Part 1: Terrible Ways To Figure Out Your Number
April 26, 2008 – 6:53 amThis post is the start of a new series on how to determine your retirement savings goal.
I’d like to kick this series off by point out several bad ways to figure out how much money you need to be able to retire. Here are just of few:
- Don’t ever take the time to figure it out (this one is popular!)
- How ever much you’re worth @ the early social security age
- How ever much you’re worth when you’re over 45 and you get “downsized”, “RIF-ed”, or just plain let go.
- $1MM (one million dollars). This one is popular too. Ever heard of inflation or frugal living?
- Sit on your calculator twice and then average the numbers
- Generate a random number between 1 and 1,000,000 using Random.org (hurray! $248,419 for me!)
- $100,000 more than you currently have. This works for a salary that makes you happy too. Just change $100,000 to $10,000.
- One one-millionth of our national debt = $93,783. This estimate adjusts every day! http://www.brillig.com/debt_clock/
Retirement planning can be a complicated subject, but it doesn’t have to be. Starting the process and taking a few simple steps will provide a preliminary goal and will serve as a basis for a more detailed retirement plan in the future. By investing a little time now you will be much more likely to achieve a meaningful, enjoyable retirement.
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