How Much Do Teachers Need to Retire in San Diego?
A realistic look at what it takes and what actually matters
It is a question we hear often, usually framed in one of two ways:
Do I have enough? orWhat number should I be aiming for?
The honest answer is it depends. But not in a vague way. In a very specific, knowable way.
Start with this: most San Diego teachers do not rely on savings alone
If you are part of CalSTRS, your retirement looks different from most people’s.
You likely have:
A pension that provides a baseline income
Social Security, in some cases, depending on your history
Personal savings, often through a 403(b) retirement plan
So the real question is not:
How much do I need total? It is:What gap do I need to fill?
What retirement actually costs in San Diego
While everyone’s lifestyle is different, we tend to see three broad ranges:
$80,000 to $110,000 per year
A more moderate lifestyle, often with a paid-off home$120,000 to $160,000 per year
Comfortable, with travel, dining, and flexibility$170,000 or more per year
Higher discretionary spending, supporting family, or higher housing costs
These are not targets. They are reference points.
A simple way to estimate your number
Rather than starting with a lump sum, start with income.
Estimate your annual spending
Subtract your pension income
Subtract any Social Security
The remaining amount is what your savings need to generate
Example
Desired income $140,000
STRS pension $75,000
Social Security $25,000
Remaining gap is $40,000 per year
That gap is what your savings need to support.
What that means in savings
A common rule of thumb is that investments can support about 4 percent annual withdrawals over time. So:
$40,000 per year requires roughly $1,000,000 in savings
$60,000 per year requires roughly $1,500,000
$80,000 per year requires roughly $2,000,000
This is not exact, but it is a useful framework.
Food for thought: Why two teachers with the same savings can have very different outcomes
We have seen this many times. Two educators retire with similar balances, but:
One feels confident and flexible
The other feels constrained and uncertain
The difference usually comes down to:
When they retire
How their investments are structured
How withdrawals are timed and taxed
In other words, the number matters, but how you use it matters more
The factors that tend to move the needle most:
Housing: Whether your home is paid off or not has a significant impact on required income
Retirement age: Retiring at 55 versus 63 can materially change how long your assets need to last
Healthcare: Especially before Medicare, this is often underestimated
Lifestyle expectations:Travel, family support, and discretionary spending vary widely
Taxes: California taxes most retirement income, which affects how far your dollars go
Where your 403(b) fits into this
Your 403(b) retirement plan is often what bridges the gap between:
What your pension provides
What you actually want your retirement to look like
It gives you:
Flexibility in timing
Control over withdrawals
A buffer against unexpected costs
Without it, retirement can feel more rigid than most people expect.
What we typically see
Most San Diego educators fall into one of three groups:
Well positioned but unsure: They have saved consistently but have not translated that into a clear plan
On track with a few gaps: Usually around taxes, allocation, or timing
Behind but fixable: Often due to late starts, but still with meaningful options
If you want to understand your numbers more clearly
At Independent Wealth Solutions, we work with educators across San Diego to:
Map pension income alongside savings
Identify income gaps and opportunities
Build a plan that supports when and how you want to retire
If you have never seen your plan laid out this way, it is worth doing. Contact us to learn more.
