Retirement Savings - How much is enough? 2.1M according to Blackrock CEO

[IA Shelby]

Blackrock CEO said a recent survey suggested that people feel they now need 2.1M in retirement savings to live comfortably. I assume this number is skewed by the audience that it surveyed but still somewhat eye opening.

The chart below is a sobering view of current state. Both the median and average amounts are way below the 2.1 target.

Obviously everyone’s situation is different. Current and expected expenses, personal health, where you live in the country, etc…

Just curious what peoples thoughts are about what is needed to live comfortably going forward.

The aggregate savings balances are downright scary. I have to believe the taxing on the upper class will reach stratospheric levels in the coming decades to subsidize the vast majority of Americans that do not have enough saved.

I will likely end up working much longer than I need to out of fear the government will continue to change the rules.

What are your opinions on the matter?

 

[GCG]

it’s definitely dependent on many factors

Like this house we live in will be paid off ~5 years. That puts her at 47, me at 44. Both our cars are paid off. We spend less than $75 a week on food.

Maybe 1 tank of gas a week.

If the business goes well, by 50-55. Even if we don’t have 2,1 saved away… I don’t see why we wouldn’t be fine with 10 years of really no outgoing major payments. If we stayed this way.

 

[Blk04L]

I'd have to assume only a fraction of people retired are 7 figures deep.
Probably some just living off social/pensions and praying they don't get cancer or a major bill before they die.
I know some around me moved to the area 20+ years ago and back then COL was cheap, insurance was cheap, taxes were cheap etc... Now all those have risen and being on a fixed income has strained them.

 

[tistan]

I think by the time I retire in 15-20 years, I will need $4-5 million.

 

[DSG2003Mach1]

2.1 sounds like a number from the fire crowd assuming a 4% annual withdrawal

 

[72MachOne99GT]

I have no idea what I’m going to have/need.

Have a good pension lined up. Wife and I will both have a 401K.

We’ll see. 19 years left.

 

[*Jay*]

In for info, no idea where we will end up at but am actively saving/investing/planning for retirement and have been for years. Trying not to get locked on a certain amount by a certain age but I am fairly certain I will be well past that number, just doing as much as I can until I decide to retire. Funny this thread came up, Ive been learning about maximizing our retirement savings/investments and minimizing our tax burdens when the time comes. 20ish years to go.

 

[Velo2]

I think these retirement figures are high assuming you go into retirement debt free.

$2m at 4% is $80k year. What exactly do you plan to do with 80k/year in retirement?

Medicare is very affordable. Regular bills will be cheap. Sure, you'll have to buy another car or two before you can no longer drive. Life slows down as you get older. It doesn't speed up. Toss in whatever social security is paying and it'll be easy street.

This is from watching my parents/family/coworkers/etc. retire over the last 5 years. They will all die with 1 million+ and passing it on to their children/charity.

 

[tistan]

I think these retirement figures are high assuming you go into retirement debt free.

$2m at 4% is $80k year. What exactly do you plan to do with 80k/year in retirement?

Medicare is very affordable. Regular bills will be cheap. Sure, you'll have to buy another car or two before you can no longer drive. Life slows down as you get older. It doesn't speed up. Toss in whatever social security is paying and it'll be easy street.

This is from watching my parents/family/coworkers/etc. retire over the last 5 years. They will all die with 1 million+ and passing it on to their children/charity.

Everyone has a different opinion of retirement. I want to retire with the lifestyle equal to what I have now. I'm not going to be sitting on my couch just deteriorating. I will have more time to do things. The more things you do, the more you spend.

I'm not banking on SS one bit.

 

[Relaxed Chaos]

Assuming a 4% 401K withdrawal rate, each $1M equates to $40K per year. Add on Social Security bucks to roughly estimate retirement income.

 

[CobraBob]

I’m very happy that my wife and I are still working. We both work from home now and our schedules are VERY flexible. No complaints. I try to put money aside in savings on a monthly basis. We’re nowhere near $2.1M. LOL.

 

[Velo2]

Everyone has a different opinion of retirement. I want to retire with the lifestyle equal to what I have now. I'm not going to be sitting on my couch just deteriorating. I will have more time to do things. The more things you do, the more you spend.

I'm not banking on SS one bit.

I think most think that way when they are younger hence why they (think) need multiple millions to retire.

They say: I am going to travel, buy this, do that, etc. There is no reason to wait until retirement to do those things. You want to see Europe? You go when you're still working. "But I don't have time to go to Europe." You have to recheck your priorities now. The old live to work, work to live saying comes handy here. Want a certain car? Same thing. Give yourself time to enjoy it. You have to do that while you have your health as there is no guarantee going forward. I know of too many people that ran into health problems before they hit retirement age (or right after) to bank on having the ability to do all of these things. This is at 65 too. Everyone ages and slows down. The expenses drop off in a hurry.

