Retirement Timeline

One of the fun things about personal finance (in the nerdiest sort of way) is if your goal is to replace you income in retirement, and you invest based on a percentage of your income, it actually does not matter how much you make! 

Let me give an example. Assuming both people receive a 7% real return:

Person 1: makes $300,000 a year as a doctor. From age 35 to 65 they invest 25% of their income. Using the 4% rule their retirement income will be: $303,000 or 101% of their pre-retirement income. 

Person 2: makes $60,000 a year as a mailman. From age 35 to 65 they invest 25% of their income. Using the 4% rule their retirement income will be: $65,700 or 101% of their pre-retirement income. 

See what I mean?? Isn't that neat? That means we can make some pretty helpful tables. Check it out

Assuming you start from $0, make 7% real return on your investments, and you want to replace 100% of your gross pre-retirement income. 

Investing Percentage Rate	Years Until Retirement
0%	Infinite
5%	52
10%	43
15%	37
20%	33
25%	30
30%	28
35%	26
40%	24
45%	23
50%	22

Seeing tables like this encourage me to better understand retirement investing and invest continue to aggressively.