“If you use a zero percent return, it’s easy to figure out how much you need to save. If you want to work for 30 years, and live in retirement for 30 years, then you should save 50 percent. If you want to work for 40 years, and live in retirement for 10 years, you should save 25 percent. And so on. Over the last two decades or so, savings rates have ranged from single digits to slightly negative. In rough terms, zero percent. So as a nation, we have essentially no savings and face very low future returns. The inference is simple: We will need to increase savings drastically.”
