These are the two biggest fears about retirement:
1. Not saving enough money while you’re still young
2. Spending all your retirement money too quickly
Things have changed since you started saving for your retirement. People are living longer, there are health care costs, the cost of living is increasing and there’s inflation. And that’s before you even consider the possibility of your investments failing.
In this video, filmed at the Real Estate Investing Summit during the Titanium Mastermind in the Dominican Republic, Stephen Michael Miller reveals how much money you really need to be saving for your nest egg.
LONGEVITY RISK AND RETIREMENT SPEND-DOWN
Longevity risk is the risk of outliving the money you have in your retirement fund. This is a relatively new problem, since people are living longer than they used to.
Retirement spend-down is consuming the principal and dividends of retirement income until it’s all gone.
For the first time ever, it’s not uncommon for people to hope they’ll die younger. The thought of being age 80 and broke is worse to them than being dead.
People who are getting to retirement age are realizing that their prospects are bleak. They’re finding themselves being forced to go back to work, even at Wal-Mart or Target, just to make ends meet. Social security won’t cut it, in order to maintain their lifestyle.
Plus, they’re not getting any younger. They have a greater need for long term care and more medical bills.
HOW MUCH DO YOU NEED TO SAVE?
If you’re young and retirement is far off, the time to start saving is now.
Let’s say you want to build a nest egg of $1.5 million at age 65. If you’re currently 35, and you plan to invest every month at a 10% interest rate, you’re going to need to save $1,300 every month.
The average American saves 5% of their income and spends the rest. If that’s you, you need to make at least $318,000 a year for the next 30 years to hit your goal.
Alternatively, save a greater percentage of your income, or find an investment vehicle that can return you more than 10%.
The MOBE Platinum Mastermind is where the most experienced mentors in investing and asset protection share their investment methods with fellow members. To learn more about the Platinum Mastermind, click HERE.