Retiring at 55 - How to reach your goals financially

I was reading an interesting article on ABC.net.au about a millennial who wanted to retire at 35. I thought to myself, how is this guy going to do it when he's hardly been working long enough to get a decent super fund going?

However, when I read it, it made heaps of sense.

Home ownership seems to be the goal for many young people, or young families. They save up for a deposit then work their asses off to be able to make the mortgage repayments, and at the end of 30 years, they should own their own home.

But the interest you pay is not an insignificant amount! Let's take this $500,000 home for example, with a 20% deposit of $100,000.

After 30 years, you would have paid over $752k for your $500k house. You HOPE that your house is worth more than that so that when it comes to selling time, you will make your money back.

In this article, Pat (the millenial) said:

My colleague Matt nearly choked on his coffee when I told him I had $250,000 in the share market. "That's crazy," he said. But I'll tell you what I think is crazy: spending 30 years of servitude paying off a mortgage, just to own a very expensive material possession, when I could be doing other things like spending time with my friends and family.

His aim was to have 1 million put into shares by the time he was 35 and then live off the earnings of that for the rest of his life, which was a modest 40k a year.

It sounds like very little, but it really depends on the lifestyle you want to lead.

For that 500k house, 2k rent a month is probably not unreasonable. That approximates the interest repayments. But throw in a person to share it with and suddenly you only have to pay 1k a month. And that 1k you can put aside for investment.

Pat was going to avoid big city living and live in more affordable areas, like country towns. Watching his budget is what impresses me. Most young people these days want to keep up with the Jones' and have the latest tech, clothes and go out and live the city lifestyle, which is expensive!

Pat blogs at Long Life Shuffle about how he goes about getting to his financial goal. Check it out if you want to see if you want to retire early!

Obviously, my situation is different. My goal is to retire at 55, and I think I would need about 60k a year to feel comfortable. If I live to 90 then that's 35x60k = 2.1 million. I need to have 2.1 million saved up to be able to retire at 55. I am a high income professional married to another high income professional and we have 2 children.

So how I distribute my money for savings go:
1) kids saving funds
2) Superannuation
3) Property
3) Managed funds/Bonds/Shares

I'll go into each of these in a later post. But I think everyone should stop and think about how they would like to live their lives - do they want to work till they die? Or do you want to retire early? If you decide the latter, then you need to be organised and start a saving plan NOW.

Chicken Diaries - New chickens that weren't what I expected

After the trauma of the previous day, I thought the best thing was to distract them with a new chicken. Not so they thought that Snowy was easily replaceable, nor was it to make them cheapen death, but I asked them if they would like another chicken and they said they did.

I responded to an ad on Gumtree which was selling a cheap chicken, but it turned out that they wanted all 3 to go together.  Oops, that wasn't part of the plan. Lose one and come home with 3? Now I havae 8 chickens!

These new chickens were all Isa Browns, good egg layers. However, I was surprised when I saw them because I saw something I hadn't seen before.

Debeaking.

It just meant that the sharp bit of their beak was cut off, but it still looked weird. Short little beaks.  At first I baulked, thinking these were mistreated chickens, but they seemed happy enough, just funny beaks.

So this is a sad picture of debeaked chicks. It's done with a hot iron/laser so it's cauterised at the end. Some say the beak grows back, but I don't really think it does.

These are my chickens. You can see their short beaks. Some are shorter than others...

Beaker

Peckachu

Puffy

Beaker has the shortest beak - she belongs to my daughter. Peckachu is my husband's chicken, and has white feathers around the neck, and Puffy is my son's chicken, and has a longer beak and is slightly more red than the others.

The good thing about having three is that the bullying is not as bad and they hang around together. They figured out food and water pretty quickly. I was naughty and didn't isolate them, but I did a lice check and didn't see anything. On the first night they slept separately but the second night I tried to get them to go up the coop and they slept on the ground of the coop instead. On the third night I manually put them up there and now they've figured out where home is.

They laid eggs the next day but they didn't know where to lay. I found eggs on the ground the day after I brought them home and also out in the garden the day after that. But once they figured out that the coop was home, they laid in the nesting box.

I can't tell whose eggs they are so it doesn't help me with my egg calendar. It's easy when there are 3 eggs! However they do lay quite big eggs compared to my other chickens, so that's one way to tell.

Welcome to the family, ladies!

Chicken Diaries - A sad case of chicken cannabalism

Poor Snowy. She had a prolapsed cloaca again but this time I wasn't home and she was pecked to death by the other chickens. The worst part was, my daughter had gone out to check the chickens and found her droopy and dying, and went over to pick her up and the chickens came and mauled the chicken in front of her whilst she was holding her. I had dropped the kids home for a few minutes and gone to pick something up but when I got back both kids were screaming and in tears, the poor things, clutching a dead chicken, with her intestines all pulled out.

Anyway, I buried the chicken and comforted the teary kids, and talked about death and dying. The kids kinda knew about that already, but now they had seen it first hand. They were upset at the other chickens, but I told them that the chickens can't help it, it's instinct to peck at red things.

I buried Snowy in the front yard. I hope no dog comes digging her up in the middle of the night.

I also saw she had laid an egg today. That fateful egg. The egg that killed her. The kids wanted to keep the egg as a memory, and I will have to go find a syringe and needle so I can keep the egg for them.

Thinking of you, Snowy! You weren't the most friendly chicken (so I'm surprised the kids were so sad) but you were loved by everyone.