How Much to Save for Retirement at Every Age

Thinking about saving for your future retirement can feel daunting, especially in the early days of your career. It’s important to know that saving for retirement is a decades-long process that’s different for everyone. How much and when you save depends on a variety of factors, including career, employment status, income and lifestyle.

While there is no one-size-fits-all plan, here are some tips to help you navigate saving for retirement in the decades to come.

In your 20s

Planning for retirement can feel challenging, especially when you’re just starting out in your career. Still, your 20s can be a great time to develop positive financial habits, like building an emergency fund or nest egg. The 50/30/20 model, which involves putting 50% of your net income towards needs, 30% towards wants and 20% towards savings and paying off debt, can be an easy way to start budgeting and build savings into your finances.

If you want to go one step further, consider saving 10% of your salary in a 401(k) or other employer-sponsored retirement fund. Pay attention to your employer match if it’s available – they may match all or part of your contribution up to a certain percentage. You can also look into alternate retirement account options, such as a Roth IRA.

Above all else, your 20s are a great time to set the tone and develop good saving habits. Remember, saving something now is better than saving nothing at all.

In your 30s

By the time you’re in your 30s, you may feel somewhat more settled in your career, lifestyle choices and financial habits. Alternatively, you may have gone through milestones like getting married, starting a family, taking out a mortgage or going back to school for your second career. No matter what life changes are happening, it’s still important to make saving for the future a priority.

If it’s possible, commit to your 401(k) savings with 10%, 15% or even 20% of your salary. As in your 20s, contributing to a Roth IRA account may also make sense for your situation.

Other habits for your 30s include reevaluating your weekly or monthly budget to see where you can save more. Finding money to save wherever you can is particularly important, as you may be starting to set aside funds for big life milestones. Your 30s may also be a good time to seek out a financial advisor to help you optimize your savings and plan for the future.

In your 40s

By the time you reach your 40s, you may be starting to think seriously about saving as much as you can for retirement and your family’s future. It’s important to stay on track with the progress you’ve made so far. If you haven’t been able to save as much as you’d hoped, there’s still time to set aside what you can for the years ahead.

New, significant expenses can pop up in your 40s – for example, your children may be starting college. Consider working with a financial advisor to allocate your income in a way that supports you and your family now and in the future.

In your 50s

Your 50s are another time of change and reflection. They can also be a great time to ramp up your savings to give yourself some extra cushioning in retirement. 

Consider what your retirement income will look like and start to do some basic calculations. Ask yourself important questions. What kind of lifestyle can you afford? Where do you want to live? What kind of healthcare costs are you thinking about? Is downsizing in the cards? If these questions feel too daunting to tackle by yourself, a financial advisor may be able to help create an actionable plan.

In your 60s

Getting more granular about your retirement plan in your 60s is key to your long-term financial health. At this point, it can be helpful to start putting together monthly and annual budgets based on your retirement savings, other savings accounts and any passive or active income. Get as specific as possible about what sort of income you’ll have, how you’ll use your retirement savings and what this means for your lifestyle. Are there any assets that you want to sell before you retire? Would you consider downsizing your home? What is the financial impact of legacy planning for your immediate family?

As you get closer to retirement, a financial advisor may be able to help you make sure you have all your ducks in a row. No plan is entirely foolproof, but doing what you can now to feel financially secure in the future can be well worth the effort.

Disclosure: This article is for general educational purposes. It is not intended to provide financial advice. It also is not intended to completely describe any Citi product or service. You should refer to the terms and conditions financial institutions provide for various products.