Elon Musk Reveals More Details About His Plan to Colonize Mars

SpaceX CEO Elon Musk revealed a trove of new details on the company’s plan to colonize Mars.

He discussed technical details about the giant rocket that he says will take passengers to the Red Planet, the road map for getting to its first launch, and insights into SpaceX’s broader strategy in an “Ask Me Anything” forum on Reddit Saturday.

Musk was his typical freewheeling self during the AMA, quoting the cartoon Bob the Builder and responding to a question about spaceship design with the highly technical insight that “tails are lame.”

He also gamely responded to questions about tangential details of settling Mars, including speculation that settlers might use a compressed version of the Internet. Musk observed that data would take between 3 and 22 minutes to travel between Earth and Mars. “So you could Snapchat, I suppose. If that’s a thing in the future,” he wrote.

More substantively, Musk clarified the scope of SpaceX’s ambitions on Mars. Though he has shared images of vast Martian cities in his presentations on Mars colonization, he said SpaceX isn’t focused on building those cities itself.

“Our goal is get you there and ensure the basic infrastructure for propellant production and survival is in place. A rough analogy is that we are trying to build the equivalent of the transcontinental railway. A vast amount of industry will need to be built on Mars by many other companies and millions of people.”

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That means SpaceX will be designing and building things like systems for creating fuel from Martian resources, work that Musk said is “pretty far along.” But they won’t be focused on issues like how colonists grow food.

Musk also reiterated previous claims that SpaceX is designing the new Mars rocketstill code-named BFR, which stands for exactly what you think it does – to be as safe and reliable as today’s commercial airliners. That will be crucial if plans to use the BFR for transportation around Earth come to fruition.

Musk also shared some details about the game plan for testing the BFR ahead of its first scheduled flight in 2022.

“[We] will be starting with a full-scale Ship doing short hops of a few hundred kilometers in altitude and lateral distance,” Musk wrote. “Those are fairly easy on the vehicle, as no heat shield is needed, we can have a large amount of reserve propellant and don’t need the high area ratio, deep space Raptor engines.

“[The] next step will be doing orbital velocity Ship flights, which will need all of the above.”

SpaceX’s progress on its Falcon 9 rocket in recent years – especially its unprecedented success in landing and reusing rockets – has fascinated observers and re-energized public dialogue about space.


You Have 10 Years Left To Retire, How To Plan

Let’s say you have just turned 50, or you are already in early 50’s, and you plan to retire in about 10 years. It’s probably the high time to work out a plan and put it into practice. Thinking of retirement, the very first question that comes to mind is how much savings would be enough that could last comfortably for 30-40 years. The second question would be what will be my/our expenses in retirement. Both of these questions are inter-dependent and often are the most intriguing questions facing most people who are not yet retired but plan to retire not too distant in the future.

On the other hand, if you are still in your 40s, you may think it is too early to ask these questions. However, it never hurts to run some numbers and plan accordingly. Moreover, if you plan early, you will have more choices and time to adjust your plan.

Obviously, these questions are not very straightforward to answer. There are many variables that can differ from one person to another. The first question that you need to tackle is how much spending/expenses a year you will have in retirement. The answer to the other question with regard to the amount of savings will largely depend on our ability to answer the first question fairly accurately. In this article, we will try to address these questions and try to develop some estimates. We will also try to demonstrate how a modest level of savings can be grown to significant sums that can last for a long time.

We can use a hypothetical couple – John and Lisa – let’s assume they both are 50 years of age and want to retire in 10 years at 60 years of age. Their current savings are modest at $ 300,000 and mostly in 401K, and/or IRAs. Their current household gross income is $ 125,000 a year. They recognize that they need to do some serious planning and make some tough choices if they hope to have a comfortable retirement starting 10 years.

John and Lisa currently carry a mortgage on their house and have one child in college whom they are supporting. First, they make some bold decisions. They decide that they will make some extra payments each year on the mortgage and will be able to pay off the house by the time they retire. They decide that they will not carry any car loans or credit card debt into retirement. They also decide that they both will increase their current 401K contributions to 16% of their earnings until they retire. This will help boost their savings significantly.

