I think they are assuming that some type of social security will be included to make up the difference of that.
If I go to ssa.gov's quick calculator and type information corresponding to a full retirement date this year, and a current salary of $80,000, then SSA estimates $2058 monthly benefits, or about $24,700 a year.
If this person's personal savings was 8 times $80,000, it would be $640,000. If the safe withdrawal rate were 4%, this would be a withdrawal rate of $25,600 a year.
Combining personal savings withdrawals and SSA would yield $50,300 a year, which is probably not far from what a person making $80,000 needs in retirement (62.8% of gross salary). Granted, 4% is maybe only a mostly-safe assumption, and SSA continuing at current levels is probably a mostly-unsafe assumption, but given these assumptions it seems reasonable. I myself would be more comfortable with 10-12x.
If I go to ssa.gov's quick calculator and type information corresponding to a full retirement date this year, and a current salary of $80,000, then SSA estimates $2058 monthly benefits, or about $24,700 a year.
If this person's personal savings was 8 times $80,000, it would be $640,000. If the safe withdrawal rate were 4%, this would be a withdrawal rate of $25,600 a year.
Combining personal savings withdrawals and SSA would yield $50,300 a year, which is probably not far from what a person making $80,000 needs in retirement (62.8% of gross salary). Granted, 4% is maybe only a mostly-safe assumption, and SSA continuing at current levels is probably a mostly-unsafe assumption, but given these assumptions it seems reasonable. I myself would be more comfortable with 10-12x.