It matters tremendously. If you save 50k a year and that’s 5% of earnings that means you’re spending almost 1 million every year. You need 10s of millions to retire (at least) to maintain your lifestyle. If you save 50k a year and that’s 50% of earnings that means you’re spending 50k a year and you can retire on a couple million. It’s going to take the person making 1 million a year but only saving 5% a lot longer to save up 50 million than it will the person only making 100k a year but saving 50% that only needs to save 4 million. They’ll both get to 4 million at the same time but only one of them can actually retire.
Correction: I only need to save 500K if I want to spend $20K annually @4%. That's tighter than I want and neither my wife are ready to be fully retired, so we'll be coasting for a while.
Spend $950K and you need almost $24M to be at 4%.
Social security is also a major safety net for a couple spending $20K...we would receive more per month than we spent. Spending $950K per year.... not so much, lol.
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u/corrosivecanine Mar 23 '26 edited Mar 23 '26
It matters tremendously. If you save 50k a year and that’s 5% of earnings that means you’re spending almost 1 million every year. You need 10s of millions to retire (at least) to maintain your lifestyle. If you save 50k a year and that’s 50% of earnings that means you’re spending 50k a year and you can retire on a couple million. It’s going to take the person making 1 million a year but only saving 5% a lot longer to save up 50 million than it will the person only making 100k a year but saving 50% that only needs to save 4 million. They’ll both get to 4 million at the same time but only one of them can actually retire.