How much $ is enough for retirement?

[Nutria]

And then what? What made you only calculate until you turn 81? You may live to be 90 or 95 or even older. My mom was 89 in August and is still doing pretty much okay, living on her own, etc.

More importantly, those are the minimum amounts I'd need. By retiring at 67, my money should last until I'm 99.

[disneysteve]

2. That's about the current life expectancy for a 65 year old.

Actually life expectancy for a 65yo woman is about 86.5 according to Social Security and actuarial tables.

[disneysteve]

More importantly, those are the minimum amounts I'd need. By retiring at 67, my money should last until I'm 99.

That's good. I'd hate to see someone planning to only need money until they're 81 and them running out of money for the last 5 or 10 or 15 years of their life (other than SS of course).

[Nutria]

Actually life expectancy for a 65yo woman is about 86.5 according to Social Security and actuarial tables.

No one will ever confuse me for a woman...

[disneysteve]

No one will ever confuse me for a woman...

Oops. Well it’s 84 for a man.

[Nutria]

Oops. Well it’s 84 for a man.

That's for someone born today. For men our age, it's about 81.

[disneysteve]

That's for someone born today. For men our age, it's about 81.

Actually no. That’s for someone who is 65 now. Of course, that’s an average. SS says 1 in 3 will
live to 90 and 1 in 7 will live to 95.

[TexasHusker]

It's really difficult to say "how much is enough" to retire on. There are two big variables that only you can plug the number in on: 1. How much will you spend, and 2. How much will you make (from your nest egg).

You've got to know the answer to both of those questions before you can begin arriving at your number. If you are going to live off of CDs, then 2% is your annual yield. That doesn't work for most people. More times than not, retirees eventually meet up with an Edward Jones rep who talks them into giving him all of their nest egg and setting up income from an annuity. That is usually an awful idea, but sooner or later, this is what usually happens to wealth, and there is no going back on it. The money is gone and all you have are payments.

So if you aren't going to buy CDs, and you aren't going to buy an annuity, you've got to find a way to make consistent income off of your nest egg. This is a confounding, if not terrifying, problem for retirees, as it is the first time in their lives that they have had to figure out how to generate income from their nest egg.

Related to that a little bit, my father in law just passed away, and each of his four daughters is set to receive around $170,000 cash. Of course, Edward Jones is trying to talk each sister into keeping the money at Edward Jones. None of the sisters have a clue as to what to do with the money. This amount could be a life changer for two of the sisters, but I am afraid they will both blow it or be ill-advised and lose their windfall. They have little chance because they've never "swam in the deep end" on anything financial.