Retire at 55, 60, 65, or 70? Here’s EXACTLY How Much You Need (Based on Real Spending Data)

About this Video

• Video Title: Retire at 55, 60, 65, or 70? Here’s EXACTLY How Much You Need (Based on Real Spending Data)
• Channel: Erin Talks Money
• Speakers: Aaron
• Duration: 00:13:45

Introduction

This video explores how much money is needed for retirement at various ages (55, 60, 65, and 70), factoring in real spending data and Social Security benefits. The presenter uses Fidelity's data on average household spending to create realistic retirement portfolio models for different retirement and Social Security claim ages.

Key Takeaways

• Spending Declines with Age: Based on Fidelity data, household spending tends to decrease as people age. This significantly impacts the size of the retirement portfolio needed.
• Social Security's Impact: The age at which Social Security benefits are claimed greatly affects portfolio size. Claiming early reduces benefits, requiring a larger portfolio; delaying increases benefits and reduces portfolio needs.
• Bridge Strategy: A "bridge strategy" is used to determine how much investment income is needed to cover expenses until Social Security benefits begin.
• Portfolio Size Varies by Retirement Age: The video calculates the portfolio size needed for each retirement scenario (retiring at 55, 60, 65, and 70, with varying Social Security claim ages). Retiring later requires smaller portfolios.
• Risks to Consider: The video highlights risks, such as lifestyle inflation, longevity, increasing medical expenses, and poor market performance, especially crucial for early retirement.