Estimation of Expenses in Retirement:

Next task is to figure out how much their spending/expenses will be when they retire in 10 years. There are basically two ways to calculate spending. First one is to simply make a list and add the likely expenses in retirement; however, one is likely to underestimate or overestimate some expenses. The second method that we feel is more appropriate is to take the current income and subtract all the expenses that you will not incur in retirement. Also, add any expenses that you may have in retirement that you do not have currently; for example, there may be an increase in medical premiums/costs. Then, adjust this remaining amount for inflation for the number of years that are left prior to retirement. It basically means to figure out how much of the money currently goes into items that will no longer be needed. This method will ensure your current lifestyle into retirement years.

This is what they come up with:

  • They will not need to put the 16% savings contributions into their 401K or retirement funds any longer.
  • Their tax bracket would be much lower, so will need to account for that reduction.
  • They will not be putting any more money into Social Security/Medicare deductions, as they would not have any earned income.
  • Besides they will not have work-related expenses, like commuting, new clothing, dry-cleaning expenses, etc.
  • They should be done with kid’s college education which will cut down another $ 14,000 a year.
  • They will not have the house mortgage payments anymore (monthly mortgage $ 1,200 or $ 14,400 yearly).
  • They will not have the current medical premiums that get deducted from their paychecks, but instead, they will need to earmark higher medical premiums since they will not be eligible for Medicare until 65.

Total current gross earnings

Minus (-)

Current 401/IRA contributions

Social security/Medicare deductions

Taxes (federal and State)

Medical premium deductions

Any work-related expenses

Kid’s college expenses

Home Mortgage payments

Plus (+)

Extra costs or premium for Medical Insurance.

John and Lisa use a Google spreadsheet (prepared by Financially Free Investor, available here) to run the numbers and come to a conclusion that nearly 60% of their current income goes to expense-items that they will no longer have or need in retirement. That means they would only require 40% of their current income to support their existing lifestyle. Based on their current gross income of $ 125,000, it comes to $ 50,000 a year in today’s prices. However, due to inflation in the next 10 years (assuming at 2.5% a year), they will require $ 64,000 a year. In addition, they plan to earmark another $ 1,000 a month or $ 12,000 a year for medical premiums/costs. So, they figure out that they will need roughly $ 76,000 a year to be able to sustain their current living standards. They round it off to $ 75,000 a year.

40% of the current Income:

Inflation adjusted Amount (10 years later):

Plus Medical Premiums in retirement:

$ 50,000

$ 64,000

$ 12,000


$ 76,000 a year

(~=75,000 a year).

How Much Savings Are Needed?

John and Lisa decide that John would start taking his social security benefits at the earliest eligibility age of 62 years, but delay Lisa’s social security until she gets to 70 years of age. By doing this, they will be able to balance out the income needs along with compounding Lisa’s social security benefits to the highest payout possible.

John and Lisa also assume that they will withdraw up to 6% income from their investment capital at the time of retirement at age 60 until they get to the age 70. This is when they start withdrawing the second social security benefits. Now some folks will argue that 6% income is too high to withdraw. However, even if we think it is too high, in the worst case scenario, their portfolio may not grow as much they would like during their age from 60-70 years. After 70 years, when they have the second social security coming in, their withdrawal percentage will get reduced significantly.

By reverse calculation, this couple will require $ 1.25 million (75,000/0.06) in investment savings at the time of retirement. They only have $ 300,000 today. Without any more contributions, to grow this amount to 1.25 million in 10 years will require compounding this amount at a rate of 16% per annum, which is almost unachievable. But the good thing is that they are still working. They have already decided to increase their 401K pre-tax contributions to 16% of their income, and along with the employer’s matching, they will likely be able to achieve the target. Any further rise in their income would also be put away to ROTH IRA accounts.

Investment Returns Simulations:

John and Lisa get to the task of planning how they could get to the target of $ 1.25 million in 10 years. In the first example, they assume that their investments would grow at a very steady rate of 9% a year for the next 10 years, while they contributed 16% of income every year along with 4% from employer’s matching.


