentages and sustainability of the income side of investments but make no mention of the percentages and sustainability of the outgo side of family budgeting. You see, the social security and dividends and pensions and such go in one end, and the housing, transport, medical, entertainment grocery and all the other bills is where all that income goes to. Like a bucket with a hole in it.

    We all know this and so I do not need to write here as if I am teaching folks how to suck eggs, but it is well worth remembering because control over the outgo is how we can all enjoy secure retirements. I have personally lived below the level of welfare eligibility and did so with kids while working full time at a responsible but low paying job. What I learned about getting by back then still influences me today and it is the main reason why a not impressive income has resulted in a fairly impressive dividend reinvesting portfolio which I believe will sustain me and be gifted to the next generation intact.

    Back in high school, I made my own clothes. These days I simply go to charity shops for my clothing. For decades I have lived on boats so I have had no rent or mortgage, no property tax either directly or indirectly through a landlord. I have heated by changing my latitude with the seasons, energy for transport has come from the wind, and my "home" was built by our own hands. This is just one way that low income can be made to fit sustainably into a balanced and contented life. Most folks looking at us out in the anchorages would think we have a big budget, but the fact is, I have lived on $3000 a year once and can manage on about $12,000 quite easily. This is not too hard to do with social security and a small dividend reinvesting portfolio. Of course we anchor and avoid marinas, we cook aboard and don't eat in restaurants. Our parties are potlucks on the beach with other boaters because we are all on small budgets, but the beach is on some island with a beach fire under the stars. Not a lot to pity about any of that kind of scrimping and saving, is there!

    Folks really do need to sit down and think just as deeply about their expenses as they do about their income. Just as some folks are savers and some are not, therefore some have larger dividend reinvesting portfolios than others. It is equally true that some spend a lot and some spend a little regardless of income. That is how some save and others don't. It is simple math not complicated by use of credit cards.

    Sure, not everybody wants to live on a boat. But there are other alternatives if one is really interested in achieving a sustainable and pleasant low cost lifestyle. Read the books by Helen and Scott Nearing about their self sustaining lifestyle in Vermont. Again, this is not for everyone, but it is a viable and sustainable solution. You could take your average USA family living in average suburban communities and working for average or less pay and make 100 small changes like reading books aloud as a family instead of going to the movies, going to the park or having potlucks on the weekend, going back packing in the nearest National Forest for a vacation, there are hundreds of ways to save and still have a great or even better time. Usually these simple things are more fun anyway and leave more lasting happy memories. Just because they are not advertised, we tend to forget about them and begin to think we must go spend big in order to have a good time.

    It amazes me how so many folks get a raise at work and see it only as a new spending opportunity. Always I saved half of all raises at work and invested it. In 1978 I invested $1,000 in a utility and 25 years later it had grown to $48,000.

    Certainly one can not drive a fancy car and live a simple lifestyle. I have friends who ride bikes for transport and have better health as a result. One will not wear fur coats, but hand knit sweaters are beautiful and if you can't knit, they are available for $5 at the charity shop. Going to restaurants is not possible, but potluck suppers with friends of like mind are more fun anyway. Going to concerts is not on the budget unless they are free, but one can bring the tape player to the park with friends. Yes, we still use the old tape player.

    My grand daughter can have more fun with a big cardboard box than just about any other toy I buy her. Those kids were playing outside with the hose squealing and running around laughing all day long today. No cost and more real and creative fun than anything I can imagine.

    This is the way those last two categories can make it all work for them. It is the way it is all working for me and the way it has already worked for me during the past several decades. If the income is tight, balance it on outgo. Be creative because you are not obligated to live the way they advertise on tv. You can even throw out that tv! There is great freedom to living simply. My own dividend growth investments were enough for us to make it fine in retirement without selling the stocks. I have recently inherited and so I am in one of the top two categories now, but that only happened last year. I want my kids to inherit that from me along with my own portfolio from before. I will use those inherited dividends for my grand kids. My simple life does not need it.

    Peace
    Jul 21, 2013. 04:03 AM | 50 Likes Like |Link to Comment
  • A Current Review Of Dividend Safety Superstars - Part Two [View article]
    advisor4.

    I have heard your message. I don't happen to agree with you, but I have listened and considered your thoughts and I am sure others will have read and considered your thoughts.

    In my own case, I have done this style of investing for many decades already and my mentor did this style of investing since he was 9 years old. He died recently in his late 90s. His father taught him and we have some of those same investments in our portfolio today. So my view is not just a "few years" that you say in your post. My family has used this method for well over 100 years.

