Whether you’re 25 or 40, it’s natural to wonder: “Am I saving enough?” It’s a question packed with emotion—and often without a clear answer. While everyone’s financial path is different, looking at average American savings by age can offer a helpful benchmark. And if you’re asking “how much money should I have saved by 30?” or “how far behind am I at 40?”, you’re definitely not alone.
This article breaks down national savings data and includes realistic benchmarks for where your savings might stand—and where you can still go from here.
What Counts as “Savings”?
For clarity, this article looks at total liquid and retirement savings, including:
Cash in savings or checking accounts
401(k), IRA, and other retirement accounts
Brokerage accounts (taxable investments)
We don’t include home equity or illiquid assets—this is about what’s ready for emergencies, growth, or retirement.
Average American Savings by Age
According to the Federal Reserve’s 2022 Survey of Consumer Finances, here’s how the median savings (including retirement accounts) stack up by age group:
These figures offer a reality check. They reflect what people have—not what financial experts recommend.
Under 35 ($11,200): This is typically a stage where income is still ramping up and financial obligations like rent, debt repayment, or education costs can take priority over saving. Many in this age range are just starting to build their financial foundation.
35–44 ($27,900): At this stage, earnings are typically higher—but so are expenses, including housing, family costs, and possibly aging parent support. Savings may be growing, but slowly.
45–54 ($48,200): With retirement starting to appear on the horizon, this age group ideally should have already built a solid savings base. But in practice, many are still catching up or restarting after financial setbacks.
55–64 ($71,500): This is often considered the final decade before retirement, yet the median amount saved remains far below most retirement income recommendations. It raises concern about long-term security for a large portion of households.
65–74 ($70,000): For those already retired or just entering retirement, this figure reflects both savings that remain and the financial limitations many face. It suggests a reliance on fixed income sources like Social Security rather than personal assets.
A Note on “Median” vs. “Average”
You might have seen headlines stating that the average 401(k) balance is well over $100,000—and technically, that’s true. But average figures are skewed by a small number of very high-balance accounts. The median, on the other hand, gives a clearer view of what most people have saved.
So when the median savings for a 55–64-year-old is reported as $71,500, that means half of people in that group have saved less than that amount—a far more realistic snapshot of typical households in America.
Average Savings by Age 25
If you’re wondering about the average savings by age 25, here’s what the data says:
The average 25-year-old has $3,240 in savings, according to SmartAsset.
Many have $0 saved for retirement—especially if they’re still paying off student loans.
For someone making $40,000/year, that’s $20,000–$40,000—a stretch for most 25-year-olds, but a useful long-term benchmark.
How Much Money Should I Have Saved by 30?
This question gets Googled thousands of times every month. According to Fidelity’s age-based savings guidelines, by age 30, you should aim to have 1x your annual salary saved for retirement.
So if you earn $50,000/year, your goal would be $50,000 in total savings (retirement + other).
But how are people actually doing?
The average savings for 30-somethings is around $11,200, according to Federal Reserve data.
Bottom line: If you’re behind, you’re in good company—but catching up is still possible.
Average Savings by Age 40
By age 40, many people are balancing kids, mortgages, career shifts, and often feel squeezed between saving and spending.
The average savings by age 40 is about $27,900, per the Federal Reserve
Fidelity recommends having 3x your salary saved by 40
So, if you earn $75,000/year, the goal would be $225,000 in retirement and savings
How much money should I have saved by 40? It depends on your lifestyle, debt, and goals—but aiming for at least 2–3x your annual income is a common benchmark.
Why So Many Are Behind (And What to Do About It)
Across all age groups, savings rates are lower than ideal. Here’s why:
Student debt delayed saving for Millennials
Stagnant wages have made it harder to grow wealth
Housing costs have outpaced income growth in most major cities
Low financial literacy remains a persistent challenge
But here’s the good news: starting now still matters. Even if you’re in your 40s or 50s, there’s time to catch up—especially if you:
Generational Snapshot: How Each Generation Is Saving
Savings behaviors vary widely across generations—shaped not only by age and life stage but also by economic events, cultural shifts, and financial education. Here’s how Americans are actually saving in 2025, according to available data:
🧪 Gen Z (Ages 13–28): Digital Natives, Cautious Starters
Gen Z is still early in their careers—or in school—but already showing different savings habits. Many use fintech apps, automated investing tools, and round-up features to build small savings passively. Their awareness of financial literacy is high, but their savings levels remain low, largely due to high rent, student debt, and entry-level wages. Still, early participation in Roth IRAs and 401(k)s is more common than it was for Millennials at this age.
