How much should you have saved for retirement by age 30?

84 Comments

How much you should have saved for retirement by age 30 (or any age) is not an easy question to answer.

How much you are able to save depends on a myriad of factors. How much you are willing to save is another story entirely.

It hard to feel motivated to start putting cash away for your old age when you’re barely out of school — but now is the best time to start!

How much should you have saved for retirement by age 30?

The first thing you need to ask yourself is how much you’ll need. Apparently, a 20-year-old could need to have $7 million saved by retirement, but that’s a pretty pessimistic estimate. I’m planning to have at least $2 million, but I’m hoping it will be more.

Saving for retirement in your twenties has significant benefits to your long-term wealth. Your money has decades to compound, so your returns will be significant. You get in to the habit of saving when you’re young, which will make it easier to stick to for the rest of your life. And lastly, retirement savings adds to your bottom line, regardless of what stage you are in life.

At 27, my retirement nest egg is somewhere in the neighbourhood of $20,000. If you add in my TFSA (and I don’t, because I might spend that on other stuff) it’s even higher. I started saving at 25, which is early or late depending who you talk to in the personal finance community. I started slowly, but this year I’m on a retirement-saving bender because the stats about how little people save for their retirement really freak me out.

Very few people save, and those that do aren’t very good at it.

Canadians are actually some of the worst savers in the world. I don’t know how anyone in their 40’s sleeps at night with $10,000 or less in the bank, but they probably have a higher pain tolerance than I do, or considerably less FOMO. I know that if I want to maintain my groovy lifestyle into my 70’s and 80’s — and believe me, I will — I need to make sure I have the funds to do it.

How much should you have saved for retirement by age 30 1How much should you have saved for retirement by age 30 2

Whatever your lifestyle, you will need to save for retirement in order to afford it. And how much you should have saved for retirement by age 30 is a great first milestone on your lifetime wealth building journey.

Milestones and goals for your retirement savings will let you know you’re on track. I don’t put a lot of thought into my life at age 65 because it’s nearly 40 years away, but age 30 is something I can work with. 30 is soon. So how much should you have saved for retirement by age 30? Word on the street is:

You should have 1x your annual salary saved for retirement by age 30.

That seems doable, right? I’m more or less on track, unless my salary jumps significantly in the next year or two, in which case I would need to have more, but that’s not a bad problem to have 😉

This means if you’re making $30,000 per year, you should strive to have $30,000 saved at age 30.

If you’re making $50,000 per year, then strive to have $50,000 saved. 

If you’ve supported yourself through school and entered the workforce late, you might not be able to save 1 year’s salary at thirty. That’s ok! Even if you only get halfway, it’s better than nothing. How much you should have saved for retirement by age 30 depends on your personal circumstances. The most important thing is that you don’t enter your 30’s with nothing saved. Because you’re starting early in your twenties, you will have time to catch up in the years to come, so don’t beat yourself up if you’re a little behind. 

If you have more than 1x your annual salary saved, awesome! If you have less, you’ve got some work to do. If you have nothing, you have a lot of work to do.

If you think saving for retirement when you’re in your 20’s is unimportant, I get it. I’m probably the least concerned of all personal finance bloggers about how wealthy I’ll be when I’m old and grey. I don’t like saving for retirement at all, but I do it anyway because I like the idea of being poor even less. Don’t be a self-saboteur and save nothing for retirement in your 20’s, it’s a huge pain in the ass to play catch up every decade thereafter.

How I save for retirement:

Without choice: work deducts 11% of my gross pay and saves it for me. I never see that money, so I never get to spend it. There’s nothing quite like being volun-told to get stuff done.

Automatically: I have transfers set up every payday that direct a small part of my paycheque to my retirement savings accounts. If I didn’t think the above was already enough, I’ve got my own thing going in the same theme: money in, and money out before you can spend a dime. I like locking money in my RRSPs because I can’t get it out to spend it on dresses.

