How much you should have saved for retirement at every age

How much money should I save?

Yes, that's the age old personal finance and money question if there ever was one. We all want to be given "the number" to shoot for and desire to know how close (or how far) we are to that target.

If you're like my wife and I, you wonder whether you are doing it right or not. You are constantly discussing money matters over dinner or during a long car ride. Maybe you worry about how you will be able to afford your own home. If you do own a home, you may worry about having enough money for the mortgage each month.

Then, there's saving for children. You need clothes, food, diapers, toys, and who knows what else. One day, you will want to send them to college. So, there is saving for that.

Finally, you probably don't want to work for the rest of your life. I know I don't. So, you need to plan for retirement somehow. However, that seems so far off and you just put off doing anything about it.

So, depending on your situation, you are likely asking yourself one of two questions. If you aren't saving, you will want to know how you can get started. On the other hand, if you are saving, you will want to know if you're saving enough.

In order to answer those questions, you have to know your goals and understand the process to achieve them. Saving money is not a one-size fits all concept. Sure, there are guidelines and we will discuss some of those. But, you need to customize these guidelines to fit your lifestyle and your family's end game.

Let's explore these ideas and tips now.

How much money should I save for my retirement goals? How do I know if I'm saving enough money?

First, what are your goals? Are you a person looking for financial independence and trying to retire early? Or do you see yourself working until your 50s or 60s?

There is no right answer to these questions. Sure, I am partial to financial independence and retiring earlier. But, that doesn't mean you have to be. Some people have jobs they enjoy and have no desire to start a side hustle. Many people don't want to work for themselves. It comes down to what you and your family want.

Secondly, it's helpful to at least have a baseline to begin with. I know I like to know what the normal range is and be able to benchmark it. I do my research and see where my goals and expectations align.

Behind the Numbers

I am going to share some information with you below. You see for each 10-year range from 25 to 45 what the ideal savings rate is based on income. Review it carefully and consider your own situation. Then, I want to ask you to step out of your comfort zone and share how you stack up in the comments.

The information below comes from J.P. Morgan Asset Management's Guide to Retirement. They release it every year in March.

Now, keep in mind that the numbers at the lower end of the spectrum factor in a greater reliance on Social Security retirement benefits. So, consider that as you're assessing your situation. If Social Security is something don't want to have to rely on, adjust the numbers accordingly.

Also, these numbers are based on the you beginning your retirement savings today. So, it really simplifies things. And if you already have something saved, then hey, good for you!

One last thing before we dive in. J.P. Morgan's model assumes a few things, including:

  • A pre-retirement investment return of 6.0%;
  • A post-retirement investment return of 2.5%;
  • An inflation rate of 2.25%;
  • Retirement age of the primary earner is 65 and the spouse's age is 62; and
  • 30 years in retirement.

OK, now with that out of the way, let's take a look.

How much money should I save by 25?

In your early 20s, it's hard to think about anything else but continuing the good times from college. I know the transition from college to the working life was difficult for me. You go from waking up at 8 am, 9 am, or, yes, 10 am most days to waking up at 6 am (or earlier). Then, you fight traffic to sit in a cube punching numbers into spreadsheets for 8 hours or more.

Not exactly what you had planned for your life, right? "Mommy, I want to sit in cubicle when I grow up!" – said no 7-year-old ever. But, such is life, right? Heck, you're lucky to have a job!

Adjusting to post-college life aside, you are probably like the rest of us. You haven't considered retirement. I know I wasn't serious about it in my early 20s.

With that said, you need to get serious about it. You need to make it a priority. Beginning to save before age 25 is such a huge boon to your finances later in life.

Here's where you should be. These numbers signify you starting your retirement savings today:

  • If you're making around $50,000 and have $0 saved for retirement today, you need to save 7% of your income (or $3,500) every year until retirement.
  • At around $75,000, you should save 10% (or $7,500) per year
  • At around $100,000, you should save 11% (or $11,000) per year

How much money should I save by 35?

By 35, you're likely married with children by now. You likely also own your home by now. So, with a family, a home, and God knows what else, retirement is something you want to shoot for obviously. But, finding the extra money to set aside for it is another conversation.

Chances are you're either loving your career and working towards advancement — or you hate it and are trying desperately to get out. So, there's another factor of finding another job or starting something on the side that you hope leads to working for yourself full-time. Yes, there's a lot to juggle in your 30s as I'm finding out.

