How much should you be saving in your 20s, 30s, 40s and 50s?
Getty Images/iStockphoto
You know you should save, but (yikes!), just what is the right amount? While there is no perfect answer, there are some simple rules to consider to get you started. (See the best savings rates you may be able to get now here.)
Some general savings rules to help you get started saving
These rules are very general, and depend on your levels of debt, expenses, life stage and more, but they are a solid way to get started thinking about savings.
- The 50/30/20 rule: Applying the 50/30/20 budget is a good place to start, pros say. It allocates 50% of your paycheck to needs, 30% to wants and 20% to savings and debt payments.
- The save 15-20% of your paycheck rule: Even simpler advice? Some pros simply say aim to save 15-20% of your paycheck to savings. You can slowly build up to this number.
Unsure how to handle debt vs savings? In addition to always payming the minimums on all debts, Bryan Stiger, certified financial planner at Betterment says the savings order of operations are to:
- Take advantage of your employer match and save enough in that account to receive the employer match
- Quickly pay off high-interest debt (debt greater than 7% interest rate)
- Save in an emergency fund
- Save more in your retirement account
- Save for other goals you might have like buying a home or putting kids through college.
How much do other people save?
Data from the Federal Reserve’s Board Survey of Consumer Finances from 2019 reveals that the average savings balance, not including retirement funds, for Americans under the age of 35 is $11,200.
| Age | Median balance of accounts | Average balance of accounts |
| Younger than 35 | $3,240 | $11,250 |
| 35 to 44 | $4,710 | $27,910 |
| 44 to 54 | $5,620 | $48,200 |
| 55 to 64 | $6,400 | $55,320 |
| 65 to 74 | $8,000 | $57,670 |
| 75 and older | $9,300 | $60,410 |
But plenty of Americans have barely any savings. Sadly, Bankrate data from January 2022 showed that 56% of Americans wouldn’t be able to cover an unexpected $1,000 bill using savings. What’s more, an FDIC survey from 2019 revealed that 5.4% of US households, or 7.1 million people were unbanked — meaning nobody in the household had a checking or savings account at a bank or credit union.
Make sure you have an emergency fund
You need an emergency fund — which pros say should be about 3-9 months of essential expenses — if you don’t yet have one. Pros say you can aim for $1,000 to start, so factor that into your monthly savings plan — and then go from there. Even if you can only save say $50 a month into that emergency fund, do it.
See the best savings rates you may be able to get now here.
How much should I save per paycheck?
It depends. If you’re going to retire at 60 and travel the world for 10 years, you would need more than if you plan to work until 70. “The rule of thumb is 15% to 20%, but this depends on age too. If you’re in your twenties with student loan debt and saving 5% instead of 10% means a better quality of life, but your plan still looks good long-term, then it might be a good choice,” says Struthers. Obviously, you want to take advantage of a company match and the magic of long-term compounding, but you have to use common sense around these rules of thumb.
Bessette says a good benchmark to aim for is to save 20% of every paycheck for savings and/or to pay off debt. But while conventional wisdom says you should save 20% of your paycheck, some individuals might not be able to save 20% of their paycheck. “Start with 10% to 15% of your paycheck and build up to 20% of your paycheck,” says Stiger.
How much should I save per week?
Fidelity recommends using a 50/15/5 schedule, where no more than 50% of take-home pay goes to “must-have” expenses like housing, food and healthcare; 15% of pretax income including any employer contributions is saved for retirement; and 5% of take-home pay is used for short-term savings like an emergency fund.
Another common standard is the 50/30/20 rule in which 50% goes towards the things you need (essentials), 30% goes towards the things you want (discretionary items) and 20% goes towards savings and investments.
See the best savings rates you may be able to get now here.
Savings in your 20s
-
How much should I save in my 20s?
