You Can Retire in 10 Years

May 8, 2010 by Jeremiah | 1 Comment

You can retire in ten years. That’s not a misprint. But to be honest, retiring in fifteen years would be better. If you are 40 now, you could retire at age 50 but if you wait until you are age 55, you’ll be a lot better off. Starting with zero money in a retirement account, consider these numbers for a minute:

Save $1,000 a month for ten years at 10% and you’ll have $258,986
Save $1,000 a month for fifteen years at 10% and you’ll have $503,549
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Save $1,000 a month for ten years at 15% and you’ll have $364,021
Save $1,000 a month for fifteen years at 15% and you’ll have $855,633

At the 10% rate you will have almost double in fifteen years than you would have in ten. At the 15% rate you would have well over twice if you waited fifteen years to retire.

I can see that there might be three questions you would be asking.

Question #1 – Where am I going to get $1,000 a month?
Question #2 – What investment can I buy that will make 10%?
Question #3 – What investment can I buy that will make 15%?

I don’t know what your goals are and don’t know how much retirement money you already have. But I have been able to show people who have joined my Retirement Membership website how to get returns over 10%. I have shown two members in Massachusetts how to get returns over 15% by investing in their own back yard. Well not quite in their back yard, but close to where they live. I showed a young man in Georgia how to make 20%. I know I can show you how to do the same.

I have known about this investment since 2004, and was able to turn a small Roth Self Directed IRA of $8,000 into an IRA worth over $100,000, as of December 2009. I started with only $8,000 and never put a dime more into the account. It was just one of the IRAs I had at the time.

The 401k account I had when I left my first job was worth just a bit over $100,000 when I left in 1987. I placed the account into a self directed Qualified IRA. All the “Qualified IRA” means is that the money was all pretax and it was a combination of money that the firm put in and that I put it before it was taxed.

My plan was to take $10,000 out each year, roll it into a Roth and pay the tax on it at the time of the roll over. My CPA at the time advised against doing that. I had been doing quite well in the stock market. I moved in and out of the market when the trend was moving up or down.

Beginning in 2004, I devoted 25% of my old 401K account to high yielding certificates and the rest in the stock market until 2008 when I sold all of my equities and moved into cash. In March 2009, I invested the equity part of the portfolio into an International mutual fund and made 60% or so until January 2010. Since January I have had the entire self directed Qualified IRA in 18% certificates.

I am working on a video that will show you how I made the decision to sell everthing. You can use it too, for free.

With the down turn in the economy since 2008, I have done even better. No it’s not stocks, options, bonds or any products that you would buy from a stock broker. I’ll give you a hint in a future article.

Oh – I almost forgot. If you retire at 50, how do you get the money out of the IRA account, without paying a penalty, since you have to be 59½ to start taking money out. You can take the money out without a tax penalty and I’ll discuss that in a future article.

For Taking Early Retirement (TER), I hope you are enjoying a great retirement or are close to that day!