Save more now, to retire earlier
To know where all my spending stands at any given time across all of my accounts is UNBELIEVABLE. Mint has truly helped my wife and I see the light at the end of the financial tunnel.
—C.J. White, Mint User
Looking forward to the day you work because you want to, not because you have to? While there’s a lot of potential complexity to anyone’s personal financial situation, the basics of saving enough money to get to retirement are simple.
Set Your Goal
To maintain your lifestyle in retirement, you’ll need roughly 80–90% of your annual income at retirement age. What will you be making then? Assume a 1–2% average annual real growth rate until your target retirement age, less 10–20%, to get your number. Or use a retirement calculator at Ameritrade, Etrade, Motley Fool, or Fidelity.
Never let your money retire
You should enjoy 25–30 years of chasing grandkids, changing the world, or whatever you choose to do after 65. Keep your money invested and you’ll only need 20x your last year’s salary on the day you retire to make ends meet for 30 years. If you’re counting on Social Security, you’ll need roughly 15x.
Start saving yesterday!
Einstein called compound interest the “eighth wonder of the world.” Why? In an average stock market, every $1 you invest in your 20’s will be worth $10 at 65, in your 30’s $2, and in your 40’s $5. So, if you didn’t start saving yesterday, start today!
Let your employer help
Always maximize an employer’s 401K plan. Every dollar you invest pre-tax will cost you 25–30% less. If your employer also offers a 50% match, you’ve already achieved a 100% return, plus compound interest in the future. If you leave your employer, move your balance to a Rollover IRA or 403b to lower your fees and get more investment options.
Let Uncle Sam help
Retirement savings incentives abound. After maxing out your 401K, invest in the right IRA for you. Our IRA Advisor will help you pick the best one to help your money grow tax-free or tax-deferred.
Get the right mix of stocks, bonds, cash
The return on your retirement portfolio will be driven by its allocation across stocks, bonds and cash. Track your retirement accounts in Mint and you’ll see how much you’re holding in these categories. Rule of thumb: invest a percentage no higher than your age in fixed return assets like bonds and cash.
Make sure the market isn’t beating you
Mint shows you how your portfolio is performing compared to the stock market over time. If you’re meeting or beating the growth rate of the S&P 500, after fees and commissions, you’re doing well. If you’re not, consider moving from actively managed mutual funds, or equities, to lower cost index funds that are tied to the performance of the market.
