Saving Too Much for Retirement?

Make Sure to Understand the Underlying Assumptions when Saving for Retirement

Conventional wisdom says that you can't save enough for retirement. Considering that Americans are living longer and are rarely given guaranteed pensions from employers, it certainly makes sense to save sufficient funds to ensure a long, comfortable retirement. But how much should you be saving towards your retirement each year? And is it possible that you're saving too much of your income towards retirement?

In crunching through the numbers, it turns out that determining the right amount to save for retirement is more of an art than a science. These calculations are left in the hands of workers who may or may not have the tools necessary to complete such an exercise. Financial planners can help with the analysis, but the tools that they use often have a huge "factor of safety," which may lead you to believe that your financial situation is much worse than it actually is.