David Blanchett

Great to be here.

Sure.

So if we think about how income changes, right, you know, and it's obviously very different for everyone.

What tends to happen, right, is when you're young, you make less.

As you move into your 50s and late 50s, you make more.

And then earnings tend to trail off.

So what we typically see is this pretty significant income growth while you're working.

And why that's really important to point out is that for a lot of Americans, they're actually under-saving if they increase their spending along with their raises over time.

So say you're in your 40s, you're making $100,000 a year and you're saving 10%.

That's great.

But then if by in your 50s, you're making twice that,

What we often see is people fall kind of further and further behind.

I had a clever piece I wrote a few years ago talking about more money, more problems, which is just that it's important to be aware that, you know, if your income rises dramatically as you approach retirement and your spending adjusts accordingly, that could have a detrimental effect on your retirement readiness.

Okay, so, you know, one, like, think about there's spending, there's income.

Now, in retirement, we can focus more on spending.

And, you know, we don't tend to see large changes in spending when someone moves from working to retired.

I've done a bunch this different ways, and it goes maybe down about 5% on average, right?

So there's kind of common rules of thumb, people throw out like the, like 70%.

And so like, to be really clear about like the 70% rule, whatever we call it,

Like that's a ballpark for your pre-tax income and what your after-tax retirement goal is going to be.