According to a 2023 Transamerica report, 67% of Gen Z workers are already saving for retirement.
Millennials faced headwinds from the 2008 financial crisis and rising costs of living, often delaying homeownership, marriage, and saving. Many are now in the “catch-up” phase—balancing childcare, mortgages, and climbing incomes with growing awareness that retirement is no longer far off. While the median retirement savings for Millennials is around $27,900, those numbers are rising.
In 2024, Fidelity reported a 20% increase in Millennial 401(k) contributions compared to the previous year.
⏳ Gen X (Ages 45–60): High Earners, High Pressure
Gen X is often called the “forgotten generation” in financial media—but they are now at peak earning years and facing the most financial pressure. With college expenses for kids, aging parents to care for, and retirement approaching, many Gen Xers report feeling unprepared. The median retirement savings of $48,200 doesn’t match the 6–7x income recommendation for their age bracket, but Gen X contributes the most (percentage-wise) to 401(k) plans today.
A 2023 Bankrate survey found that 49% of Gen Xers fear they won’t be able to retire on time.
🧓 Boomers (Ages 61–79): Entering or Living in Retirement
Boomers are either drawing down their savings or preparing to. While median savings for this group sits at $71,500, it varies drastically depending on income, health, and housing status. Many Boomers rely heavily on Social Security, and some supplement it with pensions, real estate income, or part-time work.
According to Fidelity, Boomers with access to 401(k)s have an average balance over $232,000—but millions are below the median.
As the data shows us, each generation faces unique circumstances, but the pattern is clear:
The earlier the start, the better the outcomes.
Delays in saving compound over time—but so can small wins.
Final Thoughts: You’re Not Behind—You’re Just Getting Started
If you’re asking questions like “how much money should I have saved by 30?” or “what’s the average savings by age 40?”—you’re not failing. You’re planning.
Yes, the averages might feel intimidating. But they’re just data points—not destiny. The most important number in your savings plan isn’t what you have today. It’s what you consistently add from here forward.
Most personal finance advice stops at “build your emergency fund.” But what happens when you actually need to use it?
For many people, dipping into their emergency savings feels like failure. Others blow through it too quickly and then struggle to rebuild. And some don’t even know what truly qualifies as an “emergency.”
This guide goes beyond the basics to answer not just how to build a financial safety net—but how to think clearly and strategically when you actually need to rely on it.
What Is an Emergency Fund?
An emergency fund is a dedicated pool of money set aside for unexpected expenses—not everyday bills, not planned purchases, and definitely not that concert you forgot to budget for.
Its purpose is simple: to protect you from going into debt or financial freefall when life happens—whether that’s a job loss, medical expense, car repair, or emergency travel.
📊 According to Bankrate, 57% of Americans would struggle to cover a $1,000 emergency from savings alone (source). That’s why having a fund isn’t just a good idea—it’s critical.
Why Might It Be Better to Keep Your Emergency Fund Money in a Separate Account?
One of the best practices in personal finance is to separate your emergency savings from your everyday checking account. Why?
It reduces the temptation to “borrow” from it for non-emergencies.
It makes it easier to track progress toward your savings goal.
It creates a psychological boundary—so when you do touch it, you know it’s serious.
Most experts recommend keeping your emergency fund in a high-yield savings account or money market account for quick access but better returns than a regular bank account.
Using It Is the Hardest Part
The internet is full of advice on how to build an emergency fund. But almost no one tells you what to do when you actually need to use it.
Here are three questions to ask yourself before you spend your emergency fund:
Is this truly unexpected and necessary? Not every surprise is an emergency. A car breaking down, yes. Last-minute vacation? No.
Will this expense cause financial harm if I don’t pay it now? Think rent, insurance, or medical bills—not a discounted new phone.
Do I have another way to cover this without risking debt? Sometimes there’s a smarter workaround—payment plans, employer advances, or tapping non-retirement savings.
When your car needs a $1,200 repair and you don’t have another way to get to work? That’s a yes. When your friends are planning a weekend getaway? Probably not.
So, which of the following expenses would be a good reason to spend money from an emergency fund? ✅ Medical bills, rent after a job loss, car repairs to maintain work access ❌ Shopping deals, vacation upgrades, or minor home improvements
Why People Struggle to Use It (Or Use It Too Quickly)
Emotion plays a big role in financial decisions—and emergency savings is no exception.
📊 A 2023 Morning Consult study found that 38% of Millennials (ages 29–44 in 2025) say they feel guilty when they tap into their emergency fund, even for valid reasons.
On the flip side, Gen Z (ages 13–28 in 2025)—who are more open about “loud budgeting”—often use emergency savings too casually, sometimes treating it as a backup checking account.
That’s why the emotional framework around your fund is just as important as the number itself.
How Much Is Enough?
A good rule of thumb is three to six months’ worth of essential expenses, but this varies depending on your lifestyle, dependents, and risk tolerance.
📊 According to Fidelity, single-income households or freelancers should aim for six months, while dual-income or more stable situations might be okay with three (source).
Some people even maintain tiered emergency funds:
One small fund in checking for “mini” surprises
A larger fund in a high-yield account for major events
The Generational Lens: Different Approaches to the Same Goal
How people think about and use their emergency savings often depends on their age, when they were born—and what they’ve lived through. Age and life stage influence how much someone can save and past experiences shape how comfortable they are using that money when things go wrong.
Every generation faces emergencies. But the way they prepare for them—and respond to them—is different.
Gen Z (ages 13–28 in 2025) Most are still early in their financial journey. Many are focused on building basic savings while juggling rent, student debt, or irregular income. They’re more likely to use tech tools like roundup apps to save small amounts consistently—and to share their financial wins and struggles openly. But without a buffer, even small emergencies can hit hard.
Millennials (ages 29–44 in 2025) This group is balancing career moves, kids, and rising living costs—all while trying to recover from the financial setbacks of the Great Recession and the pandemic. Many use their emergency fund as a pressure valve, relying on it for short-term gaps rather than rare disasters. Their reality often forces them to choose between saving and stability.
Gen X (ages 45–60 in 2025) With both aging parents and college-aged kids, Gen Xers are stretched in multiple directions. They’ve lived through several economic downturns and tend to be cautious, often prioritizing liquidity. Their approach to emergency savings is shaped by a desire for control and self-reliance—and a strong reluctance to rely on credit in a crisis.
Boomers (ages 61–79 in 2025) Many are in or near retirement, and their focus shifts from saving to preserving. Without the safety net of employer pensions or predictable income, Boomers are more likely to hold larger emergency funds to avoid having to sell investments during downturns or become financially dependent.
The takeaway? Your strategy should evolve with your age, income, and responsibilities. There’s no one-size-fits-all—but every stage needs a safety net.
Final Thought: Give Yourself Permission
Using your emergency fund is not a failure. It’s what the fund is for.
“The only thing worse than not having emergency savings is having it—and being too afraid to use it when it matters.”
Whether you’re 22 or 62, building your emergency fund is only half the story. Knowing how to trust yourself to use it wisely—that’s what builds real financial resilience.
If you’ve ever stared at a benefits form or investment platform thinking, “Should I check Roth IRA? Or is it 401(k)? Or do I just hope for the best?”—you’re not alone.
Most people know they should be saving for retirement. But the moment you dive into options, you’re hit with an alphabet soup of accounts, limits, taxes, penalties, and terms no one explained in school.
This guide is for anyone who wants a straightforward explanation of tax-advantaged accounts and how to think about their retirement savings, no matter your age or income.
Let’s break it down.
What Is Retirement Planning, Really?
Retirement planning simply means figuring out how to support yourself when you’re no longer working full-time. It’s about:
How much money you’ll need
Where that money will come from
How to make your money grow in the meantime
Retirement planning usually includes:
Estimating future expenses
Using tools like Roth IRAs and **401(k)**s to save
Factoring in Social Security or pensions (if you’re lucky)
The earlier you start, the more time your money has to grow—and the less you’ll need to save each month.
Roth IRA vs. 401(k): What’s the Actual Difference?
Here’s the core difference: it’s about when you pay taxes.
Feature
Roth IRA
401(k)
Contributions
After-tax (you pay taxes now)
Pre-tax (you pay taxes later)
Withdrawals in retirement
Tax-free (if rules met)
Taxed as income
Contribution limits (2024)
$6,500/year (or $7,500 if 50+)
$23,000/year (or $30,500 if 50+)
Income limits
Yes (IRS income limits)
None
Employer match
Not available
Often included
RMDs (Required Withdrawals)
None
Yes, starting at age 73
What Is a Roth IRA?
A Roth IRA is a retirement account that you fund with money you’ve already paid taxes on. That means when you retire, you can withdraw both your original contributions and your earnings completely tax-free—as long as you’re 59½ and the account is at least five years old.
You must earn less than $146,000 (single) or $230,000 (married) to contribute the full amount
What Is a 401(k)?
A 401(k) is an employer-sponsored retirement account that allows you to contribute pre-tax income. That means you don’t pay taxes now—only when you withdraw the money in retirement.
Many employers offer to match part of your contribution, which is essentially free money toward your future.
📊 According to Vanguard, the average 401(k) balance was $112,572 in 2023, but the median (more realistic for most people) was $27,376 [https://institutional.vanguard.com/content/dam/inst/vanguard-has-a-long/investment-approach/research/pdf/How_America_Saves_2023.pdf].
Both Roth IRAs and 401(k)s are considered tax-advantaged accounts because they give you a break on taxes—just at different times.
Roth IRA: pay now, withdraw tax-free later
401(k): skip taxes now, pay them when you retire
These tax benefits are what make them smarter than keeping all your savings in a checking or standard brokerage account.
What If I Can’t Max Out Both?
If you can only do one (which is most people), here’s a simple decision flow:
✅ Your employer offers a match? Start with the 401(k)—contribute at least enough to get the full match.
✅ You expect to be in a higher tax bracket later? Go Roth IRA—pay taxes now, skip them later.
✅ You’re early in your career? Roth IRA is usually best—you’re likely in a lower tax bracket now than in the future.
✅ You want to save more than Roth allows? Use both. Start with Roth, then go to your 401(k).
What Does This Look Like Month to Month?
Let’s say you can set aside $300 a month. You could:
Put $150 into your 401(k) and get a $150 employer match = $300
Put $300 into a Roth IRA
Or split it between both (e.g. $150 into each)
The key is to automate your savings so it happens before you spend. Most employers and brokerages make this easy.
How Age (Not Just Income) Changes the Retirement Game
Your stage of life plays a huge role in how you should approach your retirement planning—regardless of your income or career path.
In your 20s and 30s, the priority is usually building the habit—even small contributions to a Roth IRA or 401(k) matter because of compound growth. This is the time to take advantage of Roth accounts, especially if you’re in a lower tax bracket. You’re investing in time more than cash.
By your 40s and 50s, your strategy shifts. With retirement closer on the horizon, the focus becomes increasing retirement savings rates, maximizing employer matches, and possibly adjusting your risk tolerance. You might consider increasing 401(k) contributions and even using catch-up contributions if you’re 50 or older.
For those in their 60s and beyond, it’s about decumulation planning—thinking through when to withdraw, managing Required Minimum Distributions (RMDs), and balancing withdrawals with Social Security and other income streams.
🧠 This naturally overlaps with the generational perspective: Each generation is navigating retirement planning from a different point along this age-based path. As of 2025, Gen Z is just starting, Millennials are in the building phase, Gen X is playing catch-up, and Boomers are managing withdrawals. Your financial strategy will reflect your age—but understanding where your generation sits helps explain what you might be seeing or feeling about money right now.
Final Thought: You Don’t Need to Be a Finance Nerd
You don’t need to memorize tax codes or predict the stock market to make smart moves. But you do need to start.
“The best retirement account is the one you actually use—and the earlier you start, the easier it gets.”
Whether it’s a Roth IRA, a 401(k), or a little of both, the goal is to build momentum. Your future self—whatever generation you’re part of—will thank you.
Budgeting should be simple. Money in, money out, don’t spend more than you earn—right?
But for most people, it’s not that simple at all. You set a budget with the best intentions, only to blow it the next weekend. You feel guilty after buying something you don’t need, or worse—you justify it because “you deserve it.”
This isn’t a failure of discipline. It’s behavioral finance in action—the study of how our emotions, habits, and thought patterns influence financial decisions in ways that often defy logic.
Understanding the psychology of spending doesn’t just help you save more. It helps you make peace with the part of your brain that doesn’t always do what’s “best”—and build a system that works with your emotions, not against them.
Behavioral Finance 101: The Brain Behind the Budget
Behavioral finance is a field that blends psychology and economics. It explains why people don’t always act in their own financial best interest—even when they know what they should do.
Classic examples include:
Keeping a low-interest savings account while carrying high-interest credit card debt
Overspending on experiences to avoid FOMO
Avoiding your bank app when you already know you went over budget
One famous concept is mental accounting—the way we assign different values to money based on where it comes from. (Ever notice how easily you spend a tax refund vs. your paycheck?)
📊 A 2022 Morning Consult study found that 59% of U.S. adults have made purchases they later regretted, and more than half say their financial decisions are “at least somewhat emotional.”
In short: humans are emotional creatures. And when it comes to money, we don’t check our emotions at the door.
Why Spending Feels So Personal (and Emotional)
A Capital One and Decision Lab study found that 77% of Americans feel anxious about their financial situation, even among those earning $100,000 or more [https://www.capitalone.com/about/newsroom/americans-financial-wellness-report/].
One major driver? Emotional spending—using purchases to regulate mood, cope with stress, or create a sense of control.
📊 In 2023, Bankrate reported that 49% of Americans admitted to buying something to “feel better” in response to stress, sadness, or boredom [https://www.bankrate.com/banking/savings/impulse-buying-survey/].
Examples:
After a tough day, you order takeout instead of cooking
You buy a new outfit to feel more confident at an event
You “celebrate” payday with an online shopping spree
This is the psychology of spending in action. And it’s completely normal.
How Your Money Mindset Is Formed
Your money mindset is the mental framework you use to interpret what money means to you. It’s shaped by:
Childhood experiences
Your parents’ attitudes toward debt and saving
Cultural and generational influences
Life events, like job loss or financial windfalls
📊 According to a 2023 Credit Karma survey, 69% of Americans say their financial habits are directly influenced by their parents, and nearly 1 in 3 Millennials say they were never taught how to budget.
This is why some people avoid checking their balance entirely—it’s not just disorganization, it’s emotional discomfort rooted in learned beliefs.
Common Traps in Our Spending Habits
Spending habits are often driven by deep behavioral patterns. Behavioral finance research has identified several traps:
🔹 The Pain of Paying
Paying with cash is more “painful” than paying with a card. 📊 In a well-known MIT study, people were willing to pay up to 100% more for the same product when using credit instead of cash.
🔹 Present Bias
We heavily discount the future and prioritize short-term gratification. 📊 The American Psychological Association notes that 80% of people say they know saving for the future is important—but only 50% are actively doing it.
🔹 Lifestyle Creep
As income increases, so does spending. 📊 A 2023 LendingClub study showed that 60% of Americans making over $100,000 still live paycheck to paycheck [https://www.lendingclub.com/company/press-releases].
These patterns aren’t personal flaws. They’re predictable human responses.
How Different Generations Experience the Psychology of Spending
While the core emotional drivers behind money behaviors are universal, the way we experience them often reflects the generation we belong to.
🔹 Baby Boomers (born ~1946–1964)
Boomers tend to value security and long-term financial stability, shaped by the post-war economy and the rise of employer pensions. They’re less likely to use budgeting apps but may be more disciplined with savings. However, rising healthcare costs and supporting adult children can lead to late-life emotional spending or financial anxiety.
🔹 Gen X (born ~1965–1980)
Often called the “forgotten generation,” Gen Xers came of age during economic uncertainty and tend to be financially cautious—but carry high debt loads. 📊 According to Experian, Gen X carries the highest average credit card debt of any generation (~$8,134 in 2023). They are particularly vulnerable to present bias—balancing college savings, retirement, and daily life expenses at once.
