- Mr. R - $100 ever 2 weeks in a 403b (no company match)
- Mr. R $80 per month in an IRA
- Mrs. R - 6% of income into 401k (4% company match)
- Mrs. R - $40 per month in IRA
I used the retirement plan calculator on Wells Fargo's website. If I retire at 60 and Mr. R at 67, they recommend that we save $1211 per month!!! And that's if we still continue to have income from our rental property. (Which I only calculated at the current $325 in income we have each month after all the bills are paid. That will obviously increase once the mortgage is paid off.)
$1211 per month is not possible for us. And if we do this, they project we may receive $12,331 per month at the start of retirement. Really?! Damn. That's way, way more than we make now. I know they add in increases in our income and inflation but damn that's a lot of money! It's scary to think we could need that much in 29 years. Hopefully by then both our condo's will be paid off. I can't imagine needing that much money.
And this is the point where I usually stick my head in the sand and pretend that what we are saving is enough. There's no way we could achieve that level of savings. There's a fine line between saving as much as we would need for the future and having the money to enjoy life right now. Who knows what tomorrow will bring, we may never live to reach retirement age. Hopefully we do. I would love to retire with Mr. R and travel the U.S. seeing everything this country has to offer. But ya never know, right?
Right now my savings goal for the year is to save $12,000. We've made some great progress on that. Who knows what the future will bring but I'm thinking once we reach our $12,000 savings goal, our next challenge will be to find ways to increase our retirement savings and increase our mortgage payments to pay them down quicker and save on interest.
I reduced our monthly contribution on the Wells Fargo site down to $606 which is the lowest it would let me go and this is the response I got:
Reducing your initial monthly contribution amount from $1,211 (recommended plan) to $606 will require you to contribute an additional $105,216 over your lifetime to reach the same retirement goal.
I know when it comes to this type of savings, the earlier we start the better so this needs to become a priority soon.