No. of Recommendations: 0

I would like to raise one point, which you may have already done but didn't say so in your post. Before you can determine if you are saving at the right rate, you first must have an idea of how much money you will need to fund your retirement. . . let's say at age 65 (40 years from now). The way I would do this is to pretend you were 65 years old today and calculate how much money you would need to fund your retirement say over the next 30 years. If you calculate that you need $1 million to fund your retirement at age 65 today, what amount would be equivilent to $1 million in terms of purchasing power 40 years from now. Basically, you need to calculate the future value of $1 million in 40 years making an assumption for inflation over that period of time. At an assumed inflation rate of 3% over the next 40 years, I calculate $1 million today is the present value of approximately $3.3 million in 40 years (someone correct me if I am wrong).

The links referenced in the previous responses to your post should help you do this.

Hope this helps.

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.