New retirement chart-thoughts?

Xstatic3333 · April 2014

This seems a bit low to me. I'm not sure why I, as a lower wage earner, need to have a lower percentage of my income saved than a high income earner. I am much closer to target on this chart than some others, which is nice. What are your thoughts here?

http://www.slate.com/blogs/business_insider/2014/04/05/retirement_savings_how_much_you_should_have_saved_at_every_age.html

sparklerose · April 2014

That is low...although I'm embarrassed to say I don't know how much is "on track" for us. According to this chart we are doing great, but I know in reality we are behind. Hmmm.

vlagrl29 · April 2014

It seems really low or maybe I'm doing it wrong. It said we should have $3500 in retirement right now. I must be calculating something wrong. We have way more than that right now. We have 3 times our salary at this point and I'm 33, DH 38.

blondie42107 · April 2014

I'm wondering if this article is assuming that this would supplement Social Security???

However, at my age, I am not going to assume that Social Security will still be available to me. If so, bonus!

Mom987 · April 2014

Hmm. We need to catch up some more. We have around $34,000 and we are 26 and 29. Based on our salaries we need to be higher.

Wulfgar · April 2014

I think the reason they are assuming 5% investment a year is what the average person is doing. As for the numbers, I think they are low and I would take them as a minimum guide line.

@vlagrl29, you must have left off a zero or two. The smallest amount to have saved would be $20,000 if you made 50k and was 30.

sillygoosegirl · April 2014

I think this chart is taking into account social security, which will replace a larger percentage of your income if you earn less. It also assumes you will not need as much income in retirement as you need now, which exaggerates the social security effect.

I don't feel particularly comfortable planning on social security... plus, I want to retire early, so even if social security remains solvent, I won't qualify for much. My target is 25x annual retirement expenses when we retire. I figure since we'll be paying for our own health insurance in retirement, our retirement expenses will be similar to our expenses now or maybe even a little more (we'll be done paying the mortgage and student loans, but insurance for old people is really expensive, even with Obamacare).

JoanE2012 · April 2014

These numbers seem awfully low. And 5% isn't much, even if social security is still around in future years. I think it's safer to be saving at least 10%!

Xstatic3333 · April 2014

sillygoosegirl said:
I think this chart is taking into account social security, which will replace a larger percentage of your income if you earn less. It also assumes you will not need as much income in retirement as you need now, which exaggerates the social security effect.

I don't feel particularly comfortable planning on social security... plus, I want to retire early, so even if social security remains solvent, I won't qualify for much. My target is 25x annual retirement expenses when we retire. I figure since we'll be paying for our own health insurance in retirement, our retirement expenses will be similar to our expenses now or maybe even a little more (we'll be done paying the mortgage and student loans, but insurance for old people is really expensive, even with Obamacare).

I've heard the 25x expenses number before. Apparently that's the point at which you should be able to live off of your investment dividends without reducing your core savings. It's a good goal!

Counting on SS makes sense for this chart. It explains why you need less at lower income levels. Honestly I know very little about SS since I assume I won't be getting any. Overall I have higher goals for myself than this implies. Even though I'll never make $200,000 a year, I still want a nice retirement!

brij2006 · April 2014

Those numbers do seem low. We are on par with what it says we should have saved, but I can't even imagine only investing 5% of my income. That won't get us anywhere near our retirement goals.

KatieCutie05 · April 2014

Um i'm gonna cry that everyones saying thats low... cus i was going to say thats high. We have 5k and i'm 25 and DH is 28. According to this we should have another 42k in 2 -5 years. LMAO yea okayyy.

But I don't feel too bad because once my student loans are paid off, we'll be saving 15% instead of 5% so we'll catch up eventually.

jtmh2012 · April 2014

The cost of waiting....

https://www.lfg.com/LincolnPageServer?LFGPage=/lfg/rfs/edm/index.html&LFGContentID=/lfg/rfs/edm/non/cow

Just waiting one year could cost you $50k by the time you turn 65.....

Something else interesting to play with...

http://planning.tdameritrade.com/sites/client/tda/tdap/calculator.vm?siteContent=5215&topic=5035

This will show you how much you have to contribute annually to reach your goals...

hoffse · April 2014

jtmh2012 said:

The cost of waiting....

https://www.lfg.com/LincolnPageServer?LFGPage=/lfg/rfs/edm/index.html&LFGContentID=/lfg/rfs/edm/non/cow

Just waiting one year could cost you $50k by the time you turn 65.....

Something else interesting to play with...

http://planning.tdameritrade.com/sites/client/tda/tdap/calculator.vm?siteContent=5215&topic=5035

This will show you how much you have to contribute annually to reach your goals...

Exactly. That's why I'd rather fund our Roths than pay off H's student loans a year earlier.

Xstatic3333 · April 2014

KatieCutie05 said:
Um i'm gonna cry that everyones saying thats low... cus i was going to say thats high. We have 5k and i'm 25 and DH is 28. According to this we should have another 42k in 2 -5 years. LMAO yea okayyy.

But I don't feel too bad because once my student loans are paid off, we'll be saving 15% instead of 5% so we'll catch up eventually.

We're behind all charts, too. But, we're determined to do better! H just signed up for an additional work-sponsored plan beyond his pension, which I'm thrilled about.

CuriousKiddosMama · April 2014

According to that chart, we are way behind which is insane. DH has always put away 5% so I'm not sure how that has happened- investments not working out great I guess. Now we are putting away about 21% trying to play catch-up (and part of that is an awesome 6% match from his employer). DH wasn't contributing much before we got married and he was 34 then so way behind.

That's depressing! We are like 200k behind based on that- not sure how we will be able to catch up to that.

New retirement chart-thoughts?

Re: New retirement chart-thoughts?

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