With 9% steady growth rate, they are very close to their target of $ 1.25 million, but not entirely. Further, the above assumption of 9% growth every year would probably be fine over 2 or 3 decades, but over 10 years it may not be very realistic. The market’s ups and downs from year to year can change the outcome. If the history is any guide, it can vary greatly depending on how the markets do in the next 10 years. Let’s run some numbers for John and Lisa, from the past for historical perspective to see what is realistic.

We will consider every 10-year period, starting from the year 1999; for example, 10-year periods such as 1999-2008, 2000-2009, 2001-2010 and so on. We will assume that they invested rather conservatively with a mix of 70% in stocks, and 30% in Treasuries and bonds. Let’s see how they would have fared in each scenario.

Now, what if, John and Lisa had decided to invest everything in S&P 500. Let’s see how they would have fared in this scenario:

As you can see if they had started their 10-year plan anytime between years 1999 and 2002, they would be much behind their intended target. The 10-year periods of 1999-2008, 2000-2009 and 2001-2010 were most undesirable as they had to bear two full-blown recessions/corrections and did not have enough time to recover from 2008 debacle. It is clear if John and Lisa had started the plan anytime between 1999 and 2002, there was no way they could have retired at the end of 10 years with the level of spending expenses as they had planned. The only options would have been either to postpone the retirement for a few years until the markets recovered or to cut down on their lifestyle significantly.

Now, for the sake of comparison, let’s also run the numbers if John and Lisa had decided to invest in a Conservative Risk-Adjusted Rotation portfolio (based on back-tested numbers). This portfolio rotates between S&P 500 fund and the treasury/bond funds. When the market is relatively strong, the more funds are invested in the market; however, when the market starts declining or enters into a correction phase, more funds get switched to treasuries and bonds. Such a portfolio would generally underperform slightly during strong bull markets, but protect the capital during major corrections or recessions.

Author’s Note: The above Risk-Adjusted Rotation portfolio is part of FFI’s Marketplace service “High Income DIY Portfolios.”

Comparison of 3 Investment portfolios:

Initial Capital = $ 300,000

Additional Contribution= $ 25,000 each year for 10 years

However, for the sake of simplicity, let’s assume, John and Lisa would get a constant return of 8% over 10 years, which is not overly optimistic. With this rate of growth, their savings and contributions over 10 years will accumulate to 1.01 million. Let’s round it off to $ 1.0 million. As we can see, John and Lisa would fall short of their target of $ 1.25 million. However, the gap is not huge and can be managed with some innovative thinking. The other solution may be that one or both of them work some part-time job for a couple more years; however, not a desirable outcome. Let’s look at some alternatives to manage the gap.

Bridging The Gap:

For John and Lisa, the other solution may be as follows:

  • They reserve 2 years of expenses in cash from the total capital, a total of $ 150,000 @ $ 75,000 per year, leaving the investment capital to $ 850,000.
  • Also, they had already decided that John will start withdrawing social-security at the earlier eligible age of 62. Due to early withdrawal, he will get 75-80% of the full benefits. We will assume that SS-1 to be $ 1,500 a month and grow at a very conservative rate of 1% per annum due to COLA (Cost Of Living Adjustments).
  • This will allow Lisa to wait until the age of 70 years to collect and let the social-security benefits be compounded to a much higher amount. We will assume that the SS-2 will be $ 3,000 per month, starting at 70 years and grow at 1% per annum by COLA adjustments.
  • However, at age 70, due to inflation (from age 60-70 years), their expenses would go up as well, and they would need roughly $ 94,000 to keep the same purchasing power as of $ 75,000 (when they were 60).
  • They assume that investments of $ 850,000 ($ 1.0 million – 150K reserve) will grow at a conservative rate of @8%.

COLA – Cost Of Living Adjustment – (Source: Investopedia)

An adjustment made to Social Security and Supplemental Security Income to counteract the effects of inflation. Cost-of-living adjustments (COLAs) are generally equal to the percentage increase in the consumer price index for urban wage earners and clerical workers (CPI-W) for a specific period.

Below is the table that simulates the income and withdrawals from the age of 60-80 years.

