401K Savings - how much to reach goal?

[lisaross]

Just curious what u think should already be saved at target ages

total amount saved by retirement - lets say 65years old...

Age 65 - 1 million ? ( is this a realistic number?)

Age 50 - how much do u think needs to be in there to reach the million in 15yrs?

I know alot depends on the market etc, but assuming u contribute 10% and the company matches 5%.

Any ideas....

 

[scottmel]

CNN or FORBES on line JUST had an article on this. DH is 49 I am 45 and for us the RECOMMENDED AMOUNT to have right now to retire comfortably for MY AGE (45) is 700K which of course keeps being contributed to and grows etc assuming retirement at 65. So at 45 I need to have 700K right now to keep on growing to be able to retire well. If you want the age chart, let me know. I will ask DH to dig it up. He just told me about it at dinner.

The study also said the AVERAGE 401 that people have is sadly 50K. I remember having my first job out of college and my dad insisting I max out my 401 etc - it was a life long lesson he taught me as we have never waivered from that rule. And we even set DD14 up with her own retirement roth when she was 10! LOL.

And no I don't think a million is realistic in terms of being ENOUGH. The article explained this as well.

 

[lisaross]

Wow, 700,000 at age 45???? guess we're waay behind

 

[akcire]

CNN or FORBES on line JUST had an article on this. DH is 49 I am 45 and for us the RECOMMENDED AMOUNT to have right now to retire comfortably for MY AGE (45) is 700K which of course keeps being contributed to and grows etc assuming retirement at 65. So at 45 I need to have 700K right now to keep on growing to be able to retire well. If you want the age chart, let me know. I will ask DH to dig it up. He just told me about it at dinner.

The study also said the AVERAGE 401 that people have is sadly 50K. I remember having my first job out of college and my dad insisting I max out my 401 etc - it was a life long lesson he taught me as we have never waivered from that rule. And we even set DD14 up with her own retirement roth when she was 10! LOL.

How'd your daughter set up a Roth? I thought you had to have earned income for a Roth. Did you base it on investment earnings? My daughter is 2 and I'd love to get her a Roth.

 

[scottmel]

Wow, 700,000 at age 45???? guess we're waay behind

I just emailed DH for the article. You can look up your age etc. and it will give you your amount. NEVER ever to late to save! And look at the average so maybe that cheers you up!

 

[scottmel]

How'd your daughter set up a Roth? I thought you had to have earned income for a Roth. Did you base it on investment earnings? My daughter is 2 and I'd love to get her a Roth.

I will get this info to you as well. My dad set it up for us initially for her and we add to it yearly. I know what you mean about the income - there was a reason. Will let you know...

 

[Gina-Gina-Bo-Bina]

I would say it would totally depend on what you want your after-tax retirement income to be once you are retired.

Some folks have a much higher standard of living to which they aspire than I do (and in the opposite spectrum, some have much lesser needs). You need to project what you want to have as a yearly after-tax income, then determine how much you need to achieve that income.

 

[scottmel]

This is an article I had bookmarked from a a year back. I think the numbers are outdated a little but at least explains the WHY and to see why 1 million is not enough in today's nutty world! I will get you the chart he referred to recently but until then I knew I had this one..

http://www.financialsamurai.com/2012/01/09/how-much-should-one-have-in-their-401k-at-different-ages/

 

[lisaross]

I'm at the low end.....

This is an article I had bookmarked from a a year back. I think the numbers are outdated a little but at least explains the WHY and to see why 1 million is not enough in today's nutty world! I will get you the chart he referred to recently but until then I knew I had this one..

http://www.financialsamurai.com/2012/01/09/how-much-should-one-have-in-their-401k-at-different-ages/

 

[jenny105]

Says I should have $127k. I am WAY behind.

 

[wiigirl]

I am a bit behind....

 

[lisaross]

Also, i guess the low end would be if u have any pension - how much SS u might be getting, etc.

 

[scottmel]

Here's the original article DH referenced to me. very informative!!!

http://money.cnn.com/gallery/pf/2013/04/15/building-wealth-54-to-65.moneymag/jump.html

 

[chimilady]

in my 20s my motto was to be sure I saved up my age. I tried to have 25K when I was 25 and 30K when I was 30. But now I have enough in there that my interest is earning me money.

