The Power of 10

How Much Do I Need to Save For Retirement?  The Power of 10

One of the most-asked questions is: “How much money do I need to retire?  (See What Does It Cost to Retire?)  The second-most-asked follow-up question is: “How  much should I be putting in my IRA, 401(k) (or C-Bucket) so I will have enough to retire?

Introducing – The Power of 10

Hypothetical illustration:

            Age 22

            Income $50,000

            Savings rate 10%

            Aggressive Growth rate 10%

            Target retirement age 62

Plugging this data in the calculator on our Website: www.frontlinefinancialsvc.comCalculators/Savings Accumulation, will produce the following information:

Scenario #1:  If you invest 10% of a $50,000 income ($5,000) at a 10% aggressive growth rate for 40 years, you will have $2,212,963

Assuming a 4% distribution rate (See What Does It Cost to Retire – 25 Times Income,    4 X 8 Rule)

$2,212,963 X 4% = $88,518

Scenario #2:  Let’s take some risk off the table and take 10% of current income ($5,000) at 8% growth = $1,295,283

At a 4% distribution rate -- $1,295,283 X 4% = $51,811

Please keep in mind these reports do not take into account inflation or pay raises, nor do they constitute a promise, or guarantee of future results.

This report was designed to give a simple answer to a complex question: “How much do I need to save in order to retire?  10%

For a plan that is more customized to your current situation, please reach out to our office.

The opinions voiced in this material are for general information only.

All investing involves risk and loss of principal.

All examples are hypothetical and are for illustrative purposes only.

Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC.