6 ms·

How Much You Should Save for Retirement, Based on 139 Years of Data

36 points by robdoherty2 13y ago

exratione 13y ago
Meaning how much you should save under the assumption that the biotech research community will fail to create any means for you to buy additional healthy years between now and your death by aging. That is a very shaky assumption if you are in your 40s now, and outright laughable if you are significantly younger. Forms of rejuvenation of function in specific tissues have been demonstrated in the lab in recent years, and the SENS Research Foundation continues to gather support and funding. Other research groups have their own SENS-alternatives in terms of plans to treat aging by addressing what they believe to be the primary causes. Biotechnology in general is showing no signs of slowing down.
- anovikov 13y ago
  Don't you think that this will first, and foremost, increase years of one's healthy life when one could work?
- Shivetya 13y ago
  then there are those of us who would prefer those extra years for something other than work. If anything, its best to save all you reasonably can. If not for what you plan for then for what you don't. That not planned for category doesn't always have to mean bad things
- dllthomas 13y ago
  It seems like you can hedge this, to some degree, by investing in biotech...
- jl6 13y ago
  While I share your optimism, there's a very large gap between "demonstrated in the lab" and the point where you can laugh at that assumption. Are there any proven life extension techniques beyond calorie restriction and regular exercise? I see a lot of possibilities and early research projects, but essentially nothing in the way of results.
  - michaelochurch 13y ago
    Not to contradict your point, but what matters from this perspective is healthy life, not lifespan. If you're healthy enough that working to maintain whatever income you need or want (you might work less, because you need less, or go without working if you can; this is about having the option) remains a reasonable prospect till 75, and drop dead at 76, then retirement isn't a huge issue. We don't, strictly speaking, need people to live to be 150 to solve the retirement problem. (In fact, them living that long in poor health would be counterproductive; however, it's almost a certainty that radical life extension requires rejuvenation.) We just need for people to be healthy and able to work while they are alive.
elangoc 13y ago
This is an important article for HN readers, if this somewhat recent article from the East Bay Express is anything to go by: http://www.eastbayexpress.com/oakland/the-bacon-wrapped-economy/Content?oid=3494301 http://www.eastbayexpress.com/oakland/the-bacon-wrapped-econ... The gist is that 20-something year olds come to the Bay area (or wherever else), go from graduating college to suddenly having high-paying jobs, and then they blow their money on short-term edification without thinking long-term. And so I think this type of personal planning for a future is important, too. Maybe down the road, we've accumulated a nest egg, or have enough money in the bank to bootstrap! (Does the EBX article generalize? Yes, very much so, but my hunch is that the article raises insightful points that are definitely worth more than the generalizing or ranting that detractors might point out, for the record.)
- dagw 13y ago
  What's wrong with having a few years of pure, wasteful, hedonistic fun in your youth while you still have the chance. You'll have plenty of time to live a respectable, balanced, upper middle class, suburban life later on. Don't waste your early-mid 20's doing it.
  - skorgu 13y ago
    Is ~$5k a year to fund a roth IRA really going to crimp your style that much? Alternatively, if you can't afford to do that maybe you can't afford quite as hedonistic a lifestyle as you thought.
citricsquid 13y ago
I'm not sure what it's like in America but in England the retirement situation is absolutely criminal. I went through high school and was never once taught about retirement (and specifically pensions), my knowledge of pensions was limited to "they pay for old people" and until last year when a pension adviser came into the company office and explained them to me I did not consider ever setting up a pension. Thanks to that adviser I now have a pension that will (assuming I continue contributing to it) give me a fantastic retirement that I would not have otherwise had because starting a pension at 20 provides massive benefits over starting at 30 or 40. I've found myself preaching the value of pensions to dozens of people also in their early 20s in the last 12 months, not one person I've spoken to has understood the value of starting a pension now until it was demonstrated to them, it's crazy.
- adolph 13y ago
  A cynical viewpoint: the acceptable curricula for most schools is set through an accreditation process heavily influenced by the government. The government has an interest in maintaining a supply of voters dependent on the dole. The curricula stays abstract and while the procedures to calculate retirement savings may be taught, the concrete examples stick to keeping the trains running on time.
  - sp332 13y ago
    I doubt it. A good retirement plan will make you a good taxpayer for decades longer.
  - koralatov 13y ago
    That would be a good plan, except for the fact that those on long-term benefits have amongst the lowest turnout at elections.
- ronaldx 13y ago
