ARE YOU ON TRACK? SAVING FOR RETIREMENT
Would you believe that one in six Millennials has already saved $100,000? How much should YOU have saved to be ready for retirement?
THAT FIGURE FOR MILLENNIALS IS SURPRISING…
Some people in their 20s are strong savers! Lack of attention to wealth building is a national phenomenon: Median (50% above, 50% below) retirement savings of families between ages 50 and 55 is only $8,000.
WHAT ARE SOME RULES OF THUMB FOR STAYING ON COURSE TO A SECURE RETIREMENT?
Basic rules of thumb:
- 20s: 1 x Annual Salary
- 30s: 2 x Annual Salary
- 40s: 4 x Annual Salary
- 50s: 7 x Annual Salary
THE EARLIER YOU START THE BETTER – COMPOUNDED GROWTH.
Goal: $1 million by age 67
- Age 22. $35/month. 10% stock market return.
- Age 40. $608/month. 10% stock market return.
WHAT ARE SOME OTHER VARIABLES THAT IMPACT HOW MUCH A PERSON SHOULD SAVE?
- Spending: If your expected retirement spending level is high, you will need to save more.
- Age of retirement: If you want to retire early or start a second career you may need to save more.
- Competing goals: Other savings goals such as funding college or a down payment on a home may reduce your ability to save for retirement.