Courtesy of AmericaSavesWeek.org
Q. What is the only free money for savings that is available to many Americans?
A. An employer’s match to a contributory workplace retirement plan such as a 401(k). Some employers, up to a certain level, will match each employee dollar contributed, thus guaranteeing at least a 100% yield on this savings.
Q. If they have no other income, how much must someone who retires at 65 have saved in order to be assured of an annual income of $50,000?
A. For a male at age 65, he should have $620,000 saved to ensure an average income of $50,000 a year for life, for a female at age 65, she should have $665,000.
Q. What percentage of elderly individuals depend entirely on Social Security payments for income?
A. In 2006, 25% of individuals age 65 and older relied 100% on Social Security payments for their income.
Q. What is the most effective way to save $100,000?
A. Tell your employer or bank to transfer, each month, as much of your paycheck as possible automatically to a savings or investment account. This is a far more reliable way to acquire $100,000 than to buy lottery tickets or wait for an insurance settlement.
Q. If one saves $200 a month with a 5% annual yield, after 30 years how much savings will have accumulated?
A. Over $170,000 will have accumulated, and most of this amount will represent interest earned and compounded.