You'll Need $5 Million+

How much do you need in yourretirement kitty to finance yourgolden years? It's a vexing question,one that many physicians tend toignore. If you're curious about whetheryou'll be living on Easy Street or SkidRow when you hang up your stethoscope,it pays to do some math.

Physician's Money Digest

One rule of thumb is to multiplyyour current income by a factor thattakes your age into account. If you'reyounger than age 40, multiply by 40.Multiply by 30 if you're between ages40 and 50, and by 25 if you're over age50. The formula shows that the averagereader (ie, age47 with an annual income of $184,000)will need a tad more than $5.5 millionto retire. That's if you plan to have thesame lifestyle after retirement as youdo in the years just before retirement.

PMD

PMD

If you plan to live on about 80% ofpreretirement income, you'll needsomewhat less—about $4.4 million.Although that kind of money isn'texactly loose change, the average reader has a head start, with a networth of more than $1.1 million. Bymaxing out on retirement plans, including401(k)s and IRAs, the average reader would be in shouting distance ofthe goal by age 65.

Although the figures may be daunting,they are a wakeup call to the factthat you may need to save moreaggressively to be able to finance theretirement you're working toward. Torun your own numbers, take a look atT. Rowe Price's retirement calculator atwww.troweprice.com.