How much you need to retire on is an age-old question with numerous answers, depending on when you plan to retire, what type of lifestyle you want and other factors.
But there are some general guidelines that can steer you in the right direction. A common strategy is to save 10 times your income by age 67.
Here’s how that breaks down by decade:
- By age 30: saved the equivalent of your annual salary
- By age 40: saved three times your salary
- By age 50: saved six times your salary
- By age 60: saved eight times your salary
- By age 67: saved ten times your salary
These benchmarks aren’t set in stone — they’re broad guidelines intended to give you enough to maintain your current lifestyle in retirement, without spreading yourself too thin or having to downsize.
If you plan to retire earlier — say, at 62 — you’ll need to save more to compensate for those additional years without income. On the other hand, if you don’t stop working until 75, you’ll probably be okay with less in your coffers along the way.
How to start saving for retirement
It’s best to start saving early — even if it’s a small, regular contribution — and let it build over the decades. A high-yield savings account can grow your money faster, thanks to compound interest. The LendingClub® LevelUp Savings offers an above-average APY, plus the option to earn even higher when you deposit $250 or more per month into your account.
LendingClub LevelUp Savings Account
LendingClub Bank, N.A., Member FDIC
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Annual Percentage Yield (APY)
4.20% (with monthly deposits of at least $250), or 3.20%
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Minimum balance
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Monthly fee
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Maximum transactions
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Excessive transactions fee
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Overdraft fees
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Offer checking account?
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Offer ATM card?
Investing is really reserved for people with a long-term investment horizon. Retirement is farther away for them, so they can afford to take on more risk and weather market downturns.
The best place for beginners to invest is in a standard index fund that tracks the S&P 500, since it’s more diversified than buying individual stocks. You can get an S&P 500 fund through a major brokerage like Vanguard.
Vanguard
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Minimum deposit and balance
Minimum deposit and balance requirements may vary depending on the investment vehicle selected. No minimum to open a Vanguard account, but minimum $1,000 deposit to invest in many retirement funds; robo-advisor Vanguard Digital Advisor® requires minimum $100 to enroll
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Fees
Fees may vary depending on the investment vehicle selected. Zero commission fees for stock and ETF trades; zero transaction fees for over 3,000 mutual funds; $20 annual service fee for IRAs and brokerage accounts unless you opt into paperless statements; robo-advisor Vanguard Digital Advisor® charges up to 0.20% in advisory fees (after 90 days)
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Bonus
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Investment vehicles
Robo-advisor: Vanguard Digital Advisor® IRA: Vanguard Traditional, Roth, Rollover, Spousal and SEP IRAs Brokerage and trading: Vanguard Trading Other: Vanguard 529 Plan
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Investment options
Stocks, bonds, mutual funds, CDs, ETFs and options
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Educational resources
Retirement planning tools
FAQs
How much do I need to have in savings for retirement?
Experts suggest having ten times your income saved by age 67, but the specific amount you’ll need to retire comfortably largely depends on your lifestyle and when you plan to stop working. At the same time, it’s important to prepare for unexpected expenses in retirement, such as medical bills and home repairs.
How are high-yield savings accounts different from traditional savings accounts?
High-yield savings accounts offer much higher interest rates, which allow your money to grow faster. Most HYSAs are offered by online banks with no physical locations, allowing them to save on overhead.
What is the 50-30-20 budgeting rule?
The 50-30-20 budgeting rule is a popular strategy in which you put 50% of your paycheck toward essentials, 30% toward things you want and 20% toward savings and investment.
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