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annegriet

When did you start planning retirement?

Annegriet
4 years ago

I'm not talking about the saving money part. I'm a big saver. I invested my first holy communion money (just kidding). When did you start daydreaming/planning your retirement lifestyle? Where you want to live? What type of residence? Any bucket list items to fulfill?


Comments (38)

  • maifleur01
    4 years ago

    Seldom dreamed. Did find a ranch house with only one area where there is a step into family room. Have several wishes that I can see that they are floating away because of ageing but no real bucket list as in things I must do before I die. Run the "what if's" when planning for retirement. Things like what if one of you becomes sick, needs to go to a nursing home, or dies. What and how will the survivor live after that. Do at least one thing a year that you have thought about early in the retirement rather than planning year by year. Later in retirement you may find that your desires have changed but you can still look back at those special "me" times.

    Annegriet thanked maifleur01
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    Thanks everyone!! jkdavis - you sound just like me! I have several Pinterest boards for my dream house (floor plans, general ideas, lighting, furniture, etc.) and was just starting to organize some of them to print and put in a binder. I also love to plan - everything and anything - and I can't seem to shut it off. I also love to play around with floor plans. I just made a comment the other day about, "When we build, I wonder if the contractor will have ever worked with someone like me? Hope I don't scare him!" gscott991 - did you have an idea what it would cost to build when you purchased your property? Part of the reason I already reached out to a contractor was because I don't want to buy property and then find out we'd never be able to afford to build. Granted, it all depends on what you want and if you only have $100K, you build a small house - but as a young couple, who will be having children in the next few years, I want a comfortable sized house for a growing family. Nothing huge and no high-end finishes - in fact we much prefer a rustic, Colonial style and hope to save some money doing all the finish work ourselves. And while we plan on our children sharing bedrooms (boys in one, girls in another ... though we have no children yet), we do want a downstairs flex/guest bedroom and maybe another upstairs; we love entertaining and having out-of-town guests. We also want this house to be our last one, so a downstairs bedroom (for when we are too old to go up and down the stairs) is a must, but I don't like having the master downstairs. So right now, I'm estimating 2000-2400 sq ft, with small bedrooms, a large kitchen/dining room (just one room), and a medium-sized living room. The kitchen is the most important room to us, so we want it to be the biggest. I hope in 3-5 years, we can still afford that. MrsPete - definitely agree that what we feel we need has changed even in this past year, and I'm certain when we finally do build, we'll know exactly what we need, where we want to splurge and where we know we can be stingy. I'm hoping it will make the actual building/planning process easier. Naween - Good luck!! Sorry to hear about that designer wasting your time. I've been reading these forums for a long time and from everything I've read, I think we'll spend the money on an architect. Even though I love playing around with house plans, and could hand over a few attempts of my own, I don't know housing codes and while I might THINK something could work on paper - in the real world, who knows? ha! It'll be a big chunk of change, but I hope that accounting for it ahead of time will take out some of the sting. MushCreek - your last paragraph is exactly what I'm hoping to do! I definitely don't plan on having a finalized house plan until we're ready to build, but in the meantime, I'd like to make sure that a ~2400 sq ft, two story (with unfinished attic and basement), saltbox (ie., single roof line) will be feasible when the time comes. But I'm dreaming in generalized ideas right now, because your'e right - a lot WILL change in 5 years.
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  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    Good questions all, annie. Everyone has different circumstances and preferences, I'm not sure what insights you may gain in hearing from others.

    We haven't moved or downsized from the house our kids grew up in and probably won't. We don't need to flee to better weather or for lower living costs so moving has never been in our thoughts. Our retirement lifestyle hasn't changed much, other than having more time available for recreation, new activities and sleeping later than before. We both enjoy traveling and like being able to do it more often and for longer trips than we could pre-retirement.

    jakkom, getting a government job that provides a pension is all the retirement financial planning many so-situated ever need to do. Far fewer people have pensions from their careers than was the case a few decades ago, and for them early planning and an early start to savings is essential. I know some government retirees, among whom are a few who are making more in retirement than beforehand because of retirement inducement packages they were offered.