  There are significant downsides to saving for a pension as well, as I will try to illustrate: The advantage of putting money into a pension (rather than regular savings) is presumably that you get to save the money in a relatively tax-efficient way. In the UK, you can presently take a percentage as a tax-free lump sum, and an annuity allows you take advantage of an assumed lower tax liability at retirement. That's all very nice. However, if you have 40 (or even 50?) years until retirement, you'll be relying on several governments not to pull those rules and pinch from your pension pot, and you're relying on the financial industry to kindly look after your money for that long. More urgently, putting money into a pension means that you don't have it for what you need now: if you need to pay off (or simply avoid) expensive debt, or if you need to save for housing rather than paying extortionate rent/mortgage costs, those should likely be higher priority. There are not many young people who can put those concerns to one side and start saving earnestly for retirement.
justincormack 13y ago
I can't immediately see what return figure they are assuming on investments, but it seems to be based on historic long term average levels that may well not apply, given how low interest rates are...
- atwebb 13y ago
  If you're planning long term then current interest rates don't matter as much. I think they should also stress the costs of investing and not just a "rise in stock price", they are many places you can make or lose money if you're not careful and in the long run .08% is a big deal.
RyanZAG 13y ago
Assuming that the world is the same today as 100 years ago is a terrible bet. Corporations and the stock market behave very differently today than they did 100 years ago. The speed of market changes and their impact on companies and share prices is very different. While the article makes a good point about retirement, the numbers are likely to be incredibly different from the reality we will face.
bryanlarsen 13y ago
As far as I can tell, this makes the assumption that American stock market returns are normal. I would argue that global stock market returns are far more normal. What have returns on the German stock returns looked like over the last 140 years, just to pick a counter-example? In the past 140 years, the United states has gone from backwater to superpower, has enjoyed stable & good governance, has not been invaded, has been able to plunder a large amount of "greenfield" resources, et cetera. The next 140 years cannot be as (relatively) fruitful for the United States. When you're number 1, relative growth is hard/impossible, and you must rely only on absolute growth. The trivial answer to the question in the title is "you cannot save enough to account for everything". If you're saving in dollars, you can be wiped out by hyperinflation. If your investments are on the NYSE, what happens if it gets nationalized after a revolution? Of course, the answer is that you pick a level of risk that you're comfortable with. Anybody that tells you anything is 100% safe is misleading you. And remember that rare events are much less rare than most models predict (cf Taleb).
- jjindev 13y ago
  When I looked at this, and ran my primitive simulations, I decided that it really, really, mattered when you were born. 70 year averages, or 140 year averages, matter very little when markets and economies turn on spans of decades. I mean, we know that if you put a bundle in the market in 1980, you did pretty well. you did the same in 2000, not so much. No average can make that easier. edit: put differently, none of us live long enough to benefit from 140 year averages
mathattack 13y ago
This article is bad on so many levels... 1) The lifehacker article doesn't list the 2 most important sanity check #s. What is the rate of return that they're assuming for the equity and fixed income? 2) If you dig into the actual research, with the hard to find link, it's actually not really 60% equity, 40% bonds. It's 60% large cap equity (which performs worse than all equity and low cap) and 40% short term bonds (which over long time periods underperform long term bonds, though are less volatile). 3) Despite digging into the linked article, I still can't find assumed rates of returns. 4) Why are we to believe the next 40 years will be like the last 139? The last 139 had a different set of wars, different stages of development, a different tax regime, and different government. All this talk about "Starting early" assumes a few things: 1) That you can afford to. How many retirees who today contribute 10k/year could have afforded that in 1973? 2) There are no massive events that wipe out returns. We've had two in the past 13 years. This doesn't mean don't save, but it does mean don't overestimate the value of saving early. (It's not worth eating out of tin cans to squeeze an extra $500 into a pension) Edited to clarify my comment on bonds and starting early, and fix a formatting issue on the second list.
- phillmv 13y ago
  Basically, we're all fucked and I don't understand how anyone retires.
  - microcolonel 13y ago
    Things aren't that hopeless. The point is that you invest in something which has greater growth and dividends, as well as something secure. Right now I'm very young, so I just put a certain amount away into Canadian bank stocks and other stocks with a history of ever-improving dividends. I think there's one particular guy somewhere here in Canada which retired at 30-something on a fairly plain job by investing in solid stocks for the long term.
