Wise sages of 2+2 -- How much should one have saved before retiring?

[PokerPaul]

I know this varies greatly between individuals, but for interests sake and narrow it down assume the following:

- Someone making 85000 per annum pretax
- want to be able to live on 75% of that after retirement
- Must also take inflation into account
- In retirement, can still safely assume to bring in 18k annually from playing some poker for fun on the side.

What figure would one need to attain before one could contemplate retirement while achieving these goals?

[Henry17]

You can't calculate that without having some age estimates. If you are 30 that is very different then if you 50 and want to retire.

[spex x]

[ QUOTE ]
I know this varies greatly between individuals, but for interests sake and narrow it down assume the following:

- Someone making 85000 per annum pretax
- want to be able to live on 75% of that after retirement
- Must also take inflation into account
- In retirement, can still safely assume to bring in 18k annually from playing some poker for fun on the side.

What figure would one need to attain before one could contemplate retirement while achieving these goals?

[/ QUOTE ]

Depends on time. YOu need less to retire at age 80 than you do if you're 22. A helpful website for this question is www.bankrate.com

[Henry17]

$400k though would allow you to live in perpetuity assuming you qualify for full CPP. If too young to get full CPP then you'd need about $600k

[PokerPaul]

OK then, lets say you are 40 years old, and have about 150k saved up already.

otherwise all the above mentioned points apply.

[mtgordon]

So if you want to spend around 45k/year, you can break even with inflation (assume your 18k goes up per year with inflation as well), you're 40 and plan on living until you're 100, you need about 2.75M in todays dollars according to my calculations. I'm not sure why I'm off so much from everyone else though so I could be wrong.

Maybe they assumed you can beat inflation with your money. If you can beat inflation by 5% then you only need around 850k todays money according to my calcs.

[Henry17]

Assuming 8% return on investment you'd need less the $600k. You might be ok with $500k. I'm not sure what effect taking 15-25 years off would have on your CPP but you'd avoid worrying about it and just go with $600k

[mtgordon]

Henry: You're talking 8% on top of inflation right?

[Jimbo232]

This is a really good personal finance forum where questions like this have been discussed in great detail many times:

http://www.early-retirement.org/forums/

This is a pretty all-encompassing retirement calculator that you can input all your assumptions to get an idea of how much you need and how long it will last. It is pretty interesting to play around with:

http://firecalc.com/

[Henry17]

[ QUOTE ]
Henry: You're talking 8% on top of inflation right?

[/ QUOTE ]

Nope. I assume 8% return and inflation of 3%. I think the difference is that I am assuming that since he has Toronto as a location he works in Ontario and will qualify for the max CPP at 65.