  • maifleur01
    4 years ago

    Elmer just getting a government job does give you a pension but it depends on which government. Husband retired with a buyout in 2003 added 5 years to his service from our city. Yes, he did take home more than he had been receiving when working. But that was because he stopped putting into his deferred comp, type of 401. When I retired with a federal pension after 23 years I received 1 percent for each year of service. Twenty three percent is no where near comfortable. Thank goodness for SS and savings. One of my sister in laws from Illinois receives a pension but no social security similar to what many teachers receive. The difference is the retirement inducement packages not being the government employee.

  • Elmer J Fudd
    4 years ago

    Take a look at this article Google found for me. Do you disagree with what it says? It's a few years old but it suggests that a career-long federal worker retiring at age 62 with a $60,000/year salary (not very high on the GS scale, depending on location) would receive retirement income from several different sources of $58,000. There's nothing comparable to that that I know of in a non-union private sector context.


    Federal Pensions


    Of the government retirees I referred to before, four are from different California State agencies and one was a teacher for a local school district. Each commented to me at one time or another that they couldn't afford to keep working because of the good deals they were offered.


    Your 23 years isn't a full length career (other than what some public safety officers can get, something I disagree with) and you obviously would have gotten more with a longer federal career. I hope you get enough to live comfortably.

  • maifleur01
    4 years ago

    Most do not make $60K except in Washington. Career long could include one of the guys that worked with me who started at age 16 in a work program for at risk teens or the woman that was 93 when she retired. Under the current system you would earn 1% X high three salary X length of service if you take it before age 62. If you wait until 62 you are entitled to and additional 0.001% X times years of service. You will receive Social Security but the third part is up to you. There is a program similar to a 401K where the government automatically contributes the first 1%. Then matches the next 3%. After that it is up to the various agencies. When/where I was working they would matched up to 5%. You could if you could afford it place up to 15% in the funds. In looking at the OPM FERS information it now reads "next 2% of basic pay will be matched 50 cents on the dollar". This portion is where many receive the extra to bring their retirement pay up to equal or greater than their previous take home pay.

  • jakkom
    4 years ago
    last modified: 4 years ago

    I don't find the Biggs' article very compelling. My niece is a Federal employee in the USDA administrative area, and her retirement at 1%/yr worked will be less than had she worked an equivalent time for one of the big consulting firms, such as Accenture or Boston Consulting.

    California has a rather unique pension system. It's impossible to compare even agency vs agency retiree benefits. CalPERS is the 800-lb investing gorilla in the marketplace, but participation is entirely voluntary for city and county agencies. It is mandatory ONLY for state agencies.

    Many city and county agencies self-insure and do not belong to CalPERS. This is why Orange Cty's bankruptcy in 1994 affected the bond market in general but not specifically CalPERS. OC was not part of CalPERS and had self-insured.

    The University of CA system has its own independent retirement system, CalSTRS. Many local school districts belong to CalSTRS, not CalPERS.

    It should be noted that every single union contract negotiated and signed, includes negotiations on retiree benefits in all instances, whether the agency contracts with CalPERS for retirement or not. Each agency negotiates and pays for its level of participation with CalPERS separately. What one agency does, or changes its mind about doing twenty years later, has no relevance to any employees of another public agency.

    Indeed, my DH's retirement plan is different than that of one of his co-workers, whom he hired in 2004. She falls under a renegotiated retirement program that is less generous (the infamous "two tier" contracts now common) because she was hired after the "two-tier" contract was signed.

    The Congress-mandated 2014 changes to ERISA established the precedent that existing pensions can be reduced if a multi-employer pension fund is "substantially underfunded". There is currently a case up before the CA Supreme Court to rule on an Appeals Court ruling saying public pensions can be reduced, which decided "the law merely requires government to provide a 'reasonable' pension."

