I have been reading a various retirement articles say how much you should have saved for retirement as a multiple of your income by age.
For instance, this page says:
- 1x salary by age 30
- 3x salary by age 40
- 6x salary by age 50
- 8x salary by age 60
- 10x salary by age 67
This article goes on the say "The above savings guidelines include anything you have in a retirement account, like a 401(k) or Roth IRA, company matches, as well as your investments in things like index funds or through robo-advisers."
But can this really be true that one should only include 401k, IRA, and stocks, especially if those comprise a small portion of one's total net worth? From the 4% (or alternately, 3%) rule one needs 25x or 33x of their salary at retirement (presumably, the age 67 amount). I'm assuming that there is some assumption about social security, which by some accounts will become insolvent in the next 15-20 years unless benefits are cut substantially. Additionally the above doesn't mention savings in the form of (for example) equity in one's home. Supposing that one outright owned their home when they retired, they would need less money due to not having to pay rent or a mortgage. Shouldn't this affect how much one needs to have saved for retirement?
So what can I really include in retirement "savings"? Is there any good reason why I can't just treat my total net worth in this figure as long at my assets reduce or offset my retirement expenses?