- Retirement at 65
- Target savings of 12 times salary
- Retirement lifestyle of 80% of working lifestyle
- Social security is available at 65
- Average investment return of 8% per year
- Nothing saved currently
Daily Savings Amount by Age | ||||||
---|---|---|---|---|---|---|
Salary | 20 | 30 | 40 | 50 | 60 | Target 12X salary |
$20,000 | 1.48 | 3.41 | 8.24 | 22.68 | 106.97 | $240,000 |
$30,000 | 2.22 | 5.11 | 12.35 | 24.02 | 160.45 | $360,000 |
$40,000 | 2.96 | 6.81 | 16.47 | 45.35 | 213.94 | $480,000 |
$50,000 | 3.70 | 8.52 | 20.59 | 56.69 | 267.42 | $600,000 |
$60,000 | 4.43 | 10.22 | 24.71 | 68.03 | 320.91 | $720,000 |
$70,000 | 5.17 | 11.92 | 28.82 | 79.37 | 374.39 | $840,000 |
$80,000 | 5.91 | 13.63 | 32.94 | 90.71 | 427.87 | $960,000 |
$90,000 | 6.65 | 15.33 | 37.06 | 102.05 | 481.36 | $1,080,000 |
$100,000 | 7.39 | 17.04 | 41.18 | 113.38 | 534.84 | $1,200,000 |
$110,000 | 8.13 | 18.74 | 45.29 | 124.72 | 588.33 | $1,320,000 |
$120,000 | 8.87 | 20.44 | 49.41 | 136.06 | 641.81 | $1,440,000 |
$130,000 | 9.61 | 22.15 | 53.53 | 147.40 | 695.30 | $1,560,000 |
$140,000 | 10.35 | 23.85 | 57.65 | 158.74 | 748.78 | $1,680,000 |
A few observations from the table:
Start young. For example, saving $1,680,000 requires $10.35 per day at 20, $57.65 per day at 40 and $748.78 at 60. That's a monthly amount of $310, $1729, and $22,463, respectively. By starting young, the power of compounding works in one's favor.
Saving over a million is doable, especially if one starts young. Saving as little as $6.65 per day ($200 per month) can get one over $1,000,000 by 65.
Delaying saving makes saving much harder. If the saving amount at 20 is a factor of 1. The factors required to reach the same amount are: 2.3x at 30, 5.6X at 40, 15.3X at 50 and 72.4X at 60.
Remember, the Retirement Saving Challenge will begin on July 1, 2007 and last for six months.
For more on Reaping the Rewards , check back every Friday for a new segment.
This is not financial advice. Please consult a professional advisor.
Copyright © 2007 Achievement Catalyst, LLC
1 comment:
Dimes,
Thanks for your comment.
If it helps, saving at these levels have made a big difference for us. If Mr. Dimes retires from the Navy at 20 or 30 years, that will be a big benefit also. My father-in-law retitred from the airforce after 30 years as a Colonel and has a great pension.
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