Regardless of age, the suggestion is to save 20% of your income — though in your 20s that can prove tough. “The sooner you start, the better. Whether that be age 20, 30 or 40. If you can’t save 20% of your income, aim for 10%. If you can’t save 10% of your income, aim for 5%. Start there and increase your savings rate over time,” says Stiger.
Indeed, “in your 20s, you’ll likely just be starting to build up your emergency fund as well as determine and save for your other financial goals. It’s still a good idea to aim for dedicating 20% of your income to savings and debt payments,” says Bessette. If you’re plagued by debt or you have a low income, start with a smaller amount and build up to 20% over time.
Savings in your 30s
- How much should I save in my 30s? “In your 30s, you’ll likely be more established in your career and you may be planning around new financial goals like buying a house or raising a family. Adjust your budget to make sure you’re saving enough to meet these goals,” says Bessette. If you haven’t started saving for retirement, make sure that’s happening too. While conventional wisdom says you should save 20% of your paycheck, if you’re unable to do that, you can start with a smaller amount and build up to 20%.
- How much should i have in savings at 30 Experts often suggest that someone in their 30s have one year of their salary saved. Indeed, the most common rule of thumb, and a good place to start is 1x your salary, according to certified financial planner Mark Struthers of Sona Wealth Advisors. “I think this has changed a little with student loan debt and home prices going up relative to incomes. It’s not that you shouldn’t strive for it, but just make sure you aren’t stretched too thin and the emergency fund is there,” says Struthers. While this number should be very individualized, Struthers says given the new paradigm, he often gives a range of .50x to 1.25x. Indeed, some experts say if you want to have a strong emergency fund, you should aim to have savings of at least 3 to 6 months of essential expenses on hand. “If you’re hoping to make a large purchase, like a house or a car, you might want to have savings set aside for a down payment,” says Bessette. Ultimately, the amount of savings you should have at 30 depends on several factors like your current income, your current debt and your personal overhead.
Savings in your 40s
-
How much should I save in my 40s?
Whether you’re 20, 30 or 40, the sooner you start saving the better. “Regardless of age, the suggestion is to save 20% of your income,” says Stiger. The biggest key, he says, is to get started saving and building good savings habits like making automated transfers. Ted Rossman, senior industry analyst at Bankrate says people in their 40s can get squeezed by competing priorities such as paying off a mortgage and raising kids. “There’s also the whole sandwich generation thing of raising your own kids while potentially caring for elderly parents, but later on, maybe some of those obligations can come off the list and you’re more able to save,” says Rossman. In your 40s, you likely have more assets and should begin diversifying your investment portfolio and looking for additional streams of income. “If you’ve managed to lock in a mortgage at a low rate, rather than make additional payments, consider investing these additional funds into a rental property or other potential passive revenue streams. But first — pay off debt,” says Gabe Krajicek, CEO of Kasasa, a fintech that provides community banks with financial products and services.
-
How much should I have in savings at 40?
The rough rule of thumb is that you want 3x your salary in savings at 40, but of course, this can be difficult. And as Stiger puts it: “There isn’t really a magic number to reach like a baseball team clinching to go to the playoffs.” In other words, do your best.
Savings in your 50s
-
How much should I save in my 50s?
In your 50s, continue to increase your retirement savings and investigate long-term care insurance. “This next chapter may be weighing more heavily on your mind, so evaluate your current trajectory and take steps to ensure you’re on the track you intended. Use an online retirement calculator and continuously check in with your financial adviser, especially given the current economic turmoil,” says Krajicek.
-
How much should I have saved in at 50?
The rough rule of thumb is that you should have 6x your salary saved at 50. But, notes Rossman: “The older you get, the more your retirement savings and Social Security can factor in.”
See the best savings rates you may be able to get now here.
How much should a college student save per month?
Depending on how much student loans and bad debt you have, someone in college should try to take advantage of being young and using compounding, while also having an emergency fund to help them avoid credit card debt. “An emergency fund also allows someone to take advantage of opportunities like moving to a different city for a job,” says Struthers.