With time: I may add funds to my accounts grudgingly, but I appreciate the interest and dividends that boost the small sum each month. Starting early and saving regularly means my retirement nest egg has decades to grow, and I’m happy to report that, slowly but surely, that’s what I’m already seeing.

How much you should have saved for retirement by age 30 and how much money you will have saved might end up being two different things — and that’s ok. The point is I’m striving towards something, and gaining traction.

How much have you saved for retirement? How much more did you need? How are you getting there?


84 Comments

  1. I’m about on track for that. We prioritized saving for property over RRSPs early on, so now it’s back to more traditional methods!

    • Bridget (Author)

      That’s what I’m kind of hoping for: if I do the leg work now, I can chill out in my 30’s and 40’s if I have other financial priorities like providing for a family and/or paying down a mortgage.

  2. Brian

    I’m ahead of schedule but that is because I have been investing for a long long time. I’m not one of these early retirement extreme folks, but I could see myself quiting the rat race earlier than most if I didn’t like what I was doing.

    • Bridget (Author)

      I’m not sure if my goal is early retirement yet… something I’ll decide in a few decades. But my goal is definitely to have it be a viable option!

      • Andrew

        My goal is to not really retire early, but rather not HAVE to work. I am working hard now so that if something bad happens when I am 45…then I can go for 2 years or more without working and not have to worry.

  3. I have trouble with “save 1x your income by age 30” or “_x your income by age 65” because my income is always a moving target! We’re 27 and have a bit over 90% of our income in our retirement accounts. By the time we’re 30 I expect us to have MUCH higher salaries because we’ll no longer be full-time students. So by then we’ll be “behind!” And that’s only looking out 3 years, not 50, grrrr.

    • Bridget (Author)

      Agreed. I’m planning on changing jobs in the next year so my income might even decrease, then go back up at 29 or 30. I think if I had to set a numbers goal I would say $50,000 by 30, which is less than my income now but is a nice round, attainable figure!

  4. Ha, you might shoot me for this: I have no retirement savings. That said, I’m 23, and I plan on starting to save for retirement before the end of 2013, after I become debt free. I did the math on that you say, and it looks like I’ll have to save aggressively in order to reach that target! Fortunately, since my debt will be gone, this won’t be a problem.

    • Bridget (Author)

      hahaha I can’t be upset with you about that — I didn’t start saving until 25, so I had $0 at 23 too!

      I think putting it off a few years in your early twenties is recoverable, especially since you likely spend those years as a student not earning an income, but if you’re 28 or 29 and still haven’t put anything away, you’re starting to do potentially permanent damage to your future financial security.

      I’ve been paying down debt and saving for retirement together. Not sure if mathematically that’s the best strategy, but I have a hard time not saving anything so this is how I ended up!

      • Phillip S.

        I’d say anything with a higher interest rate (above 6%) you want to make extra principal payments on that debt, but if you have a lower rate, then I think compounding makes up for the lost interest paid.

  5. It all depends on what you count. I have about the same as you in RRSPs right now, however we’ve almost paid off our condo, as well, which contributes to our overall financial well being a lot.
    As others have said, it’s definitely a moving target, too. Our incomes are starting to level off a little bit, but they have jumped a fair bit in the last three years or so.

    • Bridget (Author)

      That’s true too! I don’t own a home and it’s likely I will take advantage of the first time homebuyer’s plan and borrow $25,000 from my RRSPs for a down-payment on a home in the next few years. This is one of the reason I’ve been so adamant about getting more than $25,000 in those accounts as soon as possible. I don’t actually think I can withdraw from my employer pension, so I always think of that as actual retirement savings and RRSPs as house downpayment fund lol

  6. I don´t have any retirement savings yet, simply because I´m a fulltime student, and need every dime I have. My current saving target is for a downpayment for a house, which is a big deal, because we need to save up A LOT of money. But when I start working full time I will definitely start saving aggressively toward retirement as well.

