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Milan Sengupta of Calgary wants an annual net retirement income of $50,000 so he can travel extensively
The verdict
Milan is on track to easily meet his goal, says Vickie Campbell, a certified financial planner with Ryan Lamontagne in Ottawa. “If Milan saves $30,000 annually, and he spends $50,000 a year net from his nest egg starting at age 60, his retirement savings will last him beyond age 95,” she says. “He’s saving much more than he needs to meet his goal.” If Milan continues investing $30,000 a year until age 60, and we assume an annual 4% rate of return, he’ll have a $1.8 million nest egg by the time he retires. Without including any CPP or OAS payments, which he will be entitled to starting at age 60 and 67, his nest egg will be able to maintain a net annual income of $50,000 from age 60 to 95, and then some. At 95, his portfolio would still be worth a whopping $2.1 million because of the power of compounding coupled with the modest withdrawals he intends to make from the nest egg. In fact, if Milan saves just $15,000 annually until age 60, he’ll still have more than enough. At age 60, his nest egg will be worth $1.28 million and at 95, $581,933. “A portfolio with 50% invested in equities and 50% in fixed income will give Milan the returns—and the retirement—he wants. He doesn’t need to take more risk.” 
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