Saving for Retirement: How much is enough?

Don’t know how big your nest egg needs to grow? You’re not alone — but these guidelines can help you identify a ballpark amount.

If you haven't figured out how much money you'll need in your nest egg before you retire, you have lots of company. According to a survey by the Employee Benefits Research Institute, only 44 percent of workers said they or their spouse had tried to calculate how much they would need for retirement.

There's no exact "right" number — everyone's needs are different — and perhaps that's what makes the process intimidating. But with some easy number crunching, you can get a good ballpark idea of what to shoot for. Here are four guidelines to help get you on track for your golden years.

Start Logging Your Expenses

It's hard to predict how much you'll spend in retirement if you don't know how much you're spending now. Put everything you spend in a spreadsheet or use a budget-tracking app, such as HomeBudget, and find out your monthly totals. This will give you a good estimate of your average monthly expenses. Then you can look at different categories and predict which ones will likely decrease, such as mortgage costs, and which ones may increase, such as health care.

Calculate Your Social Security Benefits

Once you've figured out roughly how much you'll spend in your 70s and 80s, you can see how much of that will be covered by monthly Social Security benefits. Use the Social Security Administration’s calculator. Then subtract that amount from your anticipated monthly budget to see how much you'll need in your nest egg to make up the difference.

Do Some Easy Salary Math

Some experts say you'll need 70 to 85 percent of your current income in retirement. One rule of thumb that's widely used for getting to that total is to multiply your final salary by eight. (Although retirement consultant Aon Hewitt recommends multiplying by 11.)

For example, if you anticipate that your final salary will be $70,000, you'll need $560,000 in your nest egg by retirement. This figure compensates for expected Social Security benefits and assumes you'll enjoy the same lifestyle and cost of living.

Put Aside 10 to 15 Percent of Your Income Annually

The easiest, most general formula for establishing your retirement savings goal is to simply put aside 10 to 15 percent of your income every year — on the lower end if you're in your 20s and higher if you're closer to retirement. On a current salary of $50,000, that's roughly $5,000 to $7,500 per year, or $625 per month.

It Starts With a Plan

As you can see, there's no hard and fast rule for calculating how much you need to save for retirement. The most important point is to have a plan. And that’s something we can help with. Learn more about our retirement investment options online, meet with one of the experts in our Wealth Management divisionor visit your local branch for a one-on-one discussion.


  1. “Q&A: How much do you need to save for retirement?” John Waggoner, USA Today, March 1, 2014,, accessed July 8, 2014
  2. “You Probably Don't Have Enough Money to Retire," Kathleen Pender, SFGate, June 7, 2014,, accessed July 8, 2014
  3. “What's Your Retirement Number?" Jane Bennett Clark, Kiplinger Personal Finance, June 2013,, accessed July 9, 2014

The information contained in this article is intended for general educational purposes only and is not to be construed as legal, tax, or financial advice. Please consult with your own legal, tax or financial advisor for guidance with your own particular circumstances.