    • Bridget (Author)

      Yeah, I didn’t save for retirement as a student either! Now that I’m working full-time, it’s become a big priority. I went debt-repayment-heavy my first year of work, but now it’s all about the retirement accounts!

  7. Impressive savings! I contribute 6% that my company matches 3% of and I have a very small IRA. The thing I struggle with is saving (in general or for retirement) while getting out of debt aggressively. I never know the right ratio! Once I get rid of this debt in a few years I can up my savings big time and hopefully get on track!

    • Bridget (Author)

      Paying off my student loan debt was definitely a huge priority for me initially, but now it comes in second to retirement — but only because the balance has shrunk to something so small and manageable, $4,000. When I owed nearly $21,000 it was all I could think about so I didn’t save for anything else because all I wanted was that debt gone!

  8. I agree, I would be so nervous/sad/scared if I was in that statistic group of those who have nothing or hardly anything in the bank in my 50s or 60s. I’m saving a little for retirement right now, but am mainly focused on paying off my student loans.

  9. Your timing is EPIC Bridget, because I just finished rereading Krystal Yee’s post on how much money you should have saved by the time you’re 30 last night, lol. Given that 30 is just over a year away for me *sweating bullets*, and I only have little over $20,000 saved at the moment, it’s save to say that I won’t have 1x my income saved in retirement savings by the end of the year (unless I come across some free money, or my retirement accounts go on a tear and multiply overnight). I’d say $30,000 is more likely, and $35,000 would be a stretch goal. If I hadn’t taken $15,000 out for my house years ago I would be sitting closer to $50,000 by the time I was 30, but that still wouldn’t put me on target. I’m not going to beat myself up for it though; I already have more saved than the average 40 year old you mentioned up top (WTF??), and from what I’ve calculated I’m on pace for a comfortable retirement either way 😀

  10. SP

    It’s a great goal to have! My goal the past few years has been to max out my accounts and save as much as possible – but only because i can do it without making the here and now too painful!

  11. Erin

    I currently only contribute 6% for the match (which is only 25% of 6%, which is only 1.5% BOO!) As of yesterday, I have a whopping $3,301.76 in my retirement account. Not exactly a baller, but not bad for being 23 as most of my peers haven’t even thought about saving for retirement yet.

    I plan on just contributing to get the match until my debt is paid off and then upping it to 10% for the remainder of my twenties and then 15% in my thirties. That’s the plan for now, we’ll see how that goes.

    • Bridget (Author)

      For 23 that’s awesome. My retirement savings at 23 was a big fat ZERO.

      Prioritizing debt is the right way to do it!

  12. God…I don’t even have a salary. If I think about this too much I’m going to start to feel sick.

  13. I agree with Emily@evolvingPF that using your salary as a measurement may not be ideal because it doesn’t take into account how long someone has been in the workforce or the type of job one has. It’s a helpful measurement but maybe one should also look at their yearly spending and see how many years of spending they’ve saved up.

  14. I’ve saved a good amount considering how little I’ve made since I graduated and I’m confident I’ll have 1x my salary by thirty. And I’m like you, my retirement savings gets locked away otherwise I know I’ll be tempted to book a plane ticket to India or something.

  15. I am a little behind, but the the market gains the past 2 years have helped out a lot.

  16. I haven’t started saving for retirement but have been saving to pay off my final year of tuition. This was a great read, and gives me some ideas once I get my first full time job and need to start saving. Are you going to be sticking with TFSA’s for your saving needs or an RRSP? I know for me right now the TFSA makes the most sense since I’ll be moving money around a lot.

    • Bridget (Author)

      I use both, but I don’t really consider my TFSA as “retirement” savings, it’s just savings. My RRSPs are definitely retirement, and it makes sense for me to contribute to them because my income is high enough to get some tax relief from it!

      • Nice, that’s actually a really good way of looking at it. I know there are great benefits to both, but I definitely like the idea of the TFSA being more of every day savings account.

