Saving is Essential

Nest egg requires many years to build. You may need at least 70%–80% of your current

salary to retire comfortably.2

If you don’t save, you may have to work during retirement.

Retirement could last over 20 years.

2 Social Security Administration news release, “The Social Security Administration and the American Savings Education Council Announce National ‘Save for Your Future’ Campaign,” May 17, 2002, http://www.ssa.gov/pressoffice/retiremint.htm; Center for Retirement Research at Boston College, “Myths and Realities about Retirement Preparedness,” May 2006, http://www.bc.edu/centers/crr.

How Much Should You Save?

It can be overwhelming and frustrating. Here’s a simple “rule of thumb”:

In your 20s, save 7% of your salary. In your 30s, save 10% of your salary. In your 40s, save 15% of your salary. In your 50s, save 20% of your salary.

The important thing is to start saving as much as you can right now!

Gross Pay $2,000$2,000

Raise 80

Total Pay $2,000$2,080

Minus Estimated Tax Withheld - 380

- 395

Total Take-Home Pay $1,620$1,685

Difference in Take-Home Pay$65

Paycheck Comparison*

Before After Raise Raise

* For illustrative purposes only. Assumes federal income tax withholding of 15% and state and local income tax withholding totaling 4%, and does not account for Social Security or Medicare taxes.

Gross Pay $2,000 $2,080

Minus Contributions - 50 - 100

to Plan (Before Tax) Taxable Pay $1,950 $1,980

Minus Estimated Tax Withheld - 371 - 376

Spendable Pay $1,579 $1,604

Paycheck Comparison*

Before AfterRaise Raise

It’s a win-win: You’re getting $25 more pay per month, and you’re contributing $50 more a month for

retirement, which you haven’t seen yet!

* For illustrative purposes only. Assumes federal income tax withholding of 15% and state and local income tax withholding totaling 4%, and does not account for Social Security or Medicare taxes.

Savings after10 years

Savings after20 years

Savings after30 years

$9,208

$29,647

$75,015

$18,417$27,625

$59,295

$88,942

$150,030

$225,044

Growth Over Time*

* For illustrative purposes only. This hypothetical example does not represent the performance of any investment options. It assumes an 8% rate of return and reinvestment of earnings with no withdrawals. The illustration does not reflect any charges, expenses or fees that may be associated with your Plan. The tax-deferred accumulations shown above would be reduced if these fees had been deducted.

$50 monthly

$100 monthly

$150 monthly

Budgeting Ideas

Expense Give Up How Often?

Monthly Savings5

Value if Invested for

25 Years6

Dinner out Once a week $100 $95,737

Lunch out Twice a week $50 $47,868

Coffee and bagel Twice a week $20 $19,147

Vending machine soda

Once a day $12 $11,488

Movie ticket Once a month $10 $9,574

5 Monthly costs are based on general averages.

6 This illustration is hypothetical and assumes an investment in a tax-deferred retirement account in which you earn an average annual rate of return of 8%, compounded monthly. This hypothetical example is not based on (or predicting the performance of) any specific investment plan or savings strategy.