If a college student saves 5% to 10% of their gross salary, that’s a reasonable target. “A Roth IRA is a great option too since income at this point is low and contributions are available anytime, tax and penalty free. It can act like a third bucket emergency fund depending on how they invest,” says Struthers.
It can be hard to save as a college student since a lot of students live on grants, loans or part-time jobs. “For your peace of mind, it’s a good idea to save as much as you can. Ideally you should have an emergency fund of at least $1,000 which should help cover basic unexpected costs like a minor car repair,” says Bessette.
How to make saving easier
One that can apply to anyone with a paycheck is the concept of direct deposit and streamlining the process of saving by setting up an account that automatically deducts a portion of each paycheck into a separate account. “It becomes much less tempting to spend that money if it never hits your checking account,” says Chanelle Bessette, banking specialist at NerdWallet.
Something else to consider is setting up a budget and tracking your spending can make it easier to see where your money is going and if there’s a way to funnel more into your savings, versus your spending categories.
And look at ways to up your earnings to make savings easier — anything from getting a raise
To not storing your credit card on your computer to deter you from making impulsive purchases.
Calculators to help you know how much to save per month calculator
Many financial sites and institutions offer free digital calculators to help people determine how much they should save every month. Here are a few we like:
- NerdWallet’s calculator that spits out a number based on how much you want to save and when you want to achieve your goal.
- The US securities and exchange commission site Investor.gov has a tool that calculates how much money you need to contribute each month in order to arrive at a specific savings goal. There are options to include interest rates and compound frequency for added accuracy in addition to a compound interest calculator, required minimum distribution calculator and a college savings calculator.
- Bankrate’s simple savings calculator that lets users select an initial deposit amount, a monthly contribution, the number of years and sample current interest rates at banks like Citizens, CITBank and Synchrony.
The advice, recommendations or rankings expressed in this article are those of MarketWatch Picks, and have not been reviewed or endorsed by our commercial partners.
How much should you be saving in your 20s, 30s, 40s and 50s?
Getty Images/iStockphoto
You know you should save, but (yikes!), just what is the right amount? While there is no perfect answer, there are some simple rules to consider to get you started. (See the best savings rates you may be able to get now here.)
Some general savings rules to help you get started saving
These rules are very general, and depend on your levels of debt, expenses, life stage and more, but they are a solid way to get started thinking about savings.
- The 50/30/20 rule: Applying the 50/30/20 budget is a good place to start, pros say. It allocates 50% of your paycheck to needs, 30% to wants and 20% to savings and debt payments.
- The save 15-20% of your paycheck rule: Even simpler advice? Some pros simply say aim to save 15-20% of your paycheck to savings. You can slowly build up to this number.
Unsure how to handle debt vs savings? In addition to always payming the minimums on all debts, Bryan Stiger, certified financial planner at Betterment says the savings order of operations are to:
- Take advantage of your employer match and save enough in that account to receive the employer match
- Quickly pay off high-interest debt (debt greater than 7% interest rate)
- Save in an emergency fund
- Save more in your retirement account
- Save for other goals you might have like buying a home or putting kids through college.
How much do other people save?
Data from the Federal Reserve’s Board Survey of Consumer Finances from 2019 reveals that the average savings balance, not including retirement funds, for Americans under the age of 35 is $11,200.
| Age | Median balance of accounts | Average balance of accounts |
| Younger than 35 | $3,240 | $11,250 |
| 35 to 44 | $4,710 | $27,910 |
| 44 to 54 | $5,620 | $48,200 |
| 55 to 64 | $6,400 | $55,320 |
| 65 to 74 | $8,000 | $57,670 |
| 75 and older | $9,300 | $60,410 |
But plenty of Americans have barely any savings. Sadly, Bankrate data from January 2022 showed that 56% of Americans wouldn’t be able to cover an unexpected $1,000 bill using savings. What’s more, an FDIC survey from 2019 revealed that 5.4% of US households, or 7.1 million people were unbanked — meaning nobody in the household had a checking or savings account at a bank or credit union.
