• News/Talk
  • Music
  • Entertainment

Marketplace

Getting Personal

Save for Retirement?

Question: Chris - How much should someone save for retirement if they do not plan on retiring? I love my job and I plan on working well into my 70s as long as I have no health issues. I'm 50 now and have a modest retirement portfolio. Dave, St. Paul, MN

Answer: Don't think "retirement." Think a "margin of safety" and "flexibility." What you're trying to do by saving is maintain your current standard of living throughout your lifetime. Savings gives you a margin of safety if your job vaporizes when your older and harder to employ or if your health deteriorates.

Maybe you don't want to retire, but perhaps you'd like to change careers, try something else. A financial cushion allows you to do that easily. Perhaps you'll decide when your older that what you really desire is travel the world for three years. Well, with savings you can.

What's the right number? Realistically, most people can set aside 10% to 15% of their income with good habits and by taking advantage of savings vehicles like 401(k)s. Depending on your wealth, health, and dreams you could be more or less aggressive than that. But it's a good benchmark to start with.

07/17/08 by Chris Farrell

Looking for guidance on your personal finances? I'm taking your questions and answering one here each day. Just click on the "Ask a question" link to tell me what's on your mind.

Chris Farrell Marketplace Money personal finance guru

Ask a question

Subscribe to RSS

Archives

August 2008
S M T W T F S
          1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30
31            

August 2008

July 2008

June 2008

May 2008

April 2008

March 2008

February 2008

January 2008

December 2007

Latest Comments

Gifts (2)
Dave wrote: One followup to Chris' answer. The questioner asked if the ... [read]
Chris Farrell wrote: That's right. Thanks.... [read]
Recession? Or Not? (1)
jim wrote: Thanks for answering my question!... [read]
Debt Trouble and Reverse Mortgage (1)
Eric wrote: Seems like you need to get a budget and make some cuts in yo... [read]
Prepay Credit Card? (1)
Raymond wrote: American Express cards in South Africa do pay interest on cr... [read]
Roth-IRAs (2)
Dave wrote: To expand on Chris' comments, the contribution limit applies... [read]
Chris Farrell wrote: Good point. Thanks. Chris... [read]
 ©2007 American Public Media