How To Build Your Retirement Savings From Scratch in 2026
Written by
Vance Cariaga
Edited by
Rebekah Evans
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It’s never too late to start saving for retirement, but if you haven’t already begun, now is the time get going. The longer you wait, the harder it is to build up an adequate nest egg — which is a common problem in the United States.
Federal Reserve research found that the average retirement savings for Americans ages 65 to 74 was $200,000 as of 2022, the most recent year data are available. That total is well below the $560,000-plus recommended by Fidelity based on its formula of saving about nine times your annual salary at age 65.
If you haven’t already begun the process, here are four ways to build your retirement savings from scratch in 2026.
Create a Budget
A good first step when building your nest egg from scratch is to review your income and expenses and figure out how much you can contribute to retirement savings each month.
Ideally, you’ll be able to put 10% to 15% of your income toward retirement, said Paul Gillooly, financial advisor and director at Dot Dot Loans.
“If you start saving later (age 40 and over), aim to increase this to 20% or more,” he explained.
Gillooly also recommended adopting the 50/30/20 rule. With this rule, you allocate 50% of your budget to essentials like housing and utilities, 30% to “wants” and 20% to savings — including retirement savings.
Pay Down Your Debt
Another good initial step was shared by Jay Zigmont, Ph.D., certified financial planner (CFP) and founder of Childfree Trust, which provides estate services to people without children. “Get rid of all of your debt besides your mortgage,” he said.
“Paying off your credit cards and consumer debt is a risk-free, tax-free return of the interest saved, which the market won’t beat,” Zigmont added.
Set Up a Retirement Account
Unless you work for one of those rare employers that offer pension benefits, your main retirement account choices are a company-sponsored 401(k) plan or an individual retirement account (IRA).
If your employer offers a 401(k), then you should open an account and begin contributing immediately. It’s also a good idea to contribute the maximum amount if you have the finances to do so. The 2026 maximum is $24,500 a year, according to the IRS.
If you don’t have access to a 401(k), the next best options are traditional or Roth IRAs, according to Mario Serralta, certified public accountant (CPA), financial advisor and founding lawyer of Mario Serralta & Associates
“Younger savers could benefit from contributing to Roth accounts because they would have paid taxes up front and older savers may wish to contribute to traditional accounts for the tax relief today,” he explained.
Take Your Age Into Account With Investments
The general rule of thumb is that you should keep your retirement portfolio mixed among stocks, bonds and other investments, according to Arie Brish, business and technology executive, real estate investor, author and business professor at St. Edward’s University.
But your age will play a role in how that mix plays out.
“When you are young, you have enough time to absorb market fluctuations and have the majority of your portfolio in stocks,” Brish said. “As you get closer to your retirement age, you may want to shift gradually to more bonds and safe investments, while reducing the portion of stocks in your portfolio.”
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