Retirement

I was reading newsweek again this week and came across a great article

It should get everyone thinking. Never mind the macroeconomic side, concentrate on the personal finance side of
the article (though the macroecon is just as interesting, just not to everyone).

So in your life you can either save more now to have more to spend in the future. Or you can choose to spend now and have less to spend in the future. Pretty simple.

So by retirement, what kind of savings do you want to have? Enough to replace your income (with account for inflation)? This is probably most people's goal since it's a simple thing to aim for and if you've been living with it for the majority of your life, you can be comfortable with it if you have good insurance. This can require a huge amount of capital which varies depending on your risk tolerance. Annual returns on investments can vary from 1% to 8-9% real interest before tax. So to replace an income of $60,000, you'd need between $700,000 to $6m. That's alot of money.

Which leads to the next question...
When do you want to retire?