Retirement

by Riley

When thinking about retirement you have to decide if u are going to save for your retirement or get a pension. A pension plan is a sum of money added up during your employment period, these payments are drawn to help with life after work. A pension is either a “defined benefit plan” or a “defined contribution plan”, a defined benefit plan is a fixed sum is paid regularly to a person, a defined contribution plan is a fixed sum of money invested then becomes available at retirement age. Pensions should not be confused with severance pay. Saving for retirement could just be saving with a bank with a certain fixed number or investment rate of whatever you decide.

https://en.wikipedia.org/wiki/Retirement

https://www.canada.ca/en/financial-consumer-agency/services/retirement-planning/start-saving-retirement.html

Retiring on a Pension Plan

By Abbie

A Pension Plan when you regularly (like perhaps monthly) place money into a savings account for when you retire.  It's something that you definitely want to start as soon as possible so you can get a good sum of money when you're done.  A defined benefit plan and a defined contribution plan are the two different kinds of pension plans. 

The defined benefit plan makes sure you have a certain amount of money regardless of what you have invested.  They generally base this on age, salary, and how long you've been with the company.  It assures you have a certain amount of money monthly.  This plan is costlier for businesses so many are switching to the defined contribution plan.  Railroads and airlines are two that used this plan and today are struggling so they had to stop, unable to afford it.

For the defined contribution plan you just put your own money in.  However, you control the sum going into the defined contribution plan, so although it might sound harder, it's probably better.  Often the defined benefit plan doesn't leave you enough money to live comfortably after you have retired.  It's also just less of a risk for companies to leave your retirement fund up to you to work out, because if they promise you that they'll give you a certain amount of money monthly, they must provide you with it.

https://www.investopedia.com/articles/retirement/06/retirementforminors.asp

https://www.thebalance.com/what-is-a-pension-plan-2385771

http://time.com/money/collection-post/2791222/difference-between-defined-benefit-plan-and-defined-contribution-plan/

https://www.money-rates.com/personal-finance/employee-pension-plans-disappear.htm

The Shockingly Simple Math Behind Early Retirement (from Mr. Money Moustache)

By Giana

The higher the percent of savings you put away from your take-home income the sooner you will be able to retire. If you live on 35% and save the rest (65%) of your take home-income you can retire in 10 years. That means living on 35% in your retirement as well. The 65% savings is then invested, growing your savings exponentially.This takes care of unexpected emergencies.

Making adjustments to you daily routine such as biking, making coffee at home and using community resources can add years to your retirement. It isn’t about making more money but saving the money you do have. Spending all your money as soon as you make it is pointless, save your money and work less.

I think everyone should have the opportunity to read this article before they’re 20. It shows a clear picture on how valuable saving is.  It really is Shockingly Simple.

https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

Financial Independence (aka early retirement)

by Madison

The article I read on this topic was called The Basics of FIRE (Financial Independence and Early Retirement) FIRE is having the freedom to decide whether or not you’d like to continue working. This focuses less on the actual early retirement part of things and more on the financial independence. To achieve financial independence it takes a lot of time and dedication.

“Early retirement is less for people who hate their jobs and more for those who have a clear idea of a different lifestyle or goal they may like to pursue.” The article also said if you’re doing this because you hate your job than you’re more likely to be bored at home during your retirement. “A good reason to retire early is that you have an alternative vision for your life that you are eager to pursue but you can’t pursue while employed full time”

Now, how do you accomplish financial independence you might ask? The article talks about how you must cut back on spending (of course) but for this to work it is also necessary that you have a decent income. Spend less than you earn and save the difference in an investment fund.

https://twocents.lifehacker.com/the-basics-of-fire-financial-independence-and-early-re-1820129768

Interviewing an old Person

by Alex

Interviewing an old person about retirement is, in my opinion, a bad idea. But, for those that actually going to interview that old person, here are some questions to ask them.

1.      When did you start saving for retirement? An answer you might receive is maybe around the age of 18-30. Typically around that age does it set in that retirement is approaching.

2.       Did the retirement savings help you post-retirement? The answer for this question might be a little more complicated. For example, you need to take pension into account, and all expenses that need to be paid.

3.       Did you have any plans for post-retirement? The answer for this might be a bit long… like a whole bucket list and reasons for the items. An answer might include going on a long vacation, skydiving, or any other crazy stunt. Or, you might get a no for an answer. Maybe this person just wants to live out life after they retire.

And so, if you actually want to interview an old person about retirement, those are some questions to ask.

The 4% rule of retirement

By Natasha 

The 4% rule of retirement is used to determine how much someone who is retired should withdraw from a retirement account each year. This rule provides a steady income stream to the person in retirement while also maintaining an account balance that keeps income flowing through retirement. The 4% rule of retirement helps financial planners and people who are retired make portfolios with a withdrawal rate. Life expectancy plays a very important role while creating a portfolio because people who are retired that live longer need their portfolio to last longer so they can cover medical costs and other expenses that can increase as people age. I think the 4% rule of retirement is a good idea because it controls how much you can take out of your retirement savings per year and it's a good way to manage your money while in retirement.

4% rule of retirement: https://www.investopedia.com/terms/f/four-percent-rule.asp https://www.thebalance.com/dont-confuse-these-two-retirement-rules-of-thumb-453920

“David, never spend money you don’t have”

By David

I interviewed my grandmother to see what her methods of saving are and how she prepared for retirement.

Saving money

The first question I asked her was how she went about saving money. The first thing she told me was to never spend money she didn’t have aside from buying a home. She also told me that after she all bills were paid for the month she would take a little to entertain herself then the rest was put into a savings account that at the time had a 13% interest rate.

The best idea she gave me about saving was not to spend money foolishly and to never spend money that you don’t have (aside from buying a home) as an example she told me that if she did not have enough money for something like a TV she would not go into debt to get one, she would go without one until she had the money for one.

Investing for retirement

 Then she told me that she invested her money as well as save it, before she bought a home she found a triplex she was a bit short on the down payment for it so she borrow money from a family member and made payments to them each month to pay it back. She lived in the triplex for a time and made money of the other two apartments in it and still used the same method of saving.

 Later on she sold the triplex and invested in a house and took very good care of it as the values of it increased[DD(11]  over the years she eventually sold the home. She is now retired and lives off the money she saved over the years as well as the pension from her job as a teacher.

---

 [DD(11]