Retirement Savings by Age: Benchmarks and Your Target Number

There is no single dollar figure that is "enough" for retirement, but well-tested benchmarks can tell you whether you are roughly on track. This guide explains the age-based savings multiples most planners use, the math behind your personal target, and the levers that move it.

Age-based savings benchmarks (the salary-multiple method)

The most widely cited rule of thumb comes from Fidelity, which frames progress as a multiple of your current annual salary. The targets assume you save consistently from your mid-twenties, invest in a diversified portfolio, retire around age 67, and want to maintain a similar lifestyle in retirement. They are a yardstick, not a guarantee.

To apply the benchmark to your own income, multiply your gross salary by the factor for your age. Because the multiples are tied to your salary rather than a fixed dollar amount, a higher earner needs a proportionally larger balance. Plug your salary and age into the Retirement Calculator to see your target and projected balance side by side.

Falling short of a benchmark is common and rarely a crisis. These figures assume an uninterrupted savings history, so career breaks, late starts, periods of lower income, or a planned earlier retirement all shift the numbers. Treat them as a checkpoint, then build a plan around your own situation.

How to calculate your own retirement number

Benchmarks estimate progress; a target based on your actual spending is more precise. The standard approach works backward from the income you will need each year in retirement.

Step 1: Estimate annual retirement spending

Add up what a typical year will cost: housing, food, insurance, travel, healthcare, and discretionary spending. A common shortcut is the replacement-rate method, which assumes you will need 70 to 80 percent of your pre-retirement income, since payroll taxes and retirement contributions disappear and some work-related costs fall. Use the higher end if you expect an active, travel-heavy retirement.

Step 2: Subtract guaranteed income

Income from Social Security, a pension, or an annuity covers part of your spending, so savings only need to fund the gap. If you expect $30,000 a year from Social Security and your spending is $60,000, your portfolio supplies the remaining $30,000.

Step 3: Apply a safe withdrawal rate

Divide the annual amount your savings must cover by your planned withdrawal rate to get your target nest egg. At a 4 percent rate, divide by 0.04 (the same as multiplying by 25); at a conservative 3.5 percent rate, divide by 0.035 (about 28.6 times). The FIRE Calculator automates this, and the FIRE number explainer walks through the logic.

The 4% rule, and why some use a lower rate

The 4 percent rule comes from research by financial planner William Bengen and the later Trinity Study. It found that withdrawing 4 percent of your portfolio in the first year of retirement, then adjusting that dollar amount for inflation each year afterward, historically lasted at least 30 years across a range of market conditions for a balanced stock-and-bond portfolio.

The rule is a planning baseline, not a promise. It assumes a roughly 30-year retirement, a diversified portfolio, and a willingness to trim spending during severe downturns. Retirees who expect a longer horizon, who retire early, or who want a larger margin of safety often plan around 3 to 3.5 percent instead, which raises the savings target. A lower withdrawal rate means a bigger required balance for the same income.

What actually changes your target

When you plan to stop working

Your retirement age affects the number from both directions. Retiring earlier means more years to fund and fewer years to save and compound, so the target rises sharply. Working a few extra years does the opposite: it shortens the withdrawal period, adds contributions, and lets existing balances grow.

When you claim Social Security

For workers born in 1960 or later, full retirement age is 67. Claiming at the earliest age of 62 permanently reduces the monthly benefit by about 30 percent, while delaying past full retirement age earns delayed retirement credits of roughly 8 percent per year until age 70. Social Security replaces around 40 percent of pre-retirement income for an average earner and a smaller share for high earners, who therefore need larger personal savings.

Healthcare and longevity

Medical costs are a major and often underestimated retirement expense, covering Medicare premiums, deductibles, and care that insurance excludes. Longevity compounds the risk: planning to age 90 or 95 instead of 85 adds years of withdrawals. If you are in good health or have a family history of long life, plan for the longer horizon.

Inflation

Rising prices erode purchasing power over a multi-decade retirement, which is why withdrawal frameworks build in annual inflation adjustments. See how inflation affects fixed income for why a portfolio that keeps some growth assets matters even after you stop working.

Contribution limits and catch-up rules for 2025

How fast you reach your target depends heavily on how much you contribute and whether you capture an employer match. For 2025, the IRS limits are:

• 401(k), 403(b), most 457 plans: $23,500 in employee deferrals.
• Age 50+ catch-up: an extra $7,500, for a total of $31,000.
• Ages 60 to 63 catch-up: a higher catch-up of $11,250 under SECURE 2.0, replacing the standard $7,500 for those ages.
• Traditional and Roth IRA: $7,000, plus a $1,000 catch-up at 50 and older.

If your employer matches contributions, that match is part of your effective savings rate and an immediate return on the money you put in. Capturing the full match before directing money elsewhere is one of the highest-value moves in retirement saving. To decide which account to fund first, compare a Roth versus traditional IRA and review the order of operations in 401(k) versus Roth IRA.

If you are behind, focus on the levers you control

A gap between your balance and the benchmark is fixable, and small changes compound. Raising your savings rate, even by a few percentage points, has an outsized long-run effect because earlier contributions have more years to grow. Working two or three additional years can meaningfully increase a final balance by adding contributions and growth while shortening the payout.

It also helps to revisit spending, since a lower target is easier to reach than a larger portfolio. Model how a higher monthly contribution and a longer horizon change your projected balance with the Compound Interest Calculator, and use the how much to save guide to translate a target into a monthly number.

Frequently Asked Questions