Thursday bits: How much do you need to retire? How much have you saved?

Retirement

How much do you need to retire If you ask financial advisors, you’ll get lots of different answers. Individuals have their own thoughts as well. Do you need $250K? $500K? $1 million? $2 million? More The majority of Americans think they will need less than $1 million, according to the Merrill Edge Report Fall 2016. But 19 percent have no idea how much they will need.

The breakdown:

  • 9 percent think they will need more than $2 million
  • 14 percent believe they will need $1 million to $2 million
  • 24 percent say $500,000 to $1 million
  • 23 percent say $100,000 to $500,000
  • 9 percent say $0 to $100,000
  • And 19 percent say they just don’t know

Recently I mentioned my friend’s approach. I like this. It’s easy for most people… My friend Doug Massey created a an easy formula to estimate whether you have enough money to retire. Here’s the formula:

Age * Net Worth / Annual Expenses

If the result from this formula exceeds 1,000, you have enough money to retire.

Savings

source: Income Investors

The survey found that lower-income adults were more likely going to have a tough time saving money. Of those earning less than $50,000, over one-third, or 38%, have nothing savinged. Another 35% have less than $1,000 saved.

Women and Millennials particularly appear to be falling behind. The survey found that 42% of women have no money set aside in a savings account, compared with only 28% of men. Of young Millennials — those between 18 and 24 years old — almost three-quarters, or 72%, have less than $1,000 in their savings accounts and 31% have nothing saved at all.

USA savings rate


source: tradingeconomics.com

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