Most workers in the U.S. retire between the ages of 60 and 65.
So what you’ll read next might come as a surprise:
The average 50-year-old has less than $50,000 saved for retirement…
And 45% of Americans have nothing saved at all. Zero!
What’s your situation? Do you have enough?
And for those of you who think you have enough…
Today I’ll show you why you might want to redo your math.
The Magic Number
Everyone’s financial situation is a little different.
But to make this simple, let’s say retirement lasts 20 to 30 years...
And during that time, the average person needs $5,000 a month to pay for basics like housing, food, and medical bills.
So the question is:
How big a nest egg do you need so it provides you with $5,000 per month?
The answer might surprise you.
You need more than $1 million.
Saved by the Stock Market?
To try and reach that $1 million number, many folks invest in the stock market.
For example, let’s say you invest $1,000 a month for 30 years, and the market goes up by its historical average of 6% a year.
Hypothetically, at the end of 30 years, you’d have $1 million.
There’s only one problem:
Just because the market goes up by 6% a year, that doesn’t mean you earn 6% a year…
After taxes, fees and inflation, that 6% a year gets chopped down to about 3%.
Here’s what it looks like on a graph:
As you can see from the red shaded area, after taxes, fees and inflation, what you thought would be worth $1 million is only worth $450,000.
And that’s not nearly enough to retire.
What About Social Security?
Some folks believe they’ll be saved by Social Security.
Unfortunately, the Congressional Budget Office recently stated that, just 17 years from now, Social Security will basically be unable to meet its obligations.
Bottom line: if you’re planning to retire, don’t count on Social Security…
You’ll need to build a nest egg on your own.
Sound the Alarm
We’re sorry that we’re the ones who have to sound the alarm about this…
But most folks don’t recognize the severity of this problem.
And sounding the alarm—recognizing that there’s a problem—is the first step in solving this crisis.
Now that you’re aware of the problem, we can start creating some solutions.
So if you’re one of the millions of Americans who don’t have enough to retire (if this crisis is something that affects you), check out Wayne’s article tomorrow:
He’s going to explore some solutions.
In the meantime, so we can get a sense for everyone’s situation, tell us something:
Tell us how many years you have before you retire…