Why Dave Ramsey Calls Retirement a Goal, Not an Age

"When Dave wrote, "Retirement is not an age; it's a financial number," this unsurprisingly caught many people off guard. For far too many years, there has been a belief in the US that you retire sometime between 60 and 70 and no sooner. While those in the FIRE (financial independence, retire early) world would love to disagree, many people are now starting to gravitate toward Dave's advice as gospel. There are factors that can affect whatever number you think you need, but Dave's bottom line is that you should absolutely be focused on the number, and whenever you hit that number, that's when you retire."

"In many instances, the prevailing theory is that you need a certain multiple of your pre-retirement income. According to Fidelity, you want to have at least 10 times your salary put away by the time you are 67, with the understanding that your costs will drop to between 70-80% of pre-retirement spending. On the other hand, Northwestern Mutual indicates that it believes you need around $1.46 million to comfortably retire beginning in your 60s."

Retirement should be defined by achieving a sufficient financial nest egg rather than by reaching a particular age. Conventional expectations often place retirement between ages 60 and 70, but financial independence advocates emphasize retiring when savings meet needs. Required nest egg sizes vary by individual and depend on factors like spending needs and inflation. Common planning approaches use a multiple of pre-retirement income. Fidelity recommends having about ten times salary by age 67 assuming post-retirement costs fall to 70–80% of pre-retirement spending. Another estimate suggests roughly $1.46 million for comfortable retirement in the 60s.

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