Simplified Retirement Guide

Congrats on realizing you should start saving for Retirement!  If you plan on retiring one day, it’s pretty important to save up a nest egg.  If you’re young (early 20s), then good on you, but if you’re older then it’s definitely never too late!  This is basically a low cost, simple, DIY version to retirement investing.  There are a lot of “financial advisors” and other financial products which can “help” you but they make money off you.  Doing it yourself can save you quite a bit of money over the long haul.

Why You Need to Save:

  • Not a lot of employers are giving pensions.
  • Social Security is drying up and the fertility rate is going down.  Less babies means less workers the next generation who will be paying into Social Security when you’re old and relying on it.
  • Less kids means maybe I won’t have children to support me when I’m old.  I don’t have any yet, but if I do, I would want them to not worry about my well being.  Also it would be nice to leave them something rather than leach off of them.
  • Inflation at 3% means prices of stuff will double in 24 years.  So when you retire, you may need 2-3x what you think you need.
  • People are living longer. Life expectancy is about 80 years now and that’s accounting for people who died early of freak causes.  That could be 20+ years of retirement possibly! 20+ years of living off your savings!  That’s a lot of money.

The Good News:

  • Saving for Retirement is relatively easy once you know some basics.
  • Compound Interest is the 8th wonder of the world. Saving and investing money earns interest.  Earning interest on your interest is Compound Interest and it’s an amazing thing.  The earlier you start the more amazing it is!
  • The US Tax code will help you out with various retirement vessels (401k, IRA, etc).
  • If you’re reading this, then you’ve leveled up! You’re more financially aware and you’re understanding power of delayed gratification.
  • I’m personally grateful to be a US Citizen.  The US government may not do everything right, as that’s very subjective, but my mom was born in North Korea and her family fled during the Korean war!  I now have the privilege and freedom of actually having money to setup for the future.

Step by Step Guide Retirement Guide

Here’s my Step by Step Guide along with helpful articles to get you started.

  1. Retirement Guide Basics:  Get a little familiarized with investing. It’s a quick rundown on my philosophy of investing some basic financial knowledge definitions.  If you agree with my Philosophy, then I think you’ll enjoy my other articles.
    1. Basic Investing Vocabulary
    2. Retirement Philosophy: Where to Put Your Money
    3. Retirement Philosophy: Retirement Accounts Are For The Poor
    4. Retirement Philosophy: Passive Indexing and Rebalancing
  2. How to 401k: If your company offers a contribution match, you should definitely be taking advantage of it! If they don’t, it’s still worth it!
    1. How to Invest in 401k?: Depending on your age, you want to change the ratio of equities and bonds you have.  The older you are, the more bonds you want as they are a safer investment.
    2. How Must to Put in 401k?: Short Answer, as much as you can while still having enough money to get buy.
  3. Pay Off High Interest Debt: If you’re paying 16% interest by carrying a Credit Card debt, by paying it off, it’s like you’re earning 16% (relatively).
  4. How to Roth IRA: The Roth IRA allows you to earn money tax free! It’s pretty amazing, because the government basically taxes you on virtually everything else! Put up to $5,500 a year.
  5. If you can max out on your 401k and IRA, then you’re in the privileged few who have to figure out what to do with the rest of your money.  Rich people problems.