author: Brent Crossman date: 6/3/15
https://bcrossman.shinyapps.io/Retirement
You can't get somewhere without knowing where you're going.My retirement app helps you know where you're going.
The output is individualized based on:
- Age and Demographics
- Return and Inflation Expectations
- Savings and ability to save
The first issue is it costs a lot more to maintain your lifestyle in the future than what you're paying for that lifestyle today. You have to account for inflation. For instance, a family currently spending $5K a month for housing, cars, clothing, internet/tv/phone, and etc, equates to the following annual need in 35 years when you retire (given 3.5% inflation):
[1] "200,015.43"
And it doesn't stop growing then. The need keeps growing even when you're in retirement
Assuming that $200K of annual expense need, if you intend to live roughly 25 years after retirement and can invest your savings at5% after you retire the amount you'll need to retire is
[1] "4,431,199"
This takes into account$24K of annual post-tax Social Security receipt and a 20% tax rate on distributions
That might seem like a big number but the following chart shows how much you'll need to save per year to hit that retirement hurdle in 35 years under various return expectations:
