Retirement thoughts

I’m getting closer to paying off those debts I incurred through youthful idiocy. I wanted to be done this March, and not surprisingly, I wasn’t. What with getting implants for my teeth and needing my knee – possibly also hip – looked at, it’s gonna be a while yet. Not this year, and not early next year – but I’ll get there.

And that means I started worrying about retirement. Will social security still be there? Can I afford to retire with Mai Tais on a yacht? I’m 35 now – isn’t it a bit late to get started?

And the answer I found by taking advantage of the retirement calculators and 401k advice as well as retirement advice at fool.com is:

It doesn’t fucking matter whether SS will still be there.

That’s a comforting thought. If I start investing into a 401(k) now, then by the time I can get at that money – 62 – I’ll have enough even if SS tanks completely. Which it won’t, I’ll wager. I’ll have enough even considering the staggering cost of medical expenses, though it would be really really wise to start a long-term-care insurance plan, like, now. Or soon soon at any rate.

The best bit about it for me, after reading through all that stuff for hours on end, is how simple it can be in the end.

• Look at what you can afford to put away comfortably.
• Start now.
• Put your money into these vehicles, by order of preference:

401(k) matched by employer. Free money, woot!

Roth IRA

401(k) not matched by employer

• Over time, see whether you can max your contributions to these plans. Nay, over time, max your contributions :).
• Choose an equity index fund – like an S&P 500 – to put it all in. That’s because managed funds have expenses, and they nearly all underperform the index over the long run. I don’t think I’ll pick the one managed fund out there that outperforms the index, so I’ll stick with the index thank-you. Big bonus plus: It’s a no-brainer. I can forget about it.
• Start now.
• If you switch jobs and you’re offered a check for your 401k money, decline. The tax man would rape you. With a spiked mace. Anally.
• And foghet-about-it. No need to worry about this stuff any more for the next 3 decades.

See? Simple. The calculators claim that if I follow this simple plan, I’ll have something like 1.5 mil when I retire. Even considering inflation, that’s plenty. Just one qualifying statement:

If you have unsecured debt, for fuck’s sake, pay it off. No investment is ever going to have the kind of return to outperform what you pay in interest on that credit card.