Explanation and assumptions:

  • Column A shows the age in years.
  • Column B shows the starting capital at the beginning of the year.
  • Column C shows the needed income each year. For the first two years, they need a fixed amount of $ 75,000 each year. After that, we will add 2.5% each year for inflation.
  • Column D shows the social security payments for John, the first earner, assuming he starts withdrawing at 62 years of age (the earliest eligible date). We will assume that social security payment increases at an average rate of 1.0% (Cola adjustment).
  • Column E shows the social security payments for Lisa, the second earner, assuming she starts withdrawing at 70 years of age (the late withdrawal date), so as to get higher payments. We will assume that she gets $ 3,000 per month starting at age 7 years. Also, social security payment increases at an average rate of 1.0% (Cola adjustment) after that.
  • Column F is the actual cash withdrawn from the invested capital. Column F = Column C – Column D – Column E
  • Column G shows the percentage of cash withdrawn. Column G = Column F / Column B
  • Column H is the net investible amount after taking out the needed income.
  • Column I: Rate of return on the invested capital = 8% per annum.
  • Column K is the total balance amount at the end of each year, after accounting for withdrawals and the growth of the capital.


Now, there is no guarantee that the future returns will be at 8%. It can be less or more. It may depend on their investment choices and market conditions. Let’s see, what their net balance would be at the age of 80, assuming different rates of return, everything else being the same. In the below table, we are only showing the last line only (at age 80) from table-5, assuming different rates of return.


As you see, a lot depends on what the average rate of return is from the investments. If they get only 6% rate of return, they are not doing so good, as their capital is reducing, albeit slowly. If that were to occur, they should modify their lifestyle and reduce spending by about 10%. However, if they were to get an average rate of 8%, which is highly feasible, they have nothing to worry as their net balance at 80 years would be 70% higher than when they started, in addition to the consistent income withdrawn. Anything more than 8% would, of course, be icing on the cake.


The simple conclusion is that if you are already 50 years old or more and have not planned for a possible retirement, it is high time that you should do it. Of course, it can always be done prior to getting to 50, but your numbers may have a little higher margin of error. It is always prudent to start saving from an early age, but as John and Lisa’s example shows, it is never too late. Even if you have modest savings by the time you turn 50, there is still ample time to make a plan, ramp up the savings/contributions to retirement accounts and compound the savings. However, more you delay it, harder will be the choices.

Author’s note: If you like this article, please click on the “Follow” button at the top of the article. In our SA Marketplace service “High Income DIY Portfolios,” we provide two high-income portfolios, one conservative portfolio, and another hi-growth portfolio. For more details, please click on the image just below our logo at the top of the article. We are currently running the 2-week free trial and discounted pricing.

Full Disclaimer: The information presented in this article is for informational purposes only and in no way should be construed as financial advice or recommendation to buy or sell any stock. Please always do further research and do your own due diligence before making any investments. Every effort has been made to present the data/information accurately; however, the author does not claim 100% accuracy. Any stock portfolio or strategy presented here is only for demonstration purposes.


Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.


IDG Contributor Network: How to plan your successful cloud migration

Recent Accenture Strategy research found that four out of five companies run up to half of their business functions in the cloud. Moreover, that figure is likely to increase significantly over the next few years. The research reveals that a clear majority of business leaders see the cloud platform as a critical enabler of greater innovation and competitive edge.

Yet, companies still struggle when it comes to structuring the cloud transformation, beginning with the fundamental first step — planning a successful migration. What’s lacking is a solid comprehension of what value the cloud brings, its potential and its elasticity.

To read this article in full or to leave a comment, please click here

Network World Cloud Computing

IDG Contributor Network: How to plan your successful cloud migration

Recent Accenture Strategy research found that four out of five companies run up to half of their business functions in the cloud. Moreover, that figure is likely to increase significantly over the next few years. The research reveals that a clear majority of business leaders see the cloud platform as a critical enabler of greater innovation and competitive edge.

Yet, companies still struggle when it comes to structuring the cloud transformation, beginning with the fundamental first step — planning a successful migration. What’s lacking is a solid comprehension of what value the cloud brings, its potential and its elasticity.

To read this article in full or to leave a comment, please click here

Network World Cloud Computing

HPE said to plan sale of its software unit

Hewlett Packard Enterprise is said to be looking to sell its software division, which would include the business from its disastrous acquisition of Autonomy in 2011, according to news reports.

