About 25 months... If we decide to kill our mortgage, we could do it in less than 20 months. Living below one's means WORKS. It's nice not having to rely on market returns to get ahead.
You mean like saving it into a sock drawer? IE, not allowing for interest to accumulate? Given current savings rates: 20 years, If we for some reason really pushed it: 7 years. If we forsake all else (ie house upkeep, car upkeep, any gifts, holidays or anything) 5 years.
As I've said before, we're on the lower end of the income scale as compared to others on cmf. Our current savings rate is about 8% of gross income. We could easily push that to 16% if we put mortgage prepayment and RESPs on hold.
No, by "cash" I meant not invested in a stock, GIC, mutual fund or property, $100,000.00 cash in a checking or savings account that you have access to anytime, anywhere etc.
6-8 months. Now that the mortgage is paid off we are putting aside tons of dough. I take quarterly bonuses on top of a $112k base and the first three this year have added up to $209k so I should be around $350k this year depending on Q4. Not bad for a commissioned sales guy.
If we reallocated all of our current savings (RSPS, RESP, etc), stopped extra mortgage payments, but maintained the a general same lifestyle, about 1.5 years. If we went into frugal crisis mode, we could probably do it in about 8 months but it would be tricky to pull out because wouldn't have the same flexibility with taxes.
"I have $X saved already, I gross $Y in salary, plan to retire at age Z. How much should I continue to save each year such that I can maintain a constant lifestyle (budget) out to a comfortable age (95 say)?"
Why do we persist in these simplistic planning mantras such as the '4% withdrawal rule', 'how much do I need to retire on?', etc.
We are, each of us, sitting on computer power unprecedented even 2 decades ago. Why don't we use it?
On my current single income, about 6-7 years I guess. Once saved, I would invest half in the local real estate, and the other half split between gold bullion and dividend paying stocks.
Very nice, I did not save up much in my 20's (refer to my post in the biggest financial mistakes thread), however, my goal now is to save $100,000.00 a.s.a.p.
Im trying to hit a million in 8yrs,excluding real estate(doesnt count in my books,even if its paid off)Im in my sweet spot i think (30-40),ill need help from mr market.It would feel awesome to see a 7 digit portfolio!Couple hundred k in growth stocks,couple hundred k in income stocks.The key is to get a half a million working by 36,and drip the shitout of income(cvx,fts,abt,mmm,T,Pm,cat)ect........wynn,apple,tif,x,ect on the growth side.Trying to set up a formula!Thats the tough part!And Tune out the nay sayers lol.
If It was all I concentrated on I could probably do it in 2 years...What would I spend it on?? Nothing I really want would cost even half of that but a garage would be nice in the backyard.
At our current rate of savings, which is modest right now as we've recently dropped down to one income, and considering you said sitting in an account (which currently pays 2.5%) it would take at least 12 years. We could do it faster if we omit our RESP, TFSA, RESP and some discretionary spending but I think it would still take us at least 8 years realistically.
Pa,im talking about building off my base(which is in play right now,inside my portfolio)spread between a rrsp,tfsa,and a non reg.Ive got a 160k book vaule portfolio right now,by 36(4yrs) to get it to a half million,im working out a plan now,should be able to get @ least 200k more in it in 4 yrs.I own a small construction firm.Ill know more as i go.
Plugging,how long did it take you to reach a 100k in savings?age?
It has been my experience, that when you factor in a salary which grows at say, 2% faster than inflation (merit raises and career advances), your savings rate will be very small in the early years.
I see a lot of plans, and I find that most individuals won't start saving in earnest until their mid 40s.
Adding to this skewed savings effect is that, in those early years you will be busy paying off your mortgage and raising your kids.
Great point about the age. Though spouse and I have always had decent earnings, when we were young, we were too stupid to save that much because we were young. Now with kids and a mortgage, it makes it much harder. We figured that when our last mortgage is paid off, and we're not paying for childcare or private school, we'll be able to put in another $50-60K a year. That will probably not happen until we are in our 40's.
I also find with kids, I am less willing to take risks with our incomes to make the bigger money with less stability (like consulting, etc).
^Tough answer, I don’t know the specifics for myself, as my spouse and I have been together for a really long time, so I count our networth together. We had our first $100K in investment accounts/cash (combined and not including our real estate) when I was about 25 & 27 (he’s a couple of years older). Part of it was we invested in a couple really high risk start ups and did really well. We probably had $200K together by 30/32. I didn’t count that we also saved up for two down payments on two properties that came from our other funds as you said you don’t count real estate. Each of those down payments took about 2 years of saving a lot, some luck in our investments, and not really having the huge expense of kids.
Our goal is to have our vacation property paid off in 3 years or less, and try at save additional $50 k for emergency/float on top of our normal savings rate at the same time. We anticipate to be able to save about $100k more in our registered accounts (just savings, no growth), and $50K for float money while I make a transition of our business. My age will be 40 at the time. I’m targeting $1 Mil in all our investment accounts by the time I turn 45 (8 years) realistically, assuming transition works well, and kids don’t cost more than planned, and there are no layoffs, etc. All of these numbers also assume that I stick with my spouse We're hoping to have $1 mil by 40 (in 4 years), but I don't see that happening unless our high risk gambles pay off.
We live off of my salary and save my wife's income within the professional corporation. We are not touching it (taking it out of the PC)--forever (just pay the taxes). However, we do take out distributions up to $50K (essentially tax free at the personal level).
We'll likely do an estate freeze in a few years so that the bulk of the value of the PC can be passed down to our children.
At this rate, we save $100K in four months. In a few years it will be on a monthly basis.
Atrp2biz:I take it @ your point your building generation wealth.You are completely in the drivers seat.Do you ever worry if your children will be able to handle it?Do you teach them about money?Do they know the vaule of a dollar?This is none of my business im just curious,im guessing there will be multiple millions passed on.Do they know?
Teaching them about money will certainly be a priority. Right now, our goal is to have him go two weeks without peeing his pants. He's the first of hopefully many, but we hope to instill similar values as us. For us, money is a scorecard and the goal is accumulation.
I'm 35 and my wife and I have that saved now + just not sure what to do with it... that's the hard question. Whether to put on the mortgage or do something else...
Wow @ some people saving 25 grand / month. That takes some serious cash flow. In the olden days people used to have humongous families and use income pooling. Well they still do that in places like rural China, but they're competing for hundreds and thousands not hundreds of thousands.
Don't underestimate the advantages of dual incomes. Once I started living with my future wife, and we made the decision to combine our finances, the wealth accumulation really took off.
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Related Threads
?
?
?
?
?
Canadian Money Forum
684.7K posts
166.2K members
Since 2009
A forum community dedicated to Canadian personal finance enthusiasts. Come join the discussion about investing, stock portfolios, equities, frugality, real estate, market trading, taxation, retirement, and more!