Retirement Planning Basics
The key question is: how much do you need saved to generate your desired income for 25-30 years of retirement? The most common approach is the 4% rule — you can safely withdraw 4% of your portfolio annually.
Target Savings = Annual Income Needed × 25
The 4% Rule
Based on the Trinity Study, withdrawing 4% of your portfolio in year one (adjusted for inflation each year after) has historically sustained a portfolio for 30+ years with a 95% success rate.
Frequently Asked Questions
How much do I need to retire? A common target is 25× your annual expenses. Wanting $60,000/year means you need about $1,500,000.
When should I start saving? As early as possible. Starting at 25 vs. 35 can mean twice the retirement savings thanks to compound interest.