(WFLX) - Preparing for retirement might not be top of mind -- especially with a tough economy. But, experts say, if you do a little today, you might be able to save up a lot for tomorrow.
How does a million dollars sound? Retiring as a millionaire is within your reach. But you're going to have to make some sacrifices along the way.
How to do it will be different for every household. It will depend greatly on your age and income.
But here's a good starting point: If you're 30, and make $40,000 a year with a 3 percent salary increase each year, here's what you need to do. Save 7 percent of your salary in a 401k, and you'll get $1 million when you retire. But here's the catch, you need to have a 10 percent return on your investment. That's very optimistic.
A more realistic goal is to set aside 10 percent of your salary, and then you only need an 8 percent return on your investment. It' still high, but more likely.
Robert Pavlik is the chief market strategist for Baynan Partners in Palm Beach Gardens. He says saving is the best way to become a millionaire retiree. But, he also says, it takes a lot of work throughout your career.
Here's the downside: If your 30 now, $1 million to retire on might not be enough. No one can forecast the price of healthcare, and even basic needs 30 years for now.
Pavlik's best advice is to look at your retirement plan four times a year to make sure it's performing well.