How Much Should You Save for Retirement by Age?

No single number means “enough for retirement”, because the answer depends on what you intend to spend rather than what you earned. But there are checkpoints worth knowing, a rule for turning a pot of money into an income, and one variable that matters more than all the others combined. This guide covers each, with the arithmetic that makes them concrete.

The salary-multiple checkpoints

The most widely cited benchmarks, popularised by Fidelity, express savings as a multiple of your current salary at each age:

• By 30 — about 1× your salary saved.
• By 40 — about 3×.
• By 50 — about 6×.
• By 60 — about 8×.
• By 67 — about 10×.

Read them as a progress bar, not a verdict. They assume steady saving from the early twenties, a career without long gaps, and a retirement funded partly by Social Security. Someone who spent their twenties in graduate school or raising children will be behind these markers for reasons that have nothing to do with discipline.

They are also expressed against salary, which quietly builds in a flaw: a large raise late in your career moves the target away from you even though your savings have not changed. If your spending did not rise with the raise, the checkpoint is misleading and you are in better shape than it suggests.

The 4% rule turns savings into income

The 4% rule estimates what a portfolio can pay you indefinitely: withdraw 4% of the balance in the first year, adjust that amount for inflation each year after, and the money has historically survived 30 years across most market histories. Inverted, it becomes a target — 25 times the annual income you want from savings.

To draw $40,000 a year you need roughly $1,000,000. For $60,000, roughly $1,500,000. Those figures are before Social Security, which for a median earner replaces around 40% of pre-retirement income, so the portfolio only has to cover the gap between your spending and that benefit — a distinction that moves the target by hundreds of thousands of dollars.

The rule is a planning heuristic, not a law. It was derived from historical US returns over 30-year windows, and it assumes a diversified portfolio and steady spending. Retiring early, or into a bad first decade of returns, both argue for a lower withdrawal rate.

Time is the variable that dominates

Saving $500 a month at a 7% return produces wildly different outcomes depending only on when it starts:

• From age 25 to 67 — about $1,521,900.
• From age 35 to 67 — about $714,200.
• From age 45 to 67 — about $312,300.

Ten years of delay costs more than half the outcome, and twenty years costs about 80%. Put the other way: to reach the same $1.52 million starting at 35 you would need $1,065 a month, and starting at 45 you would need $2,436 — nearly five times the original contribution for the same result.

This is the whole argument for starting with an amount that feels too small to matter. A contribution you can sustain from 25 outperforms one you postpone until it feels adequate.

If you are starting late

The compounding argument is discouraging read backwards, so it is worth being precise about what actually helps after 45. In rough order of effect:

• Raise the contribution rate first. It is the only lever fully under your control, and late savers benefit from peak-earning years.
• Use catch-up contributions. From age 50 the 2026 limits allow an extra $8,000 in a 401(k) and $1,100 in an IRA, and ages 60 to 63 get an enhanced $11,250.
• Delay claiming Social Security. Each year deferred past full retirement age raises the benefit by roughly 8% until 70 — a guaranteed, inflation-adjusted increase no investment offers.
• Work two more years. It adds contributions, removes two years of withdrawals, and shortens the period the portfolio must survive. It is unwelcome advice and it is unusually effective.
• Lower the target. Spending less in retirement reduces the 25× requirement directly — $10,000 a year less is $250,000 less to accumulate.

A savings rate is a better check than a balance

Multiples tell you where you stand; they do not tell you whether this year is going well. The commonly cited target is 15% of gross income, including the employer match — so a 5% contribution against a 5% match is two-thirds of the way there, not a third.

The rate is the more useful measure because you control it directly and it responds immediately, while a balance mostly reflects decisions made years ago and markets you did not influence. It also survives a bad market year intact: a portfolio down 20% does not mean the plan failed, but a savings rate that fell to zero does.

What the benchmarks leave out

Two things move the real number more than the multiple you have hit. The first is whether the mortgage is paid off, since housing is most households' largest line and retiring without it can cut required income by a quarter. The second is healthcare before Medicare eligibility at 65, which is the single most underestimated cost for anyone retiring early.

Run your own number

Project your actual path in the retirement calculator — current balance, monthly contribution, expected return, target age — then stress-test it at 5% instead of 7%. A plan that still works at the lower return is a plan; one that only works at 7% is a hope. Check what the employer match adds in the 401(k) calculator (and how a 401(k) match works if you are not certain you are capturing all of it), see what the pot actually pays out in the retirement drawdown calculator, and test claiming ages in the Social Security claiming age calculator.