How Much Should You Save for Retirement? | What the Experts Say
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- Опубліковано 3 лип 2024
- Make sure to watch this video if you want to know if you're on track for your retirement goals. Preparing for retirement can be really hard.
Experts always seem to be saying different things.
In today's video, I'll break down how the experts think about retirement and how you can get the most life out of your money. Today's 5-step framework will teach you exactly what you need to know to be on track.
Introduction
00:00 - Experts Introduction
2:15 - Example of Future Retirees!
4:31 - 5-step framework
6:35 - Back out other income sources
8:50 - Applying Withdrawal Rates
11:26 - Retirement Calculator
13:10 - Working With Us
Learn the tips & strategies to get the most out of life with your money.
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Thank you for this. Nice, simple process for figuring out where you stand and where you need to go.
Great video! Thank you
Love it. Thank you for the step by step explanation 😍
This was fantastic, and you made it super simple to understand. Thank you!
Excellent!
Glad you liked it!
This is exactly how I set our goal. I set up a budget based on on how we live currently. Plus included a tax factor of 20% (federal, state, local & property). My advice, listen to James. Root financial is hands down the best advice you can find online.
I appreciate this perspective. Up to now I have been going with the idea of estimating how much? I think I need to live on every year and then multiplying it by 25. And yes, I did figure out what we would get from social security and a small pension and added that to the equation. But what has always stumped me is trying to figure out inflation. This was very helpful, thank you.
Very clear and what I had done myself. I appreciate the overall approach of your channel. Thanks.
Great video for a young couple. Sending to my daughter and son-in-law who are just starting out. Both have professional degrees and are doing well less than 2 years into their careers. The more I can educate them when young, the more I can hope they live a responsible life while preparing for their future self. My kids grew up hearing "You can work as much as you want while the body allows you, but one day you will not be able to work anymore and will be living off of what you saved." Sure hope they hear that in the back of their minds each pay day.
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Why are you quoting Suze Orman?
Definitely a fan of dividend investing. The more you can get paid out to you without having to sell a single share is the saftey net im looking for. Worst case, you can still sell shares if you are in a pinch. Ideally this is in a tax-free account but after tax accounts with qualified divies works for me too 😊
The problem with that is that divaden stocks don't pay all that mutch in divadens so you will have to own multable times the number of shairs. If you make 1% you will have to own 4 times as many shares to make the same as the person who sells 4% of its value to live on. So if that other person has $1m going into retirement you will have to have $4m going into retirment. If you can actually save that wail working that's great but the vast majority of people cant.
Hi James another great video can you share a link to the calculator you used want to send this to my daughter I just sent this vide to her
While I enjoy these videos, as James mentions these are numbers before taxes! This is a HUGE difference to the math! He mentions Social Security payments to contribute to the estimated budget, but SS will be taxed. It's really not as rosy a picture.
What is retirement? That’s the ultimate question isn’t it. Stop working and sit on a boat somewhere or finally do something that brings you pure happiness or fulfillment for the first time in your life?
Financial Freedom!
Where can I find the calculator that you used to show the figures in your video? Thanks 😊
I'm saving ~14% of my after tax income. I calculated that (depending on what market returns are) it should give me between 10x and 20x my salary in my retirement accounts at retirement. I've got a while to go, but hopefully that should be plenty to retire on. 🙂
MERRY CHRISTMAS....
15% is good if you start investing in your 20s and plan to retire at 65/67.
Suze's plan is good. Figure out how much you need each year and how many years you need it. Assuming your investment only matches inflation, you should have enough money. If it exceeds inflation you will have more. Depending on how much it exceeds inflation, there is a breaking point where you will have enough money to spend indefinitely. So if the market returns an inflation-adjusted 3% long term, you can spend 3% forever.
We all need cash flow. Look at it that way. We need the cash flow monthly to pay for the way of life we want to live.
Exactly
You can track automatically how much your checking account balance changes each month by using your bank's app. You can see if it grows or goes down. If you are also saving in a high yield account, this helps and will round out the picture.
Yes!
My wife and I hit it hard the five years we were married before we had kids. We put away 25% of our income and paid off our house. We backed off to 5% savings and she stopped working when the kids were born. We have made a few sacrifices along the way. We have stayed in the same home, we drive older but reliable cars and average two vacations every three years. I am going to retire this time next year at age 54 and have more disposable income than I do now. (As a firefighter I can draw from my 401K without penalty)
Ok, I think I’m going to have to work until I die, and never retire!