    I explain this because in CA, it's meaningless to say "so and so has XX retirement income from YYZZ sources." If five people are union workers, but each belongs to a different union and different public agency, there will be five different retirement programs, whether they belong to CalPERS or not - and those benefits will each need to be renewed at EVERY contract negotiation with that specific public agency.

  • maifleur01
    4 years ago

    Your comment about benefits being available in one agency but not the other is the same as in the federal government. I was talking to an employee from another agency at a training session and she did not understand what is shown on the OPM site as the federal retirement information because her agency did not follow it. Her agency was not one of the special ones that get favored status.

  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    The article I linked isn't an opinion piece, there's no need to find it compelling. It explains how some government pensions work and how much they can amount to. It derives from an article in USA Today. You can like it or not as you choose, it's only information.

    People make job choices for reasons other than money. jakkom, I'm sure your niece hasn't automatically decided to work for less money for the USDA - the consulting firms pay top drawer salaries but typically don't offer defined benefit retirement plans as generous as from government careers. Private sector jobs also tend to be more demanding. I'm sure there must be many factors involved for her choice.

    The fact remains that government jobs more frequently and more generously offer pensions than do private sector jobs, where defined benefit or other pension plans with broad coverage are today virtually unknown.

    I personally am very against government workers being allowed to belong to labor unions, but that's a different topic.

  • mojomom
    4 years ago
    last modified: 4 years ago

    Back to the original post. We started seriously thinking about retirement, other than in abstract terms and savings, about 7-8 years ago and i will semiretire next year.

    Where: We currently live in the south, but our daughter (only child) and SIL live in Colorado where we've owned a second home for a number of years, since way before she moved there and met SIL. Once it became obvious that they were there to stay, we started thinking about moving there full time.

    Type of Residence: The kids lived in our vacation home and it was too small for all of us and didn't provide the privacy needed for full time living. It was also not good for aging in place. So we started looking for something multigenerational with private spaces and finally decided to build a duplex with them. We broke ground in late July and expect completion about a year from now. This won't be a mirror image type duplex. Our side will have one level living. I'll link to a description below.

    Bucket list items: The kids are giving us the top of the list with a grandchild early next spring. A grandson to be specific. Other than that, the new house is a bucket list item because I've always wanted to build and traveling -- DH and I love road trips and the outdoors so lots of road trips to National Parks and wilderness areas. The other item on my bucket list is to get back in shape for more extensive skiing and kayaking than now. Sitting behind a desk everyday takes its toll, but in my early 60s and in good health, I think with more exercise and time to build back up, I'll still be able to get back into it pret good, although probably not at the level I was doing it 10-12 years ago.

    Semiretirement: DH just sold his practice this year and is working for the buyer two days a week. He has his CO license and may do some part-time work out there -- maybe 4-5 days a month. I enjoy many aspects of my job, but what I am best at can be done remotely, so we've been talking about me maintaining a relationship with my firm in some part-time remote capacity for a while and may come "home" to the office several times a year, which is fine because I'll still have family and friends here that I will want to see anyway. I'll probably stay pretty much full time until we move next fall.


    The description/progress on our retirement home duplex can be found on this thread. Scoll down to My post on Oct. 8:

    Duplex

  • zippity1
    4 years ago

    married to a planner seriously head of planning and scheduling for a very large company he started planning retirement in his 20's i was along for a ride trying to spend the money not going into retirement wisely.....it all worked out

    so far at least almost 5 years into retirement and everything's going well we are very fortunate in that both of us have pensions and had more than adequate salaries for a portion of our working years we've always lived well below our means and we still do our only problem, we made a major change in where we wanted to live (state) due to some health difficulties, wanting to be near great medical facilities but we're near the children and grandchildren and have friends of many years we're enjoying life with...

