How much should I save for retirement?
Picture this: You're 35 years old, earning $60,000 a year, and wondering if the $15,000 in your 401(k) means you're on track for retirement. Sound familiar? You're not alone—figuring out how much to save for retirement is one of the most pressing financial questions Americans face today.
The good news? There's a clearer path forward than you might think. Whether you're just starting your career or playing catch-up in your 40s, understanding retirement savings benchmarks can transform vague anxiety into concrete action. Let's dive into what the latest research tells us about building a secure financial future.
The New Rules of Retirement Savings
Gone are the days when the old "save 10% rule" was enough. Today's retirement landscape demands a more nuanced approach. According to T. Rowe Price's 2025 retirement analysis, the magic number has shifted: aim to save 15% of your income annually, including employer contributions.
Why the increase? Consider that Americans are living longer, healthcare costs are rising faster than general inflation, and Social Security's future purchasing power remains uncertain. These factors combine to create a retirement that could span 30 years or more—requiring a substantially larger nest egg than previous generations needed.
But here's where it gets interesting: your savings rate is just one piece of the puzzle. The real power lies in understanding how your age, income, and current savings interact to determine whether you're on track. Let's break down exactly what you should have saved at different life stages.
Retirement Savings by Age: Your Personal Scorecard
Think of these benchmarks as mile markers on your retirement journey. They're not rigid rules, but rather guideposts to help you gauge your progress:
| Age | Savings Target (Multiple of Annual Salary) |
|---|---|
| 30 | 0.5x to 1x your salary |
| 35 | 1x to 1.5x your salary |
| 40 | 1.5x to 2.5x your salary |
| 45 | 2.5x to 4x your salary |
| 50 | 3.5x to 5.5x your salary |
| 55 | 4.5x to 8x your salary |
| 60 | 6x to 11x your salary |
| 65 | 7.5x to 13.5x your salary |
Here's what this looks like in real numbers: If you're 35 and earning $60,000, having between $60,000 and $90,000 saved puts you solidly on track. By 50, that same earner should aim for $210,000 to $330,000 in retirement accounts.
These ranges might seem wide, and that's intentional. Higher earners typically need to save more relative to their income because Social Security replaces a smaller percentage of their pre-retirement earnings. Meanwhile, those with pensions or other guaranteed income sources might aim for the lower end of these ranges.
Monthly Savings: Breaking It Down
So how do you actually hit these targets? The path forward depends on where you're starting. If you're 25 and just beginning your retirement savings journey, contributing 15% of a $40,000 salary means setting aside $500 per month. Thanks to the power of compound growth, starting early gives your money decades to multiply.
But what if you're getting a late start? The math changes significantly. A 40-year-old earning $80,000 who hasn't saved anything yet might need to save 20-25% of their income—or $1,300 to $1,700 monthly—to catch up. The lesson? Every year you delay significantly increases the monthly amount you'll need to save.
Your Action Plan: Smart Strategies for Every Stage
In Your 20s and 30s: Establish the Foundation
Start with your employer's 401(k) match—it's free money that immediately boosts your savings rate. If your company matches 3% and you contribute 3%, you're already at 6% without feeling the full pinch. From there, increase your contribution by 1% each year until you hit that 15% target.
Consider automating everything. Set up automatic transfers from your checking account to your retirement accounts. When you can't see the money, you won't miss it. Plus, automated investing helps you avoid the temptation to time the market—a strategy that rarely works.
In Your 40s and 50s: Accelerate Your Progress
This is crunch time. If you're behind, take advantage of catch-up contributions. In 2025, those 50 and older can contribute an extra $7,500 to 401(k)s and an additional $1,000 to IRAs. Combined with regular contribution limits, you could potentially save over $30,000 annually in tax-advantaged accounts.
Look beyond your 401(k) too. Once you've maxed out employer matches, consider opening a Roth IRA for tax-free growth. The tax diversification will give you more flexibility in retirement. Don't forget to regularly check your asset allocation by age to ensure your investment mix matches your time horizon.
The Power of Small Increases
Here's an eye-opening comparison from A Wealth of Common Sense: Two households with identical incomes and investment returns, but different savings rates, end up in vastly different places after 20 years. The household saving 25% accumulates $1.4 million, while the one saving 10% has just $500,000. Your savings rate matters more than almost any other factor—including investment returns.
Beyond the Basics: Adjusting for Your Reality
Regional variations matter more than most people realize. Fidelity International's research shows that Americans typically need to replace 45% of their pre-retirement income from personal savings, after accounting for Social Security. But this percentage varies based on your income level and location.
High earners face a particular challenge. If you're making $200,000 or more, Social Security will replace a much smaller percentage of your income. You might need to save 20-25% annually to maintain your lifestyle. This is especially true in high-cost areas where housing and healthcare expenses can devastate even well-funded retirement plans.
Don't Forget Healthcare
One critical factor often overlooked in retirement planning is healthcare costs. Medicare doesn't cover everything, and supplemental insurance, prescriptions, and out-of-pocket expenses can easily run $300,000 or more per couple over a 20-year retirement. Factor this into your savings targets, especially if you plan to retire before Medicare eligibility at 65.
Making It Happen: Your Next Steps
Knowing how much to save for retirement is only half the battle—execution is everything. Start by using Maybe's 401(k) retirement calculator to see exactly where you stand today. Input your current savings, expected contributions, and retirement goals to get a personalized projection.
Then, take these concrete steps:
- This week: Review your current retirement contribution rate and increase it by at least 1%
- This month: Ensure you're getting your full employer match and set up automatic annual increases
- This quarter: Meet with HR or your plan administrator to understand all your retirement savings options
- This year: Consider opening additional accounts (Roth IRA, HSA) to diversify your retirement savings
Remember, perfect is the enemy of good when it comes to retirement savings. Starting with something—even if it's just 5% of your income—beats analysis paralysis every time. You can always increase your savings rate as your income grows and your financial situation improves.
The path to a secure retirement isn't mysterious or impossibly complex. It's about consistent action, realistic benchmarks, and making adjustments along the way. Whether you're 25 or 55, the best time to improve your retirement savings is right now. Your future self will thank you for every dollar you set aside today.
