Thursday, December 29, 2005

Question # 13

Question #13 How much money will I need for retirement? Does simply asking this question make me hyperventilate? Can I stand to do the math? Am I brave enough to begin?

I just turned 24 but I will answer this question anyways.

Umm - I have no idea how much money I will need for retirement. I just know that by the age of 25 you should be putting from $100 to $200 dollars each month towards (and not withdrawing) a 401K account either through your company or your bank.

I have this handy dandy Destination: Retirement 401K savings plan estimator.
According to that:

you are 25 years old - you make 30k a year - you put 6% of your annual income ($1800 which = $150 a month) into a 401k account - in 30 years (age 55) that account will reach $175,418.
That's with all the interest and the matched amount contributed by your bank or employer.

This little calculator can calculate any annual amount with any income and give you the account balance in 5 years, 15 years and 30 years. Pretty neat.

So for now since I'm still young - I will just rely on this little thing for reference until I can really estimate how much I will actually need based on the pension and social security I will be receiving.
I have a 401k account already that I started two years ago - for now I am contributing only 1% of my income each month - but by next year (depending on where I am) I will probably contribute the maximum about that my employer matches - if I can.

If anyone needs one of these or needs something calculated - let me know.
Posted by Katrina :: 11:21 AM :: 0 Chortles

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