  - mathattack 13y ago
    I think the real lesson is we don't know how long or how much we'll need to save. We do know that we'll live longer than the people for whom the original pension systems were defined. We also know that returns may not be as good as they have been in the past. What can we do? 1 - Invest reasonable amounts in aggressive enough well diversified tax friendly financial assets with low fees. (Low fee index funds in 401Ks, and 529s for folks with kids) 1.5 - Delink your financial investments from your human capital. If your salary (& options) are very tied to the success of silicon valley, don't invest in the NASDAQ. If you are working for a mining company, avoid commodities funds because you don't want your investments to lose value the same time you lose your job. 2 - Avoid high cost debt. (Credit cards, unsecured bank loans, etc) 3 - Invest time (and if needed, money too) in your professional education continuously. Assume your skills (and salary) will degrade on a trendline of 5-10% each year that you don't invest. 4 - Plan on working a long time. (75? Note - this isn't as hard as previous generations, because less of the work is manual) 5 - Invest in your health, since you'll be working and living longer. 6 - Invest your time in a happy and healthy home life. This sets you up for a pleasant surprise of retiring at 55 if the situation allows, or 75 if it doesn't.
quaffapint 13y ago
This is an unrealistic joke. Scraping by paycheck to paycheck like many folks and you're supposed to save near 50%? And my company just told me my healthcare premiums are going up another 10% without any cost of living increase in the past 5 years, all other costs have gone up every year. Obviously this chart is totally useless other than to simply say save what you can. Last I calculated it, I would have to work a little more than another 100 years to retire. So, I'll be starting that new saas when I'm about 120. For the first time in awhile here, we're doing worse than our parents. Dang baby boomers.
- elmuchoprez 13y ago
  The article does not say to save 50% of your income. It says that if during retirement you want to replace 50% of your income average during your working years, you need to save approximately 17% of your working income over a 30 year period.
  - quaffapint 13y ago
    Depending upon what category you're looking at. For us folks that are close to retirement than a 20 year old, it does say to save near 50%. My current 8% is what I can max at, and thus my calculation of working another 100 years based upon x times my salary.
- r00k 13y ago
  Am I reading correctly that you haven't had a raise in 5 years? And in fact have been subject to effective pay cuts, due to increased healthcare premiums? Isn't it time to look for a better job?
  - quaffapint 13y ago
    Heh - Yup, it's been pretty much pay cuts in the end. It's a real pain when you dont go out to dinner or vacations and still keep living paycheck to paycheck as everything gets more expensive. Around this part of the US there are jobs, but ever since the economic downturn the pay never rebounded, and now that employers realize they can get us developers cheaper, I don't expect them ever to go up that much any time soon. Given also that I can work from home, and am the sole support of my family, I don't want to take the risk of getting in an even worse position. This is why I spend many, many hours trying/doing side work to pay the bills. Here's to hoping my upcoming saas will actually gain traction...
michaelochurch 13y ago
The fuck, man? A retirement thread? What is this, Old People News? Retirement is for middle-class fuck-ups. If you don't have a major, live-anywhere-you-want-and-never-have-to-work-again hit by 40, then what the fuck did you do with your life? If you're halfway smart, you'll be financially independent (startup exits, at least two, plus passive income) by your mid-30s. What the fuck are you doing? Go out and raise a $800,000 seed round! I don't actually think that way, but a lot of people do, and when you compete for jobs (usually on wage) you are in the market with them. They depress wages (if they aren't thinking about retirement, why should you?) but they also push up demands in a lot of those bullshit cultural competitions (such as the need to live in Manhattan in many NYC firms) that get very expensive and kill what you should be saving. That is why, barring unforeseen technological or economic changes, most people in the VC-funded bubble world will never be able to save enough for retirement. To save requires being smart, and you're typically going to be competing (on wages and rent) with people who are stupid.
mkramlich 13y ago
This is one area in particular where the past is not a reliable guide to the future. The future is an unknowable country especially with respect to how much one should be saving. The rough rule of thumb, of course (I hope of course) is to save as much as you can and that isn't too painful. Savings is a cushion. It provides security. It buys options. Money can be turned into (almost) anything else you need/want. And there is absolutely no way that a sufficiently intelligent, knowledgable and honest person can come up with some magic specific number or percentage and declare confidently that that is what you should do. Save as much as you can/want, and generally the more the better. Old news. Resolved issue.