🔹 Millennials (born ~1981–1996)
Millennials came of age during the Great Recession and student loan crisis, which heavily shaped their money mindset. 📊 72% of Millennials say financial stress affects their mental health (CNBC + Acorns, 2023). They’re highly digital but also more prone to emotional spending and lifestyle creep, driven by social media comparisons and a desire for experiences.
🔹 Gen Z (born ~1997–2012)
The youngest generation is incredibly financially aware—but not immune to impulse. They favor loud budgeting and transparency, often talking openly about money online. 📊 54% of Gen Zers report tracking their spending weekly, but 39% say they’ve made purchases they instantly regretted, often influenced by TikTok or influencer trends (Morning Consult, 2023).
How to Make Budgeting Feel Less Emotional
Budgeting often fails because it becomes a battlefield of shame and restriction. But what if it became a tool for financial mindfulness instead?
Here’s how to shift the script:
✅ Use Categories That Reflect Your Values
Instead of “Entertainment,” try “Things That Make Me Feel Alive.” Labeling expenses in a value-based way makes spending more intentional.
✅ Track First, Then Judge
Track your spending for a month without changing anything. Awareness is the first step—guilt comes second (and usually isn’t helpful).
✅ Make Room for Emotions
Don’t eliminate emotional spending. Plan for it. Allocate money toward “joy,” “comfort,” or “celebration” so that you can embrace your feelings without sabotaging your finances.
✅ Use the Right System
Choose a method that matches your personality. If you’re detail-oriented, try zero-based budgeting. If you prefer flexibility, the 50/30/20 rule offers structure without rigidity.
Final Thought: Rational Money Is Still Emotional
The biggest lie in personal finance is that money is just numbers. In reality, it’s identity. It’s power. It’s safety. It’s emotion.
“Your spending is a reflection of your inner world—not just your outer income.”
Behavioral finance helps explain why we behave the way we do—and how we can build habits that honor our emotions without being ruled by them.
So the next time your budget feels “off,” don’t just tweak the numbers. Look deeper. Ask yourself what you’re feeling—not just what you’re buying.
I don’t track my spending because I’m broke. I track it because I’m deliberate.
At some point in my late 20s, after paying off a small mountain of student loans and getting my first “real” job, I stopped living paycheck to paycheck. And yet, something strange happened: I still had no idea where my money went. I’d check my bank account mid-month and think, “Did I really spend that much already?”
That’s when I started tracking every dollar—not just budgeting, but actively managing my money like it was a system to understand, not just survive.
This article isn’t about financial emergencies or scraping by. It’s about money management as a mindset—even when you’re “doing fine.”
The Psychological Case for Tracking Your Spending
Before we talk spreadsheets or apps, let’s talk about your brain.
A 2023 study from the National Endowment for Financial Education found that 65% of Americans say money is their top source of stress—more than work, health, or relationships. But here’s the twist: those who actively track their expenses report significantly lower stress levels, regardless of income.
This isn’t about how much you earn. It’s about how in control you feel.
“Tracking your spending isn’t about restriction—it’s about clarity,”says psychologist and financial behavior expert Dr. Brad Klontz. “Most financial anxiety comes from the unknown.”
When you track every dollar, that fog starts to lift. You begin to see where you overspend without guilt, where your values align (or don’t), and where a little change could free up a lot of room.
Where the Money Goes: Americans are Still Guessing
According to a 2023 Intuit Mint survey, 62% of U.S. adults admit they don’t know exactly how much they spent last month. Yet most believe they’re “good with money.”
The average U.S. household spends:
$7,000/year on food outside the home
$2,200/year on subscriptions (streaming, gyms, apps, etc.)
$5,500/year on transportation (gas, insurance, rideshares)
These numbers might sound familiar—or shocking. But unless you’re tracking it, how would you really know?
The First Month I Tracked Every Dollar: What I Learned
Let’s be honest: tracking every transaction sounds tedious. I thought so too.
But here’s what I found after 30 days of writing down every cent:
I spent $130 on coffee—but only drank half of it
I was still being charged $24/month for a digital newspaper I didn’t read
My “miscellaneous” category—everything from takeout to last-minute gifts—was eating up 18% of my budget
I wasn’t broke. I just wasn’t paying attention.