  • jakkom
    4 years ago

    >>the consulting firms pay top drawer salaries but typically don't offer defined benefit retirement plans as generous as from government careers. >>

    Not sure that's true. Definitely not true for Accenture and Boston Consulting, as I know employees and partners from both firms who have retirement pensions as generous or more so than the USDA, including retiree healthcare. And of course, no WEP penalty either.

    But generous or not, planning is one of those things one can never start too early on, which I'm sure we can all agree upon.

  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    In saying "as generous", I was talking about how high they were as a percentage of active salary.

    Many government and agency workers can have retirement income (from all sources) equal to 75% or more of their regular salary during active employment years. I have a retirement benefit from a large but privately held business that was partly a competitor of the two you named. While I'm very happy with what I have, it's nowhere near that high of a percentage of my pre-retirement income. For a for-profit business, especially public held ones, offering benefits like that are unaffordable. It's the same for governments but it continues until budget problems arise and then the trick of reducing what new workers will ultimately get is the typical solution.

  • pamghatten
    4 years ago

    I'm 57, planning to retire from a local bank when I turn 66 and 10 months. Just this past year downsized and sold a rural farm and moved into a suburb close to work. Bought a ranch house, all one level, and made one of the bedrooms a 1st floor laundry. All to make life easier as I retire and age.

    I'm curious about some comments I've read about people going into nursing homes. Isn't anyone considering a senior community?

    My Mom moved into a local senior community 2 years ago, and is having the time of her life. She's 85. It has all 3 levels of care, she's in independent living, she can go into assisted-living when needed and then full nursing care.

    A friend's Mom refuses to leave her "home", and has no social life or much contact with other people. She's dwindling away in her house, it's sad.

    My Mom's experience has totally changed my idea of where I plan on living as I age. I will definitely be looking at senior communities when I'm tired of maintaining my house.

  • 2katz4me
    4 years ago

    I don't think we started talking much about lifestyle until maybe age 55 though we got serious about working with a financial advisor when we were 50. DH bought a business around age 55 and doesn't plan to retire - he will keep working at this business as long as it's viable and he's able. We're both around 60. I previously worked with advisor on plan to retire at age 60 but now that I'm almost there I have no interest in retiring. I enjoy my career and have no compelling desire to give up my income or health insurance though supposedly we're financially prepared to retire at 60. We have no pensions - just our own investments and SS.

    We did move to a "rest of our life" home last year and also purchased a different second home that we also consider a "rest of our life" place. All the things you need on the main level though the homes do have other levels/stairs. Our primary residence is now a detached townhome so someone else does the yard work and snow removal. These are in the same area we've always lived. We aren't planning to move somewhere else in retirement.

    We've both traveled extensively in our careers and have seen a lot of the world so not feeling the need to travel a lot of people do in retirement. Mostly interested in travel to visit people we know who live in other places. We've really done a lot of things in our life so don't have much of a bucket list. We seem to be getting more connected socially with friends and neighbors now that we don't travel much for work and are enjoying that a lot. Really happy with our life for now so will carry on as is until that changes.

  • artemis_ma
    4 years ago
    last modified: 4 years ago

    I'm 62 now, and I bought my retirement property back in 1997 or 1998 -- hoping then I'd do even earlier retirement than I did. (2007 did a reality check on that!) I retired this past summer.

    I didn't actively think about my residential design until about five years ago, but didn't actively start the building until more recently. The house should have been completed close to a year ago, but still working on it.

    Other retirement plans - travel. So far I've driven to Rhode Island for a few days in August, and to St Petersburg, FL this November to meet my new great nephew (seeing friends and other relatives and the sights along the way). Hoping to do more road trips and to do some air trips further afield as interest indicates. Sometime in the spring I will 1) move to my new home and put this one on the market, 2) fly to Oregon to spend some time will an old college roomie and plan on starting a business with her, 3) drive (?) to the Chicago area to spend time with my brother and his wife, 4) renew my passport so I can go visit Iceland with some friends who go there every fall, 5) plan for raising chickens for meat -- they could go into the freezer in September and I could travel again.