The enterprise IT company that emerged from the breakup of Hewlett-Packard has been restructuring its operations recently, including a $ 8.5 billion deal announced in May to spin off and merge its enterprise services business with CSC. A sale of the software business would leave the company focused largely on servers, networking, storage, business critical systems and technology services.

To read this article in full or to leave a comment, please click here

InfoWorld Cloud Computing

Quarterly numbers lend credence to Whitman’s plan for HP breakup

Originally published on Gigaom Research

HP has announced its final quarterly results prior to the break up into Hewlett Packard Enterprise — which will be led by current CEO Meg Whitman — and HP Inc. — to be headed up by Dion Weisler. The numbers suggest that Meg Whitman may be getting the bigger half of the wishbone with Hewlett Packard Enterprise, and also lend support to the basic idea of splitting the company in half.

Of course the new HPE needs a new look, logo, and narrative:


Meg Whitman made an observation about the new logo back in April:

Maybe you noticed it, but take a look at the name “Hewlett” in the new design.  This is the first time in our history that the two t’s in Hewlett connect. That connection is symbolic of the partnership we will forge with our customers, partners, and our employees – what we will do together to help drive your business forward.

Ok, I am willing to take that with a grain of salt. We’ll have to see what actually comes from the new HPE, but the numbers tell us something.

First of all, HP’s net income dropped to $ 900 million, or 47 cents a share, down from $ 1 billion, or 52 cents a share from the previous year.  But they beat expectations on profit slightly — after restructuring and acquisition charges were excluded — leading to the share price rising in after hours trading. Wall Street seems happy, so far.

And the best news, or perhaps the only good news, is the 2 percent increase in revenue for the HP enterprise group — the soon to be Hewlett Packard Enterprise — reflecting market uptake of the company’s servers, storage, and networking products.

The negative buzz at the earnings call is all about the other end of the soon-to-be-broken-apart HP: the printer and PC business of HP Inc. Or perhaps we can call it Red Inc. PC sales were down 13 percent, and the printer business is down by 9 percent.

I can’t find a post with a logo for the new HP Inc., but in a recent interview Weisler seemed to be saying that he’s bullish about 3D printing as a future for HP Inc., although he veers between wonky details and historical analogies so much it’s hard to tell:

Weisler: If we go way back in time, you had a blacksmith who would make a unique horseshoe for your horse, as an example.  That would be the manufacturing process. With the industrial revolution, the assembly line was created, and over the years we got better at pressing the supply chain, and making that assembly line more efficient. Manufacturing was still in the hands of a few. The internet comes along, and we can collapse and make that supply chain even more efficient and close it. It still was not really a dramatic change. With 3-D printing, you actually get to democratize manufacturing again because anybody can do it.

Now, where does that start? In our view, the greatest amount of value actually starts in the commercial marketplace. Ultimately as these technologies mature, it will make its way into the consumer realm, as well. Some have another strategy to grow from consumer up. I think the reason it has not taken off either in consumer or commercial, is as an industry we have not solved the problem of speed, quality, and cost. If you really want to be instructive to traditional manufacturing processes, you have to have it operate at the right speed, you have to have the right kind of quality, and you have to have an economic model that makes sense. So with multi-jet fusion, we believe we have made a really big breakthrough here.

Those who actually understand the industry well, and understand what we have done, recognize that we are printing copy ten times faster than the fastest printer on the market today.  We can do it with minute accuracy down to 21 microns–  about a tenth of a size of a human hair.  We can do very intricate parts that still have really strong mechanical properties.  Then because of the technique we use to print the part – we do it on a big flat bed – we can do highly economical parts that begin to make a difference. I think initially it will lend itself more towards commercial markets in the near-term.

I admit, I got lost in there. But I do believe that there is an enormous opportunity in 3D printing, and HP Inc. is well-positioned to attack that.

But I think that Meg Whitman has cleared her decks for the upcoming battle for enterprise infrastructure, and handed off her worst headaches to Dion Weisler. It’s looking like a better idea all the time.

Quarterly numbers lend credence to Whitman’s plan for HP breakup originally published by Gigaom, © copyright 2015.

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