How Much You  Will  Need To 
Have in The Bank in Order To

SPEND $1,000 PER MONTH!  

Rounded to the nearest thousand  

This chart shows the approximate amount of money or investments, that you will need invested,  to allow you to withdraw $1,000 a month for the periods shown in Col. # 1  

For example, assume that your future savings will earn 8% interest (Col. # 4).   

Then assume that, after you retire, you will need $1,000 a month for 10 years (Col. # 1).  

In looking at the chart, you will need, at the start of the ten years, approximately $82,000.  If you have this amount, you will be able to withdraw the $1,000 a month for the full 10 years, at which time your savings would be close to zero

NOTE--WE ARE SPENDING THE PRINCIPAL 
ALONG WITH THE INTEREST!!
We are actually living up to that famous Bumper Sticker:

Let’s check back with our 40 year old, now 55. Is the $588,000 enough?  The income needed is about $93,600 a year or $7,800 a month. Let’s round that up to $8,000 to make our calculations easier. Assuming the $588,000 will earn 8% a year, we look at the above chart to see how much is enough. We’ll need to assume a life expectancy, so let’s go with 30 years after retirement. Our now 55 year old, is “planning” to go to heaven at age 85. 

He or she will need, 8 times $136,000 or $1,088,000 in the nest egg  in order to withdraw $8,000 a month for 30 years! OUCH! The nest egg is only $588,000 so we’re a little short.    
Our 40 year old may not be able to retire at age 55!!  However, there are some additional factors that we’ve haven’t considered, such as, other retirement plans, asset sales, insurance proceeds, working part time or even Social Security.  

Now, let’s use this chart to calculate what your future earning power must be in order to supplement your Social Security Benefits.  

Assume that you will need $3,000 a month when you retire at age 65.  

Statistically, you will live at least 10 more years but we'll assume that you will live 15 years (Col # 1). 

If you really need the $3,000 and your future investments will earn 8%, (Col # 4) then you will need to have a retirement fund of $105,000 multiplied by 3 or $315,000.  

Can you use our other charts to determine how much you will need to save each month in order to have the $315,000?  YES!

Go back to the Table titled,  How a $100 A MONTH WILL GROW!  We can use this chart to fine tune our future retirement needs. Assume an interest rate, years to retirement and find the amount closest to your $315,000 goal.  

For example, look at the 6% column and assume you have 15 years to accumulate the $315,000. How many hundreds of dollars do you need to save each month?  Divide the $315,000 by $29,082 to see that you’ll need to save about $1,083 a month.

Now, assume you have the same goal, the same 6% but you have twice as many years—30 to accumulate the $315,000! Your savings per month drops to $313.58.  ($315,000 / $100,452)

Now, assume the same facts but look at the 10% interest earnings column.  15 years--$760.00 ( $315,000 / $41,447)  a month. 30 Years,  $139.35 a month.  ($315,000 / $226,049)

Wow! You’d better start today!!!

   

Each of us, needs a plan! Written out!

Goal oriented! Flexible but firm! 
Use a ledger! Use a computer!
Use a legal pad! 
But whatever, write it down!

For those of you who may just be starting on the road to financial freedom, please be sure that you see the outline,