Of course a consistent 15% per year return is not as Probable as a more certain and lower return Investment.
Lets instead look at the historical long term average annual rate of return for stocks. Over the prior 70 Years or so large company stocks have averaged 10.2% per year and small company stocks have averaged 12.2% per year. Since retirement savings are a long term Commitment and based on these historical rates, we can use an 11% per year long term assumption to reconstruct the example in more realistic terms.
At 11% per year a 21 year old could save $1,000 per year until age 30 and accumulate more (almost twice) at age 65 than a 30 year old saving $1,000 per year until age 65. At 65 the 21 year old would have $645,049 and the thirty year old would have $341,590.........
The point???....there are two
1) The sooner one starts the better
2) Its never too late to start
But the type of investment portfolio depends on the age and individual circumstances. Are you saving appropriately for your
retirement? Based on your age and circumstances
With today's technology and Multimedia Capabilities you can do your own analysis and retirement planning.
A number of environmental factors may dramatically affect the adequacy of Retirement income for future retirees, i.e.:
1. Potential future de-liberalization of social/statutory benefits because of a Failing social security program which will eventually need overhauling.
2. The shift in industry from company funded pension plans to employee Funded defined contribution arrangements, such as 401(k) plans.
3. The prevalent societal mind set that places little or no priority on saving for Retirement either within company sponsored 401(k) plans or through external Savings.
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