How Much Do You Need to Invest for $1 Million in Retirement?

We’ve talked about investing and retirement, but what’s the magic number you need to have saved by the time you retire? And how much do you need to invest per month to hit that number? Is retirement actually a myth?

Here’s the video version for those less inclined to read a blog post!

What you need in retirement is going to depend on a number of variables. 

  1. How old are you? The younger you are, the easier it will be to hit your number. 
  2. How much do you have saved right now? The more you have saved, the easier it will be to hit your number. 
  3. When do you want to retire? The further out, the easier it is to save for it!
  4. How do you want to live? If you’re going to travel a lot, that might be a bit more pricy than hanging out with the grandkids every day. 

I’m not going to pretend I know the right investment number for everyone watching this. But what I can do is make some assumptions and give you a very possible scenario.

Also, I can tell you that you should go to a financial advisor for professional advice on investing. By no means should you take my word as gospel for investing. 

Here’s an example

First of all, let’s say you are shooting for $1M invested when you retire. This will allow you to live off the growth every year without withdrawing any of the $1M. At a 6% rate of return adjusted for inflation, that would give you $60k to live on per year. Completely reasonable if you have your house paid off and aren’t traveling all over creation!

Now, let’s look at 4 ages and the amount you would need to invest per month at each in order to hit $1M by the age of 65. Each example is assuming no retirement savings have been made as of that age. Also, it assumes you’ve completed baby steps 1, 2, and 3, (check out the blog post here for a complete rundown of the 7 baby steps of personal finance) and are ready to invest!

Age 25

If you’re 25 years old, we’re in about the same boat! You got a lot of time left but don’t use that as an excuse to hold off on your investing! To hit a million dollars by 65, you have to put $503 per month into a 401k and/or an IRA. Make sure you go Roth

Use the investment calculator yourself by clicking here.

Also, your contributions total only 24% of the $1M, nice! The rest is growth! 

Age 35

If you’re 35, you’ve got a little less time but it’s still very doable. To hit that mythical 7th figure, you’ve got to put away $996 per month. You can do it! 

Use the investment calculator yourself by clicking here.

Your contributions total 36% of the $1M. 64% is growth, not bad!

Age 45

If you’re 45, it’s time to crank up some heat. But don’t get discouraged! You’re going to need to invest $2165 per month to hit your $1M. 

Use the investment calculator yourself by clicking here.

Your contributions to your $1M will be just over 50%. All things considered, not bad. 

Age 55

It’s going to be a challenge, but keep your focus on the goal. If you have nothing saved, you’ll need to put $6103 in per month to hit $1M by your 65th birthday. 

Use the investment calculator yourself by clicking here.

Your contributions will be 73% of the total $1M. 27% will be growth.

What can we learn from this?

Okay, the lesson to learn here is SAVE NOW! Whatever age you are at right now, save save save. 

I talked in a recent video about compound interest and how that significantly impacts your retirement. Compound interest has one friend, time. The younger you are, the easier it is to take advantage of compound interest. 

That’s clear from the percentages above. At 25, you only have to contribute 24% of your $1M. At 35, it’s 36%. At 45, it’s 52%. And at 55, you’ll be contributing 73%. 

Compound interest and your investment growth curve

Compound interest allows us to make the growth curve actually a curve. The less time you have, the less compound interest you get and thus, the straighter the line. We want our line to be curved! 

In our 25 example, You can see our line is nicely curved. 

At 35, it get’s a little straighter but still very curved. 

At 45, it’s just a little straighter. 

At 55, it’s completely straight. 

So how does this change your perspective on saving for retirement? Do you think you can do it? 

Obviously many of these factors may change. You may receive a higher average rate of return over the years. You may need more than $1M set aside because of the lifestyle you want to have. You may need less than $1M. You may have some money invested already which will really help! It really depends on what your goals are. 

So I’ll pass this question on to you. What are your financial goals for retirement? I want to hear from you in the comments below! 

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Do your own research. My content is intended to be used and must be used for informational purposes only. It is very important to do your own analysis before making any investment based on your own personal circumstances. You should take independent financial advice from a professional financial advisor when considering your retirement options. Though I teach financial principals, I am not an investment advisor and none of my advice constitutes legal, tax, or investment as a professional. Everything I share is based on my own research and is intended for your benefit.


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