What a couple making $180k needs to retire comfortably

This is the amount of money that a couple making $180,000 a year needs to save up for retirement. Typically what most people would recommend is just multiplying your salary by 25. So $4.5 million, and they'd call it a day and say that's your retirement number. Personally, I don't think that this is accurate. The way that I would focus on doing it is to start by looking at how much money is actually hitting your bank account after paying taxes. In this case, $135,000. And then I would use 80% of that number. That's because typically you're living off of 80% of your money and then investing 20%, and during retirement you're no longer investing. So really, a couple that's making $180,000 per year is going to be living off of $108,000 at retirement. The next thing that we need to factor is that both people would be getting Social Security, which on average is $24,000 per person. And so if we subtract all that from the $108,000, that means we get to $60,000. This is the amount that needs to be covered by the retirement savings. You could follow this formula and again, you could multiply 60,000 by 25. That is based on something called a 4% safe withdrawal rate. And all that that means is that you can withdraw 4% of your retirement balance without it ever being depleted. This number has actually recently been changed to 4.7%. And so instead, I would focus on multiplying 60,000 by 4.7%. And if you did that, you would find that your retirement number is $1.276 million. This number right here should be the minimum for a couple making $180,000. If any of this is helpful, sign up for my weekly newsletter using the link in my bio.