I get confused when people use per couple then switch per individual. Seems like everyone does this stop!~
One point seven I think would be enough for my retirement
Dave Ramsey actually says to invest a minimum of 15% once you are debt free (other than your mortgage). Then he says to put everything over the 15% towards the mortgage until it’s paid off, (which ideally would be a 15 year mortgage). Then (if you want) go all out on investing, meaning more than 15%. What are your thoughts on this advice?
We mostly followed Dave R, and it is very beneficial to get yourself out of debt, including your house. Being debt free then let's you choose how you want to live, where you can invest heavily for an early retirement or still save for retirement but also enjoy your life. The key is once you are debt free it is your choice.
If your mortgage interest rate is much less than the average portfolio growth rate (say 7.5% for a 50/50 stock/bond split) you are much better off investing the money.
Generally in my opinion you actually need to do a lot less savings then the experts say, unless you want to live like they live which is not realistic for most people.
Totally agree.
yup....
Well then most people are succeeding considering the median new retiree only has $148k in retirement accounts and a full quarter of new retirees have no separate retirement funds at all
It's all about expenses. 🤑 You all got the wrong focus. Step #1
Not only how much to save but, how to protect your savings. Example: In Jan 2021, I had 1.5M. By Dec., 2022, I have 1M.. 60/40 did not work. $500k Gone!!!! WTF are we supposed to do????
Your supposed to invest long-term, one year is meaningless Long term.
Ride it out.
w/d all of it out and go to Vegas, bet on red.
Do think $500,000 will be enough for retirement if I live a simple and frugal lifestyle? What about $300,000? At my current savings rate I don't see myself generating any more than $500k by retirement and even that's a lofty goal.
Wrong focus. It's all about expenses.
$500,000 is top 20% it's definitely enough if your expenses match your savings
If you are 70, maybe $500k plus social security is enough
If you have a frugal lifestyle, you will be good. Largest concerns need to be expenses - expenses - expenses ...
If you have no debt and live frugally you will be fine. I am retired 5 years, have no pension and have not needed to touch my savings yet.
Dude, those three in the thumbnail are definitely NOT experts.
Dave Ramsey is more "paramedic for people in crippling debt" than he is "expert on retirement"
I have never understood where people get that they will spend less in retirement and not more.
First you want to do stuff when you are retired that you could not do when working as you did not have the time to do it as you where at your job. And in all likelihood it's going to cost a lot of money.
Second medical bills get higher as you age as people are weaker and a lot slower to recover from things the older they get.
I bought a house off an estate where the entire estate had to be liquidated just to pay off all of the medical bills from when she died. This was a house that the family owned for generations. The person who inherited the estate ended up having to sell her house and move into an apartment as she was expecting the inheritance to pay down her mortgage.
Suze Orman an expert???
😂😂😂 agreed.
😂😂
Yeah all those "experts" are more on scale of entertainer to less flattering descriptions...
I know !
I trust James a lot more than these experts.
Interesting reading the comments a year later. Those that complained about 2022 should have done well in 2023 if they didn’t sell.
I'm really struggling to find out how you did the calculation for the inflation. How did you get from $60k to $101K with 3% inflation p.a., in my calculation the result would be $93,478. I don't understand what I did wrong
Your calc is correct. It is (1.03^15) * 60K = 93.5K
“$727,000 per year”?
Lets see, 2022 my gains were -15% and REAL inflation is 20% my 401K lost almost all my annual income and I got 5 years to go. 2023 they are expecting more inflation and a huge stock market correction. Even bonds took a huge hit. I cannot afford to lose any more money
It’s now 2024. Bet you gained it all back and then some 🤑
@@smileygeniprobably stayed in cash…
The important question is, "Are you on track for YOUR retirement?" No one but you can tell you if you will have enough for the retirement you want.
@9:03. $727,000 per year? hmmm???? Haste on the script writing?
Easy answer, max out your 401k every year, you’ll have millions
Its the infation giving me pause. 100K 15 years from now will only be worth 60K today?
Idk bro that's why I cam here
Thank you for this excellent practical walk-through. I should say that I wouldn't use the word "expert" to describe the three celebrities. The hype and often dubious opinions that such conceited blow-hards put out would be better viewed as entertainment rather than advice that one should follow.
Oh my goodness! Someone spoke the truth!
They all have become in love with the sound of their own voices. Lol.
Lol 😆 47 percent of Americans have less than 5k in savings!! Get real.
This guy gives ridiculous examples.
I heard 60%
I’m getting $60,000/year in social security including my wife’s benefit. So I might only need $20000 from accounts, if that. None of those so called experts even consider this.
8,9,10% inflation today, Lets Go Brandon
blah blah…
Orman is a grifter. Kiyosaki is a doomsdayer. Ramsey is a peddler. None of them is an expert.
Only you expert.
Bidenflation. FJB.