36 points by robdoherty2 13y ago

Meaning how much you should save under the assumption that the biotech research community will fail to create any means for you to buy additional healthy years between now and your death by aging. That is a very shaky assumption if you are in your 40s now, and outright laughable if you are significantly younger. Forms of rejuvenation of function in specific tissues have been demonstrated in the lab in recent years, and the SENS Research Foundation continues to gather support and funding. Other research groups have their own SENS-alternatives in terms of plans to treat aging by addressing what they believe to be the primary causes. Biotechnology in general is showing no signs of slowing down.

anovikov 13y ago
Don't you think that this will first, and foremost, increase years of one's healthy life when one could work?
Shivetya 13y ago
then there are those of us who would prefer those extra years for something other than work. If anything, its best to save all you reasonably can. If not for what you plan for then for what you don't. That not planned for category doesn't always have to mean bad things
dllthomas 13y ago
It seems like you can hedge this, to some degree, by investing in biotech...
jl6 13y ago
While I share your optimism, there's a very large gap between "demonstrated in the lab" and the point where you can laugh at that assumption. Are there any proven life extension techniques beyond calorie restriction and regular exercise? I see a lot of possibilities and early research projects, but essentially nothing in the way of results.
- michaelochurch 13y ago
  Not to contradict your point, but what matters from this perspective is healthy life, not lifespan. If you're healthy enough that working to maintain whatever income you need or want (you might work less, because you need less, or go without working if you can; this is about having the option) remains a reasonable prospect till 75, and drop dead at 76, then retirement isn't a huge issue. We don't, strictly speaking, need people to live to be 150 to solve the retirement problem. (In fact, them living that long in poor health would be counterproductive; however, it's almost a certainty that radical life extension requires rejuvenation.) We just need for people to be healthy and able to work while they are alive.

elangoc 13y ago

This is an important article for HN readers, if this somewhat recent article from the East Bay Express is anything to go by: http://www.eastbayexpress.com/oakland/the-bacon-wrapped-economy/Content?oid=3494301 http://www.eastbayexpress.com/oakland/the-bacon-wrapped-econ... The gist is that 20-something year olds come to the Bay area (or wherever else), go from graduating college to suddenly having high-paying jobs, and then they blow their money on short-term edification without thinking long-term. And so I think this type of personal planning for a future is important, too. Maybe down the road, we've accumulated a nest egg, or have enough money in the bank to bootstrap! (Does the EBX article generalize? Yes, very much so, but my hunch is that the article raises insightful points that are definitely worth more than the generalizing or ranting that detractors might point out, for the record.)

dagw 13y ago
What's wrong with having a few years of pure, wasteful, hedonistic fun in your youth while you still have the chance. You'll have plenty of time to live a respectable, balanced, upper middle class, suburban life later on. Don't waste your early-mid 20's doing it.
- skorgu 13y ago
  Is ~$5k a year to fund a roth IRA really going to crimp your style that much? Alternatively, if you can't afford to do that maybe you can't afford quite as hedonistic a lifestyle as you thought.

citricsquid 13y ago

I'm not sure what it's like in America but in England the retirement situation is absolutely criminal. I went through high school and was never once taught about retirement (and specifically pensions), my knowledge of pensions was limited to "they pay for old people" and until last year when a pension adviser came into the company office and explained them to me I did not consider ever setting up a pension. Thanks to that adviser I now have a pension that will (assuming I continue contributing to it) give me a fantastic retirement that I would not have otherwise had because starting a pension at 20 provides massive benefits over starting at 30 or 40. I've found myself preaching the value of pensions to dozens of people also in their early 20s in the last 12 months, not one person I've spoken to has understood the value of starting a pension now until it was demonstrated to them, it's crazy.

