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A Marktwatch article claiming "you should have twice your salary saved" by the time you're 35 years old has angered the internet. The article, which included advice from Boston-based investment firm Fidelity Investments, said you should have a year's worth of salary saved up by age 30, and double that by age 35.
Pretty much the same nonsense about no one should retire without 1 million dollars.
$3,000,000 would be better (for someone who wants to retire in 2020-25, has no pension or funded health care during retirement, and doesn't have a huge amount of assets {$1 mm+ house to sell} and wants to maintain a lifestyle between middle-class and upper-middle-class in a medium cost of living area)
These article IMO do nothing but depress folks and make them mad, which is evident from the replies.!!
Pretty much the same nonsense about no one should retire without 1 million dollars.
This is not nonsense. The median household income is $56K. Let us say it is going to take $45K to maintain that standard of living in retirement. The median social security benefit is $16K leaving a gap of $29K. Using 4% as a safe withdrawal rate, the median amount of savings needed would be $750K. Anyone in their 50s who is planning for retirement better be looking to save at least $1 million in order to maintain a median level lifestyle.
This is not nonsense. The median household income is $56K. Let us say it is going to take $45K to maintain that standard of living in retirement. The median social security benefit is $16K leaving a gap of $29K. Using 4% as a safe withdrawal rate, the median amount of savings needed would be $750K. Anyone in their 50s who is planning for retirement better be looking to save at least $1 million in order to maintain a median level lifestyle.
Agreed! - The real nonsense is the notion that 'reality must change to accommodate the outrage of the day.'
The suggestion that one should have 2X their salary in their retirement account by age 35 is not far fetched at all. How one "feels" about this changes nothing.
The whimsical philosophy that creates such outrage is: "Retirement is too far off for someone 35 to think or worry about and There will always be time to save later." Those foolish enough to buy into this philosophy may find themselves at 50, thinking the same thing. The sooner, the better when it comes to retirement savings, PARTICULARLY if one is in a lower income bracket (compounding).
Yes, some financial management companies proclaim (or infer) that unless one has several million upon retirement ... they will live under a bridge and eat cat food. In this area, one must exercise some common sense and not believe every advertising claim .
I read about this concept the year I turned 30 and honestly, I didn't think it was high enough. Of course jumping from 30 (with x income) to 35 (double your income) seem like bigger jump. But investing tends to jump faster assuming economy is good. I think most people should be able to save a year of their income by 30.
By 30, most people have worked for a decade already, that is
(10years * 52 weeks/year) = 520 weeks/year
Median salary is 50K so
$50,000/520 weeks = $96.15 per paycheck.
This is not including interest rate or bonus people get. It can be hard some week but most people should be able to tuck away 96 per paycheck
I am 59 now, thinking back when I was 35 we must have been fairly close to having 2X my annual income invested in our portfolio.
same here
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