Becoming a "Middle Class Millionaire" - WAOW - Newsline 9, Wausau News, Weather, Sports

Becoming a "Middle Class Millionaire"

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WAUSAU (WAOW) -- Many Americans dream of a comfortable and prosperous retirement. But the recent recession has threatened that.

Lori Schubring owns a business in Rib Mountain. Her husband also works. But she says saving for retirement has taken a back seat.

"We're not even halfway there," said Schubring. "We're not even a quarter of the way there."

Lori and her husband both have 401(k) plans worth about $80,000 combined. For years, they contributed every month. But then Lori's husband lost his job. He's working again, but he took a substantial pay cut. Now, the Schubring's have stopped saving.

"I don't even see a light at the end of the tunnel, and it seems like it's getting further and further away with the way the stock market's going," said Schubring.

Many Americans are in the same boat. A recent study from the Center for Retirement Research at Boston College shows the financial crisis drained retirement accounts by $2.8 trillion in just a year and a half (Oct. 9, 2007-Mar. 9, 2009). That has made a comfortable retirement seem out of reach for many people.

"I'm not seeing that happening. How am I going to make it happen?" said Schubring.

But financial experts say all is not lost, and that building up a healthy nest egg is not impossible.

"It's important to implement a savings program young," said Randy Ullmer with Dottenwhy Financial Group in Wausau. "Every dollar that you save has a capability of compounding."

But many people are not saving—or planning. Roughly 300 million people live in the United States. But according to the U.S. Department of Labor, fewer than half of them have actually figured out how much money they need to retire.

"A good, sustained savings program is essential," said Ullmer.

So how much do you need to save for retirement? Financial experts say there's not really a magic number.  It depends on what you want to do, and how you want to live.

Some people peg a healthy retirement amount at around a million dollars. What do you think? Can you become a millionaire?

Experts say you can, it just takes planning. And tools like a millionaire calculator (http://trend-chart.com/millionaire-calculator.php) can help.

Let's say a 30-year-old has $5,000 to invest upfront, and plans to put away $200 every month. With a six percent return rate, that person would become a millionaire by age 72. Adjust the numbers, and the age changes.

You also have to account for inflation. But financial experts say this formula works as long as you save.

"Retirement should be another phase or another beginning of your life," said Ullmer. "You need to plan for it just like you did for the whole life that you were working."

Lori Schubring says she knows that, and admits she and her husband could do a better job saving.

"There's definitely areas that we could still cut yet that we could save," said Schubring. "We probably go out to eat a couple of times a week."

And experts say it's important to find ways to save and take that first step -- to be ready for that day.

Online Reporter: Daniel Woodruff

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