    When my mentor died, I was at a bit of a loss because I did not have him to discuss investing ideas with me. When I found Seeking Alpha, it was full of the same ideas and procedures that he used but it was more up to date in that folks here use computers instead of snail mail and they also use on line information sources instead of walking to the library to look at Morning Star reports as he and I used to do together every month.

    I sincerely wish you the very best as you continue to invest according to your information and your own personal ideas. I really mean it. And I wish the same for all the other folks here. It is our money and we are trying to find the best way to earn it, and save it, and live with it and make it grow. We are all getting older and I am already rather old myself so there is much that I have learned just by living.

    One thing I have learned is that there is not much to be gained by arguing. Sharing is more in tune with all my other values and I certainly do not need to put anybody down who does not agree with me. One thing I really like about this site is the polite way we all work together here sharing and learning together what there is to learn and teach. Then we are all free to think things through and do what works for each one of us in our own ways.

    All the best to you - Peace
    Jun 13, 2014. 08:02 AM | 43 Likes Like |Link to Comment
  • Team Alpha Retirement Portfolio: Going Long In A Scary Market [View article]
    A person can get a great education in dividend/growth investing just by hanging around on this web site and reading the nice reports and articles. It is a lot easier to get this education now that we have each other to learn from and it is also lots easier to get information about dividends, splits, historical data, etc now that I have a computer.
    The way I have set up my own portfolio, I expect to only take the dividends for spending money (I am already 70 and retired) and let the rest of the money increase. I live on a budget and I am willing for it to be a bit tight now so that I can fund grand kids education and also have increased dividends to spend during the latter part of my retirement years as I travel down life's road.
    I've been at this for a while now and have learned that with good companies, the usual thing is that they grow and so do the dividends. Sometimes the share value goes down for a while, but if the dividends are steady and increasing, I do not need to worry all that much. The value comes back in a couple of years.
    During the recent melt down 2009 my portfolio lost half its value but I had no interest in selling because the dividends were steady and that is what I am interested in. Sure enough, my portfolio recovered within two years as it has in earlier recessions.
    Because I did nothing, I had no transaction fees, no taxes on cap gains, and no hassle. I just collected my usual dividends and waited it out.
    I will admit that I watched the situation closely and did so with wide eyes with a bit of worry and wonder, but it has happened so often before. At my age, we see the ups and downs and also the ever incresing progression of the slow and steady portfolio approach. The long view takes the bumps out of the road.
    All the best -
    May 12, 2013. 03:19 PM | 34 Likes Like |Link to Comment
  • You Are Responsible For Your Investing Decisions [View article]
    Mister J
    In the future, could you please simply state your views without such shrill wording. I like to read opposing views, but I do not like to read angry and confrontational comments. They are not needed here.
    Peace
    Jul 2, 2014. 07:39 PM | 27 Likes Like |Link to Comment
  • The Business Model Of The Dividend Growth Investor [View article]
    I am 70 and retired and I live off the dividends from my dividend growth portfolio. I do not need to sell shares for spending money and so I don't. Some of my shares are still reinvesting and I am sill able to buy some new ones from time to time. As a result, the portfolio continues to grow and so do the dividends.
    My mentor was never a big earner but he did dividend growth investing and became wealthy in the end. If things go on the way they have been for me, it looks like I will have the same result. This is not just dream land thinking or something that only works for rocket scientists. It is really what happens to regular folks who are patient and continue investing and reinvesting in these steady dividend growth companies.... Honest!
    There is a secret though and it is an important thing to remember. If you spend faster than those dividends grow, your whole plan will fail. So just stick to the budget and make sure you are spending a little less than you earn at work. I suggest that while you are in your working years, you should be disciplined enough to only spend one half of any raise you get. After all, you were making out ok before you got that raise. So then you can add half the raise to whatever monthly amount you were investing each month when you "pay yourself first" before you pay any other bills or go to the store to buy stuff. Stay on a cash basis as much as you can so you are not cheating by spending next months's money with the credit card. When that month's money is spent, stop spending! The store will not sell you financial security this month or next month. The store will not sell you happiness or love or time or any of that good stuff. But you can invest and at least get the financial security. That you can do.
    It is not rocket science at all to figure this all out, but it is eemingly difficult for some. Take some time with a piece of graph paper and see how it really works with dividend reinvesting or at least partial reinvesting. It worked for me. I am the one with the experience to say it is true.
    Peace
    May 15, 2013. 02:13 PM | 24 Likes Like |Link to Comment
  • The Case For A 100% Dividend Stock Portfolio [View article]
    Hi Tim,
    It is so nice to see your article this am!
    That is what I have been doing since 1978 and my mentor did the same since 1925 and his father before him. Those guys had only 3 stocks and they did fine that way but it made me nervous so I have a broader base of 10 stocks now and will continue with broadening the base until I have 15. I do not feel obligated to buy any stock just because it is in a different category of business - I just want steady dividend growth, good business practices that are also life sustaining, and increasing share value over time so I will have something to fall back on in an emergency and something to leave when I die. I never buy a stock I do not intend to keep for at least 20 years.
    This method of investing seems slow until you start to graph it on paper including the dividend reinvesting. Then it all comes clear. Graph paper makes it quick and cheap. I keep a monthly graph and a yearly graph on each stock and also on the entire portfolio.
