Question

Mr. Birdie has worked hard as a Math teacher all his

life and has saved 42 a million dollars. A savings bank
has offered him 4% interest per annum on his savings.
Mr Birdie is retiring at 65 and wants enough to live on
until his 90th birthday. He figures that he will have
$1666.66 a month.
Can you explain where his calculation may have come
from if it is correct. Explain your thoughts in the box
below.

Answer 1

You'll likely need assets worth 10 to 16 times your salary by the time you leave your job. A 45-year-old making $120,000 who hopes to retire at age 60, say, should already have nearly $700,000 set aside. (See the Retire Early calculator.) You can get by with less if you'll have other sources of income.