Normal Retirement at 65 is basic personal finance, which is why it boggles my mind that Most People haven’t figured this shit out yet. Up until yesterday, I hadn’t figured it out either. After all, it wasn’t too long ago I said Retiring at any age wasn’t likely. The truth is I was just lazy and hadn’t run my numbers yet. I just got back from the bank, and I’m now 100% set for Normal Retirement (NR). Here’s how I did it.
I have $13,174.09 in my RRSP right now. $8,605.79 is invested in a Select Growth mutual fund and $4,568.30 is in US Index. I plan to go even more aggressive in my investment strategy and put 80% into US Index. I expect that to return 7% annually. I’m only 27, so I have 38 years of growth to look forward to before I’m an old sack of shit who won’t want to work anymore. If I do, I’ll have even more money, but let’s just pretend I’m useless at 65. Using our trusty Compound Interest Calculator, let’s see what happens if I maintain 7% growth for 38 years without further RRSP contributions: $172,307.50! Not bad, but I can’t Retire on that. What if I put in $100/month, or $1,200/year? Holy assballs, we’re looking at $393,875.85! THAT’S ONLY ADDING $100/MONTH! That’s enough to Retire on. I’ll still have my Home inflating my Net Worth to $500,000+ and I’ll most likely still be Working instead of being 100% Retired. I’ll be even richer! And all it took was $100/month. Go, me.
Are you in your 20s? Right now is the absolute most crucial time to save. Did you know investing just $15,000 from the time you’re 20-34 means more than investing $35,000 from the time you’re 30-64? WHAT THE FUCK. If, at 20, you start saving $100/month and invest it in US index funds with a 7% annual return, you’ll have $366,902.12 by 65! Are you an overachiever? $200/month gives you a whopping $733,804.23! HOW ARE YOU NOT ALREADY DOING THIS? ARE YOU NOT AWARE THAT BANKS ARE MONEY MACHINES DESIGNED TO MAKE YOU RICH?
If you’re reading this, you’re most likely a Millennial with no hope of Retiring. I’m here to tell you Retiring is possible. NR can be yours for less than $200/month. That’s approximately the cost of NOT buying a $5 latte every day. It’s also approximately the cost of NOT going to a club filled with douchebags and racking up a one-night bar tab every month.
Your Future is in your hands. What means more to you? The Retirement you never thought was possible, or the soy-mocha-frap-fuckdrink you “can’t live without”? Buy a coffeemaker. Go to shitty clubs less. Treat yourself still, but not in a way that costs money. Go for a goddamn jog. Eat well. Read a book. You’ll be Rich in no time.
If you need me, I’ll be over here mathing how to put an extra $100/month into my TFSA. Maybe I can try for EARLY Retirement. I can’t believe how simple Getting Rich is…