    Once I reach a certain level with a stock, I stop the reinvesting and have the dividends automatically deposited into my bank account. Whenever I can afford to, I send off a check and add to one of the stocks I have that is still growing. I always have three to choose from.
    On occasion, I decide one of my stocks is getting too big (remember too big to fail?) and I sell a bit to reinvest in one of the growing stocks. Rarely I decide that one of my stocks has become a dud and I take a few years selling it and putting the money into my growing stocks. This spreads out my cap gains so my taxes are always in the lowest level. I do my taxes myself and have never had a broker.
    Some of the youngsters on this site have called me a turtle type of investor. I like that. I am a life sustaining green turtle and I have won my race with investing and I already crossed the finish line. I am 70 and it worked for me.
    Peace
    May 13, 2013. 10:08 AM | 22 Likes Like |Link to Comment
  • Dividend Growth Investors: I Have A Few Questions [View article]
    Your questions are provocative, Bob. For me to answer them, I must also say how much my life and my budgets have changed over the recent five years and how those changes have influenced my investing.
    For almost 30 years I lived full time on boats cruising around in the Atlantic avoiding expensive marinas and restaurants and trading work to save money. There were almost no bills - just full insurance for the boat once a year - because we heated by latitude, sailed with the free wind, made our electric with solar panels, and traded work or fixed stuff ourselves. It is an unbelievably cheap way to live and very rich lifestyle. But one grows old and boats are not for advanced old age and we are nearly there, so we were glad to recently inherit a big old family house from my mentor. That is when I learned about bills. Houses and land based living cost a whole lot of money because of recurring monthly bills. You all know that, but it came as a great shock to me. The heat bill alone was the size of my annual total budget!
    We tried sharing the big house in the big city with family members to cut costs but that failed miserably and so we sold it for X and bought a small house in a small village that cost half as much and that cut our monthly bills in half too and there was a lot of money left over to invest into my existing moderate sized portfolio that had been growing and reinvesting for all those 30 years while I was sailing over 70,000 miles. Now, with the new money added, the portfolio produced enough for us to meet all our regular land based living expenses easily and we were amazed when we found that we had a safe and secure life ashore. Thank you to my mentor for leaving us the house and thank you SA for helping me figure out the best way to invest and thank you to the small house in the little village where living is cheap. Balance. It is all about balance.
    The interesting thing is that I had not done much stock selecting before and luckily I had found out about FAST graphs and read a lot here on this website before we sold that big house. I following you and Chowder and David Fish and David VK and Mike Nadel and many others here, I did select some fast growers with low yield and some slow growers with high yield. I decided to think of them as being paired so they worked as a team to meet all of my needs. This pairing idea was just as it had been when Mr Peace and I were building the boat, the technique of pairing worked very well for us and was essential for successl. I have a visual problem so I cannot use a ruler. Mr Peace has a problem with chemicals on his skin. But working together, we can do all that was needed to build a very large boat extremely inexpensively. He did carefully measured carpentry and I did really good epoxy and fiberglass work which was no problem for me. Together worked.
    So together I have the AT&T high yield slow growth paired with the UNP low yield and fast growth. And also I have the CVX high yield slow growth paired with the CBRL low yield and fast growth. Now those fast growers not only grow their yield, they also are rapidly growing the size of their holdings. So the pairs do not stay at the same size in my portfolio because the UNP soon towers over its pair AT&T and the CBRL soon towers over its pair CVX. This is where my methods get very interesting. When one of my fast growers reaches the arbitrary limit in size that I have set for all of my investments, I just trim it by 10% and use the money to reinvest in the slower growing partner of the pair. This is working so well, it has increased the dividend yield of my portfolio very nicely and also the total value of the entire portfolio is increasing very well. The pairs work together to accomplish that and all of the companies are high quality with secure and predictable and increasing dividends because I read a lot of Chowder. This old lady pacifist has a Marine Corp attitude about investing for sure!
    Perhaps some of you would laugh at the small amounts of money I am taling about here, but they are well over what we need already and we are looking at five investments which will need to be trimmed soon and the other five are growing fast. I can see that it will not take much time before all ten of my holdings will be at the top limit that I have set and I will be trimming more and more in the near future.
    Now, this trimming involves capitol gains tax, as you say in your last question, Bob. For this reason, I have decided not to buy REITs which are taxed higher than ordinary dividends. None of my holdings are in any kind of tax advantaged accounts because I never thought that I would have enough income to pay much tax. Remember that I was sailing and saving and living small so long and trading work and living simply and I always filed but rarely owed more than 100 bucks a year on my tiny income.
    So now we enter a new lifestyle where money is just arriving and we are not needing all of it so now we can easily afford to assist grand children with college and various charities also. Pairing works for us. And should circumstances change, we can adjust things to let some or all of the holdings increase by using the trimmings to reinvest more for a while.
    Yes, we are looking for a smaller boat to spend holidays and weekends but not to live on full time. We are too old for that now and it has become a danger in stormy weather which arrives sometimes quite suddenly with no prediction. But land based living is ok too. There is lots to do that we have not done for the past 30 years.
    Here on SA we have all the many ideas and can select what works for us. It worked for me! Thanks everybody!
    Peace
    Feb 25, 2015. 09:31 PM | 19 Likes Like |Link to Comment
  • April Showers Bring... Dividend Growth, Joy And Fun! [View article]

