How much to save for retirement?
Here's an interesting question for you: I would like to know what percentage of my income to save in order to give me the most similar income in retirement as in my working life. Here are the (I think) important pieces of information you will need to help me answer this question: 1) I will get a 70% company pension when I retire 2) I will retire in 27 years 3) I would like to receive retirement income for 30 years 4) Assume average interest of 3% for any investments
Public Comments
- Assuming you made 100,000 a year and didn't change salaries for 57 years. You would need $1,372,030 in retirement to retire and be paid $70,000 a year for 30 years. To get 1,372,030 in your account in 27 years you would need to contribute $28,839 a year into your retirement with a 3% return rate. But if you are just talking percent, then assume 28.8 % of your salary. But now all of this is assuming that interest is compounded yearly, which is usually not the case. It might be compounded monthly, daily, or continuously. You can also get a lot better than 3% returns if you are investing over a 27 year period.. Go to a bank and talk about getting an Roth IRA. The adviser their will advise you with your investments. If you are only getting 3% for a 27 year investment, you are getting gipped. You can get that in a regular savings account or savings bond.
