Saving for Retirement
How to Make a Million at 55
Seven-figure savings strategies for fifty-somethings.
By the Editors of Kiplinger's Personal Finance Magazine
June 2010
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You've Saved: 0$
To reach $1 million by 65 you need to save $5,466 per month. (This assumes an 8% annual return, invested in stocks.)
If You've Saved: $50,000
To reach one million by age 65 you need to save $4,859 per month.
If You've Saved: $100,000
To reach one million by age 65 you need to save $4,253 per month.
If You've Saved: $200,000
To reach one million by age 65 you need to save $3,040 per month.
Successful Savings Strategies
Take advantage of your peak earning years to top off your savings.
Add an extra $5,500 in catch-up contributions to your 401(k) savings and an extra $1,000 to your IRA.
As you near retirement, reallocate your portfolio to 70% stocks and 30% bonds.
Estimate your retirement expenses and your projected income. If you're coming up short, consider working a few more years.
SEE ALSO:
HOW TO SAVE A MILLION AT AGE 25
HOW TO SAVE A MILLION AT AGE 35
HOW TO SAVE A MILLION AT AGE 45
OUR METHODOLOGY
Have more retirement questions? Find the answers at Jumpstart Your Retirement.
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Reader Comments (16)
Posted by: frank waugh at 01/29/2008 12:40:18 PM
if i had an extra 5,466 a month to put away i wouldnt need you.
Posted by: Kathy at 02/25/2008 09:05:23 AM
Well, looks like I'm outta the game, that's more than twice as much as I make in a month.
Posted by: Mark at 03/27/2008 07:54:29 PM
...you... shouldn't...wait... til 55 to save money for retirement....
Posted by: georgina at 07/14/2008 04:24:56 AM
Are you kidding us,I have never made $5400 a month in my life,I am not a senator,or lawyer,or a doctor.
Posted by: Bill at 07/14/2008 06:09:28 PM
Guess I'll keep playing the market, the puppies and the ponies.
Posted by: charles w. coates at 07/19/2008 10:27:06 AM
thanks for the information.
Posted by: Cindi at 08/13/2008 11:58:12 AM
I've been saving for over 20 yrs and I see my investments go down monthly I have been putting $5000 yrly for several of those yrs and I'm not seeing 8% that's really bs with the recent economy. Seems futile to me!
Posted by: Jesse House at 02/11/2009 11:04:26 AM
Doesnt seem like bs to me cause im 17 and i can do it
Posted by: cloe at 06/22/2009 08:38:58 AM
I never made much money during my life. Went through two divorces and was left with nothing but starting over. Needless to say I have nothing saved until this year which is a small pittance compared to what this article says I should (have) saved. My biggest concern and horror to find out is that I would need to save each month more money than I make a month. After paying bills there isn't much left. I am saving all I can but now it seems like there is no point because it won't even make a dent on what I need.
Posted by: john taylor at 06/22/2009 03:58:04 PM
...interesting, but predictable, article. As someone said below, if i were making over $5K a month, i would need you. How true, for the most part...Pretty useless really, to the older folks out there, over 45., who live as best they can, and still getting hours cut, with rising prices inevitable...
Posted by: Jade at 09/18/2010 09:32:01 PM
The name of the article states How To MAKE a Million At Age 55. I see nothing in the article whatsoever about MAKING the million. Save this amount, then save that amount, there's no recipe for making anything happen. This is nothing more than a poorly written article with a misleading title to bring people to this web page under false pretenses.
Posted by: Jan at 09/20/2010 10:52:43 AM
So that's your advice. Take $5500 from somewhere and invest it at 8%. I should get your magazine for more great advice.
Posted by: ipscshooter at 09/20/2010 01:55:01 PM
Gee, I can improve those numbers by simply "assuming" a 20% annual return. Back in the "real world", over the last 15 years, the geniuses running my 401(k) accounts have managed to get me an average return of about 1%...
Posted by: GonzoHunter at 09/20/2010 04:50:31 PM
I'll be 56 next month and due to 2 illnesses and my spouse's continual unemployment (he's a carpenter...yeah, keeps getting laid off as companies tank). So how do WE save anything?Tho' our mortgage is paid off, we're barely surviving. Invest? Save? This isn't the SIMS or Animal Crossing, where you can catch fish, bugs and pick fruit and sell it! If only...As someone pointed out, ROI has been going down on everything from savings to stocks to that once untouchable commodity: real estate. If we sold now (and that's a big 'if'!), we'd LOSE money!
Posted by: monkeyfurball at 09/20/2010 10:47:48 PM
I'm 55 and have $2.2 mill. saved for retirement. I started a business and began saving 28 years ago. At the time I had nothing in savings or anywhere else. My business and other assets are worth maybe $3 mill more. I lived below my means and saved all I could. I also gave 10% or more of my income to charity that whole 28 years. It can be done. Yes, my savings are larger than the average person, but the last 10 years have been generous to me as the business has grown. Saving $1 mill isn't that hard if you start early in life. Stay away from an expensive house and pricey cars. Don't buy on impulse. I'm not a miser. I buy the things I want. It's just that I don't have billionaire taste. I cured myself of that cash sinkhole years ago.
Posted by: jj at 09/21/2010 11:15:36 AM
This is the most ridiculous article I've ever seen on finances...If you're 55 or even over 40, and haven't learned how to save anything by then, forget it. How do you think you'll have an extra 3k to save each month anyhow??? This was a laugh. Plus to top it off absolutely NO ideas on how to make extra money...