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You make valid points, but consider the following:

1. Salaries tend to outgrow inflation, which your calculation neglects.

2. If by 2040 people suddenly start expecting to live for 120+ years, they wouldn't retire at 70. Not working for 50 years sounds like a hell of a nightmare to me.

3. 9% return seems somewhat conservative.

4. Even accepting your calculation and assuming 3% inflation, you get about $700K in today's money in 35 years. Taking a return of 7% on that, you get about $50K annual income (today's money). Yes, it is taxed, but no FICA. Add to that the social security benefits that are likely to exist in some form at that time. The result seems to be more than sufficient, considering that one would likely to have some savings out of retirement accounts, no house payments, and plenty of home equity to leverage.

5. If the stock market is flat for 35 years (which is nearly impossible and something worth betting against), there's really no advantage to using tax-deferred accounts.

More is always better, but shifting too much income into retirement does not sound like a good idea to me. Before that, one has to pay off your home, send the kids to college, and use your cash flow for various "operating activities." Retirement funding should be adequate, but not excessive.


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