Building financial security can feel overwhelming, especially when it comes to saving for the future. Whether you’re in your 20s, 40s, or nearing retirement, understanding the savings benchmarks by age can help give you a clearer picture of where you stand—and where you should be heading.
But let’s face it: life doesn’t always unfold in a straight line. Between job changes, unexpected expenses, and family goals, it’s easy to feel unsure about how much you should have saved by now. The good news? There are clear, simple benchmarks that can guide your decisions and help you stay on track—without any fancy jargon.
Why Understanding Savings Benchmarks by Age Matters
Think of these benchmarks as mile markers on a road trip. They tell you how far you’ve come, how far you have to go, and whether you’re ahead or behind schedule. More importantly, they give you direction so you’re not just putting money away blindly.
Having a clear savings target helps you:
- Set realistic goals for big life events—like buying a home or retiring comfortably.
- Stay motivated as you hit key milestones.
- Make smarter decisions about spending, budgeting, and investing.
Let’s take a closer look at how your savings should evolve across each stage of life.
In Your 20s: Start Small, Think Big
Starting early is your superpower—even if it’s just a little. Compound interest can work its magic over decades, turning small monthly savings into big future rewards.
A good rule of thumb is to save the equivalent of your annual salary by the time you hit 30. So if you’re earning $50,000 a year, aim to have at least that much saved in retirement accounts like a 401(k) or Roth IRA.
Don’t let that number scare you. The key in your 20s is to build habits more than hit goals.
- Start by saving 10–15% of your income.
- Take full advantage of employer-matching retirement programs.
- Focus on building an emergency fund with 3–6 months of living expenses.
Even if you’re only setting aside $100 a month, that consistency pays off over time.
In Your 30s: Grow and Protect
By now, you’re probably more established in your career and earning more than before—but expenses like a mortgage or children might also be part of the picture. This decade is about balance.
The savings benchmark by age 40 is to have two to three times your annual salary saved. So if you’re making $70,000, aim for $140,000 to $210,000 in retirement savings.
Here’s how to stay on track:
- Maintain that 15% savings rate—or bump it up if possible.
- Build your emergency fund or “rainy day” fund even further.
- Start thinking about other financial priorities—like saving for your child’s education.
If you’re behind, don’t panic. Many people catch up later in life with larger contributions and better financial planning.
In Your 40s: Catch-Up Time (If Needed)
Life tends to feel busy in your 40s—but it’s a critical time to check in with your long-term goals. If you had a slower savings start in past decades, this is your chance to double down and make up ground.
Experts suggest having about three to six times your annual salary saved by age 50. Making $80,000 a year? That translates to $240,000 to $480,000 in your retirement accounts.
This is also when many people begin maxing out retirement contributions. If you’re eligible, start taking advantage of catch-up contributions in your 401(k) or IRA accounts to boost savings beyond standard limits.
Helpful strategies during your 40s:
- Cut unnecessary expenses—whether that’s dining out less or canceling unused subscriptions.
- Downsize debt, especially high-interest ones like credit cards.
- Revisit your investment strategy to be sure it’s still aligned with your goals.
If you’re looking for more ways to optimize your finances, check out our guide to budgeting better and saving more.
In Your 50s: Prepare for the Transition
This decade is when retirement transforms from an idea into a plan. It’s time to get serious.
You should aim to have six to seven times your income saved by your mid-50s. If you’re earning $90,000 annually, the goal is around $540,000–$630,000 in your retirement nest egg.
But retirement planning isn’t just about saving—it’s about envisioning your post-work life. Ask yourself:
- What kind of lifestyle do you want?
- What will your monthly expenses look like?
- Do you plan to travel, relocate, or start a business?
Answers to these questions will help shape your savings targets and investment strategy.
In Your 60s and Beyond: Turning Savings Into Income
By this stage, your goal should be to have around eight to ten times your income saved. For someone finishing a career earning $100,000 a year, hitting $1 million in savings puts you on solid ground.
This is also when you’ll start taking income from those savings. Work with a financial advisor to:
- Determine your safe withdrawal rate.
- Create a tax-efficient strategy for withdrawals.
- Protect your savings from market swings.
And don’t forget other income sources like Social Security or pensions. Combine all of these to create a steady, reliable flow of income in retirement.
Final Thoughts: It’s Never Too Late to Start—or Catch Up
Hitting these savings benchmarks by age isn’t about perfection—it’s about direction. Life happens. Maybe you started saving late, or maybe you had to dip into your emergency fund more than once. That’s okay.
What matters most is that you stay committed and keep moving forward. Even small, consistent steps make a huge impact over time.
If you’re unsure where to begin or need help setting up a plan, consider speaking with a financial advisor—or start by exploring trustworthy resources like this Investopedia article for more in-depth insights.
At the end of the day, you’re not saving for a number—you’re saving for freedom, peace of mind, and the life you want to live.
Start where you are. Use these benchmarks as a guide. And remember: the best time to save was yesterday. The second-best time? Right now.