# The most innovative retirement income calculator I’ve ever seen.  The right retirement formula is based on the value of your home – MarketWatch

Here’s the idea.

1. Take the market value of your house, and multiply by 0.3. That is the income you need in retirement. 2. Take that number, and divide by 0.04. That is the value of the assets you need to retire with.

1. Dennis kohke says:

Not sure this makes sense. A \$1M house in California, very common, will generate \$300k in required income?

This formula may work only for a particular geographic range.

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1. rdquinn says:

I think you misinterpreted the formula. It’s saying you need \$300,000 as income during retirement. And to reach that you need \$7,500,000 in savings.

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2. Atossa says:

,

Obviously one size does not fit all.

My Dallas 2200 sq ft brick home in a nice neighborhood is worth about \$200,000.

Assuming my quick math is correct, the formula figures are much too high.

I’ve never made that much annual income in my life and I doubt I will reach that total nest egg figure. Yet I have been comfortably retired for 12 years and my nest egg continues to grow every year.

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3. Dwayne Gartner says:

This is another good estimating tool but if you read the comments, it does not work in places with high cost of living. For me in New Jersey, it missed the mark. This formula would have said I was OK with 50% less of an income than I currently have. The calculated income would have had me with \$9 per week after the basics of food, utilities, medical, car and homeowners insurance, and taxes. Forget Christmas, birthdays, vacations, and house maintenance on \$9 a week. I do not have a \$1m house, but a modest \$145k house. I guess I would save on gasoline because I would not be able to go anywhere. I believe that I could survive on about 25% less cutting out vacations and Christmas but medical costs will only raise as I get older. I also don’t want to just survive.

Now if I downsize from a 1200 sqft house to a trailer, moved away from a coastal state, it might work.

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