Make sure you have an emergency fund
You need an emergency fund — which pros say should be about 3-9 months of essential expenses — if you don’t yet have one. Pros say you can aim for $1,000 to start, so factor that into your monthly savings plan — and then go from there. Even if you can only save say $50 a month into that emergency fund, do it.
See the best savings rates you may be able to get now here.
How much should I save per paycheck?
It depends. If you’re going to retire at 60 and travel the world for 10 years, you would need more than if you plan to work until 70. “The rule of thumb is 15% to 20%, but this depends on age too. If you’re in your twenties with student loan debt and saving 5% instead of 10% means a better quality of life, but your plan still looks good long-term, then it might be a good choice,” says Struthers. Obviously, you want to take advantage of a company match and the magic of long-term compounding, but you have to use common sense around these rules of thumb.
Bessette says a good benchmark to aim for is to save 20% of every paycheck for savings and/or to pay off debt. But while conventional wisdom says you should save 20% of your paycheck, some individuals might not be able to save 20% of their paycheck. “Start with 10% to 15% of your paycheck and build up to 20% of your paycheck,” says Stiger.
How much should I save per week?
Fidelity recommends using a 50/15/5 schedule, where no more than 50% of take-home pay goes to “must-have” expenses like housing, food and healthcare; 15% of pretax income including any employer contributions is saved for retirement; and 5% of take-home pay is used for short-term savings like an emergency fund.
Another common standard is the 50/30/20 rule in which 50% goes towards the things you need (essentials), 30% goes towards the things you want (discretionary items) and 20% goes towards savings and investments.
See the best savings rates you may be able to get now here.
Savings in your 20s
-
How much should I save in my 20s?
Regardless of age, the suggestion is to save 20% of your income — though in your 20s that can prove tough. “The sooner you start, the better. Whether that be age 20, 30 or 40. If you can’t save 20% of your income, aim for 10%. If you can’t save 10% of your income, aim for 5%. Start there and increase your savings rate over time,” says Stiger.
Indeed, “in your 20s, you’ll likely just be starting to build up your emergency fund as well as determine and save for your other financial goals. It’s still a good idea to aim for dedicating 20% of your income to savings and debt payments,” says Bessette. If you’re plagued by debt or you have a low income, start with a smaller amount and build up to 20% over time.
Savings in your 30s
- How much should I save in my 30s? “In your 30s, you’ll likely be more established in your career and you may be planning around new financial goals like buying a house or raising a family. Adjust your budget to make sure you’re saving enough to meet these goals,” says Bessette. If you haven’t started saving for retirement, make sure that’s happening too. While conventional wisdom says you should save 20% of your paycheck, if you’re unable to do that, you can start with a smaller amount and build up to 20%.
- How much should i have in savings at 30 Experts often suggest that someone in their 30s have one year of their salary saved. Indeed, the most common rule of thumb, and a good place to start is 1x your salary, according to certified financial planner Mark Struthers of Sona Wealth Advisors. “I think this has changed a little with student loan debt and home prices going up relative to incomes. It’s not that you shouldn’t strive for it, but just make sure you aren’t stretched too thin and the emergency fund is there,” says Struthers. While this number should be very individualized, Struthers says given the new paradigm, he often gives a range of .50x to 1.25x. Indeed, some experts say if you want to have a strong emergency fund, you should aim to have savings of at least 3 to 6 months of essential expenses on hand. “If you’re hoping to make a large purchase, like a house or a car, you might want to have savings set aside for a down payment,” says Bessette. Ultimately, the amount of savings you should have at 30 depends on several factors like your current income, your current debt and your personal overhead.
Savings in your 40s
-
How much should I save in my 40s?
