(Don’t) take this 30 second challenge about retirement (unless you want to panic)

Solar system

People always like simple things they can remember. Whether it’s using the Rule of 72 to figure out when an investment (or debt) will double, or whether it’s aphorisms like “own your age in bonds“, (or even “Mary Very Easily Makes Jam”, a mnemonic about the order of the first five planets in our solar system, which I will never forget) there’s an appeal to these tactics.

So you can imagine my interest when I was thumbing through an investing magazine and found a call-out box titled “Take 30 Seconds to Measure Your [Retirement] Progress“.

Well, funnily enough, I’ve got 30 seconds. And I’m curious how I’m doing on my path to retirement. It is, after all, something I focus on a lot (as you may have noticed).

So I went through the T. Rowe Price “30 Second Challenge” as they call it, and was appalled.

I don’t recommend you do this. Unless, of course, you want to panic.

Challenge accepted

30 seconds was a bit generous. Most of it was spent on a scrolling graphic, before I was asked three basic questions:

  • My age
  • My salary
  • How much I’ve saved for retirement

Easy enough. I filled out my info and hit “Calculate”. To be honest, I was feeling pretty confident. I prioritize retirement savings in my life, and I’d like to think that I’m pretty on top of things.

So imagine my surprise when I got a thumbs down:


Oh. Um. Well then.

I have to admit that it was a bit of a wake up call for me to be told that even after all my work to put away money for retirement, that I’m still a little behind. Not much, mind you, but certainly not ahead of the game.

And it occurred to me that if I’m feeling a little displeased, me who is so focused and intentional about retirement, many people who use this calendar are going to be downright horrified.

Moreover, this isn’t the kind of emotion that would lead people into action. My gut is that it might cause people to shut down entirely, to conclude that it’s hopeless, and tune out completely.

This is why I don’t want you to take the 30 second challenge.

Garbage in, garbage out

We all know that saving for retirement is a tremendous challenge, one that takes up our whole working life, and then some. While it would be great if we lived in a society where we took care of our own, we don’t. So we need to take care of ourselves.

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I don’t want anything to get in the way of that, and that’s why these types of calculators can be so unhelpful.

Moreover, they are subject to way too much uncertainty. The gist of the calculator is that you want to aim to have 12 times your annual salary in retirement savings by the time you retire, which various multiples achieved along the way. But this opens up a lot of unanswered questions, such as:

  • What savings vehicle? $100,000 in a Roth IRA is very different from $100,000 in a Traditional IRA.
  • What salary? Mine changes every couple of years.

Taking that last point, as I’ve mentioned before, I changed jobs a few months ago. With that came a change in salary. I plugged in my numbers from just a few months ago, and found that the calculator said I was on track!

So, I’m forced to conclude that, like all simplistic tools, this one is a good general guide, but shouldn’t be adhered to as gospel.

And to be fair, the site does have some good suggestions on what to do to get back on track if you’re not.

The most important takeaway here, is that all of us could be doing more to save for retirement. How much more is up for debate (I say start with 15%), but there is always room for improvement. You don’t need a 30 second challenge to learn this.

(And while I don’t recommend using the calculator for all the reasons mentioned above, I’m sure someone will want to, so here’s the link.)

But enough about me. Do you think you’re on track for retirement?


  1. mallika_1

    >What salary? Mine changes every couple of years.

    12 times your current salary, at the time you retire (as well as along the way, when you’re checking) The idea is to use what are you used to getting. Obviously, if your paycheck changes, the numbers will change. And if you’re putting in before-tax salary, it is okay to put in tax-deferred retirement amount savings, I’d guess.

    If your savings are mostly in Roth, I guess you’re right you may not really be off-track.

    Another thing – while you say you prioritize retirement savings in your life, it does rather depend on when you started, doesn’t it?

    • Mike Pumphrey

      Thanks for writing in! All I was trying to point out was that one’s salary changes over time, so if you want to work toward the salary you have at retirement, you would (separately) need to determine what that might be, as it may be very different from what you’re earning now. Wouldn’t you agree?

      And as for prioritizing retirement savings, I just meant that I generally put away a significant portion of my income toward retirement, more than many financial experts suggest. And yet, for the purposes of this calculator, I’m still behind. Which was a bit startling to me!

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