Retiring to Monaco

Thursday, September 29, 2011
Like many Americans, I have a 401K through my company. And like many companies, my employer offers a financial planning service through a third party vendor. Once a year they "evaluate" my retirement savings and try to convince me that they can help me achieve my retirement goals, because obviously their decision making skills in this area far exceed my own.

Aside from the irritation that my company allows these yahoos access to my private financial information so that they can shill their services, this year's "analysis" made me scratch my head. The form they send gives "green," "yellow," or "red" areas of concern in my portfolio, and here's the section for "retirement income:"

Danger, Will Robinson!

Yeah. $167,000.00 a year in 2011 dollars MAY NOT BE ENOUGH FOR ME TO RETIRE. In fact, it's possible my retirement income may be AS LOW AS $93,500.00 A YEAR. Horrors!

First of all, my current total target compensation* is not $167,000.00 a year, and we manage to do just fine here at the Big Yellow House in terms of being able to pay our bills and ensure my Hot Daughter is getting an education. We're not eating Top Ramen (except when we want to), and we even manage to leave the house periodically, in addition to putting a pretty sizable chunk into our retirement savings.

Where the hell do these people think I'm going to live in my retirement? Monaco?

That's my condo - the dump on the left

For some strange reason they've decided I need at least $142,000.00 a year to live in 2011 dollars in my retirement. NEWSFLASH: I won't.

So either their calculations are wildly optimistic (more likely), or they really do think I'm going to be spending my golden years in one of the most expensive places in the world (less likely). I tend to believe they need to revamp their automatic calculations and perhaps even review the output before they send out their letters shilling for business.

But I do hear Monaco is nice this time of year...

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*I'm on a variable compensation plan since I'm in sales. Some years my income is above my target, most years it's below.

5 comments:

filelalaine said...

Monaco or bust.

Warner said...

I don't think it was via the 401K guardian, but the corporate retirement site, but I was a bit startled to find out I needed more than I was making to retire.

And that is without the corporate retirement or Social Security.

Turns out I've a second pension I didn't even know about, that I'm waiting until 65 to take.

The Mechanicky Gal said...

You mean that you won't be getting that nice! new! home with significant mortgage when you are 60?
Because, you KNOW you need to keep up with the, uh, Jones?
(Seriously, WHY are people getting a BIGGER house with a BIGGER mortgage when they are getting older???)

Janiece said...

Beats me, MG. We'll be downsizing as soon as the last kid is off the payroll and on her own. And then we'll spend the rest of that $162K on CRUISES. To FARAWAY PLACES.

Warner said...

On the bigger house, believe it or not sometimes it makes sense. My wife and I wanted a big kitchen, not the 7x11 pullman we had. We also wanted home offices and guest rooms. Moved from a 1400 square foot duplex to a 3200 square foot something, think it is 'Dutch Colonial' what ever that is.

We also wanted a yard, as we didn't know about deer and ground hogs. Don't get those in Brooklyn.