I Asked ChatGPT for the Bare Minimum I Should Save for Retirement: Here’s What It Said
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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Rules for how much you should have saved for retirement vary depending on the source, and it can be confusing to know which rule to rely upon.
As someone over the hump of 50, retirement feels both far away and like it will be here any day to me. To help me get a sense of a baseline, I asked ChatGPT what is the bare minimum that I should save for retirement — and some general guidelines for the average person, too.
These Are the Widely Cited Guidelines
First, ChatGPT shared some of the “widely cited guidelines” for retirement. It drew on sources like Fidelity, which suggests that, by my age, you should have roughly six times your annual salary saved, yikes! Other expert sources, such as Vanguard, suggest that number should be closer to eight to 10 times your salary by retirement.
Another rule, ChatGPT said, drawing on data from Schwab, is to save with the “4% rule” in mind. That means you need enough saved so that you can withdraw 4% a year and have that cover your retirement expenses.
However, I live in a part of California where costs of living are higher than much of the U.S., so ChatGPT said many retirees in my neck of the woods should have well over $1 million, often closer to $1.4 million to $2 million or more, depending on housing, lifestyle, healthcare, taxes and inflation by my age.
What a ‘Bare-Minimum’ Retirement Goal Could Look Like
Because cost of living (especially housing) in the Bay Area is so high, and likely to remain so, a realistic bare-minimum nest egg for comfort (not frugality) likely needs to be toward the lower end of the “comfortable retirement” estimates. Here’s a rough scenario for someone in my shoes:
If my pre-retirement income were $100,000 per year, a six times-salary target by age 50 would imply savings around $600,000. But given the Bay Area cost structure, a $600,000 nest egg would probably be too tight for a comfortable, long retirement if I expect to stay locally.
A more realistic modest-comfort minimum might be $1.2 million to $1.5 million (assuming I don’t have a paid-off home and that I’m relying largely on savings and possible Social Security). Still, ChatGPT recommended aiming higher, more toward $2 million or more, leaving wiggle room for unexpected expenses, inflation, longer life and maintaining some discretionary spending.
Thus my “bare minimum” depends heavily on how I spend on housing, lifestyle, retirement age, healthcare costs and whether I’ll rely on Social Security or other income streams.
What Should a 50-Something Do Now?
If you’re like me, a 50-something in a not-so-cheap state and burb, ChatGPT suggested the following steps to prepare more accurately:
- Estimate: Estimate your expected annual spending in retirement (housing, utilities, taxes, healthcare, food, travel and leisure).
- Decide: Decide roughly what age you want to retire and how many years you expect to spend in retirement.
- Consider: Consider what portion of your expenses might be covered by other sources (Social Security, part-time work, pension, downsizing a home or selling property).
- Adopt: Try a “safe withdrawal” rule (like 4%) to back into a savings target. For example, if you estimate needing $60,000 per year in retirement, saving around $1.5 million would allow for a 4% withdrawal (that’s $60,000).
- Boost: Try boosting your savings now. While many advisers recommend saving 10% to 15% of gross income annually, do your best with what you’ve got and consider a 1% increase to contributions each year.
For me, a 51-year-old woman in the San Francisco Bay Area, a bare but relatively realistic minimum savings goal is $1 million to $1.5 million (assuming conservative retirement spending and possibly modest additional income). As a safer, more comfortable target, I should plan for $2 million or more.
A Simple Formula for a Bare-Minimum Target
For people who aren’t living in my ZIP code or in my exact situation, ChatGPT suggested thinking in formulas rather than fixed numbers. A useful baseline is to take your annual spending, multiply it by 25, and treat that as your “bare minimum” savings target (that’s the 4% rule in action).
If you’re behind on savings, another shortcut is to aim for six times your current income by your early 50s and eight to 10 times by retirement, then adjust up or down based on where you live, whether you’ll have a mortgage and how much you expect Social Security or part-time work to cover. It’s not perfect math, but it gives most people a realistic starting point that can be tailored to cost of living and lifestyle.
At the end of the day, knowing your own numbers is what turns a vague retirement worry into an actionable plan.
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