How Much Do You Really Need to Retire?

How Much Do You Really Need to Retire?

magic-number

“People with plans achieve far more than people without plans. Successful businesses follow business plans. We even prepare written plans for after we are dead. So, it only makes sense that we should apply the same forethought and planning to our lives.”

~Stefan Wissenbach, financial strategist and founder of MagicNumber.com

One of my goals for this year is to really get a good plan in place for retirement saving. As an entrepreneur, saving for retirement has not been my top priority as much as, say, feeding my family. That said, I know it’s incredibly important, and I also love the idea of work becoming optional at some point before I’m ready to actually stop working, both for the security and flexibility that provides!

Retirement planning can be a bit overwhelming, though, since it seems pretty impossible to go from $0 to $500,000 or $1 million or however much you might need!

And just how much money do you need to make work optional anyway?

Even if you have been putting money in savings or a retirement account, knowing exactly how much you need or when you’ll reach that point can be a bit elusive.

It Depends on Your Lifestyle

Personally, we’re not planning on an especially extravagant retirement. We like our simple life out in the country, and while I will want to have enough money to travel to see our girls even if they move away (while praying that they’ll stay close!), I don’t see us jet-setting around the world, buying expensive cars or building a bigger house.

On the other hand, if you are planning to travel the world or enjoy the arts or whatever your passion may be, you’ll obviously need to take that into account as well.

And, of course, the number is going to depend on when you hope to reach that point too. You’ll need a whole lot more money to retire at 45 than you will to retire at 70.

Perfection Paralysis

It’s questions and variables like these that make me shove my fingers in my ears, close my eyes and sing, “La la la la” as I try to ignore the need for retirement planning. Sure, I could pay a financial advisor to answer them for me, but what I’d get is one person’s opinion at a fairly significant cost.

Trying to make sense of the numbers sucks the motivation right out of the whole “work is optional” goal. And let’s face it, if you’re not motivated to reach that point, you’re going to have trouble making the decision to set aside the necessary money each month.

MagicNumber.com

magic numberI had the opportunity to play with MagicNumber.com a couple of weeks ago, and I gotta tell you — this is a seriously cool program. I walked through and created a bare bones retirement plan just to see what the absolute minimum amount of money I should be putting away each month in order to retire by 65 would be. That number was lower than I expected, which was encouraging.

And then the real fun began.

I decided to see how much money I’d need to put away to retire at 45 (just 15 years away), or to retire with enough money to jet set around the world after all. Sean and I had a lot of fun dreaming up various scenarios and coming up with various plans to make them happen before settling on the one that actually made the most sense for us right now.

Not Just Retirement Planning

But MagicNumber.com doesn’t just do retirement planning. You can also figure out how much you’ll need to put away each month to buy a new car with cash in 3-5 years, or how much you need to save for your 25th anniversary celebration, or whatever your financial goals may be.

They’re also developing other goal-setting tools to help you create new habits and design vision boards for your future!

To get your Magic Number today:

  • Visit MagicNumber.com and enter the age at which you want work to become optional.
  • Design your perfect post-work life using Magic Number’s fun and interactive tools.
  • Let the system calculate your “Magic Number”, the amount of wealth you need for work to become optional and monthly goals to help make that happen.

When would you like work to become optional for your family? What do you hope to do in your retirement?

This post is sponsored by MagicNumber.com, but all opinions are 100% mine.

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