Farm Horizons
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retired at 65, you would receive 300 payments by the time
you turn 90.
I sat down with Russ Runck with Ameriprise Financial
and asked him what it would look like if we compared
three people beginning an IRA at different ages.
Using one of Ameriprise’s spreadsheet tools, we compared a 25-year-old, a 40-year-old and a 50-year-old. Each
of them put $5,500 into the IRA each year. We did not
increase the amount at 50 years of age. We assumed that
each would retire at 67, with an annual inflation rate of 3
percent, and a return on the investment of 7 percent prior
to retirement, and 5 percent after retirement.
The chart below clearly shows the differences in growth
of the investment, and how long the money will last in retirement. We did not include any Social Security income,
rental income, etc. We strictly used the IRA for retirement
income.
In Scenario 1, your retirement savings and expected
contributions will not provide all of your re F