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August 11, 2023 at 5:46 pm #86664Julie
Hi. I’m turning 50 soon. I’m a single mom. I have financial dysmorphia. I go into a panic about money even though I “know” I’m OK. Like it’s unhealthy. I’m trying to figure out a logical way to determine that I’m on track for retirement and how much fun money I have that I should start spending and enjoying instead of living like I’m paycheck to paycheck.
I cannot probably retire early because I need insurance and I have a ten year old and have to keep insuring him. Thanks America. but I could tone done my work to live mentality.
I went to grad school so didn’t have a “real” job until I was 36. Work in non science higher Ed so no pension and awful pay. No pay increases on the horizon. They expect gratitude when we get 2.5% once every few years. So basically pay cuts yearly. But I happened to make some pretty lucky investments early which set me up OK. I’m also a saver and squirrel money away constantly and am always looking for side hustles for more money.
– 160k roth ira
– 210k employer sponsored 401k (max contributions at 7% me 7% them matching…it’s about 12k a year)
– 550k regular investment account
– 400k in cds and money market. Afraid to invest this because “what if I need the money ::sob::”.
I rent out my first house (not really a source of income but more investment that I can sell later) and have a very low mortgage percentage and affordable payment on my current house.
1. I clearly have a lot saved but is it enough that I can stop funneling all my spare money to investments or savings and just leave it at the employer account?
2. When do I stop contributing to a roth ira and either just stop contributing entirely or switch it to a traditional ira contribution?
3. My concern is that I’m mentally wired for disaster prep survival mode and really I should be enjoying myself now with modest trips and experiences if I’m on track and not constantly worry about costs. But how do I know? And I’m afraid of swinging too far the other way. This year was financially bad and I’ve basically spent my entire take home pay on a new roof and other emergencies. So I know it can happen and I guess that’s keeping me worried. But there aren’t huge expenses like this often (roof should be good for thirty years now!).
Side note that my parents are old and I’m managing all their stuff now and they have saved and can take care of themselves financially but it’s made me cognizant of what can happen if you aren’t able to do that and how expensive care is (and I don’t want to burden my child who owes me absolutely nothing!!). They might leave me some inheritance but they also might spend every penny they have which is fine!
I think the online calculators for retirement are flawed for many reasons. Ideally I would like to have enough of a nest egg that I can live off the interest and leave the principal for my child so he doesn’t have to worry in his life (without telling him bc work ethic is important!!). I would love to retire early if I could…or at least to stop doing extra contract work to make more money and only do my job. But I’m scared!
Thoughts? Or what type of person can I hire who can help me conceptualize and organize all this so I can feel confident? A financial therapist I think I need. Or if I’m not OK or on track, please tell me!!
::panicked sob::August 11, 2023 at 5:47 pm #86665Dalton
Maybe a bit off track, but have you considered talking to a therapist?
Might help you make sense of why you’re in a panic about not having enough despite objectively having a lot of money.August 11, 2023 at 5:48 pm #86666Chris
You’re in a lot better condition than most people. If I were you, I’d abandon education, parlay my skills into a job that respects you and pays well and be content with thatAugust 11, 2023 at 5:49 pm #86667Christopher
No, you don’t have enough saved if you are going to keep $400k on the sidelines…I mean seriously what kind of $400k emergency do you think is going to happen in your life?
All joking aside, an actual therapist may be helpful.August 11, 2023 at 5:49 pm #86668Leann
I live in a country where all this is possible! Thanks America!August 11, 2023 at 5:50 pm #86669Watson
Dear anxious, as most will state, you’re doing pretty decent. Your problem isn’t your knowledge or methods.
Your attitude is very poor, frankly it sucks. You wouldn’t have been able to do this anywhere else. So, you should be grateful for being in the USA.
Also why beat yourself up? And cut yourself down. Stressed me out. If you read this you need to know that you’re freaking awesome. You probably just need a good old fashion confidence slap in the rear end. Take time to learn investing. Dividend investing and REITs in ROTH IRAs is something you may enjoy based on your fear of investing. Spend 15 minutes learning each day. Don’t give up now.August 11, 2023 at 5:51 pm #86670Ale
You received financial advice, so I don’t have anything to add to that. As a therapist, I recommend psychotherapy for you. If your current therapist did indeed “kind of scoff about this issue” that is not okay and I recommend looking for another therapist to whom you will have a better relationship. On the other hand, what somebody says and does can be interpreted vastly different by another person than it was original intended.
This is a perfect opportunity to talk about it in therapy, especially if this sort of feeling (shame?) And/or thought (he doesn’t take me seriosuly?) happens in different situations, with different people.
Btw. Generalised anxiety is not the only possible explanation for what you are describing, even though it is very likely. That’s what psychotherapy is for, to figure all of this out.
Explore these too: Extremely unsafe financial decision – I am not sure what to doAugust 11, 2023 at 5:51 pm #86671Anjoli
How much of your income do you currently spend? How much do you think you would want to add to that number if you were enjoying life more?
Without knowing those numbers, it’s hard to know the answers to your questions. However, I will say that nothing in life is guaranteed, and it’s okay to give yourself permission to live and love your life now, too.
I highly encourage a “balance” that allows you to continue saving but also to build those memories and experiences that will last you the rest of your lifetime. It’s okay to sacrifice…but don’t sacrifice so much for so long that you start to lose yourself in the process. Have fun, too. Breathe a sigh of relief in the open air, too. Save…and live, too.August 11, 2023 at 5:51 pm #86672Steven
“I have to work for health insurance for my child and have low pay and raises but I’m a millionaire”. What a crybaby.
I’m guessing you stole that in the divorce.August 11, 2023 at 5:52 pm #86673Ava
You’re doing so well. When you can retire depends on your expenses. If you’re able to get your expenses down, you can retire now. I used to think I HAD to live in super expensive Northern California.
But after losing a LOT of money because of the pandemic, I finally realized that I can live somewhere MUCH cheaper.August 11, 2023 at 5:53 pm #86674Patty
I recently took a basic spreadsheet and put the years from now into the future then matched up my age to the years then added notes. In what year will my kids each be old enough to drive, in what year will each of my kids graduate school &/or become legal adults.
At what age (and thus calendar year) can I begin withdrawal from retirement plans, can enroll in medicare insurance, when is early/normal/extended social security years, when does required minimum distribution start, etc. (I do keep in mind politicians could change the laws on some of those things but it gives a planning guide, a road map).
Then I made a column with current finances on this year and predictable finances (income/expenses) on future years. You would have to fiddle around with numbers to your personal circumstances but the way I did ours gives me an idea of where we are, where we are going and what may be left for the children. I make investment decisions separately but that timeline gives me an idea of when I can be a little more aggressive or conservative to maintain/grow the accounts despite spending and ’emergencies’.