Where does that leave your savings goals? Consider the following:

  • If you make around $75,000 and you have $0 saved for retirement, you should be saving 17% of your income (or $12,750) per year.
  • At around $100,000, you should save 18% (or $18,000) per year.
  • At around $150,000, you should save 22% (or $33,000) per year.

How much money should I save by 45?

At 45, you are well into your career or you have made a career change. Your attitude needs to change from asking the question, "How much money should I save?" to more of a demand like "I must save ..."

If you made a career change and went back to school, hopefully your salary today isn't too far off from where you might be if you stayed in your first career. Either way, the numbers are what they are.

By now, you may have paid off your house or you could still have plenty of mortgage payments left in your future. At 45, it's more difficult to begin financial pursuits because you have so many commitments by now. By the way, how's the college fund for the kiddos coming along?

On average, you're likely 10 to 20 years from retirement. It all depends on how you set yourself up. For those that put off saving for their retirement until now, all hope is not lost. It just gets tougher and requires more of your disposable income.

Here's how the numbers go at 45:

  • If you make around $75,000 and you have $0 saved for retirement, you should be saving 31% of your income (or $23,250) per year.
  • At around $100,000, you should save 34% (or $34,000) per year.
  • At around $150,000, you should save 41% (or $61,500) per year.

So, you asked, "How much money should I save?" Well, you have your answer.

OK, so you have the numbers. Whether it's good or bad news, you have an idea of where you should be. If you're on par or better, great for you! Congratulations!

However, if you've fallen short, you need to figure something out. It comes down to discipline and the commitment to follow through. It comes down to each of us individually and those who are entrusted to our care.

Based on a rough estimate, I'm not far off where I should be. But, by no means am I perfect when measured against this scale. However, that doesn't mean I'm off the hook either.

We all need to do a better job of managing our finances. We all can improve in a variety of areas. The point is getting the drive and courage to begin. Take that first step. Get educated. Don't be afraid to "adult" and live a wonderful, enriching life. Get at it today. Good luck!

The post How Much Money Should I Save for Retirement? A Look at Savings Goals by Age appeared first on Run the Money.

RELATED: You probably are guilty of #18

50 everyday expenses you need to stop spending money on
See Gallery
50 everyday expenses you need to stop spending money on
ATM fees

"Take a bit of extra time to withdraw money from your bank's ATM and save on the cost to withdraw your own cash or if your bank has a mobile app, use it to find an in-network ATM near you."

Credit: My Debt Epiphany

Lottery tickets

"According to the Powerball, the odds hitting the jackpot are 1 in 292,201,338.00, and CNN cites that Americans spent $70.15 billion in 2014. Let's save our hard-earned money."

Credit: My Debt Epiphany


"A daily cup of joe adds up if you purchase it at places like Starbucks and Dunkin Donuts. Save by brewing at home."

Credit: My Debt Epiphany

Credit card interest

"Maintaining a balance on your card usually you to pay interest each month. Try to pay off your credit card balance in full each month or send more than the minimum payment. As always, use your credit cards responsibly."

Credit: My Debt Epiphany

Kids meals when dining out

"When you do dine out and if you have kids with you, be sure to take advantage of 'kids eat free' specials. Most restaurants have specific days of the week when they offer free kids meals."

Credit: My Debt Epiphany

Gas station food and snacks

"Although it may be convenient, prices are always marked up when compared to other stores. So take the time to shop for food in advance at your grocery store and pack emergency snacks in your car."

Credit: My Debt Epiphany

Pumping premium gas

"Some vehicles may not require premium gas, which is the most costly of the gasoline grades. Stop trying to be fancy, check the owner's manual, and save."

Credit: My Debt Epiphany

Banking fees

"Don't pay to manage your money at a bank. Find banks that offer free banking or bank online for free like CapitalOne 360. Earn $25 when you open a free checking or high-yield savings account."

Credit: My Debt Epiphany

Change-counting machines

"Many of us like to keep our loose change in a jar and let it collect over time. Once it's full, don't pay machines to count it for you, go to your bank to deposit your savings or have it exchange for cash."

Credit: My Debt Epiphany

Wasting gas due to low tire pressure

"You may not know this, but having low tire pressure affects your mileage significantly. Save gas and money by improving your gas mileage by simply checking your tire pressure and maintaining it at the proper level."