  17. $20K is a lot considering you only started saving for retirement not that long ago lol. I consider all my long term investments to be part of my retirement portfolio because I don’t plan to use any of the money until I’m done working for life 🙂 But if we’re just looking at my RRSP then I currently have about $30K in there so I feel like I’m on track. 1 times the annual salary seems reasonable and I should have that by the time I’m 30, but there are too many factors to really say for sure at this point.

    • Bridget (Author)

      Yep, all thanks to work and their mandatory retirement plan =\ haha I NEVER would have saved that much on my own.

  18. I’m almost 23, hubby is 23. We a combined retirement savings between pre and post tax accounts of $15,000.
    Don’t want to worry about money in my old age.

  19. I bought my first house at 21 and have been saving ever since so I’m going to say I’m on schedule in my mid thirties now. I honestly was not thinking about retirement as much as I should have been back then as I do now. I was more inclined to own a home than anything else but my works pension scheme was lucrative compared to some in Canada so I do have a decent sized pension in the UK because of that in the short time with one organization that I was with. It’s a mindset and the more we learn about money and finances from a young age the more it should click in.

  20. Perhaps. With me, I started grad school at age 30 so this wasn’t really an option…

    • Bridget (Author)

      But certainly you were working before grad school? Did you spend all 10 years of your twenties in undergrad?

      • I’m in a similar situation. I started working at 18, got married, bought a home and had a child at 21-22. Went back to school at 25 and graduated college at 27. I’m 28 and finally have a job (almost a year now) that makes +30K but a family, mortgage and student loan debt plus a middle of the road salary makes saving difficult. I am going to start grad school in 2014 but part time so I won’t have to leave the workforce and lose income. Retirement and the higher interest (6.8%) student loan debt is my major priority this year. Once I hit the 1 year mark with my job I will qualify for my employer’s 401k, to which my employer automatically contributes but doesn’t match. Do you have some advice for getting on track?

  21. Rea

    I’m 21 and have just short of $8,000. I’ve been working for 4 years on junior rates though, now I will finally earn the proper adult wage!
    I’ve never contributed to my retirement account, my employer just pays the mandatory 9% of my weekly wage.
    I think I might start contributing, I guess it all adds up..

  22. Steve

    best way to save money is to be single. If your unfortunate like me with 3 kids, a girlfriend with no job then your S.O.L. so much for my future savings and retirement.

  23. Hawaii808state

    I’m 31, married, homeowner (mortgage), with my first child being born in 4-6 weeks. I started saving for retirement in Nov. 2008. I put in a Very aggressive percentage of my pay into my 401k. I do this because my employer doesn’t match anything. We have a “profit sharing retirement” program…. But with apparently No profit…. There’s nothing to share. Go figure. I’ve managed to save $97k so far in my 401k. My wife has roughly $40k in retirement. I hope I’m on track not only by your standards but by the overall retirement financial advisors standpoint. I want to be able to live well in my old age, travel some, and have something to leave my soon to be born son :).

  24. Brian

    I’m 40, married with 2 kids, 5 and 7, and it gets harder now when you add in trying to save for their college funds. They project I’ll need 200k per kid by the time they start school. I have about 500k saved for retirement but not sure exactly how much I’ll end up needing if inflation kicks in.

  25. Phillip S.

    I’m 26 & only have a couple thousand in my savings. I have a mortgage (which I’m assuming you include in the 1x your income?) since I thought it would be smart to take advantage of low interest rates, but have no other investment plans. I work for a very small company that doesn’t offer a 401(k) match. What would you recommend I start investing in first?

    • Bridget (Author)

      I definitely DO NOT include a mortgage in the 1x your income calculation.

      A mortgage is not a retirement plan.

      • brendan

        What about a mortgage on an Investment Property Bridget? Surely it’s about building assets

  26. This is great, its good to know that I am on track for an appropriate retirement next egg. I work in accounting and have been saving diligently since year one. Looking at my grandparents and parents, who in that bay area are house rich and cash poor, really motivated me to get on track. I’ve been fortunate to be able to live at home and save additional funds for the last year, and am proud to be on a current pace for 2x salary by age 30 (at age 28 already at 1.3x)!

