This is about your old age and how you intend to live it. “Elderly” is the one minority we all are destined to join.

16.6% of your annual income for 30 years: This is the savings that Wade Pfau of Tokyo’s National Graduate Institute for Policy Studies calculates you will need (“Safe Savings Rate: A New Approach to Retirement Planning Over the Life Cycle”, Journal of Financial Planning), assuming 60% equities balanced with short-term debt, based on returns from 1871 to 2009. (Minor point: data that old is suspect for accuracy, plus structural and regulatory changes in the economy make data prior to the Great Depression of limited use.) Good news: Save for 40 years and you need to put aside only 8.8% of your income. The power of compound interest!

So if you are 25 and you want to cease the joy of gainful employment when you are 65, better get started now. If you are 35, better figure on contributing to the economy until you are 75 or double up your savings rate.

Unfortunately, the savings of most Americans comes nowhere near what’s necessary to insure even a modicum of financial security in the infirm years. Financial discipline NOW will insure fewer worries in the coming decades. Your future self will be eternally grateful. And, admit it: The “pleasure” you get from many of your expenditures is fleeting. Most people can’t tell you where their money goes so it can’t have bought anything important. It is possible to learn to get a true sense of satisfaction out of watching your 401(k) grow and grow. Yes, we have all taken a big hit lately but the past is the past. Time to get up and move on.

P.S. Most retirement planning targets a retirement income of 50% of final salary with Social Security, paid off house and car, with general thrift making up the difference. Good enough as far as it goes but does not allow for increased medical expenses, or income for fun activities to fill all that leisure time. Furthermore, some retirees choose part-time employment both for the stimulation and to stretch dollars.

Closing quotes:

“The best way to predict the future is to create it.”

“The question isn’t at what age I want to retire, it’s at what income.” — George Foreman

“O, blest retirement! friend to life’s decline—
How blest is he who crowns, in shades like these,
A youth of labor with an age of ease!”
— Oliver Goldsmith