Once I saw the pattern, I didn’t feel the need to cut everything—I just made better decisions. I kept the coffee (with joy), canceled the newspaper, and gave “misc” an actual limit.
Budgeting vs Tracking: What’s the Difference?
Many people confuse budgeting with tracking. They’re related—but not the same.
Budgeting
Tracking
Planning where money should go
Seeing where money actually goes
Often monthly, forward-looking
Daily or weekly, backward-looking
Can be rigid or idealistic
Usually reality-based and revealing
Tracking is the diagnostic tool. Budgeting is the treatment plan.
How I Track (Without Going Crazy)
There are endless ways to do this—apps, spreadsheets, journals. What matters is consistency, not complexity. Here are a few methods worth trying:
1. Spreadsheet Simplicity
A basic Excel or Google Sheets setup can work wonders. Just four columns: Date, Category, Amount, Notes.
2. Budgeting Apps
Some top-rated tools for expense tracking and money management include:
YNAB (You Need A Budget) – great for zero-based budgeting
Tiller – syncs your spending into Google Sheets
Copilot – beautifully designed and AI-assisted
Monarch Money – built for households
Lunch Money – perfect for tech-savvy solo users
Most offer free trials. Find the one that feels natural.
3. The Notebook Method
Old school? Yes. But writing down what you spend with your hand makes it real. Even just for a week.
Budgeting Styles That Actually Work
If you’re tracking consistently, you’ll naturally start to budget more intentionally. Here are a few of the most effective methods:
🔹 Zero-Based Budgeting
Every dollar gets assigned a job—nothing left unallocated. It’s structured, but powerful.
🔹 50/30/20 Rule
Popularized by Sen. Elizabeth Warren:
50% to needs
30% to wants
20% to savings or debt
Great for people who want structure without micromanaging.
🔹 Cash Stuffing (Envelope Method)
Yes, it’s made a comeback—especially among Gen Z. Physical cash is divided into categories. No envelope = no spending.
Each method has trade-offs. Try one. Tweak it. Make it yours.
The Rise of Loud Budgeting (and Why It Matters)
One of the biggest trends in 2024? Loud budgeting.
Popularized on TikTok, it’s the opposite of “treat culture.” Loud budgeting means saying things like:
“I’m skipping dinner out—I’m tracking my goals this month.”
“Not in my budget, but let’s find something else.”
It’s about normalizing financial boundaries, not pretending you’re endlessly available for $17 cocktails and group trips.
Loud budgeting makes it socially acceptable to care about your finances—out loud.
Why I Still Track, Even When Things Are Fine
These days, my finances are in better shape than ever. But I still track every dollar. Why?
Because I value clarity
Because I want to be aligned with how I spend
Because money, left unmanaged, tends to evaporate
Most importantly, I track because I want my spending to reflect my priorities—not my impulses.
“Money management is less about control and more about awareness. It’s not about deprivation. It’s about direction.”
Final Thought: You Don’t Need a Crisis to Be Intentional
There’s a myth that only broke people budget. Or that tracking is for people in “fix-it” mode.
But what if it’s just… wise?
You don’t wait until your car is falling apart to check the oil. You don’t wait until you’re injured to start exercising. So why wait until money is tight to understand where it’s going?
Start small. Track for a week. Then two. Then a month. You might be surprised—not by how much you’re spending, but by how much better you feel once you know.
That’s not about control. That’s about peace of mind.
“How much to save for retirement?” This is a question most people don’t ask out loud—but think about all the time. You might see a headline claiming you need six figures saved by your 30s and wonder if you’re hopelessly behind. Or maybe you’re doing okay, but you’re still unsure if it’s enough.
According to the Federal Reserve’s 2023 Survey of Consumer Finances, nearly 1 in 4 U.S. adults have no retirement savings at all. For Americans between 35 and 44, the average retirement savings by age is about $60,000—a number that might feel encouraging or terrifying, depending on your own situation.
But numbers without context don’t help much. This guide unpacks the most widely accepted savings benchmarks, explains how everyday people are actually doing, and offers real, actionable steps—whether you’re ahead, behind, or just getting started.
Why Do These Benchmarks Exist in the First Place?
The idea of having a certain amount set aside by a certain age isn’t new—it comes from the financial planning industry, where firms like Fidelity, Vanguard, and others aim to provide simple goals to help individuals gauge progress.
