One question I often hear is “how much do I need to save to retire?” The answer to that question is “it depends.” Have you paid off your mortgage? How long will you live? What other sources of income do you think you will have, like Social Security or a pension?

If you want to have an income of $45,000 per year, before taxes, then you need to have $900,000 saved by the day you retire. You need to average 5% returns (Annual Rate of Return: ARR) on your investment nest egg. If you achieve this, you will never have less than $900,000 in your account. Of course, your nest egg will go up and perhaps even down, but this is a good way to see the power of the annual rate of return. By the same token, by simply increasing your ARR to 6%, you then only need $750,000. And if you can achieve 7% ARR, then you need about $643,000.

Why am I sharing the retirement calculator tool? Because it shows you the power of being more invested in stocks and less than bonds during your asset accumulation stage before you retire. Before you retire you should be easily able to get 9-10% returns by avoiding bonds and cash Those dollars grow quickly. They need to. You have to remember inflation and future taxes.

You should try the retirement calculator at this web site: