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Determining Savings Goals Retirement Projection Here is a practical example of retirement planning. Select the highlighted text for an explanation of each step: 18 Years: Bruce is 44 and plans to retire when he is 62 years old. So he has 18 years to make sure he lives the life he imagines in retirement. $61,000: Bruce took his current income and increased it by 3% per year until his retirement date. Bruce chose 3% because he expects his wages to keep up with inflation. $48,800: After setting his lifestyle goals and reviewing his basic living expenses, Bruce determined that he will need about 80% of his income in retirement. $34,140: Bruce used the information provided by his employer and his annual statement from Social Security to determine that his income from these sources will total $34,140. $14,660: Bruce took his estimated need and subtracted his income from his pension and Social Security and found that he had a shortfall. The portion of Bruce's retirement pie that he is responsible for providing is $14,660 in income per year. So how much must Bruce have saved up on the day he retires? < PREVIOUS NEXT > #38599