    I am discovering the book clubs at the local library -- very many dynamic folks there.

  • Lindsey_CA
    4 years ago

    JAKKOM -- My husband and I both are State of California retirees, and I don't feel that you've properly explained how things work for CalPERS retirees. I will add in partial quotes (trying desperately not to take quotes out of context) and my comments to those quotes.

    "California has a rather unique pension system. It's impossible to compare even agency vs agency retiree benefits. CalPERS is the 800-lb investing gorilla in the marketplace, but participation is entirely voluntary for city and county agencies. It is mandatory ONLY for state agencies."

    I'm going to address my comments only to state employees who retire, because, as I said, my husband and I are state retirees and I cannot speak with certainty about city and/or county employees.

    Yes, you can compare "agency vs agency retiree benefits." Only in rare cases do the separate agencies come into play. It is the union to which the employee belongs (or the union MOA that governs the non-union-member) that makes the difference.

    I was a member of Bargaining Unit 1 - Professional, Administrative, Financial, and Staff Services. My husband was a member of Bargaining Unit 2 - California Attorneys, Administrative Law Judges, and Hearing Officers. During our years as state employees, we never worked for the same agency, but the agencies that both of us worked for (and we both worked for more than one agency) all had both Unit 1 and Unit 2 employees, as well as employees from various other bargaining units. Unit 1 employees at my agencies get exactly the same benefits as Unit 1 employees at my husband's agencies, and Unit 2 employees at my agencies get exactly the same benefits as the Unit 2 employees at my husband's agencies.

    And, for anyone who may care, the bargaining units are:

    Unit 1 - Professional, Administrative, Financial, and Staff Services

    Unit 2 - California Attorneys, Administrative Law Judges, and Hearing Officers

    Unit 3 - Professional Educators and Librarians

    Unit 4 - Office and Allied Workers

    Unit 5 - Highway Patrol

    Unit 6 - Corrections

    Unit 7 - Protective Services and Public Safety

    Unit 8 - Firefighters

    Unit 9 - Professional Engineers

    Unit 10 - Professional Scientific

    Unit 11 - Engineering and Scientific Technicians

    Unit 12 - Craft and Maintenance

    Unit 13 - Stationary Engineers

    Unit 14 - Printing and Trades

    Unit 15 - Allied Services

    Unit 16 - Physicians, Dentists and Podiatrists

    Unit 17 - Registered Nurses

    Unit 18 - Psychiatric Technicians

    Unit 19 - Health and Social Services/Professional

    Unit 20 - Medical and Social Services Specialists

    Unit 21 - Educational Consultants and Librarians

    Obviously, there are concerns and conditions for the employees in, for example, Units 5, 6, and 8 that wouldn't apply to employees in Units 1, 2, 3, and 4, etc. Therefore, there are some benefits -- both while working as well as retirement benefits -- that are different in Unit 5 than in Unit 1.

    "The University of CA system has its own independent retirement system, CalSTRS. Many local school districts belong to CalSTRS, not CalPERS."

    And many of the school district employees can choose which retirement system they prefer to join -- CalSTRS or CalPERS.

    "It should be noted that every single union contract negotiated and signed, includes negotiations on retiree benefits in all instances, whether the agency contracts with CalPERS for retirement or not. Each agency negotiates and pays for its level of participation with CalPERS separately. What one agency does, or changes its mind about doing twenty years later, has no relevance to any employees of another public agency."