They’re based on some core assumptions:
You’ll retire around age 65–67
You’ll want to replace about 70–80% of your pre-retirement income
You’ll live until your mid-80s or beyond
Your investments will grow by 5–7% annually, adjusted for inflation
These assumptions lead to the common advice that your retirement savings plan should be structured around certain income multiples at key age milestones.
The Most Commonly Cited Retirement Benchmarks by Age
Age
Recommended Savings Target
30
1x your annual salary
40
3x your salary
50
6x your salary
60
8–10x your salary
Example: If you make $60,000/year. Your recommended savings target is:
By 30: $60,000
By 40: $180,000
By 50: $360,000
By 60: $480,000 to $600,000
On paper, these numbers make sense—especially when thinking about the power of compound interest over time. But in practice, not everyone has the stability, income, or early start to hit those targets.
What the Average American Has Saved (And Why It’s Less Than You Think)
Here’s a look at the average retirement savings by age, using the latest available data:
Keep in mind: these are median numbers, meaning half of people have less than this. It’s far below the benchmarks from financial institutions. But this doesn’t mean people are lazy or irresponsible.
The gap exists for many reasons:
Stagnant wage growth over the past two decades
Student loan debt delaying saving for retirement
Rising housing and healthcare costs
Job instability, gig work, and caregiving duties
In fact, 27% of Americans over age 45 now expect to either work past 70 or never fully retire. Not because they want to—but because the systems built for previous generations don’t align with today’s economic reality.
Why It’s Okay If You’re “Behind” the Average Retirement Savings for Your Age
Let’s be clear: falling short of these benchmarks doesn’t mean you’ve failed. Many people make up ground later in life, especially as expenses like childcare and rent decrease, or income increases with experience.
Plus, most retirement calculators and plans don’t account for:
Spouses or partners with income
Pensions, inheritances, or other assets
Changes in retirement age or lifestyle expectations
In other words, a retirement savings plan should be tailored—not templated. If you’re saving steadily now, that consistency will matter far more than whether you hit a target by your 35th birthday.
What To Do If You’re Feeling Behind
It’s never too late to start. And it’s never too early to adjust. Whether you’re 32 or 52, the same principles apply: focus on small wins, automate progress, and let time work in your favor.
1. Define What Retirement Means to You
Does it mean fully stopping work at 65? Working part-time until 70? Moving somewhere cheaper? You can’t figure out how much to save for retirement if you don’t know what you’re saving toward.
2. Use Simple Tools to Estimate Your Gap
A calculator from Vanguard, Empower, or NerdWallet can give you a clear (and quick) picture. This step alone removes a lot of the guesswork from saving for retirement.
3. Automate Your Contributions
One of the most effective ways to start or scale up is to automate. If you’re wondering how to save for retirement, start by removing the decision fatigue: let it happen in the background.
4. Start Small—and Then Grow
A $100 monthly contribution may not feel like much, but with compounding, it grows significantly over time. As you earn more, aim to increase your contributions by 1–2% annually. That slow ramp-up can double your results over a decade.
5. Take Advantage of Employer Matching
It’s shocking how many people leave this on the table. If your employer offers a match on a 401(k), always try to contribute at least enough to get the full benefit. It’s free money toward your future.
Beyond Retirement: Building a Bigger Financial Picture
A healthy retirement savings plan is just one part of your financial life. You might also be:
Paying off student loans
Raising kids
Starting a business
Supporting family
Saving for a home
None of these goals exist in isolation—and sometimes saving for the future takes a back seat to urgent needs today. That’s okay. The goal is to stay aware and intentional. Even when you’re not saving as much as you’d like, the habit of checking in regularly builds lifelong financial resilience.
Final Thoughts: Progress Over Perfection
When you Google “how much to save for retirement,” you’ll get articles filled with numbers, acronyms, and panic-inducing charts. But here’s the truth: no number defines your worth, and no missed target means you’re too far gone.
“Benchmarks are helpful—but they don’t know your story. The best savings plan is one you can actually stick to.”
Whether you’re just getting started, catching up, or cruising steadily ahead, your path is still valid. Stay consistent. Stay informed. And most of all—stay kind to yourself.