  27. Hahaha. No. 🙁 If my debt repayment continues as planned and I jack up my RRSP payments right after, the best I can hope for is 1/3 my salary. Siggh.

  28. Jon Birgel

    I’m about to turn 38 and my wife and I only have around 30 grand so far although we just started contributing over the last year. If your behind do not worry, there is time to catch up and the idea should be to save what you can responsibly and when your retired you’ll have to live on what you have. The _x by age is a good gauge, but by no means should stress you out. We have started very late and still plan to have 1.5 to 2 mil by retirement. And if life throws us unexpected expenses we’ll deal with it and continue on. 🙂

  29. Eric

    25 years old, 85k saved total. Very fortunate though. I got accepted to Purdue for EE but turned it down due to a lack of scholarships so I went to UT San Antonio and graduated with a masters loan free (lived with my parents). Also worked full time and didnt have many expenses so I was able to save most of income. Moral of story – screw expensive schools, EE is EE whether I go to Purdue or a cheaper less known school. It’s not where you go to school but what you do with the degree

  30. Cody

    I graduated in 2012 (23 years old) and was fortunate enough to land a job right after I graduated. After my 90 day trial period I started contributing 10% into my 401k. Since I have been employeed, 14 months, I have thought about leaving the company. Therefore, seeing as how I would not be fully vested unless I put in two years of service, I decided to diversify my retirement vehicles and open up a Roth IRA. Now, I contribute 6% to my employers 401k and 4% to my Roth IRA. I am still getting my dollar-for-dollar match from my employer, which is nice. As of 7/12/2013 my total retirment egg comes to $7,910.18.

    I also am getting married come October. My fiance and I have been putting away $500 a month for the wedding and also $200 a month towards our emergency funds. Once we are married, and receive promotions, that $500 will increase to $600-$700 and be allocated towards a downpayment on a house. The $200 will increase to $250-$300 for emergency and then we will save an additional $100 for varies expenses (apartment furnishings, etc.). If all goes as planned we will be saving right around 25% (before employer contribution to 401k) of our combined total incomes. That includes our 401k’s, Roth IRA, House Fund, Emergency Fund,and Discretionary Expenses Fund.

    I’m completely anal about finances and my fiance gets a little ticked every time I bring them up, but hey it’s better to be prepared then not!

  31. Chip

    Im 20, and have 650$ in stocks and mutual funds, I hope this is a good start, when do they start to do tricks?

  32. MIPL

    I’m 28 and I have saved over $170,000 in both savings, fixed deposits and petty stocks. With today’s rate of inflation and high competition, you guys are falling way behind. Theres no way to retire comfortably at that rate. Not trying to be a prick but I seriously think theres a false sense of comfort with most of the people replying on this topic.

  33. brandon

    I’m 29 and only have about 0.40% of 1 years current salary saved up in retirement. My salary increased nearly 40% since I entered the workforce at age 24 (engineer) and I’ve saved nearly the same amount in non-retirement accounts for a house a wedding. I’m not sure how practical or realistic your 1x salary by 30 is for most people. It’s certainly something to shoot for but I don’t think most will make it unless they start saving at 21 and don’t get too many raises.

  34. Avril

    🙂 I’m on this page reading because I want to start saving. I’m 20, turning 21 soon and I really want to start saving as much as I can, especially for a home. I have big plan and worry I won’t be able to get there because of how hard saving actually is!

  35. Monique

    I started putting money away into my super at 19…. But in saying that it hasn’t really done anything to boost it. The tough part is trying to figure out how much to put away each week and still being able to pay the bills.

  36. Kevin

    I have a psychiatric condition that took ages to find a competent doctor to treat it. I won’t be able to start my career until about age 34. I guess I’m screwed, right? I’ll probably have to spend my retirement at home watching tv every day.

