The Boston Globe Money Makeover: With planning, helping friends still affordable profiles Cathleen (48) and John (50) Banister-Marx, teachers who live in school housing at The Governor’s Academy in Byfield, MA. While the couple live within their means and are frugal, they have made expensive commitments which they now realize will make retiring early somewhat impossible:

The couple sometimes provide extra cash to family members who are having a tough time making ends meet. They have even volunteered to fund the college educations of four boys – godsons who are children of friends in Colorado and Mexico – who might not otherwise be able to afford tuition.

“We’re teachers and we don’t have children,’’ said Cathleen, a speech pathologist with the Gloucester public schools, explaining that their ability to help others is an important part of their life.

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Financial projections run by fee-only financial planner Jill Boynton of Newington, N.H.-based Cornerstone Financial Planning provided some straightforward answers. In order to retire comfortably at 55, the planner told them they would have to save more than $166,000 a year to maintain their current lifestyle. Not possible, the planner said, given their combined salaries of just over $110,000.

But delaying retirement to age 62 would reduce their needed annual savings to a more manageable $34,000, or roughly the amount of annual surplus cash the couple has after vacations, charitable contributions, and support for their godsons.

“I was really hoping for 55,’’ said Cathleen when she saw the figures. “I have six different friends who retired in their 50s. How do they do it?’’

Labels: Money Stories

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