Total
Control
Some
Control
Out of
your
control
Saving vs.
Spending
Asset
allocation and location
Employment earnings and duration
Longevity
Market
returns
Policy
regarding
taxation,
savings and benefits
Retirement
Saving vs.
Spending
Saving vs. spending: Advice varies on how much to sock away, though most experts say aim to save 10% or more of your income. Fidelity has a simple way to do this: The 50/15/5 rule. Allocate no more than 50% of take-home pay to essentials, save 15% of pretax income (that includes employer contributions) for retirement, and save for emergencies by socking away 5% of take-home pay in savings. The rest is yours to do what you will, though paying down high-interest debt if you have it should likely be a priority.
Asset allocation and location: T. Rowe Price offers a simple guide on asset allocation broken down by age to get people started, recommending 90%-100% of your retirement portfolio in equities in your 20s and 30s, with that switching to 80%-100% in equities with 0-20% in fixed income in your 40s. By your 50s, they’re recommending 60%-80% in equities, 20%-30% in fixed income, and 0-10% in short-term investments, then moving increasing amounts into fixed and short-term as you creep up in years.
Asset
allocation and location
Employment earnings and duration. Plenty of factors impact your earnings, including career choice and where you live. Another thing: Switching jobs for more money or asking for a raise.
Employment earnings and duration
Longevity. We assume you want to live a longer life — though this does mean you will need to save more for retirement — and to that end, Harvard Medical School has published a list of 10 things that can help lengthen life, including exercise, diet, avoiding smoking, maintaining healthy weight, and having friends. Especially if you’re healthy and don’t have many health issues or risk factors for health issues, talk to your financial advisor about how much more you should save should you live to 100 (or older!).
Longevity