    Again, agency-to-agency comparisons do not apply in state service. It really confuses things when you are doing a comparison explanation that includes state agencies mandated to use CalPERS and local agencies and school districts that are not mandated to use CalPERS. You are comparing apples to oranges. Apples and oranges are both fruit and state employees and local/school employees are all public employees, but they are very different from one another. You said, "Each agency negotiates and pays for its level of participation with CalPERS separately. What one agency does, or changes its mind about doing twenty years later, has no relevance to any employees of another public agency." Those sentences apply to agencies other than State of California agencies.

    "Indeed, my DH's retirement plan is different than that of one of his co-workers, whom he hired in 2004. She falls under a renegotiated retirement program that is less generous (the infamous "two tier" contracts now common) because she was hired after the "two-tier" contract was signed."

    First, if your husband hired this woman in 2004 or any other year, his retirement is going to be different than hers because he is a manager or supervisor who is exempt from collective bargaining and she is rank-and-file who is subject to the collective bargaining MOU. (Unless your husband works for a public agency other than a State of California agency, in which case who knows what the facts are since you didn't say which local/school district he worked for.)

    Second, two-tier retirements have been in place for a very long time. My husband first went to work for the State of California at the beginning of 1985, and Tier I and Tier II were in place at that time. I believe what you're referring to is the "First Tier A" and "First Tier B" differences as well as the "Public Employees' Pension Reform Act (PEPRA) First Tier Retirement Formula."

    Employees hired before January 15, 2011, are subject to "First Tier A" which gives them "2% at age 55," employees hired on or after January 15, 2011, but before January 1, 2013, are subject to "First Tier B" giving them "2% at age 60," and employees who are eligible for CalPERS membership on and after January 1, 2013 fall under the "PEPRA Formula" which is "2% at age 62."

    For anyone who is interested in reading more about the differences, this link to the current Unit 1 contact will give all the details. (The contract has expired but the provisions are still in effect until there is a new contract.) You will want to go to page 83, which is the start of where the different retirement formulas are explained, complete with charts. Basically, though, "2% at age 55" means that if you are 55 when you retire, you will get 2% of your salary times the number of years of your state service. If you work past the age of 55, the percentage goes up incrementally until it tops out at 2.5% at age 63. I was 63 when I retired as a First Tier A employee.

    "The Congress-mandated 2014 changes to ERISA established the precedent that existing pensions can be reduced if a multi-employer pension fund is 'substantially underfunded.' There is currently a case up before the CA Supreme Court to rule on an Appeals Court ruling saying public pensions can be reduced, which decided 'the law merely requires government to provide a "reasonable" pension.'"

    "I explain this because in CA, it's meaningless to say 'so and so has XX retirement income from YYZZ sources.' If five people are union workers, but each belongs to a different union and different public agency, there will be five different retirement programs, whether they belong to CalPERS or not - and those benefits will each need to be renewed at EVERY contract negotiation with that specific public agency."

    Again, your statements apply only to employees of non-State public agencies.

  • steve_o
    4 years ago

    We started planning in earnest about five years ago. That's the time that some big changes at my work (high-tech IT) led to burnout and a desire to do something/anything else. :-s DW also has long targeted the end of 2019 as her retirement date. But neither one of us even will be 60 by the end of 2019, so we had to figure out if what we wanted was do-able.

    We met with a financial planner and started watching more closely where our money went. Both of us (second marriage for each) have long lived below our means. But when you're thinking of at least temporarily knocking out 60% of your take-home, you want to know these things. We've been meeting with the FP pretty much annually just to make sure we're on track. So far, we are.

    We have started our "final approach", as they say in aviation. This year we upped DW's dental insurance (through work) to manage some stuff we knew needed to get done. If we were planning to move (we're not), we'd be looking at what we had to do to get the house ready for market. DW and I are both working on creating freelance jobs we can do in the years between retirement and SS/Medicare (and beyond, if we want to and can). Life can change pretty darn fast; better to have a plan.