Credit: My Debt Epiphany

Single car washing

"Many car wash places offer a flat monthly rate for unlimited washes, so check with your local car wash to find out if they offer a monthly rate and cash in on a clean car. Or, you can get a discount when you pump your gas."

Credit: My Debt Epiphany

Bottled water

"Unless you live in an area where potable water isn't safe, don't waste your money on bottled water. Often times, it's simply bottled tap water. Buy a reusable water bottle or invest in a quality water filter, and save (plus you'll reduce plastic waste)."

Credit: My Debt Epiphany


"It's a tough addiction to beat, but it is a very expensive to purchase cigarettes daily. Aside from causing deadly health effects, according to Time, smoking can cost you $1 to $2 million in a lifetime. Make an effort to better your health and wallet."

Credit: My Debt Epiphany

Gift bags and wrapping

"Reuse bags from previous occasions if they are still in good condition. We started doing this last year and no longer have to run out and by $3+ gift bags when we go to events or parties."

Credit: My Debt Epiphany

Plastic bags fees

"For those living in an area where stores charge for plastic bags (*cough cough Chicago*), bring your own reusable one. Those cents add up!"

Credit: My Debt Epiphany

Utility bill payment fees

"Skip the line at the currency exchange or grocery store and pay online using checking account or debit card. Some companies charge to use a debit card, so schedule e-check payment, which is typically free."

Credit: My Debt Epiphany

Travel size toiletries

"For the frequent traveler, you should buy empty travel containers and refill with shampoo, lotion, etc. as needed."

Credit: My Debt Epiphany


"Unless you're a student, you probably don't really need to buy a lot of paper – reuse already printed pages and use both sides."

Credit: My Debt Epiphany

Magazine and newspaper subscriptions

"Save money and paper by keeping up with free online news services."

Credit: My Debt Epiphany

Paying for premium streaming music services

"In the digital age of music, don't pay for premium services. Streaming companies like SoundCloud and Spotify allow you to listen to music for free."

Credit: My Debt Epiphany

Buying books

"If you'd like to truly own a book, then save on the paper and extra cost by purchasing the digital version, or go to your local library and check them out for free."

Credit: My Debt Epiphany

Library late fees

"Remember to return all materials on time. It'll save you money and allow for other library patrons to enjoy the material in a timely manner. If you do have library fees, wait for a month when they accept canned goods as a payment method (usually around the holidays)." 

Credit: My Debt Epiphany

Brand new video games

"Skip the early release and commotion of having the latest video game. Save major bucks by purchasing a used version of the game online or at stores like Game Stop."

Credit: My Debt Epiphany

In-app purchases

"Gaming apps are meant to entertain, and while most of them are free, don't fall for the "purchase bonus lives" trap. In-game purchases add up."

Credit: My Debt Epiphany

Greeting cards

"Take some time to make your own personal cards or send an eCard and skip on the expense."

Credit: My Debt Epiphany

New phone chargers

"If you forget your charger and your phone needs to be charged, some time you'll be inclined to purchase a new one, but it can be costly or even poor quality. Always keep your charger handy, look for a charging station where you're at, or simply ask to borrow one."

Credit: My Debt Epiphany

Expiration dates

"Sometimes, expiration dates may not reflect the true shelf life of a product. Don't waste food (and money) by throwing out a product which may still be fine to consume. Check out Eat By Date and see for yourself the true shelf life of your groceries."

Credit: My Debt Epiphany

Stuff on your birthday

"When you're heading out and can't or don't want to drive, consider calling Uber or Lyft instead of calling a cab so you can save money on the ride. You can use my linkto get $20 off your first Uber ride."

Credit: My Debt Epiphany


"Save on disposable batteries and purchase rechargeable ones. They can last up to two to three years."

Credit: My Debt Epiphany


"Many offices, banks, insurance companies, etc, give them away for free. Save them and skip on the purchase."

Credit: My Debt Epiphany


"Be sure to get the best rate for your individual needs, whether it is car, health, home or life insurance."

Credit: My Debt Epiphany

Garbage bags

"If your area doesn't charge for using plastic bags, reuse the ones you get from shopping as garbage bags. I do this all the time."

Credit: My Debt Epiphany

More house than you need

"While some families "grow into" their homes, sometimes less is more. Save on mortgage and the possibility of purchasing more for a larger home. Downsize and save."

