Your reader is correct. When he or she uses the usual retirement calculators, the result overestimates they amount of savings they will need, and the number of years they must work. Why? Because they all use salary to determine retirement savings needs. Salary is irrelevant when it comes to determining retirement savings needs.
How much savings you need for retirement, depends on how much you spend in retirement, not on your salary. Their is a new retirement planning formula and method, that does just that, calculates your retirement savings needs based on your retirement budget. The Green Retirement formula and method. At the following link, you can try the Green Retirement Calculator, and compare your retirement savings needs with Green v.s. the traditional calculators. You may be pleasantly shocked.
http://www.iplanretirement.com
If your reader is paying $2000 per month in mortgage or rent, and moves to another part of the country and pays $500 per month for housing, they can retire with $450,000 less in required savings. If they move to a location that doesn't require a car they can retire with $180,000 less in savings. Those two actions, taken together, enables your reader to retire with $630,000 less in savings needs.
Your reader is right - the retirement industry is wrong.
Kimberly Palmer, senior editor for U.S. News & World Report, writes about how to save money, avoid scams, manage debt, and be a savvy shopper. Send your personal finance questions to her for expert money advice.
Ramsay Mameesh of CA @ Dec 14, 2008 18:23:37 PM
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