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Green grass and
high tides
Picture of old rugged cross
posted
You should have 6 times your annual salary in your 401k to be able to retire at 67. 7x at 55.

That is pretty vague as it does not address many other aspects.

Just food for thought to share.



"Practice like you want to play in the game"
 
Posts: 19111 | Registered: September 21, 2005Reply With QuoteReport This Post
thin skin can't win
Picture of Georgeair
posted Hide Post
Great news. Well, other than I just took a 20% cut to annual salary..... Razz



You only have integrity once. - imprezaguy02

 
Posts: 12350 | Location: Madison, MS | Registered: December 10, 2007Reply With QuoteReport This Post
Eating elephants
one bite at a time
Picture of ffips
posted Hide Post
Here's to hoping they are wrong! If they are right then it would seem retirement at 67 is not an option for me.
 
Posts: 3572 | Location: in the southwest Atlanta metro area | Registered: September 10, 2006Reply With QuoteReport This Post
is circumspective
Picture of vinnybass
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quote:
Originally posted by ffips:
Here's to hoping they are wrong! If they are right then it would seem retirement at 67 is not an option for me.


I took that to mean, to retire at age 55 on 67.7% of your yearly income. Did I read it incorrectly?



"We're all travelers in this world. From the sweet grass to the packing house. Birth 'til death. We travel between the eternities."
 
Posts: 5473 | Location: Las Vegas, NV. | Registered: May 30, 2009Reply With QuoteReport This Post
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I don't buy into that.

As has been said there are too many other things to consider. Add to that...at 50 most people are just getting into their peak earning years. A lot can happen between 50 and 67.

Our daughter is graduating from college in December. I'm 55. The next 10 years, we should have more money to invest than ever before in our lives. Way more Smile
 
Posts: 2096 | Location: Bowling Green, KY | Registered: January 02, 2004Reply With QuoteReport This Post
Green grass and
high tides
Picture of old rugged cross
posted Hide Post
I do not think so Vinny. It simply means to be on track to retire at 67 years old you need to have 7x times your annual salary in your 401k at 55 years of age.



"Practice like you want to play in the game"
 
Posts: 19111 | Registered: September 21, 2005Reply With QuoteReport This Post
Green grass and
high tides
Picture of old rugged cross
posted Hide Post
LR, the reality is that it is time (years) more than it is money contributed at a later age that really makes the difference. Later is better than never though.



"Practice like you want to play in the game"
 
Posts: 19111 | Registered: September 21, 2005Reply With QuoteReport This Post
Ignored facts
still exist
posted Hide Post
Too many factors. Pensions, Social Security, debt, expenses like what you expect to pay in rent/mortgage.

no one size fits all.


----------------------
Let's Go Brandon!
 
Posts: 10861 | Location: 45 miles from the Pacific Ocean | Registered: February 28, 2003Reply With QuoteReport This Post
thin skin can't win
Picture of Georgeair
posted Hide Post
quote:
Originally posted by vinnybass:
quote:
Originally posted by ffips:
Here's to hoping they are wrong! If they are right then it would seem retirement at 67 is not an option for me.


I took that to mean, to retire at age 55 on 67.7% of your yearly income. Did I read it incorrectly?


No.

7X at 55 for same result. The period after 67 is a period, not a decimal.

All these fear tactics to make folks freak out are crazy. Many folks neither need or expect to retire at their full pre-retirement income, depending on how they plan.

For example, if you plan to have a house paid for and will be living somewhat more conservatively in retirement, and at lesser tax rate, then 60-80% of income is probably plenty to get you through 90+ years. Also, most of us will travel/buy way less at 80 than we will at 65 so that trend line is positive. Well, other than potential medical expenses.



You only have integrity once. - imprezaguy02

 
Posts: 12350 | Location: Madison, MS | Registered: December 10, 2007Reply With QuoteReport This Post
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I also think you need to base it on anticipated spending, not current salary. If you are hitting it hard and saving half of your income now, you don't need to replace that amount later.

Of course, if you spend nearly every penny, you need it all.
 
Posts: 8944 | Location: The Red part of Minnesota | Registered: October 06, 2002Reply With QuoteReport This Post
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Picture of vinnybass
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Wow! I wonder how they figured that. As was mentioned, there are many variables to consider. I'm 60 & I figure to have made more between 55 & 65 than any other ten year period. Also I'm debt-free for the last ten years & have saved the difference.



"We're all travelers in this world. From the sweet grass to the packing house. Birth 'til death. We travel between the eternities."
 
Posts: 5473 | Location: Las Vegas, NV. | Registered: May 30, 2009Reply With QuoteReport This Post
Green grass and
high tides
Picture of old rugged cross
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All this article was addressing is what should be in your 401k at a given age. Nothing else. Nothing about how much you will need per year at retirement over 25 years etc.

Simple at age 50 your 401k balance should be 6x your current annual income. At 55 7x.

Simple math.

