The Carr Report: How much should you have saved for retirement at every age?

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There’s a popular meme floating around on social media that states, “I have enough money saved to live comfortably for the rest of my life. If I die by Thursday.”

When I post this meme, it gets a lot of reactions and comments. Why? Because for the average person, the statement is funny with a dash of truth. Most people can relate.

The average person is grossly undersaving for retirement. According to Vanguard’s “How Americans Save 2023” report, the average retirement savings in the U.S. by age are as follows:

  • Under age 25 – $5,236
  • Ages 25-34 – $30,017
  • Ages 35-44 – $76,354
  • Ages 45-54 – $142,069
  • Ages 55-64 – $207,874
  • Ages 65+ – $232,710

Based on the average retirement saving figures stated above, are you below average or above average for your age?

There’s another popular meme circulating on social media that states, “Work until your bank account balance looks like a phone number.” When I was growing up, a person’s phone number was 7 digits. We didn’t include the area code when calling local phone numbers. The bank account balance equivalent to 7 digits is $1 million. Nowadays, when you call someone you have to include the area code with the phone number. That’s 10 digits. The bank balance equivalent to 10 digits is $1 billion. By using the phone number reference, the meme is essentially stating one should work until they’ve amassed anywhere from $1 million to $1 billion. Surely, if you save an amount that looks like a phone number, be it 7 digits or 10 digits, you’re going to have a comfortable retirement. So, when this one person responded to this post stating that his bank account balance looked like a phone number, I took notice. Then I burst out laughing. 

The phone number he was talking about is 911. His response had a double meaning. He was saying that his bank balance was 3 digits which is $100 or so dollars. 911 is the phone number you call when you need emergency help. If you’re an adult at any age and you have zero to less than $1,000 saved for retirement, surely you need to call for help!

The amount you should have saved for retirement at every age can vary depending on your individual circumstances, such as your retirement goals, lifestyle, expected expenses, and other sources of income. However, here are some general guidelines for retirement savings milestones:

In your 20s: This is a great time to start building your savings habit. It’s generally recommended to save at least 10–20 percent of your income, if possible. Additionally, it’s a good idea to work towards building an emergency fund that can cover 3 to 6 months’ worth of living expenses.

By age 30: Aim to have saved the equivalent of your annual salary in a retirement account. This can include contributions to employer-sponsored plans like 401(k)s or individual retirement accounts (IRAs). If you’re 30 years old, earning $45,000 per year, you’d want to have approximately $45,000 saved for retirement.

By age 40: Aim to have three times your annual salary saved for retirement. This may include contributions to retirement accounts as well as other investments. If you’re 40 years old, earning $50,000 per year, you’d want to have approximately $150,000 saved for retirement. ($50,000 x 3)

By age 50: Aim to have six times your annual salary saved for retirement. Take advantage of catch-up contributions in retirement accounts if you are eligible. Catch-up contributions allow people age 50 and up to save over and above the standard threshold for retirement contributions in a given year. If you’re 50 years old, earning $55,000 per year, you’d want to have approximately $330,000 saved for retirement. ($55,000 x 6)

By age 60: Aim to have eight to 10 times your annual salary saved for retirement. Evaluate your retirement plans and make any necessary adjustments to meet your retirement goals. Between ages 45 and 47, you’re within 20 years from retirement. When it comes to retirement planning, age 45-47 puts you in the red zone. At age 60, you can see the goal line. If you’re 60 years old, earning $65,000 per year, you’d want to have approximately $650,000 saved for retirement. ($65,000 x 10)

In the end, you’d want to retire as a millionaire. Imagine retiring from work with a paid for house that’s free and clear of a mortgage and upwards of $500,000 saved for retirement. That’s my definition of Golden Years!

These milestones are just general targets and may not apply to everyone. It’s important to assess your own financial situation, consider your retirement goals, and consult with a financial advisor to create a personalized retirement savings plan. Additionally, factors like your desired lifestyle in retirement and other sources of income, such as social security or pensions, should be taken into account. It’s important that you start thinking about your desired lifestyle in retirement as early as possible. Ask yourself how much income will you need monthly to maintain your standard of living. Will you receive a pension? If so, how much? How much can you expect from social security if you take social security at age 62, age 67, or age 70? Are there any other sources of income that you’ll receive during retirement?

Tally up how much income you can expect from pension, social security, and other income monthly. Let’s assume that number is $2,500 per month. Let’s further assume that $5,000 is what you need monthly to maintain your desired standard of living. You have a $2,500 monthly gap. In this scenario your retirement savings need to generate $2,500 per month for you to be comfortable and maintain your desired standard of living.

In order to get an approximate of how much you need your retirement savings to be, multiply your monthly gap by 12 months. ($2,500 x 12 = $30,000) This is the amount you need to draw down from your retirement account yearly. Then take $30,000 (annual amount needed) x 25 ($30,000 x 25 = $750,000) In this scenario, $750,000 is how much should be saved for retirement to meet desired goals.

How much should you save for retirement? Answer: As much as you can. Little to no funds in your retirement savings equal little to no fun for you during retirement.

(Money Coach Damon Carr can be reached at 412-216-1013 or visit his website @




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