Most aspiring retirees and their advisors feel faint when they think on the subject of retirement savings. It's just naturally assumed that they haven't, and won't save enough.
A new study from Dimensional Fund Advisors
] is poking holes in that common wisdom, according to Reuters
Savers usually freak because the general assumption is that their salary replacement rate will have to be 75 to 80 percent -- which for many seems impossible to achieve.
The Dimensional research, penned by Marlena Lee
, says that the actual replacement rate needed is much lower.
The gist of her argument is this: the more a saver makes, the lower their replacement rate upon retirement needs to be because line items like high working-year taxes disappear in retirement.
The full argument can be read in Reuters
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