Credit: My Debt Epiphany

Club/bar full cover charges

"While having a spontaneous night out is fun, if you RSVP when possible, arrive early, or take advantage of online ticket sales, you can skip out on paying in full at your favorite nightlife places."

Credit: My Debt Epiphany

Leaky faucets

"If you pay for water utility bill, according to the EPA, fixing leaky faucets saves you 10% on your bill. By ignoring it, you not only lose money every day it goes unfixed, but you also waste clean water, at a rate of 10,000 gallons per year."

Credit: My Debt Epiphany

Fast food restaurants

"Improve your health and wallet by not eating fast food often. It may be cheap, but it adds up, especially if you eat out a few times per week. Instead, spend the money and the time to grocery shop and prepare meals."

Credit: My Debt Epiphany

Cool drafts

"Save on heating and electric bills by fixing drafts and keep the warmth and cool in your home during the winter and summer."

Credit: My Debt Epiphany

Unnecessary data phone plans

"Unless you need unlimited data for work, you should not spend much on your cell phone bill. I save a ton of money on my cell phone bill by using Republic Wireless."

Credit: My Debt Epiphany

Pet food

"You may not be able to cut out this expense completely if you have pets, but you can score free cans of pet food with coupons occasionally so you won't have to spend as much."

Credit: My Debt Epiphany

Buying lunch

"Sometimes you're running late for work and don't have time to pack a lunch. Buying lunch often costs much more than preparing and bring a meal to work. Spend some time planning, purchasing and preparing meals ahead of time so they're ready to go, even when you're in a hurry."

Credit: My Debt Epiphany

Leaving electronics plugged in

"Even though you may not use them often, electronics that are plugged in still consume energy. Unplug appliances you don't you often and keep other electronics on a power strip, turning them off when not in use."

Credit: My Debt Epiphany

Prepared grocery store meals

"When you do go grocery shopping, sometimes the already-prepped sub or diced fruits and veggies tempt you to buy them and save time, but you'll be paying top dollar for those products. Plan a list ahead of time and buy the individual food items, then spend the time prepping them yourself in order to save.

If you have trouble making grocery lists and figuring out what you're going to eat each day, I'd highly recommend trying out the $5 Meal Plan so you can receive healthy meal plans and recipes to your inbox."

Credit: My Debt Epiphany

Vending machine snacks

"Not only are these snacks typically unhealthy (there goes your healthy habit), they are typically much more expensive than their grocery store counterparts. If you find yourself buying vending machine snacks, try to save the money instead and see how much you have leftover at the end of the month. You can probably invest it."

Credit: My Debt Epiphany


"When you're heading out and can't or don't want to drive, consider calling Uber or Lyft instead of calling a cab so you can save money on the ride. You can use my link to get $20 off your first Uber ride."

Credit: My Debt Epiphany

Brand name items

"Save money by skipping on the brand names, like medicine, toiletries, and certain foods. Remember that healthier options with fewer additives may cost more and in that case they may be worth it. Otherwise, generic is the way to go."

Credit: My Debt Epiphany

Buying smaller/single packs

"Save money by skipping on the brand names, like medicine, toiletries, and certain foods. Remember that healthier options with fewer additives may cost more and in that case they may be worth it. Otherwise, generic is the way to go."

Credit: My Debt Epiphany

Purchasing paper towels/paper napkins

"You are purchasing these to eventually throw them out. Save on the waste and save money by buying reusable, washable towels and napkins. Your wallet and the environment will thank you."

Credit: My Debt Epiphany

Paying extra for night time movie showings

"Primetime showings are typically 2x higher than those during the day. Go to morning matinees or take advantage of weekly specials ($5 movie nights during the week)."

Credit: My Debt Epiphany

Movie theater food

"Often times, movie theater food can cost more than the ticket to get in. Try to keep food purchases to a minimum when you can or eat a filling meal before you go see a movie."

Credit: My Debt Epiphany

DVDs and On Demand

"Instead of spending money on purchasing the movie, subscribe to streaming services and find an alternative or go to your local library."

Credit: My Debt Epiphany


More from Run the Money
How To Start Running: 5 Tips to Help You Get Going
Personal Debt Isn't Necessarily a Bad Thing ... Except When it Is
Protecting Your Financial Information: Don't Let Your Money be a Target for Cyber Attacks

Read Full Story