askjdisd wrote:
My saving has picked up recently, but I feel I'm way behind the 8-ball on this. Any thoughts?
As has been said a couple times, you have MORE than the average for your age (a couple years ago a study showed that the average 45-year old had only $25,000 invested for retirement; you're way ahead of that at just 31 years old). Also, as has been said, just because you have more than the average doesn't mean it's enough.
The good - $1,000 a month is decent. Keep that up and with your start you will have $1,571,261.46 at age 62, and that's at JUST 7% annual return. Not super rich, but you could make it work on that, and if you can't then give more later when you make more. Your goal should eventually be to give more than that if your income allows. 15% MINIMUM should be the goal, and more if you can stomach it (I don't know your income and I don't want to know, so I don't know if you're in the right range or not).
The bad - You have debt. Good that that car loan will be gone soon. Student loan debt is a pain too. Once all that debt is gone (you should consider getting that student loan debt gone quickly), then NEVER ever go into debt for anything other than a house that is no more than 25% of your take home pay again.
The point to ponder - You not wanting to buy a house. For sure you can make it in your later years without buying a house, but you'll need to put even more away than you are if you don't buy a home. Buying a home and paying for it quickly is one way to GREATLY limit your outgo in retirement. As a renter, your rents will continue going up until you die.
A point to not believe - Another poster mentioned that people in your generation will have to work to age 70 before retiring. I call BS on that. Put your money away, live well within your means, stay out of debt, and you can retire at 60 or earlier even if you want. All it takes is a plan. Plan to work until 70 and you likely will. I've already begun teaching my kids (who are young and still living at home) that they can create their own destiny. At 31, you're young enough to manage a retirement in your mid 50s if you really want to. We have so much earning potential in the US, and so many viable living options that you can sock away 50% of your income if you really wanted to. Go do it!