    @gfmn2000,
    I did not get to where I am (living free of financial worry) by earning a lot of money - that has never been the case. I took a short cut long ago and learned how to live on a very small income and also how to enjoy living on that very small income by living on a boat which has low expenses. As the income increased, I just kept living low on the boat the same way and so there was more money left over to invest. That is how I got here so early in life. Some people like me like living on boats and other people are happier living in a small home with low expenses and that makes it easy to accumulate large savings which can be invested. It really is simple. A large and fancy home costs more to buy and to maintain so it is best to avoid that and live in a less expensive home with low maintenance costs.

    Think about your income arriving in your life kinda the way water fills a bucket. Then think about how your expenses are kinda like a hole in your bucket and the water (money) is running out when you spend it. If you have large holes (spend a LOT of money) then the bucket cannot fill and it might even get to be empty even if you are adding a lot of water (have a large income). But if you have only very small holes in the bucket (spend only a small amount of money) then even a small income will eventually fill the bucket to over full. The over flow (excess money beyond expenses) is the money you can invest and the invested money then earns dividends for you (the dividend fairy mentioned above). That is my short cut. I spend less than I have coming in and then I invest the difference which earns dividends that can be invested or spent as required and I always have done that. My mentor taught me how to invest that extra money back in 1978.

    I like the feeling of being financially secure. You can do it by earning lots and you can also do it by saving lots. It is your choice and you can make that choice every day if you want to do so. It is up to you.

    I do not understand how some folks can get their hands on money and rush right out and buy a big muscle car which costs lots to gas up, lots to insure, and ends up being worthless after 10 or 15 years. That huge SUV is like an enormous hole in your bucket. But if you had bought a used cheap car like I always do, you would have gotten to work just fine with lower running costs and the money saved could have been invested and would have doubled once or twice during those 10 or 15 years.

    The first time your invested money doubles it is pleasant. The second time you feel sorta like a party. The third and fourth times you get all silly laughing and running around shouting "WHEEEEEEEEE!" After that you are sailing in your boat or doing some other life style dream and you are free from financial worry because you know how to live simply while having fun. And if you keep your expenses low all the time, you arrive at that place of "WHEEEEEEEEEE!" a lot sooner than you think and you can stay there easily. There are lots of ways to travel other than expensive jets and fancy hotels and restaurants. We will soon buy a large van and build simple accommodation inside. I suppose we will travel throughout the US and Mexico and Canada in our van. Simple, sweet, and free.