adolph 13y ago
A cynical viewpoint: the acceptable curricula for most schools is set through an accreditation process heavily influenced by the government. The government has an interest in maintaining a supply of voters dependent on the dole. The curricula stays abstract and while the procedures to calculate retirement savings may be taught, the concrete examples stick to keeping the trains running on time.
- sp332 13y ago
  I doubt it. A good retirement plan will make you a good taxpayer for decades longer.
- koralatov 13y ago
  That would be a good plan, except for the fact that those on long-term benefits have amongst the lowest turnout at elections.
ronaldx 13y ago
There are significant downsides to saving for a pension as well, as I will try to illustrate: The advantage of putting money into a pension (rather than regular savings) is presumably that you get to save the money in a relatively tax-efficient way. In the UK, you can presently take a percentage as a tax-free lump sum, and an annuity allows you take advantage of an assumed lower tax liability at retirement. That's all very nice. However, if you have 40 (or even 50?) years until retirement, you'll be relying on several governments not to pull those rules and pinch from your pension pot, and you're relying on the financial industry to kindly look after your money for that long. More urgently, putting money into a pension means that you don't have it for what you need now: if you need to pay off (or simply avoid) expensive debt, or if you need to save for housing rather than paying extortionate rent/mortgage costs, those should likely be higher priority. There are not many young people who can put those concerns to one side and start saving earnestly for retirement.

justincormack 13y ago

I can't immediately see what return figure they are assuming on investments, but it seems to be based on historic long term average levels that may well not apply, given how low interest rates are...

atwebb 13y ago
If you're planning long term then current interest rates don't matter as much. I think they should also stress the costs of investing and not just a "rise in stock price", they are many places you can make or lose money if you're not careful and in the long run .08% is a big deal.

RyanZAG 13y ago

Assuming that the world is the same today as 100 years ago is a terrible bet. Corporations and the stock market behave very differently today than they did 100 years ago. The speed of market changes and their impact on companies and share prices is very different. While the article makes a good point about retirement, the numbers are likely to be incredibly different from the reality we will face.

bryanlarsen 13y ago

As far as I can tell, this makes the assumption that American stock market returns are normal. I would argue that global stock market returns are far more normal. What have returns on the German stock returns looked like over the last 140 years, just to pick a counter-example? In the past 140 years, the United states has gone from backwater to superpower, has enjoyed stable & good governance, has not been invaded, has been able to plunder a large amount of "greenfield" resources, et cetera. The next 140 years cannot be as (relatively) fruitful for the United States. When you're number 1, relative growth is hard/impossible, and you must rely only on absolute growth. The trivial answer to the question in the title is "you cannot save enough to account for everything". If you're saving in dollars, you can be wiped out by hyperinflation. If your investments are on the NYSE, what happens if it gets nationalized after a revolution? Of course, the answer is that you pick a level of risk that you're comfortable with. Anybody that tells you anything is 100% safe is misleading you. And remember that rare events are much less rare than most models predict (cf Taleb).

jjindev 13y ago
When I looked at this, and ran my primitive simulations, I decided that it really, really, mattered when you were born. 70 year averages, or 140 year averages, matter very little when markets and economies turn on spans of decades. I mean, we know that if you put a bundle in the market in 1980, you did pretty well. you did the same in 2000, not so much. No average can make that easier. edit: put differently, none of us live long enough to benefit from 140 year averages

mathattack 13y ago

This article is bad on so many levels... 1) The lifehacker article doesn't list the 2 most important sanity check #s. What is the rate of return that they're assuming for the equity and fixed income? 2) If you dig into the actual research, with the hard to find link, it's actually not really 60% equity, 40% bonds. It's 60% large cap equity (which performs worse than all equity and low cap) and 40% short term bonds (which over long time periods underperform long term bonds, though are less volatile). 3) Despite digging into the linked article, I still can't find assumed rates of returns. 4) Why are we to believe the next 40 years will be like the last 139? The last 139 had a different set of wars, different stages of development, a different tax regime, and different government. All this talk about "Starting early" assumes a few things: 1) That you can afford to. How many retirees who today contribute 10k/year could have afforded that in 1973? 2) There are no massive events that wipe out returns. We've had two in the past 13 years. This doesn't mean don't save, but it does mean don't overestimate the value of saving early. (It's not worth eating out of tin cans to squeeze an extra $500 into a pension) Edited to clarify my comment on bonds and starting early, and fix a formatting issue on the second list.

