re: This Is What Life Without Retirement Savings Looks Like

It’s funny, my parents who are smart by any standard and have owned their own company and made a very good living for 30+ years, have no 401k or any type of “retirement plan”. They’ve just got a bunch of cash sitting in a bunch of bank accounts and probably still have cds or some old school basically no interest generating account.

Just seems like something their generation was never educated on, when my wife and I discuss our stuff with them they just seem like they think it’s a waste of money and say “well it’s good y’all are thinking about that I guess”

Sounds like my oldest. I told him one day he will wake up in his 50's saying...awe shite.

way to go Millenials. Always ruining the country.

I base my calculations on 5/2% stock/bond real returns which I feel is conservative

Here is some reality for everyone. Let’s say today in 2018, you are 30, and you have saved up $50k in retirement funds.

You can max your 401k ($18.5k) and max an IRA ($5.5k) every year moving forward, and you will have approximately $2.7M in retirement funds by age 60 (assuming a reasonable 7% return). This also assumes starting at age 50 you up your 401k contributions to $24.5k.

Adjusted for inflation, $2.7M in 30 years will be worth about $1.3M today. If you want to retire at 60, using the standard 4% withdrawal rate, you are looking at living off of $52k/year in today’s dollars. Doable? Sure. You can live a modest life especially after paying off your house. You aren’t traveling the world though.

And I realize that the max allowable contributions for retirement accounts will increase with time, but that still means you need to be saving a minimum of $24k/year for 30 years..

I always see percentages thrown around. “Save 10%-15% a year starting in your 20’s.” No. Save as much as you possibly can. Then when you are 30, save at least $25k/year and retire at 65+. I have a feeling more than a few aren’t saving enough.

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As a w-2 employee, yes I am.

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Anybody with earned income has to pay FICA. I don't know wtf he's talking about, you can't "opt out."

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Then when you are 30, save at least $25k/year and retire at 65+. I have a feeling more than a few aren’t saving enough.

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How many 30 year olds make enough money to save $25,000 a year. I'm 28 and that's almost half my gross income

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How many 30 year olds make enough money to save $25,000 a year. I'm 28 and that's almost half my gross income

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I would guess probably less than 5%. I just turned 30. It’s probably not happening.

I’m just saying.. that’s the reality of it. People talk about retiring in their 50’s. Good luck.

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Spoken like a true Republican.

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So people not taking personal responsibility for their financial health in retirement has nothing to do this this. It's political?

Idiot.