  37. Vincent

    I never heard this before I am 30 and I make about 70k a year, I have $6000 in a 401k, $5300 in mutual funds and $26k in a liquid savings account..that 26k is my emergency fund not retirement… so really I only have 12k in retirement

    Another rule of thumb is to save 10-15% of your income per year for retirement, the cap on roth IRAs is 5500 a year, the rest goes into a regular brokerage account since my company does not match 401k..
    I only paid off my student loan of about 80k 3 months ago, so now I feel really behind because I don’t see myself having 70k in retirement by the time I am even 32, and even so, it should never exceed 15% of your gross income per year so how would I possibly save up 70k in those accounts??

  38. Vis

    Do you mean 1x your annual gross salary or net? I don’t think I could save $85000 in the next 2 years but I could probably save $54000… (and will certainly try).

  39. Lia

    I’m 33 and I have $171,000 in my retirement account. I earn $97,000. I put 16% of my salary into retirement. In addition to this retirement account I will also receive a pension from my company. I started saving at age 22, as soon as I graduated from college and got a job.

  40. CoolCool

    I understand that this is all “rule of thumb,” but it seems pretty impractical to build up a nest-egg while doing college, especially where taking out loans. You graduate in your mid-20s (Or late-20s with grad-school) with a negative balance in the $10ks (Or some in the $100ks), even without a house or other liabilities. So having 1x your annual income by age 30 as a hard and fast rule seems unrealistic.

    I am now 30, and only have about $8000 saved for retirement (100% from 401k contributions), but I was able to pay down about 40k in student loans over 2 years, as well as paying down my house by about $30k (Trying to remove my PMI premiums early). I figured that was a better investment than saving for retirement earlier. So there is no way I will have 1x my gross income by age 30, but I don’t feel that far behind, especially with my student debt wiped clean, and being very close to losing the extra PMI on my house.

  41. Yassin

    At 27, my retirement nest egg is somewhere in the neighborhood of $20,000. If you add in my TFSA (and I don’t, because I might spend that on other stuff) it’s even higher. I started saving at 25

    So what did you save $1000 a month, seriously?

  42. save more spend less

    $79k retirement accounts at 29 with $15k in a 529 for my little one. $50k liquid. $230k mortgage debt (only debt I have) on a $300k home.

  43. Lia

    I graduated from college with loans and bought a house and my stats are still as shown above. Except now it’s one month later and my retirement account balance has increased from $171k to $183k. Yay compound interest!

  44. Steve O

    Hello, I am 57 and my wife and I have 1.2 million dollars saved in our rrsps and we have no debt or mortgage. She does not work and I lost my job recently and job prospects in my profession of pharmaceutical sales is unlikely. We didn’t start saving until age 30. We instead we’re paying off mortgage. We did that by age 50. We need 2.0 million to retire comfortably so we came up short due to her low paying jobs and misfortunes. Marriage is for better or worse! If we don’t make our marriage work, we each have to live on half as much and work at McDonalds until age 75.

  45. Steve O

    Oh, just some advice you folks. Learn to be your own stock investor of conservative stocks, preferred shares and bonds. Dont give away 1% to an advisor for life or 2 % on MERs. That can really add up and reduce your capital! I have a basket of 30 stocks. It took me about three years to build it up. They all pay dividends! I have a 23 yr old daughter who now has 15K in her TFSA, we started it all with equities. She has Ishares Dividend Aristocrats ETF, BMO banks ETF, Altagas, Dundee REIT, H&R Reit, Timbercreek Mortgage Company. There is some risk always, but they are all go yield payers ranging from 4 $ to almost 8%. Dont leave your money in cash in a TFSA only getting low interest. At your ages, you can take on more risk. I use IncomeResearch.com at $ 500 per year to make investment decisions. Ask Harry for a post grad discount..he might oblige for a year or so as an introduction. Its mostly covers high yield stock in the small to mid cap range.

