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How Big Does Your Nest Egg Really Need to Be?

November 18, 2018

From the Kiplinger website

Anyone who has ever thought about retirement has surely asked themselves one basic question: How much do I need to have saved up? Unfortunately, the answer to this riddle is not simple nor one-size-fits-all. The amount depends on a variety of factors, and everyone’s calculation must be calibrated to their personal situation.

Many large financial companies have a hard time building an advertising campaign around a concept that is so complex and has so many moving parts. They’d rather just give you a target number that is probably big and scary. Why bother with the math equation part when it’s so much easier to say, “If you don’t have at least $2 million stashed away, you won’t be OK.”

Let’s call retirement what it really is: 20 to 30 years of unemployment. Fortunately, this type of unemployment can be planned for. Aimlessly accumulating savings in your retirement accounts to fund this goal is meaningless without directly basing it on your situation.

Understanding this, let’s take a deeper dive into the Nest-Egg formula:

From → Finance

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