Farrell: Can aggressive saver retire at 52? Not quite yet

  • Article by: CHRIS FARRELL , Special to the Star Tribune
  • Updated: February 16, 2013 - 3:25 PM

Q: I am a single woman who began saving aggressively for retirement the first chance I got — maxing out my 401(k), investing in individual stocks, waiting until I could pay cash for a reliable used car and carefully considering other purchases before I made them. My income was not great, but it was steady. And I never married or had children. I am now 52. My mortgage can be satisfied by writing a check. The retirement calculator provided by my financial adviser shows I am clear to retire at any time without sacrificing my current standard of living. The calculator assumes a drastically underperforming market and adjusts for inflation. I factored in a sufficient amount for health care, regular vacations, hobbies as well as the necessities such as food, clothing, shelter and transportation. I am desperate to quit and enjoy a work-free lifestyle, but I’m scared to death. Can I actually rely on a computer program to tell me I am safe to retire?

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dunc0029Mar. 5, 13 3:39 PM

I'm cut from the same cloth as the woman who asked this, and should be financially independent by my early 40s. While you don't give exact numbers, my guess is you probably DO have your bases covered, just going by your mindset and personality alone. Loosely, if you can live off < 4% of your investments, you should be set to retire in 99% of probable scenarios. What the author fails to understand is that some people just want to do nothing, at least nothing that can earn money reliably. Not everyone needs something to "keep busy", some people have outside interests. Sure, she might decide to write a book, start a business, etc. But, those choices are all the easier to make if you don't HAVE to earn money on them. Of course, the "safer" bet is to always work longer, save more. Then again, you could die tomorrow, and never get to enjoy the fruits of your labors. So, I'd just advise you to be sure you have taken everything into account (rising healthcare costs, etc.), error on the side of caution, of course, and do what makes you happy.

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