. Why is it considered a rule of thumb to have 70% income replacement ratio?

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03-01-2021
Economics

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. Why is it considered a rule of thumb to have 70% income replacement ratio?

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Theblackroseidn Theblackroseidn · Answer 1 · 2021-01-03T16:03:34+08:00

Theblackroseidn Theblackroseidn

03-01-2021

Answer:

•Income replacement ratio is a thumb rule to help you estimate this income. Simply, it is the percentage of the pre-retirement income that you are likely to need to maintain a similar standard of life in retirement. ... By this rule of thumb you will need 70% to 80% of pre-retirement income to meet your expenses.

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