From: joetaxpayer 
Newsgroups: misc.invest.financial-plan
Subject: Re: Percentage savings of gross or net income?
Date: Wed, 2 Aug 2006 06:54:53 -0500
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Elle wrote:

snip

> 
> I can only loathe the 10% or 20% or thereabouts rule, since 
> it expects people to blindly trust.
> 
> At the moment, and assuming a person is living reasonably 
> comfortably (not scrooge-like or in poverty), I think the 
> better guidance is to
> 1) max out the matching portion of one's 401(k), to get the 
> immediate 50+% return on one's money.
> 2) max out a Roth IRA, for the tax advantage.
> 3) resume contributing to the 401(k), to get the tax break.
> 
snip

Sorry if I over-snipped.
Why you do feel the rules of thumb expect blind trust?
In my earlier reply I gave some pretty hard numbers, 10% savings/10% 
return/ 42 years of work resulted in the 20X saved amount.
That statement at least is a starting point, I stated the 10% return 
moving forward was likely on the high side, so savings would need 
adjustment up (or through matching) if we assume an 8% return.

These 'rules of thumb' are what I try to share with every young person I 
meet who's just getting started. They tend to work for companies with a 
match, and if they don't see the 10% from their first paycheck, they are 
likely to stick with the savings plan.

Your order above is my exact advice, that will cover people making right 
up to $190K/($380K couple). Of course at some point they need to review 
the status of their current tax rate vs future (retirement) projected 
rate. The new ROTH401 should help that dilemma.
JOE