    Now about that dividend fairy.... she surely is a most powerful fairy. She can keep pouring her dividends into your bucket year in and year out and she does not get tired. Back in 1978 I dividend reinvested and did not really know how to pick stocks because my mentor did not know and I learned only what he could teach me. He just followed his father's example and had the same two stocks. Eventually I learned about two more and we both invested in the total of four stocks in our portfolios over the years. Now he has died but here on Seeking Alpha I have learned how to pick stocks and I check my choices by seeing if some of my heroes also invest in those same stocks or not. Now I have about 12 stocks so my base is broader and I am more secure that way.

    That's all there is to it.

    Peace
    Apr 9, 2014. 11:43 PM | 19 Likes Like |Link to Comment
  • The Dividend Growth Investing Mindset [View article]
    I met Mr Peace in Britain and learned from him that he and everyone else he knew over there expected the British government to take care of them from the cradle to the grave and so he did not need to save and actually intended to avoid saving so as to stay eligible for that government care which was paid for out of his taxes in their socialist system over there. I saw that the British plan worked fine and his mother did indeed have good care in her old age with safe and very good quality subsidized elderly housing, topped up income, really nice medical care, government paid carers who came to help her get dressed, cook, clean, etc when she was in advanced and feeble old age. I got it that their government system really worked well for her and she was secure and safe. We were British based for about 10 years and I obtained British system while keeping my US citizenship.

    But I still did not trust my own advanced and feeble old age to anybody's government. Because I grew up here in the US, I felt that it was my own business to provide all that for myself because it seemed to be in my own best interest to be extra sure my needs were covered in such a vulnerable time of life. I was happy to have that British government plan there as a back up to my own plan, but I did not want to depend on it.

    We lived and sailed together living aboard for five years before we married and then and now we have kept our money separate but available to combine for living expenses and to make dreams come true etc. In a way that I cannot explain, it works just fine. We built the boat, met expenses, lived small but free, and were happy sailing around while I continued to save and invest. We visited the US often and he saw that my method worked better for the situation in America and I saw that his method worked well for the situation in Britain.

    For the last ten years we have been based over here and we have been married for a long time now. I always have shown him all my paper charts re my dividend growth individual stocks and he is most enthusiastic that I continue to invest. He totally gets it what I am doing here and appreciates that I read and learn and do it better and better thanks to all of you teaching me so much. Without his pensions, I could not have afforded to save so much and so his method fed my method to both of our benefits and now my income is bigger than his and growing faster too. So we did it together with our separate plans and when we joined forces it worked really well. We have a good standard of living here in the US, now land based after 30 years afloat, and we can move back to Britain any time we want if we need to.

    Living aboard helped us because it is an inexpensive way to live with no bills other than boat insurance since we were cruising and not in a marina. Anchoring is free, after all and we had no electric bills due to solar panels, no heat cost due to sailing south for the winter, and no car or taxes or mortgage. We built the boat so we fixed everything ourselves. Always I have sold boats for what I paid for them, so we have been essentially living in free "housing".

    There are many ways to live and many choices to make and as individuals or as couples we can work things out if we look ahead and see where we are going and select the best path together. Not everybody wants to do things the same way, thank goodness, and so we can find the way that works best for each one of us.

    Peace
    Feb 13, 2015. 06:49 AM | 18 Likes Like |Link to Comment
  • You Are Responsible For Your Investing Decisions [View article]
    wizjinx,
    It really helps to have a mentor. I had one for the first 35 years of investing and he helped me learn to relax during dips and be glad for the chance to buy low. He also helped me to learn to hold and monitor and not rush out to try to figure when I could try to sell high. We played a little game for a while with no money invested in it, we tried to guess one of our favorite stocks future high and low. It was totally useless even though he and his father had owned shares in that for over 100 years and knew it very well by then. He taught me how to monitor and how to keep records and how to become part owner of companies and not simply traders. Then he died.
    But now I have this site and I read comments and articles just exactly like what my mentor taught me. So if you stick around, you will have what I had. A mentor - even better, you will have several mentors and some will not always agree so you will get a well rounded approach to this special kind of investing.
    Stick around!
    Peace
    Jul 2, 2014. 09:24 PM | 18 Likes Like |Link to Comment
  • Do Not Let The 1966-1981 Stock Market Dishearten You [View article]
    Tim,
    Just keep on writing your good articles and be assured there are lots of us who eagerly look forward to reading them. I am sure you can safely forget entirely about "all the negative stuff from folks" because not all of us want to invest with the same goals. Your viewpoint is very close to mine but not a perfect fit because we are different ages, have a few different values, and slightly different goals. I appreciate several of the SA contributors, but I still must do my own due dilligence after reading them and so should everyone else.
    I am extra grateful for your contributions and I know I am not alone in that! Peace
    Jun 11, 2013. 09:34 AM | 17 Likes Like |Link to Comment
  • Putting Companies On 'Dividend Growth Probation' [View article]
    I sorta feel sorry for the little trolls because they don't have much of a real life so they can only be jerks here on Seeking Alpha and that is all the fun they have.

