Dave Ramsey explains to woman, 59, how to work out if she is ready for retirement

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Dave Ramsey explains to woman, 59, how to work out if she is ready for retirement

On a video posted on The Ramsey Show - Highlights YouTube channel in 2016, the American personal finance personality suggested a way that Karen, an

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On a video posted on The Ramsey Show – Highlights YouTube channel in 2016, the American personal finance personality suggested a way that Karen, and people in her situation can calculate if they have enough to retire. She asked the money guru what type of factors she needed to look at to make her decision about retiring.

He said: “Are your investments making enough income for you to live off of like you want to live?”

Karen explained that she had about £479,600 (around $650,000) in investments.

She has her own business which is worth £295,170 (around $400,000) however they only break even so she is not making much profit from it.

From her investment, Mr Ramsey said that Karen could be taking around £44,275 (around $60,000) from the growth each year, depending on the rates of returns she gets in the market.

Karen and her husband are both retired air force so they receive a pension income each month.

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Karen gets around £40,591 (around $55,000) a year from this, and her husband gets £20,664 (around $28,000) a year.

She owns a horse ranch and plans to sell that once she retires from her day job.

Since leaving the air force, Karen works in anaesthesia as a nurse.

Her yearly income from this job is £147,605 (around $200,000).

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Mr Ramsey suggested that people wanting to know if they are ready to retire or not should be able to calculate their household income once they stop working.

He continued: “I’m getting from you a £110,688 (around $150,000) a year household income.

“When you retire you will have the air force income, and your investment income and your husbands’ pension.

“So, can you make it on £110,688 (around $150,000)?”

If Karen sells her business, it will give her money that she can put into her investment fund, which could potentially increase her yearly growth.

She said that she could sell the ranch for around £73,787 ($100,000).

Mr Ramsey added: “I would put the £73,787 ($100,000) into investment which would make another 10 or so percent give or take.

“So, with these rough numbers then yeah, you definitely can retire.”

However, the money guru referred to Karen as an “economic engine”.

As she is making “a tonne of money”, Mr Ramsey suggested she does not quit her job straight away as she is only 59.

Instead, he suggested that she take a more gradual approach.

Karen responded: “Honestly I would just like to quit and spend time enjoying my family and retire.”

From experience, Dave said 59 is too early to have nothing to do and just be enjoying your family but reiterated that she could retire when she wants as long as she can live on the income.

He said that he would keep her qualifications up to date just in case she decides to go back to work and do 20 hours a week because she has a “very valuable career”.

Mr Ramsey continued: “If you’re going to step away from it, do so in a way that you can return to it. Set your own terms.”



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