  • maifleur01
    4 years ago

    Interesting that you upped your dental insurance as most policies in this area do not cover more than about $1,200 a year. I found having an HSA and using that money to pay for dentist and other medical things like known co-pays worked better for us. Long time ago I worked for an insurance brokerage firm when dental started to become more affordable. Decided that it was a big ripoff except for people with children. If you add your twice a year checkups and divide by 12 normally the premiums for dental insurance is higher than just paying the bill. There is one policy available here that will cover everything but for a family it is about $1,200 a month when it was available through the place my husband retired from.

  • steve_o
    4 years ago

    maifleur01, as I mentioned, we have dental work we've put off because last year's dental coverage was minimal. The expense will far exceed twice-a-year checkups or our premium for the year. We'll get the work done and then we'll revert to the minimum level next year (unless we know we need to have more work done).

  • maifleur01
    4 years ago

    Reread what I posted. What I posted was that most policies do not cover much of major dental work. In this area the max for most policies is $1,200/$1,500 and the rest is not covered. Hoping it does not happen but do not want anyone shocked when it does. Last crown I had, a molar, was $1,100.

  • steve_o
    4 years ago

    I read. We're covered. Thanks.

  • judy661
    4 years ago

    I love this thread! It's great to be able to dream about bucket lists and such. Retirement planning can be intimidating though! I am 41 years old and a long way off from retirement. Who am I kidding??? Time flies, AM I right? Actually, my husband is 12 years older so yah, retirement is literally not that far off, and is on the mind more these days. We have a large family (6 kids). Our money has always gone into raising them, putting a roof over their heads and clothes on their backs, etc, etc.., so money to squirrel away for a rainy, retirement day hasn't happened as of yet, but it has been a nagging thought in the back of my mind for a while. "What ARE we going to do for retirement?!" Well, my husband and I had a 21st century thought about this and are looking into alternative sources of income for retirement. No, it has nothing to do with selling marijuana! We think the Internet economy is the way to go, especially for sorry sods like us who have nothing planned for the future financially. Great thing about the Internet economy is you can make money before and during retirement. If we start now by learning this new skill called marketing and we hone it, it could potentially be the answer to our need.

    Annegriet thanked judy661
  • maifleur01
    4 years ago

    As you hone your marketing skills be aware that marketing changes all the time so you have to be flexible. Able to move in and out of whatever you are marketing before the bust that always comes. Worked in that field and have watched many people loose everything that they had because they thought what they had was fixed. While finding something that you can do to earn money during retirement is good saving more than you are comfortable is a better more secure way to plan your retirement. Be smart like using an LLC or whatever it will be called at that time for your marketing company is smarter.

  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    maifleur, what advantages of using an LLC do you have in mind that lead you to suggest that having one for a personal business is "smart"?

    judy, you're running out of time to save for retirement income, unless you plan to get by on Social Security only. Given the high failure rate of new businesses that people start, it may be that the best opportunity you have for saving a nest egg comes from the income sources you have today. Don't put it off.

  • maifleur01
    4 years ago
    last modified: 4 years ago

    Elmer the biggest advantage of an LLC, depending on the individual state laws, is that if the business goes bankrupt all your personal assets can not be seized to pay for any debt of the LLC. You do need to have it set up properly and keep business and personal assets separately. Many business's fail within the first couple of years.

  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    Typically new businesses run out of a home, especially those run by an individual or a couple, don't tend to borrow money initially. When they do, and even for something like a lease (that many don't think of as being debt but it's debt-like), the party on the other side (bank or lessor) will require the owners to guarantee the obligation outside of a business entity, if any, anyway.

    To explore the concept and see if there's potential, setting up a separate entity from the start may not be the best way to spend money, which by this person's description is limited. Projects for which Individuals try to develop a business in an unfamiliar area they lack experience with don't have high success rates.

