How Much Money You Need To Save To Retire By Age 40

The more you save, the sooner you can retire. But how much do you actually need to save before retiring? Business Insider reporter Lauren Lyons Cole breaks it down in this video.

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Following is a transcript of the video:

First, figure out how much you spend each year, then divide it by 4% (0.04).

This is how much you need to save before retiring.

Once you know your goal, you can leave work as soon as you reach it. But to make this work you have to invest your savings.

You can survive for only 25 years on these savings alone. So if you retired at 40, you would have to start working again at 65. But there's a way to make it stretch even longer.

Continue to invest and earn an average of 5% on your investments each year, then you will have enough to live on for the rest of your life.

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Business Insider is the fastest growing business news site in the US. Our mission: to tell you all you need to know about the big world around you. The BI Video team focuses on technology, strategy and science with an emphasis on unique storytelling and data that appeals to the next generation of leaders – the digital generation.

How much money do I need to have before I can stop working? | Rahul Sen | TEDxBITSGoa

Each of us have asked ourselves this question at some point in our lives. Rahul Sen in his fascinating and witty talk answers this question by taking us on along on his journey from “Small income and no free time” to “Large income and more free time than he had ever dreamed of”

A veteran Brand-advisor, Rahul Sen lives life on his own terms instead of slogging in a regular 9-5 job and after listening to him, you will be tempted to do the same

This talk was given at a TEDx event using the TED conference format but independently organized by a local community. Learn more at

https://www.youtube.com/watch?v=0qpuEJ9QUZo