If you think saving effectively for retirement simply means knowing the total amount of money you need on the day you tell your boss sayonara, you’ve only done part of the calculation.
After all, “knowing” that number — which is really a misnomer, given that almost none of us know how long we’re actually going to live in retirement — doesn’t tell you anything about how to get to the number.
That’s why Peter “Pete the Planner” Dunn says the most important thing to know is how much you need to save every month to reach a total number that seems reasonable for retirement.
“It’s the only prudent number to think about because it leads to action,” Dunn tells IBJ Podcast host Mason King.
Dunn also wrote about the issue in last week’s IBJ.