    It sure does not look like very much fun when I think about it. Here I am living in my nice little house which is all bought and paid for out of my proceeds from dividend growth investing or out of family member dividend growth investing that we recently inherited. Later on we will go to our boat which came from our own labor and our own dividend growth investing.

    All our friends come to see us in our new house and on our nice boat and we have a wonderful time and likely a lot more fun than what the trolls do.

    So I do really feel sorry for them. Their lives are filled with frustration and anger and that is all their lives are about. It is sad, really.

    Peace
    Jun 14, 2014. 04:28 PM | 15 Likes Like |Link to Comment
  • The One Stock I Would Build A Retirement Portfolio Upon At Any Age [View article]
    I have been investing for over 30 years and some of my positions have also run up way above the 10% level so I have found a solution that works for me. When a position gets to 10% of the portfolio, I sell one tenth of that position and use the money to get a similar or higher paying dividend aristocrat or champion. And when this is happening, I just let some of that money get into my checking account because I know the difference between needs and wants. And finally we can afford some wants! Thanks to Seeking Alpha for improving my investing ability and making all this happen sooner than we had expected.
    Peace
    Jan 10, 2015. 08:47 PM | 14 Likes Like |Link to Comment
  • Protecting Your Income Portfolios In Today's Market: Consider Defensive Utility Stocks [View article]
    Interesting Times,
    Read and read here on Seeking Alpha especially the articles of Chuck Carnevale, David Crosetti, Mike Nadel, Bob Johnson, Bob Wells, Chowder, David Fish, David Van Knapp, and a host of others. Just read and read. If you are not working at present and need to invest for the future in secure income stocks, this the the place to learn. Start slowly and build confidently after reading and reading.
    May you heal quickly and regain all that is possible.
    Peace
    Jun 28, 2014. 06:10 AM | 14 Likes Like |Link to Comment
  • How To Put Your Retirement Strategy On Autopilot [View article]
    to AnAveJoe,
    You should remember that a large boat requires large sails to carry a couple across an ocean, but a small boat only needs small sails to carry a couple across an ocean. It might go slower, but will still get there in the end. Your retirement numbers need to be in proportion to what your needs have been during your lifetime. If you have been getting along nicely in a modest but well maintained home (maybe like mine) and driving a reliable but older car (maybe like mine) and living on a small but adequate budget (maybe like I always need to), then you do not require a huge retirement income to keep all that going for you in retirement. Now if you have a mansion, drive a fancy car, and eat out at 5 star restaurants every week, then you will need a huge retirement income.
    Just remember that a lot of studies show pretty clearly that the family in the mansion is not likely to be happier because of the mansion nor are they likely to be happier because of the fancy car either. What is sustaining emotionally is to feel secure knowing that you can pay the bills easily that keep you warm and dry, able to go where you need to go, and have food and clothing that is nourishing and reasonable.
    What I too often see is an average guy (maybe like you) living an average cost life, and he saves some money and rather than invest it and gain security for retirement at the old level lifestyle, he goes out and buys a big house that costs more money to run or a fancy car with huge monthly payments and then he cannot save enough to keep that new level going for a secure retirement. He has moved the goal posts and doomed himself to a retirement he cannot afford!
    But if you just spruce up the average house, spend time with the kids and make time for old fashioned kind of memorable low cost family fun, then that retirement becomes secure and there is a tipping point where the retirement savings actually bring in a little more than you actually need each month and when you reinvest it, that brings even more than you actually need each month .... wash, rinse, repeat and be really happy being an average guy with no trouble at all paying his bills in retirement while maybe watching his high spending neighbor go through bankruptsy.
    I am the average person with average family on average income or less and I cannot imagine needing an investment portfolio as large as a million dollars. It is not needed unless you are a high spender giving out diamonds as Christmas presents. I am really happy being average with a lot of family and friends that I have time to be with and I enjoy my life without worries. I am retired and I did it with dividend/growth reinvesting from an average income or less when I worked.
    Peace
    Jul 1, 2013. 05:34 PM | 14 Likes Like |Link to Comment
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