The 15 grand is not in today's dollar but more so 30-40 years down the line depending on OP's age.
Looking at my dashboard on wellsfargo it states I will need $13,520/month when I retire or 80% income replacement.
It uses my current age (30) retirement age 65 and life expectancy to 95, my current base salary. You can edit your dashboard by the way OP, at least I can
Because when I change my retirement age from 65 to 55 it drops to $10,060.
Now looking at inflation calculators $1.00 in 1980 had the same buying power as $3.06 in 2015, annual inflation over this period was 3.25%
While the past does not predict the future, you can use it as a baseline. So it is logical for them to deduct the following 2 assumptions:
- I will need more $$$ in the future to maintain the same standards (price of things going UP not down, inflation, etc)
- I will need 80% of my current income to maintain the same lifestyle (mortgage payment replaced by health insurance, medical etc).
So current base income of ~$6,000/month... 80% being ~$4,000 and with inflation needing about 3 times = ~$12,000/month
There you go. While yes you can argue that in retirement I may spend less than 80% of my current income (way less if you take out our $2,300/month mortgage and $1,500/month student loan payments) ... One thing remain certain: $1,000 today will NOT have the same buying power as $1,000 in 35 years.
Sorry just the math geek in me.
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