Want $100K a Year When You Retire? Here's How Much You Need to Save by Age 67

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  • Given that the average retiree receives a little less than $1,700 per month in Social Security payments, it's up to you to make up the difference. 
  • If a person retires at age 67 and lives to 92, it will cost approximately $2 million to supplement their Social Security check enough to bring in $100,000 per year.
  • One suggestion is to spend pre-retirement years paying down fixed expenses. 

The best time to start saving for retirement is yesterday. If not yesterday, then today.

We thought it would be interesting to figure out how much you would need to put away to retire at age 67 with an income of $100,000 per year. Let's check out the math. 

Scenario averages

In our scenario, we'll use two averages:

  • Average monthly Social Security benefit in 2022: $1,668.
  • Average life expectancy in the U.S.: 79

Of course, your Social Security could be higher or lower, and you may live to be 100 (or more) years old. The goal here is to give you an idea of how much the "average" person would need to save. From there, you can adjust up or down.

Starting number

If we round up the average monthly Social Security payment, we get $1,700 per month. That means we're working with $20,400 per year. Subtract that amount from $100,000 and we have a shortfall of $79,600 per year.


If you follow the common rule of thumb and withdraw 4% from your investments annually, you'll need approximately $2 million in various retirement plans and income-generating investments. (4% of $2 million = $80,000).

If you were to pull $80,000 from your accounts each year, the accounts would be depleted in 25 years. That would get you to age 92.

To keep this illustration simple, you'll notice we're not factoring in the return you will continue to earn on your investments until the money is withdrawn. We're also not factoring in how much you'll pay in income tax (if you live in a state that taxes retirement income).


Between the years 1960 and 2021, the average rate of inflation was 3.8% annually. That means you would need to withdraw more than 4% of your investments to stay on top of rising prices.

For example, while withdrawing $80,000 in your first year of retirement may work out beautifully, you'll likely need to withdraw closer to $83,000 the following year, somewhere around $86,000 the following year, and so on.

What that means for you is that you'll either have to cut the amount of money you're willing to live on each year or deplete your retirement savings at a faster clip.

The 'what ifs'

This scenario does not take into account that you may one day require in-home or nursing home care. If you have purchased long-term care insurance, your money will last longer. If not, you may want to adjust the amount you save and invest upward.

An alternative idea

Financial guru Suze Orman offers this advice: Make sure you have enough guaranteed income to cover fixed expenses. Here's how that works:

  • Add up how much your bills are likely to be when you retire. Include things like mortgage payments, car loans, utility bills, and other monthly expenses.
  • Log into the Social Security website to get an estimate of how much your monthly Social Security check will be the year you retire.
  • Add in any additional guaranteed income you expect to receive, including other investments, such as your 401(k), IRA, and annuities.
  • Once you've totaled your expected income, check to see if it's more or less than your expected fixed expenses. If your income is more, you're golden. If it's less, you'll need to find a way to supplement it. One way is to develop passive streams of income.
  • Pay down fixed incomes. Anything you can pay off before retirement helps lighten the load.

What's excellent about Orman's suggestion is that it allows you to use the money you withdraw from your retirement accounts to fund the things you want to do in retirement.

Discouragement is the enemy

No matter how old you are, it's never too early to think about retirement. It's also never too late. Let's say you've made it into your 50s with nothing saved. The worst thing you can do is assume that "it's no use." You may not be able to put enough away to pull in $100,000 a year, but if you start saving today, you'll still have more than Social Security or a pension to depend on.

The point is: Few of us feel ready for retirement. The idea of planning, saving, and investing can be daunting. But I'm here to tell you, most of us are in the same boat. Planning for retirement requires us to trust our heads over our emotions. Do not allow discouragement or negative thinking to prevent you from improving your life.

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