  46. As a financial planner that helps clients with retirement planning regularly, the actual experience of retirement can be different from what’s planned. I think most people tend to spend more than what they intended and if that spending is impacting the longevity of their assets, then they’ll have to make adjustments accordingly. The most important aspect to retirement planning is awareness of the situation. As long as people are aware of how their spending may impact their situation, then they will be more truthful and upfront about making adjustments.

  47. 40 and counting

    I’m 40, I make 60K a year and I have 70K in a 403B retirement plan. My wife is 4, she makes about 80K but her student loans are double that (don’t ask how…I don’t). We have a 7 and 3 year old, so we have had to pay almost 4K a year for preschool the last few years so saving has been next to impossible. We had to liquidate my wife’s sad 401K (8K) 7 years ago when she had to take off work to have our first child (had to be done). My wife only started making 80K a few years ago when she switched to being an independent contractor, but she still has to pay $900 a month to student loans and we have an underwater mortgage and a monthly car payment. I don’t know where I’m going with this other than…to the younger people out there…don’t rack up 160K in student loan debt for a career that will only have you maxing out a salary of about 80K a year. We will probably inherit a little family money someday that may be enough to save us from the student loan, but I’m not sure what a financial advisor will tell me what to do with that kind of money at that point (as we will be even closer to retirement years by that point). Final point, MAX OUT your retirement plan if you can ! I’ve never really been able to (I can only live such a Spartan lifestyle for so long) and wish I could…but I just don’t make enough too (see wife’s student loans).

  48. lbufal28

    I’m military and I have frequently heard the (1x your annual salary by 30). Only issue with that is for officers, making CPT is a large pay bump so I definitely won’t be reaching that mark by 30. I’m 26 with around 16k in a ROTH and another 25k in an annuity. I don’t think I’m gunna be able to sock away 56k by 30 to meet my current annual salary. I’ll try though.

  49. Chris

    I’ve never liked the “X” times salary idea. One day you are on track, then next you get a promotion or better paying job, suddenly you will be behind because your salary changed the equation?

    I made between 40k/90k a year from 20 to 30, probably I had saved 180k by 30, with my wife. She has only ever worked part time, no benefits. I’m 35 now and had a couple years of very low income as I switched careers, 425k in savings now and saving about 10k a month.

  50. Sophie

    Enjoyed your article but honestly saving an annual salary by the age of 30 doesn’t seem pragmatic or maybe I’m really broke. A lot of people finish grad school in their late twenties. Also what if you buy a house? Flush goes the cash with the amount if deposit banks demand these days.

    • Bridget (Author)

      I’m generally an advocate of getting a jump start on your retirement savings before you delve into home ownership. Way too many young people neglect saving for the longterm by rushing into home ownership, and then they have a lot to catch up on in the future.

  51. Tom

    I’m 25, have almost 10k in my accounts right now and no real responsibilities to spend it on. It’s my savings, and I suppose I would do well to put a large chunk of that into a retirement account. But what would be the best way to start investing? The money only accumulates .025% (or something like that) and I hear that putting money in the stock market is a bad idea, but are ETFs the best option?

    • Bridget (Author)

      Putting money in the stock market is a GREAT idea — don’t be intimidated! ETFs are an awesome way of creating a diversified portfolio. I encourage you to read up on investing (I have a few tips in this blog but you might want to check out some business magazines and one of my fave books on the topic: The Intelligent Investor by Benjamin Graham).

      If you want to practice investing, why not set up a fake portfolio on a website like morningstar or seeking alpha and watch it for 6-12 months? It will give you an idea of the volatility of the stocks you pick and your risk tolerance, and you’ll get to see how you do after a short term. It’s one of the best ways to get a taste without risking any of your own money.

