Check out the handy table below from JP Morgan Asset Management’s 2014 “Guide to Retirement” that details how much should you have saved up for retirement today based on your current age.
The chart details the amount of money a person must have in retirement funds saved to have sufficient funds to maintain their lifestyle after retirement. The chart clarifies that if people begin saving at a younger age for retirement the funds will grow greatly because of compounding interest. The chart is used with a intersection of both age, and yearly earnings.
Albert Einstein once called compounding interest the “8th wonder of the world”, and this chart demonstrates this maxim is true. The chart assumes a retirement age of 65, and allows for 7% growth in pre-retirement fund earnings, and 5% growth in earnings after the retirement age of 65. The chart assumes a annual contribution of 5% from the working person for their retirement. It also forecasts an average of thirty years retirement after the age of 65.