How Much Money Do You Need Saved To Retire at 30, 40 and 50?

Young woman in her thirties (30s) hold a notepad thinking about to do list at home.
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Could you afford to retire before you’re 55 years old? GOBankingRates surveyed 997 Americans aged 18 and older to learn which age they would realistically like to retire. Realistically, 13% of respondents would like to retire before age 55.

Retiring at age 55 means retiring a decade before you’re eligible for Medicare and seven years before you can begin collecting Social Security benefits. Those who want to retire sooner than 55, even as early as 30 or 40, also will need to be financially prepared for several decades of life ahead of them — which require robust savings. How much, on average, would an early retiree need to have in savings before they can retire?

Salary Savings By Age and Retirement Savings Goal

The usual way to determine how much you need to retire is to use this formula recommended by Nate Hoskin, CFP and founder of Hoskin Capital

Those planning to retire at 65 should have these minimums saved, according to their age range:

  • 30: 1x salary
  • 40: 3x salary
  • 50: 6x salary

However, if you want to retire early, you obviously have to accelerate that pace. It’s almost impossible to retire at 30 unless you receive a large inheritance or find a way to make millions in your 20s. Age 40 is slightly more realistic, though for the typical worker it would require accumulating around $100,000 per year in savings over the 20 working years.

Are You Retirement Ready?

What If You Have No Money Saved for Retirement?

If you have zero dollars saved for retirement, you certainly are not going to retire at age 30 and you will need to double or triple up the standard savings formula.

For the target age of 65, Hoskin recommends taking your current age and subtracting the number 15. The resulting number is the percentage of your salary you should be saving each year if you plan to retire at age 65. For earlier retirement, you will need to double or triple that percentage.

For example, the esteemed writer of this article is 34 years old. If she had zero dollars saved for retirement, she would need to begin putting 19% of her salary toward retirement savings every year. If she wanted to retire at 50, she would need to at least double that.

Remember: The older you are without any money in retirement, the greater the salary percentage that must be allocated to retirement funds. If you start saving later and find you need extra time to keep saving, consider delaying retirement past age 55.

EDITOR’S NOTE: This story has been updated to clarify the calculations needed for early retirement.

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