Michael Ecke is a mortgage professional - NMLS # 1439805, entrepreneur, businessman, and founder of Prosperment. As a current employee of a Fortune 50 company, Michael is dedicated to ensuring the utmost attention to detail and quality control. Michael provides executive oversight and direction to Prosperment and its sister companies. Michael brings to his position the business foresight and acumen required as Prosperment continues its remarkable growth.
(Retirement) Must Read
Fidelity's rule of thumb - Shoot to save at least 1x your salary by 30, 3x by 40, 6x by 50, 8x by 60, and 10x by 67.
How much do you need to save for retirement? It's one of the most important questions people have. And no wonder. There are so many unknowns: When will you retire? How much will you spend in retirement? Where do you want to live? And for how long?
That's why Fidelity came up with age-based retirement savings factors that can help you plan—in spite of those uncertainties. These milestones are monumental. You likely won't meet all of them. But these figures and methods can serve as goal to help you make a plan to save enough to maintain your lifestyle in retirement.
Fidelity's savings factors are based on the assumption that a person saves 15% of their income annually beginning at age 25, invests more than 50% on average of their savings in stocks over their lifetime, retires at age 67, and plans to maintain their pre retirement lifestyle well through retirement
Fiedlity estimates that saving 10x (times) your pre retirement income by age 67, together with other steps, should help ensure that you have enough income to maintain your current lifestyle when entering retirement. That 10x goal may seem impossible. But you have many years to get there. To help you stay focused, we suggest these age-based milestones - shoot to save at least 1x your income by age 30, 3x by 40, 6x by 50, and 8x by 60.
The age you plan to retire can have a big impact on the amount you need to save, and your milestones along the way. The longer you can postpone entering retirement, the lower your savings factor can be. That's because delaying gives your savings a longer time to increase in value, you'll have fewer years in retirement, and your Social Security benefit will be higher. Working longer will make it easier to reach your savings goals.
No matter what your age, focus on the goals ahead. Don't be discouraged if you aren't at your nearest milestone, there are ways to catch up to future milestones through planning and saving. The key is to take action, and the earlier the better.