The Dive

[John Mercier]

Originally Posted by FlyingScot

This is a really good article--the AAW tool is very cool (though it does not take a genius to know this guy's overspending, haha)

Even if times are tough, everybody over age 25 or so should be saving 10%/year to avoid an unpleasant reality at retirement (easiest way for most is employer's 401K)

His retirement savings are actually above the mean for someone his age...
We no longer actually suggest the 10%, because we have better projection tools. But even Fidelity uses an age times annual household income multiply that can be found in the FiST score calculations.

A basic outdated calculation on that would suggest that he should be around $1.8 million in retirement savings (6X) for his age. But the simple calculation doesn't deal well with incomes over the middle class income threshold of about 90K annual household. It doesn't adjust well for the drop in SS income replacement, nor can it take into account the percentage replacement drop expected in the middle of 2030s.

Needless to say, he is doing very well when the mean to age is accounted for... but terrible when the income aspect is involved. We see a lot of that.