  52. Great article, Bridget! Right now I’m concentrating on paying down my mortgage by age 31, so retirement planning isn’t a priority. Even with retirement savings on the back burner, my RRSP is at over $47K. My annual salary is $50K and I’m 6 months away from being 30, so I think that’s pretty darn good! Paying yourself first is the way to go! BTW You’re doing pretty well yourself if I must say! 🙂

  53. I don’t think I’m close but that’s ok. We are going to start with my husband (he’s 33 with nothing for retirement), and I probably have 8k. It feels so much harder when you’re married!

    • Bridget Casey (Author)

      It should be easier! You have two incomes!

      • Beth

        Yes. I totally agree. If he didn’t have terrible spending habits it would totally be the case. (Thanks army) Step 1. Budget. Haven’t gotten him there yet. In a year (maybe 6 months?) I think we will be in a great place for having our debt gone and catching up on this!

  54. Kris

    Hey,

    Thanks for this. I’d read a lot of retirement posts – largely on reddit – and as a freelancer in his mid 20s they scared the life out of me. They made it seem like I might as well use my savings to buy a shotgun when I hit 65.

    So thank you. I feel a lot better knowing I’m on course!

    • Bridget Casey (Author)

      hahahahahahaha

      right?? Some people are like “I have $150,000 saved and I don’t know if it’s enough” and I’m just like STFU.

      If you can save any five-figure amount in your 20s, chances are you’re better off than 90% of people. If you aim to save at least 1 year’s salary, you’re in an incredibly secure position.

  55. Brit

    I got lucky – my grandma left me an IRA as part of my inheirtance and I haven’t touched it since she died ten years ago. It hasn’t grown much, but it’s got about $12k plus the $14k I’ve been putting aside in the 4 years I’ve had a 401k through work, I feel like I’m on a really good track. I just put in the amount to get the full match from my office, but it’s better than nothing!

  56. I feel like a few groups of millennials just can’t follow these strategies — mainly PhD student. They don’t finish school until they’re 30! Granted, their income at 30 is probably low enough that maybe they do meet this standard. But still, it’s a bit of an exceptional case, though I find many of my friends to be in it!

  57. ART214

    Interesting article and comments. The article is right, you are never to young to start saving and thinking about the future. I guess it all depends on an individual’s life circumstances. I live in Canada and am 29 years old, I have been working full time since 25. My net salary that I live of is not huge but because I work in the public sector, I pay heavily into a pension plan that I will have access to when I am 55. Right now I have $21,000 in there, and that amount is matched by my employer. I also have close to $40,000 in savings.

    I am planning to get married next year and we will have to pay for our wedding expenses as well as make a down payment on a home. I could have even more money saved than mentioned above but I also love to travel and in my 20’s I thought it would be nice to see abit of the world before I settle down. Sometimes though I question my decisions. All the money I spent on travel I could of used towards a down payment on a home etc. and then maybe travelled later on in life. But at the same time, I also tell myself you cant put a price on those experiences while you are still young and full of energy etc, and that I did the right thing by travelling.

    Any thoughts? Its always interesting to hear other’s persepctives

  58. Great post. I like your “volun-told” phrase. Very clever, however it can be extremely beneficial for young workers to be “volun-told” to contribute to a retirement plan!

  59. Jeneva

    I think my husband and I are relatively on track but I’m just not sure. He will be 31 and I will be 29 this year, gross income is just over $180k, and together we have about $185K in savings. This amount does include some in TFSA (20k) and shares that can be sold (45k), and some straight high interest savings/investments (50k). (all of this is outside everyday savings). Although, in RRSPs alone we only have about $75k. Would you consider us behind in savings? We do own a condo that we have a mortgage on, but we will likely be using about $100k of the previously mentioned $185k on a down payment for a house in the next 5 years. Do you only count what is in your RRSP as “retirement savings.” Together we put 16% gross (includes a match program) into RRSP but I’m wondering if we should be increasing this.

    • Bridget Casey (Author)

      You are doing great! Congratulations on all your progress — definitely don’t feel like you’re not doing enough, you are WAY ahead of the game! Stick to your current methods, or if you can afford it, boost it up and keep going.