In reality, very few people hit the million dollar mark, let alone multiple millions, but everyone retires and manages to get by. Sure, some people don't have much but then they never had much to begin with. These people still seem pretty damn happy from my perspective.

 

[plumbcrazy]

My biggest concern is going to be utility bills and insurance. Who knows which way they will go, besides up- probably way up.
I’ll be 63 in a few months and I plan on working until I’m 70 and maybe even beyond. I have several plans in place for retirement and any one of them will do. I don’t need much and being self-employed for the past 35 years I’ve learned to live below my means as a safety net so I should be good.
I started over from nothing a little over 20 years ago so I feel like I’m doing OK but I would have to liquidate everything to even come close to the 2.1 million mark so that’s not happening.
I only sweat the small stuff, lol. Big picture I’m not worried.

 

[GCG]

I think most think that way when they are younger hence why they (think) need multiple millions to retire.

They say: I am going to travel, buy this, do that, etc. There is no reason to wait until retirement to do those things. You want to see Europe? You go when you're still working. "But I don't have time to go to Europe." You have to recheck your priorities now. The old live to work, work to live saying comes handy here. Want a certain car? Same thing. Give yourself time to enjoy it. You have to do that while you have your health as there is no guarantee going forward. I know of too many people that ran into health problems before they hit retirement age (or right after) to bank on having the ability to do all of these things. This is at 65 too. Everyone ages and slows down. The expenses drop off in a hurry.

In reality, very few people hit the million dollar mark, let alone multiple millions, but everyone retires and manages to get by. Sure, some people don't have much but then they never had much to begin with. These people still seem pretty damn happy from my perspective.

I agree with this insanely.

My girlfriends parents.. let's just say they are quite well off now... They retired in the last 2-3 years..


Except within those last 2-3 years Dementia is setting in on her mom, and her dad is having trouble walking.. and it's like ****

Her dad wants to go to sports games, but I want close seats like he does to enjoy it.. But all those stairs. My god

Her mom wants to go out and do things, but gets so aggravated because of the dementia... they have all the time and money in the world now to do it... but CANT ( hence why I started the company I did to try to help)


And it's like.. sure.. when they pass my gf is wellllll taken care of. But I'd rather them be able to enjoy life.

It's like right now they are talking about her mom wanting her dream car.. except 2 weeks ago her mom took off the mirror of her current car hitting their trash can and now she doesn't want to drive. So it's like.. she can get the dream car... but now doesn't even want to drive.

 

[Black Gold 380R]

I have no idea where I will land in the end.

I just got divorced and had to take out a home equity loan to pay my Ex half of the value of the house when she didn't make one payment towards the house and did not work or support me while I got educated or achieved my career experience. So, she got half for doing nothing just because I said "I DO." WTF???

I guess I was her retirement plan, but she didn't get anywhere near 2.1 Mil.

I have my military retirement. I put a percentage of my pay towards my TSP every pay period and my employer matches it. I have my Federal Employees Retirement System (FERS). And I better have SS when I retire. Been paying into that shit and being taxed since I was 18.

So, I'm pretty sure I'll have enough to survive when I retire. Although when I look at my accounts I sure as hell don't see 2.1 Mil. LOL....

 

[03cobra#694]

Everyone has a different opinion of retirement. I want to retire with the lifestyle equal to what I have now. I'm not going to be sitting on my couch just deteriorating. I will have more time to do things. The more things you do, the more you spend.

I'm not banking on SS one bit.

I honestly haven't change out lifestyle in 2 years since we retired. My SS actually starts next month, and is substantial without mentioning amounts. Most of my saved is in a couple of accounts, and let's just say, I'm good. I was lucky in my last job for my income, and we actually saved and didn't just blow money. I feel blessed for the decisions we made.

 

[Fat Boss]

I agree with a lot of the above. Also, remember the journey is often better than the destination. That said, my target is $4M. I'm semi-confident I'll hit that in the next ten years and retire around 64.

 

[GCG]

So, I'm pretty sure I'll have enough to survive when I retire. Although when I look at my accounts I sure as hell don't see 2.1 Mil. LOL....

Shiiiiit. Not with all these projects you got

 

[IA Shelby]

Assuming a 4% 401K withdrawal rate, each $1M equates to $40K per year. Add on Social Security bucks to roughly estimate retirement income.

I would hope that your principal doesn’t go down with withdrawing 4%. The rest of your portfolio gains back what you remove.

 

[DanenGraham]

I'm hosed on retirement. Like will have a house paid for and some money saved, 401K and small small pension, but nothing near like that.

I'm spending most of my money right now, while I can enjoy whatever I want to do (single/no kids). I also plan on working as long as I can (where I'm at anyway) as it's a pretty easy gig and I believe in what we are doing. So retirement could be when I'm 75-80 if my health keeps up. Might go part time in 20 years or something to have some more free time though.

I'm probably not going to make it that long though. I just assume that there is 50/50 on getting cancer and dying these days.