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What percentage of your income do you save for retirement, and do you feel as though you are on track? Company contributions can be factored, but should also be considered part of your income.
I currently save 6% for retirement and also receive a 3% company match. I would like to increase my personal contributions to about 34%(between Roth IRA and 401k) of my salary once my student loans are paid off in May. I currently feel as though I am behind, but after a couple years of the increased contributions, I will feel as though I'm on pace.
I'm 25 and feel like I'm obsessed with retirement savings compared to most people my age that I come across.
What percentage of your income do you save for retirement, and do you feel as though you are on track?
EVERYone is different with varying needs and circumstances.
What works for me or Joe may not be enough for you or Steve.
Focus less on percentages...
Quote:
I currently save 6% for retirement and also receive a 3% company match.
I would like to increase my personal contributions...
Good. Do that.
MAXIMIZE the employer contributed 401K and MAXIMIZE the IRA...
then establish savings and eliminate debt.
Once your head is square... look to invest for growth.
Get in the habit of living on less.
What you do with what you save/invest is less important than doing it steadily.
You are very smart to be thinking about this at your age. If you can keep a steady 10% with an occasional bonus input that would be good. You should often view your net worth(It should be increasing).and the amount you spend on interest(should be very little).
I put 3% in and that is matched 6% by my employer. I believe the match maxes out at 10% (of my salary). I anticipate moving to 5% next year. I'm only 24, so while I'm only able to put in the bare minimum required to get a company match, I keep reminding myself that I have years and that compound interest is working in my favor.
What percentage of your income do you save for retirement, and do you feel as though you are on track? Company contributions can be factored, but should also be considered part of your income.
I currently save 6% for retirement and also receive a 3% company match. I would like to increase my personal contributions to about 34%(between Roth IRA and 401k) of my salary once my student loans are paid off in May. I currently feel as though I am behind, but after a couple years of the increased contributions, I will feel as though I'm on pace.
I'm 25 and feel like I'm obsessed with retirement savings compared to most people my age that I come across.
I'm 42 and I save about 27% and I feel I'm on track to retire at 55 (although just barely). I didn't start saving for retirement until I was 26, so the fact that you're putting something away at 25 is good.
Keep it up...but don't forget to enjoy life, too. Saving 34% of your salary is great, if you are still able to enjoy life while you are doing it. But if you are only able to realistically save 25%, don't beat yourself up over it.
At one point, I was saving 1/3 of my salary and I was actually quite unhappy, even though my net worth was great, I was not happy with my everyday quality of life. I ratcheted it down somewhat and did a modest lifestyle upgrade and became happier.
I'm 42 and I save about 27% and I feel I'm on track to retire at 55 (although just barely). I didn't start saving for retirement until I was 26, so the fact that you're putting something away at 25 is good.
Keep it up...but don't forget to enjoy life, too. Saving 34% of your salary is great, if you are still able to enjoy life while you are doing it. But if you are only able to realistically save 25%, don't beat yourself up over it.
At one point, I was saving 1/3 of my salary and I was actually quite unhappy, even though my net worth was great, I was not happy with my everyday quality of life. I ratcheted it down somewhat and did a modest lifestyle upgrade and became happier.
Thanks for the concern, and am also aware of this issue. I am currently contributing 6% from my salary while over halfway through a 1 year payoff plan on my student loans. My goal was to pay off all $40k in one year, and I am right on track. Once that is done, maxing out my 401k and Roth IRA won't be an issue, since the increase is only about half of what I have been paying for my student loans. I will actually have more cash flow than I'm used to even with the contribution increase.
I make a decent salary, but I am modest with my living expenses. I grew up in a lower middle class family and haven't been spoiled with luxury items. I also don't feel the urge to go out and spend on stuff.
Thanks for the concern, and am also aware of this issue. I am currently contributing 6% from my salary while over halfway through a 1 year payoff plan on my student loans. My goal was to pay off all $40k in one year, and I am right on track. Once that is done, maxing out my 401k and Roth IRA won't be an issue, since the increase is only about half of what I have been paying for my student loans. I will actually have more cash flow than I'm used to even with the contribution increase.
I make a decent salary, but I am modest with my living expenses. I grew up in a lower middle class family and haven't been spoiled with luxury items. I also don't feel the urge to go out and spend on stuff.
I am putting 30% into retirement (20% is my contribution and 10% my employer). My husband puts 25% into his (20% him and 5% his employer). We are also putting an additional 5% into non-retirement savings because if we retire early we will need money that we can access without a tax penalty. I think we are on track for retiring in our mid-50s but it that would be dependent on market returns. I am 43.
At age 25 I don't think you are behind. I think you are doing fine with the 10%, just make sure that you raise it after the student loans are paid off or when you get a raise, put half of each raise into your retirement so you never get used to having the extra income.
Congratulations! You are so far ahead of most people your age! Most twenty-somethings don't even think about retirement.
When I was your age I always funded my IRA to the max and contributed the max (it was 15% then) on my 401k. Later on I had a job plus my own company, so even though I didn't actually take income from my company it still showed as income on my return. I would put 25% of that amount into a SEP-IRA.
We always had enough to live a comfortable (not luxurious) lifestyle, and best of all, I retired at 50. At the rate you are going I think you will be retiring early (if you want to). Keep up the good work.
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