How Long Will it take to RETIRE on SHARES

I don’t like wine THAT much . But traveling ( business class flights, good accomodation +_ good meals ) could easily gobble plenty of that up in retirement - especially if you wanted to get away more than a few weeks a year.

 

Travel 50k? A year?

You could easily spend 50k a week on travel alone.

 

Absolutely...

Or drop $100k plus on a new car in a day

Those spending $250k a year are doing very well, I'm curious as to the breakdown of how they choose to spend their money.

 

Catered food.
Cleaners.
Carers for kids.
Gardening for amazing ppor
All the rego and insurance on expensive cars
Eating out.
Spending big on family and friends
Golf memberships to exclusive club
Yacht club membership
Racing driving club membership and participation
For a family traveling first class, flights alone can be upwards of 35k.
Also many wealthy people do alot of charity.

And all that's just scratching the surface.

 

Some higher income retirees don’t necessarily lead extravagant lifestyles even though they could afford it. Pleasure can come from simply reinvesting the surplus because of the habits of a lifetime. Some people get great pleasure from collecting coins, vintage cars, stamps, junk, animals, “debt” whilst some investors love collecting more shares. What’s left over when they kick the bucket might go in part to family and the rest to charities.

 

Spot on, I actually like collecting many things (coins, gold, jewellery, stamps, spouse prefers good wine, cars, etc...). Each to their own.
In addition I also like to help those very close to me, especially mum, adult kids or even some close friends. It's not all about money....
Just because someone generates a certain amount of money doesn't mean it is all spent either!

 

I think I would like to keep this to myself, why put it out all there? We are all different and hence so are our saving, investing and spending habits.
But obviously I spend on things I consider important to me, I am sure you do the same, i don't keep up with the Jonses!
I read somewhere recently that when someone says 'They would like to earn a million, they really mean or imply they would like to spend a million".
Hence to me earning certain amount doesn't imply't all needs to be spent too.

 

The same goes for their businesses or new ventures or IPOs.
This becomes more relevant to them rather what they spend on.....
Hence I see spending irrelevant as each person's spending is relative to what they have/earn and how they think. So it's not useful at all to see or compare, it's not in context view at all.

 

large amount of money comparison is only relevant if you are all doing the same thing that cost a lot of money.

personally 250K or half of that makes little differences to my retirement because stuff I do cost little money and I love doing it every day, bush walking, hiking, running, gardening, biking around or go for a drive to the beach and enjoy the journey

I enjoyed sitting in the garden watching the fish and the birds and have a cup of coffee just as much as I travel to another country looking at their scenery and stop by a local cafe.

so to me spent 30K on travel is something I can do and get a lot of enjoyment out of it but it doesn't provided me that much more enjoyment to my life style nor it improve my life style than my daily routines.

I structure my life so that every day is a enjoyable day for whatever I do, so I don't need looking forward to travel or holiday because everyday is my holiday.

 

I hate any travel involving long trips nowadays. Did that when younger. We get every bit as much pleasure from our periodic short breaks at our favourite coastal location which is less than an hours drive away than holidaying at the Costa del Sol in Spain.

 

At the end of the day all the comparisons don't make much sense. What's heaven for one person may be boring for the next. Living a wealthy ( wealth in all its forms) life can differ greatly for individuals.

 

I guess the broader point is that the more money you can generate as income, the more options you have to be extravagant if you decide you want to be a little bit extravagant. For some, those extravagant spends might be few and far between... for others they may be more frequent. But if you dont have any income you arent even having these conversations...

 

True but that comes at a cost. Often at a great cost. Some may not be willing or wanting to pay that cost .

 

I think too many people trade their life away to get to an arbitrary passive income number like $100k per year, when really they might be just as happy on $60k per year or less.

Some folks hang their happiness on the future and what ‘more’ money can buy them, without realising that in a country like Australia, living a great life is independent from having a six or seven figure investment income.

 

Tend to agree - for us we just want to do whatever we want, whenever we want, wherever we want....

(obviously there needs to be some reasonable context around what those things are )

 

I think that is okay...but

So true...no point hoping for 250k per year..when you will only hit that in your 60s....better to be out on lower amounts and have fun earlier...you never know if you will live till the 60s...

 

Let me tell you I could spend $250k per year with my eyes closed. More than half of that would just go towards the car budget.

Earlier this year the wife and I drew up an expenditure budget with allowances for extras. We came to the conclusion we should be able to do $10k a month. That doesn't include kids school fees and holidays. School fees alone are $25k pa ( 2 primary school kids ) then add another 20K p.a for holidays.

We have failed to keep the spend to $10k a month. I stopped tracking after the first 2 months.

There's no first class flights or yacht clubs. Eat out on weekends but nothing to fancy unless its an occasion.

Sure we could make some cut backs to reduce our expenses. I mean do we really need 4 cars? Of course not, but I want 4 cars. Actually I want more than 4 and if I keep growing the investment pool so its big enough to sustain owning more than 4 then sure why not.

My thinking is I will grow the investment income and then I can adjust my spending in line with that income. As my investment income grows so will my spending. Though I plan on keeping that ratio to 50%. So if passive income is $200k lifestyle spend should be no more than $100k. Rest is reinvested. Need $300k gross income to maintain lifestyle, must bring in $600k investment income. This way I can continue to grow investments and if there's a major downturn that slices the investment income by half I am still cruising along.

 

How long will it take to retire on shares?

Depends.

How much money you have
How much you can put in
What you choose as the investment
How long in your time-frame
What is your life-style either chosen or forced
A variety of circumstances both planned and unplanned which will occur over your lifetime.

End result? That's how long it will take to retire on shares.

 

Yep. Additionally I think people look at income for retirement in a very black and white way and ignore the idea that for many people their wealth will continue to grow and consequently so will their options to increase their income in retirement.