phillmv 13y ago
Basically, we're all fucked and I don't understand how anyone retires.
- microcolonel 13y ago
  Things aren't that hopeless. The point is that you invest in something which has greater growth and dividends, as well as something secure. Right now I'm very young, so I just put a certain amount away into Canadian bank stocks and other stocks with a history of ever-improving dividends. I think there's one particular guy somewhere here in Canada which retired at 30-something on a fairly plain job by investing in solid stocks for the long term.
- mathattack 13y ago
  I think the real lesson is we don't know how long or how much we'll need to save. We do know that we'll live longer than the people for whom the original pension systems were defined. We also know that returns may not be as good as they have been in the past. What can we do? 1 - Invest reasonable amounts in aggressive enough well diversified tax friendly financial assets with low fees. (Low fee index funds in 401Ks, and 529s for folks with kids) 1.5 - Delink your financial investments from your human capital. If your salary (& options) are very tied to the success of silicon valley, don't invest in the NASDAQ. If you are working for a mining company, avoid commodities funds because you don't want your investments to lose value the same time you lose your job. 2 - Avoid high cost debt. (Credit cards, unsecured bank loans, etc) 3 - Invest time (and if needed, money too) in your professional education continuously. Assume your skills (and salary) will degrade on a trendline of 5-10% each year that you don't invest. 4 - Plan on working a long time. (75? Note - this isn't as hard as previous generations, because less of the work is manual) 5 - Invest in your health, since you'll be working and living longer. 6 - Invest your time in a happy and healthy home life. This sets you up for a pleasant surprise of retiring at 55 if the situation allows, or 75 if it doesn't.

quaffapint 13y ago

This is an unrealistic joke. Scraping by paycheck to paycheck like many folks and you're supposed to save near 50%? And my company just told me my healthcare premiums are going up another 10% without any cost of living increase in the past 5 years, all other costs have gone up every year. Obviously this chart is totally useless other than to simply say save what you can. Last I calculated it, I would have to work a little more than another 100 years to retire. So, I'll be starting that new saas when I'm about 120. For the first time in awhile here, we're doing worse than our parents. Dang baby boomers.

elmuchoprez 13y ago
The article does not say to save 50% of your income. It says that if during retirement you want to replace 50% of your income average during your working years, you need to save approximately 17% of your working income over a 30 year period.
- quaffapint 13y ago
  Depending upon what category you're looking at. For us folks that are close to retirement than a 20 year old, it does say to save near 50%. My current 8% is what I can max at, and thus my calculation of working another 100 years based upon x times my salary.
r00k 13y ago
Am I reading correctly that you haven't had a raise in 5 years? And in fact have been subject to effective pay cuts, due to increased healthcare premiums? Isn't it time to look for a better job?
- quaffapint 13y ago
  Heh - Yup, it's been pretty much pay cuts in the end. It's a real pain when you dont go out to dinner or vacations and still keep living paycheck to paycheck as everything gets more expensive. Around this part of the US there are jobs, but ever since the economic downturn the pay never rebounded, and now that employers realize they can get us developers cheaper, I don't expect them ever to go up that much any time soon. Given also that I can work from home, and am the sole support of my family, I don't want to take the risk of getting in an even worse position. This is why I spend many, many hours trying/doing side work to pay the bills. Here's to hoping my upcoming saas will actually gain traction...

michaelochurch 13y ago

The fuck, man? A retirement thread? What is this, Old People News? Retirement is for middle-class fuck-ups. If you don't have a major, live-anywhere-you-want-and-never-have-to-work-again hit by 40, then what the fuck did you do with your life? If you're halfway smart, you'll be financially independent (startup exits, at least two, plus passive income) by your mid-30s. What the fuck are you doing? Go out and raise a $800,000 seed round! I don't actually think that way, but a lot of people do, and when you compete for jobs (usually on wage) you are in the market with them. They depress wages (if they aren't thinking about retirement, why should you?) but they also push up demands in a lot of those bullshit cultural competitions (such as the need to live in Manhattan in many NYC firms) that get very expensive and kill what you should be saving. That is why, barring unforeseen technological or economic changes, most people in the VC-funded bubble world will never be able to save enough for retirement. To save requires being smart, and you're typically going to be competing (on wages and rent) with people who are stupid.

mkramlich 13y ago

This is one area in particular where the past is not a reliable guide to the future. The future is an unknowable country especially with respect to how much one should be saving. The rough rule of thumb, of course (I hope of course) is to save as much as you can and that isn't too painful. Savings is a cushion. It provides security. It buys options. Money can be turned into (almost) anything else you need/want. And there is absolutely no way that a sufficiently intelligent, knowledgable and honest person can come up with some magic specific number or percentage and declare confidently that that is what you should do. Save as much as you can/want, and generally the more the better. Old news. Resolved issue.