  • maifleur01
    4 years ago

    Since this is a marketing business they will be selling something. Although not directly borrowing if a business would order material using a credit card as many do and then have problems selling or using that material to recoop the expense. The creditors could attach the personal belongings of the people. With an LLC and/or corporation only the business assets can be seized. This is why I suggested the LLC. I do agree with your last sentence as that is what I have seen several times. Great expectations then disaster.

  • Elmer J Fudd
    4 years ago

    Marketing and sales aren't the same thing. I'll guess that the original poster (and you) are saying marketing when what is really meant is sales.


    It's my view that new businesses started by an individual or couple should start as a proprietorship, without any type of entity, until some momentum is achieved. For many different reasons.


    Maifleur, I had a successful career as a business and tax adviser, partially involving this same subject area but on a larger scale. I disagree with your suggestion and I'll leave it at that.

  • maifleur01
    4 years ago

    We always seem to disagree. Each person has their own background and experiences to draw from. Mine was marketing and farming. Changing small family farms to corporations and LLC's has saved many of these from having all of their personal possessions from being sold after they declared bankruptcy. Saw it happen too many times in Iowa and Nebraska.

  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    It sounds like you'll be ready to speak up when questions come up concerning failing small family farms in the Midwest, though I question the suggestion in that context too. I'm not sure why you think what you observed in one context has global applicability, it doesn't.

    Since you seem to be giving bankruptcy advice as well, are you aware that under the bankruptcy rules, what you're describing could be subject to clawback as a preferential/fraudulent transfer?

    It's an issue I've been exposed to in working with some large bankrupt businesses, but it's a technical legal matter handled by the bankruptcy lawyers. I'll bet you similarly don't know what that is either.

  • maifleur01
    4 years ago

    Since you apparently think I have no brain or experience in anything given your thoughts of course. I stopped replying to you at one point because like many men, you may be a woman but I doubt it, what you see and say are the only way things are and ever will be. Please enjoy your dreams.

  • Elmer J Fudd
    4 years ago
    last modified: 4 years ago

    I don't need to blow my own horn - I know who I am, what I know as an expert and what my background is- and I also I don't need to argue with you. And won't. I don't want a future reader to be possibly misled by your comments. The question is very basic and I disagree with your suggestion.

    Please drop the gender baloney. You don't know me or my gender, I don't know you or your gender and I honestly don't care. Male or female, you're giving advice in an area you don't have enough understanding of to share with others.

  • judy661
    4 years ago

    I see my post caused a bit of a stir. First, we live in Canada so the benefits of an LLC are not applicable here. In Canada, we can set up a business as a sole proprietorship, partnership, or incorporation. With both sole and partner, the individual(s) personal income and assets are liable if the business goes south. In incorporating, personal is separate from business. Ultimately, incorporating is most beneficial. However, we decided to go for a partnership and for a couple of reasons. One, we don't foresee making oodles of money in our first year. Secondly, we will invest our own money into the business. And because our income and business are interlinked in a partnership, any moneys we use (income and profits) will help lower our tax (that's the general idea). Our plan is to throw all profits right back into the business. Doing this will show we are actually "losing" money and so the amount of taxes we will pay will be lower. Once enough money is made so that we can let go of our 9-to-5 jobs and focus solely on our business, we will then switch from partnership to incorporation. First thing we did when dreaming up this concept was to secure an accountant and have been following his advice.

  • Elmer J Fudd
    4 years ago

    I'm glad you got competent advice, which led you to a flow-through, unincorporated structure. The same approach in Canada as I was suggesting would have been best in the US. And for the same reasons.






  • maifleur01
    4 years ago

    Sorry if I had known you were in Canada I would never have suggested the LLC. S Whiplash and I have butted heads for years. Each time I have to smile and think how he and my father in law are so similar in thoughts. Only once in the twenty some years before he died did he agree with me on anything. That was the war in Grenada when the US invaded. Both of us knew that ships could not travel as fast as was reported.

  • Elmer J Fudd
    4 years ago

    We have?

  • judy661
    4 years ago

    lol