At age 50 today. If your annual income is $50k your 401k balance today should be $300k.

If at age 55 it should $350k if you are making $50k this year.

I just thought it was interesting.

Obviously it is a Theory that can be accepted or declined in your particular situation.

I think if you have 2x or 3x you are not doing great. If you have 10x then really great. If zero, well then you have serious issues.

It is a bit like the old 4% rule we have discussed here some.



"Practice like you want to play in the game"
 
Posts: 19111 | Registered: September 21, 2005Reply With QuoteReport This Post
Eschew Obfuscation
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quote:
Originally posted by Loaded Round:
I don't buy into that.


Not me either. One thing I've learned in the last year is that you can't depend on 'one size fits all' formulas when it comes to retirement. Even though I had an expensive financial advisor, I also figured out that they had a vested interest in telling me I didn't have enough money to retire because at that point I would no longer need a financial advisor.

So, I fired them, took control of my finances and learned I already had enough money to retire. I retired 2 months later.

There are some great retirement websites out there, including some very reliable retirement calculators. This is too important of a topic to not invest quality time doing some research and reading.

Some retirement sites I like:

-- https://www.caniretireyet.com/

-- http://www.early-retirement.org/forums/

-- https://www.bogleheads.org/

A couple of retirement calculators I like:

-- https://firecalc.com/

-- https://www.flexibleretirementplanner.com/wp/


_____________________________________________________________________
“Civilization is not inherited; it has to be learned and earned by each generation anew; if the transmission should be interrupted for one century, civilization would die, and we should be savages again." - Will Durant
 
Posts: 6373 | Location: Chicago, IL | Registered: December 17, 2007Reply With QuoteReport This Post
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quote:
Originally posted by CoolRich59: One thing I've learned in the last year is that you can't depend on 'one size fits all' formulas when it comes to retirement. Even though I had an expensive financial advisor, I also figured out that they had a vested interest in telling me I didn't have enough money to retire because at that point I would no longer need a financial advisor.


I paid to have a fee for service CFP run the numbers to double check my calculations. I was actually being a bit too conservative in terms of estimated taxes in retirement. If the market can return 5%, I should be there at 59.
 
Posts: 8944 | Location: The Red part of Minnesota | Registered: October 06, 2002Reply With QuoteReport This Post
No, not like
Bill Clinton
Picture of BigSwede
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Fake news. Social Security will be there for me and take care of my needs



 
Posts: 5302 | Location: GA | Registered: September 23, 2009Reply With QuoteReport This Post
It's not easy being me
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quote:
Originally posted by BigSwede:
Fake news. Social Security will be there for me and take care of my needs



That's the spirit!! Wink Big Grin


_______________________________________
Flammable, Inflammable, or Nonflammable.......
Hell, either it Flams or it doesn't!! (George Carlin)
 
Posts: 2769 | Location: Middle TN | Registered: March 22, 2009Reply With QuoteReport This Post
You don’t fix faith,
River. It fixes you.

Picture of Yanert98
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Thank you for those links!


----------------------------------
"If you are not prepared to use force to defend civilization, then be prepared to accept barbarism.." - Thomas Sowell
 
Posts: 2673 | Location: Migrating with the Seasons | Registered: September 26, 2007Reply With QuoteReport This Post
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Picture of smlsig
posted Hide Post
quote:
Originally posted by old rugged cross:
All this article was addressing is what should be in your 401k at a given age. Nothing else. Nothing about how much you will need per year at retirement over 25 years etc.

Simple at age 50 your 401k balance should be 6x your current annual income. At 55 7x.

Simple math.

At age 50 today. If your annual income is $50k your 401k balance today should be $300k.

If at age 55 it should $350k if you are making $50k this year.

I just thought it was interesting.

Obviously it is a Theory that can be accepted or declined in your particular situation.

I think if you have 2x or 3x you are not doing great. If you have 10x then really great. If zero, well then you have serious issues.

It is a bit like the old 4% rule we have discussed here some.


Agreed.
It's just a quick statement to provoke thought as to where you are or roughly should be.
No more or less....


------------------
Eddie

Our Founding Fathers were men who understood that the right thing is not necessarily the written thing. -kkina
 
Posts: 6309 | Location: In transit | Registered: February 19, 2013Reply With QuoteReport This Post
His Royal Hiney
Picture of Rey HRH
posted Hide Post
It's just a thumb rule for a quick and dirty check.

Here's the link to the actual article.



"It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946.
 
Posts: 19588 | Location: The Free State of Arizona - Ditat Deus | Registered: March 24, 2011Reply With QuoteReport This Post
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Is that GROSS Salary or after taxes and subtraction of my current contribution to my 401K x 6 ? If GROSS I am off. However if after taxes, etc then I am pretty close. God Bless Smile


"Always legally conceal carry. At the right place and time, one person can make a positive difference."
 
Posts: 3056 | Location: Sector 001 | Registered: October 30, 2009Reply With QuoteReport This Post
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