"Save and invest 10% of your income each year" may seem like sound advice. But this sort of conventional wisdom doesn't always serve you well.

Consider that example. Save and invest 10%? Shouldn't there be more to it than that? Imagine you earn $45,000 per year. If you invest $4,500 per year for 25 years, and it grows at 8% per year, this calculator says you'll end up with $355,000. That may seem like a lot, but apply another guideline to it: Per our Rule Your Retirement newsletter and based on research, in order to make your money last, you should conservatively aim to withdraw 4% of it annually (adjusting it for inflation each year). So 4% of $355,000 is $14,200, or less than $1,200 per month.

But if you earn $100,000 per year, saving and investing 10% gives you $10,000 to sock away each year, and in 25 years at 8%, it will amount to nearly $790,000 -- more than twice as much than a $45,000-earner would have. A 4% withdrawal would be $31,600, or more than $2,600 monthly.

The assumption here is that having a lower salary means you won't want to spend as much after you retire. That could be true, but it doesn't have to be. Save as much as you'll actually need.

Mind the rate
Meanwhile, how much you save is only half the equation. If you save even as much as $20,000 annually, but invest it so conservatively that it only grows at 2.5% per year, you'll end up with just $700,000.

Growth rates matter. A broad-market index fund will instantly plunk you in major companies, such as Pfizer (NYSE:PFE), AT&T, and Philip Morris International (NYSE:PM), and will give you a shot at something close to the market's historical average annual return of around 10%.

But you can aim to top that by adding some carefully selected individual stocks to your mix. I screened for companies that keep a big chunk of every dollar of sales as profit, and whose revenues have grown at a strong clip lately:

Company

CAPS Rating (Out of 5)

Net Margin

3-Year Avg. Revenue Growth

Transocean (NYSE:RIG)

*****

31%

60%

Oracle (NYSE:ORCL)

****

24%

17%

PotashCorp (NYSE:POT)

****

39%

25%

XTO Energy (NYSE:XTO)

*****

24%

26%

Vale (NYSE:VALE)

*****

31%

25%

Data: Yahoo! Finance, Motley Fool CAPS.

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Longtime Fool contributor Selena Maranjian owns shares of Amgen. Pfizer is a Motley Fool Inside Value recommendation. Philip Morris International is a Motley Fool Global Gains pick. The Fool owns shares of XTO Energy. Try our investing newsletters free for 30 days. The Motley Fool is Fools writing for Fools.