Whether you’re 20, 30 or 40, the sooner you start saving the better. “Regardless of age, the suggestion is to save 20% of your income,” says Stiger. The biggest key, he says, is to get started saving and building good savings habits like making automated transfers. Ted Rossman, senior industry analyst at Bankrate says people in their 40s can get squeezed by competing priorities such as paying off a mortgage and raising kids. “There’s also the whole sandwich generation thing of raising your own kids while potentially caring for elderly parents, but later on, maybe some of those obligations can come off the list and you’re more able to save,” says Rossman. In your 40s, you likely have more assets and should begin diversifying your investment portfolio and looking for additional streams of income. “If you’ve managed to lock in a mortgage at a low rate, rather than make additional payments, consider investing these additional funds into a rental property or other potential passive revenue streams. But first — pay off debt,” says Gabe Krajicek, CEO of Kasasa, a fintech that provides community banks with financial products and services.
-
How much should I have in savings at 40?
The rough rule of thumb is that you want 3x your salary in savings at 40, but of course, this can be difficult. And as Stiger puts it: “There isn’t really a magic number to reach like a baseball team clinching to go to the playoffs.” In other words, do your best.
Savings in your 50s
-
How much should I save in my 50s?
In your 50s, continue to increase your retirement savings and investigate long-term care insurance. “This next chapter may be weighing more heavily on your mind, so evaluate your current trajectory and take steps to ensure you’re on the track you intended. Use an online retirement calculator and continuously check in with your financial adviser, especially given the current economic turmoil,” says Krajicek.
-
How much should I have saved in at 50?
The rough rule of thumb is that you should have 6x your salary saved at 50. But, notes Rossman: “The older you get, the more your retirement savings and Social Security can factor in.”
See the best savings rates you may be able to get now here.
How much should a college student save per month?
Depending on how much student loans and bad debt you have, someone in college should try to take advantage of being young and using compounding, while also having an emergency fund to help them avoid credit card debt. “An emergency fund also allows someone to take advantage of opportunities like moving to a different city for a job,” says Struthers.
If a college student saves 5% to 10% of their gross salary, that’s a reasonable target. “A Roth IRA is a great option too since income at this point is low and contributions are available anytime, tax and penalty free. It can act like a third bucket emergency fund depending on how they invest,” says Struthers.
It can be hard to save as a college student since a lot of students live on grants, loans or part-time jobs. “For your peace of mind, it’s a good idea to save as much as you can. Ideally you should have an emergency fund of at least $1,000 which should help cover basic unexpected costs like a minor car repair,” says Bessette.
How to make saving easier
One that can apply to anyone with a paycheck is the concept of direct deposit and streamlining the process of saving by setting up an account that automatically deducts a portion of each paycheck into a separate account. “It becomes much less tempting to spend that money if it never hits your checking account,” says Chanelle Bessette, banking specialist at NerdWallet.
Something else to consider is setting up a budget and tracking your spending can make it easier to see where your money is going and if there’s a way to funnel more into your savings, versus your spending categories.
And look at ways to up your earnings to make savings easier — anything from getting a raise
To not storing your credit card on your computer to deter you from making impulsive purchases.
Calculators to help you know how much to save per month calculator
Many financial sites and institutions offer free digital calculators to help people determine how much they should save every month. Here are a few we like:
- NerdWallet’s calculator that spits out a number based on how much you want to save and when you want to achieve your goal.
- The US securities and exchange commission site Investor.gov has a tool that calculates how much money you need to contribute each month in order to arrive at a specific savings goal. There are options to include interest rates and compound frequency for added accuracy in addition to a compound interest calculator, required minimum distribution calculator and a college savings calculator.
- Bankrate’s simple savings calculator that lets users select an initial deposit amount, a monthly contribution, the number of years and sample current interest rates at banks like Citizens, CITBank and Synchrony.
The advice, recommendations or rankings expressed in this article are those of MarketWatch Picks, and have not been reviewed or endorsed by our commercial partners.
