How much money does a 50 year old need to put away a month to retiree comfortably
There are a million right answers to that question. Help narrow them down, a little, by answering a few questions.
Expected social security or other income during retirement? (Income)
Your monthly expenses? (Expenses)
How much do you have saved already? (Income generating)
Once those questions are answered, you have a starting point. | 09.18.14 @ 06:57
This is a tough question to answer without knowing more about you. Here is an example to help you start thinking about how to analyze your situation:
Ann wants to retire at age 65. She analyzes her expenses and figures that she will need $60,000 a year to live on in retirement. She assumes she will live until 95. 30 years x $60,000 is $1,800,000 (in today's dollars). On the income side, Ann will get $21,600 a year in social security benefits. This will provide $648,000 in income until age 95. (Social Security benefits inflate most every year). So the shortfall (and needed nestegg) for Ann is $1,800,000 - $648,000 or $1,152,000. She would withdraw $60,000 - $21,6000 or $38,400 in the first year of retirement and increase it by inflation each year. Remember, the $1,152,000 savings must stay invested for a return greater than the withdrawal rate!
Please note that this is just an example. Your circumstances will be different. Best to consult a financial planner or use online calculators to calculate your needs. | 09.18.14 @ 16:09
If you haven't started yet, it will be way more than you want to. What are your likely monthly expenses in retirement? Start with that and work backwards - a compounding financial calculator can help you get a ballpark answer. For more specifics you should consult with a professional. Keep in mind that very little in retirement planning is certain - successful outcomes are really not much more than good guesses. Good luck! | 09.18.14 @ 16:47
A very rough estimation would be to assume that you want $50,000 per year of income from your own investments at age. If you were to use a annuity with a guaranteed income rider, you would need a value of $1,000,000 at age 65 or 15 years from now. Using the financial calculator, assuming a 8% return on the invested savings, you will need to invest just over $3000 per month.
If you wait to age 70 to start using the same values, you need to save about $1700 per month. Talk to a advisor who can guide you in the right direction and review your plans periodically. | 09.18.14 @ 19:52