I maxed out for most of my 20s, and when I had kids at 32, I dropped down to 15%. I want to retire early, meaning 65ish. I don't want to be working until I'm 75 - 80.

 

[Marionnette]

According to the chart, we're on target. But I never feel comfortable when it comes to retirement savings. My husband doesn't plan to retire until the age of 70. His parents are 87 and still going strong. He has aunts that are even older! My fear is that we will outlive what we have set aside.

 

[tvguy]

On target, slightly above the low end. Put 15 % of our pay into retirement for each of the last 34 years . I'll be 56 this year, sat down with retirement planner and we are on track financially to retire at 62. I must not make much, because people always complain about how little social security pays. My benefit will be about $250 a month less than I make working (take home pay, not gross). With the minimum required distributions, I'll be making more retired than working.

 

[eliza61]

Wow, 700,000 at age 45???? guess we're waay behind

LOL, never listen to these articles. According to the article, you should
1) max out your 401K (my max would be 20%) of my salary
2) then take 50% of your after tax salary and save that in a roth type vehicle.
3) also some how save for your kids college
4) then some how I quess those "incidentals" like housing, food and health care are supposed to take care of themselves.
5) and you're supposed to have some kind of life.

 

[tvguy]

LOL, never listen to these articles. According to the article, you should
1) max out your 401K (my max would be 20%) of my salary
2) then take 50% of your after tax salary and save that in a roth type vehicle.
3) also some how save for your kids college
4) then some how I quess those "incidentals" like housing, food and health care are supposed to take care of themselves.
5) and you're supposed to have some kind of life.

Really not hard. A little self control, and 40 or so years of working and saving, you're there. Folks have the money they just choose to spend it elsewhere (like on big screen tvs, cable services, smart phones, vacations)
I took over my mom's finances last year. She's almost 90, and was living on about $ 850 a month no problem. Far less than just her social security. She and my dad worked hard to pay off their house, been paid off for 53 years, didn't buy a car until they needed one......her current car is 10 years old, the one before she had 27 years.

 

[eliza61]

Yep, my dad also lived until late in his 80's.

1) never went a darn place because he had to keep saving
2) paid his house off yet refuse to even turn on the air in the middle of July in NYC because god forbid the electric bill went up.
3) paid off his house yet won't spend the dime to keep it updated.

and he died wealthy. had a military pension, a police pension from NYC and an inheritence from my mom. He absolutely made more in retirement then he did working.

I totally admit, I'm having a serious change in my tune. I know longer am living for some "mythical" age 50 years done the road that I may or may not live to see. I drive 47 miles each way to work, so yep I'm rethinking having a stripped down basic car just to save for 40 years from now. I'm not beating myself up for wanting "soft corithan leather" and satellite radio LOL.

I've dropped my 401K contributions in half. I'm saving only what my company will match.
with the remainder I plan on doing quite a bit of traveling and seeing the world with my sons.
Now I do admit to having their college tuition saved for so that makes it a bit easier.

I'm done with charts, projections etc. I'm toying with retirement soon also due to some unforseen circumstance and whether or not I have the "suggested" amount in my portfolio, I will see Italy, Spain and Greece before I get to old to move. so you are absolutely right, I'm just reevaluating my priorities.

 

[Minnesota!]

Our plan is to live on about 1/4 of what we make now. All I want out of retirement is to travel, to enjoy down time, and to live as simply as possible.

Currently if we didn't have a mortgage, student loans, private school for the kids, kids activities, or the like - we could easily live on 1/4 of our earnings now. So, by retirement (55 for both of us) we will have those things taken care of, and will be able to achieve retirement. We save money, have Roths, have 401(k), and my company has great retirement benefits...

I really do not see a need - FOR ME - to contribute a ton of money towards retirement. It's not guaranteed, and if you live simply - it's very achievable. I think that there are a lot of people who never retire b/c they figure they cannot manage it. My coworker retired recently with "just" $125K in her 401 and about 20K in cash. She lives very comfortably and has enough money to get her through till her late 90's.

Anyway, at age 35, we have a good chunk saved, but I am in no hurry to up my contributions. I would rather enjoy my money today then hang it on a day that might never happen... (too many close people in my life have died suddenly before getting to enjoy any of their hard saved cash...NO THANK YOU!).