How Much Should You Save for Retirement?

I’m old enough to remember when a million dollars was the magic number for retirement savings. Now? No one in the financial services industry talks about a cool million any more. It sounds quaint. At the same time, it’s still a heck of a lot of money, more than most Americans — myself included  — have in their retirement accounts. We’re going to have to somehow save more by the time we stop working if we don’t want to worry about running out of money over a retirement that could stretch 30-plus years. That said, there’s never been a one-size-fits-all savings number. The amount you’ll need depends a lot on the lifestyle you plan to have in retirement. That’s a big factor you can control. It’s harder to control your health and long-term care costs, though, so it’s good to have a cushion. Learn more about setting savings goals in today’s edition.

Today in our Retire with Money Facebook group, one member celebrated a big milestone: “As of today, we are 100% debt free. In the last 4 or 5 months we have paid off a car loan, our mortgage, and a hearing aid loan. All paid off years ahead of schedule. Feels great! Next step is to accumulate more of an emergency fund of cash.” He didn’t say how old he was, but it’s an accomplishment at any age! Financial advisors strongly recommend that you enter retirement debt-free (although I’ve found they’re often divided on whether you should pay off the mortgage). It can be really hard to pay off debt on a fixed income, especially if your interest payments keep rising. If you’re in over your head, learn some options to manage your debt here.

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