After you get 2.2 million, you say you can take $80K per year.
So you're saying that you'll be able make 3.6% interest per year.
I think that rate of return (after taxes and inflation) is reasonable.
In my opinion, the best way to get this is to invest in the S&P 500 via a low cost ETF such as SPY. There are many different opinions on this point.
Assume you can get the same 3.6% rate of return while you are saving.
Assume you save the same amount every year.
How long will it take to get to $2.2M?
Save $10K per year - 62 years
Save $20K per year - 45 years
Save $30K per year - 37 years
Save $40K per year - 31 years
Save $50K per year - 27 years
Save $60K per year - 24 years
Save $70K per year - 22 years
Save $80K per year - 20 years
Save $90K per year - 18 years
Save $100K per year - 17 years
But I suggest you look at the whole thing a different way.
Start with your estimated salary. How can you have about the same amount of spending money while you are working and after you retire? (A lot of people say you need a little bit less money in retirement, so you can adjust for this.)
For example, assume you get a job with take home pay of $100K per year.
If you save $20K per year, and work 45 years, you'll have $80K per year while you're working, and $80K per year in retirement. If you are able to save $30K per year for 34 years, you'll have $70K per year while you're working, and $70K per year in retirement.
I made a little spreadsheet, and came up with all the above numbers.
It's not too hard to set up a small spreadsheet and play with these numbers yourself.
I have some constants at the top - A1 has amount saved per year and B1 has interest rate, as a fraction, not a percent, 0.036.
After that, each row of the spreadsheet has a different year, starting with year 0, balance 0.
The first column is the year, for easy reference.
The second column is the new balance. Old balance + (Old balance * interest rate) + Amount saved per year.
Use $A$1 and $B$1 to refer to the constants at the top.
I ignore inflation to simplify things. Instead I use an after-inflation interest rate. These are all very rough estimates, after all. Who can really predict investment returns 20 years from now?
Assume you can get the same 3.6% rate of return while you are saving. Assume you save the same amount every year. How long will it take to get to $2.2M?
Save $10K per year - 62 years Save $20K per year - 45 years Save $30K per year - 37 years Save $40K per year - 31 years Save $50K per year - 27 years Save $60K per year - 24 years Save $70K per year - 22 years Save $80K per year - 20 years Save $90K per year - 18 years Save $100K per year - 17 years
But I suggest you look at the whole thing a different way. Start with your estimated salary. How can you have about the same amount of spending money while you are working and after you retire? (A lot of people say you need a little bit less money in retirement, so you can adjust for this.)
For example, assume you get a job with take home pay of $100K per year. If you save $20K per year, and work 45 years, you'll have $80K per year while you're working, and $80K per year in retirement. If you are able to save $30K per year for 34 years, you'll have $70K per year while you're working, and $70K per year in retirement.
I made a little spreadsheet, and came up with all the above numbers. It's not too hard to set up a small spreadsheet and play with these numbers yourself. I have some constants at the top - A1 has amount saved per year and B1 has interest rate, as a fraction, not a percent, 0.036. After that, each row of the spreadsheet has a different year, starting with year 0, balance 0. The first column is the year, for easy reference. The second column is the new balance. Old balance + (Old balance * interest rate) + Amount saved per year. Use $A$1 and $B$1 to refer to the constants at the top.
I ignore inflation to simplify things. Instead I use an after-inflation interest rate. These are all very rough estimates, after all. Who can really predict investment returns 20 years from now?