Too many of us don’t know exactly how much money we will need in order to retire worry-free. Chances are, even after you retire you won’t be sure you have enough. Here’s a simple way to tell.
Create a realistic budget based on what you are spending now. Then start to make modifications based on all the ways your life will change in retirement – fewer costs relating to work, perhaps more in healthcare, etc. Obviously this won’t be exact, but it’s a starting point.
Once you know how much money you will need each year, you must estimate how many years you expect to need it. To estimate, take the average life expectancy and subtract from it the age you expect to retire. That gives you a total amount needed.
For more, read the full article here.