nbsp 8: What are you assuming about my savings?
Without knowing exactly how you’ve decided to save and invest, it’s hard to get an accurate picture of how much you’ll earn on those savings and investments. No one can predict how the market will perform in the future, or how high or low interest rates will be. The Snapshot assumes your savings and investments will earn 2% per year—after taxes and inflation. (This Snapshot doesn’t assume what the inflation will be; it simply uses a conservative level of earnings.) You can increase this to 3%, 4%, or 5% as part of your modified Snapshot. But keep in mind that with higher earnings can be greater investment risk. Also, if you have a mortgage that will be paid off before you retire, the Snapshot assumes that you’ll start putting the monthly mortgage payment into savings after the mortgage is paid off.
