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  • Mark Fonville, CFP®

How Much Retirement Savings Should I Have?


How much retirement savings should I have?

Everyone has different income needs in retirement.


Several factors influence your “retirement number,” including your age, where and when you hope to retire, and what you want to do in retirement. Someone with dreams of early retirement will likely need more saved up than someone who plans to work through their golden years.


No matter what an ideal retirement looks like for you—an encore career or taking it easy—this article will help you sort through the many considerations on your plate and ensure you set yourself up for success.

As you prepare for your retirement journey, be sure to snag our must-have retirement planning checklists. They are free and are built using the latest in retirement insights and strategies.


So, if you are wondering: "how much retirement savings should I have?", keep reading to find out.


Create a List of Your Retirement Goals

As you begin planning for retirement, the top question that likely percolates in your mind is,

How much should you have saved for retirement?

The short answer?


It depends.


Several variables work together to determine your personal savings goals, but there are good benchmarks to help zero in on the ideal amount you should target.


To start, consider the following:


  • How many years are you from retirement? Your retirement time horizon can help you take a more precise (and critical) look at how much you’ve saved. The closer you are, the more confident you’ll want to be that your savings can fully fund your retirement expenses. A 55-year-old who wants to retire may require a more aggressive plan than someone who wants to retire at 70, for example. If you still have a reasonable amount of time before you send in your retirement letter of resignation, you have time to make up for any gaps in your savings strategy.


  • Are you hoping to move when you retire? More and more retirees are looking to relocate in retirement. In fact, 30% more retirees moved out of state in 2020 compared to 2019 (and Virginia was their top destination). If you are planning a move, define what it looks like. Are you planning to go somewhere more or less expensive than your current location (think about the cost of living, insurance, taxes, and more)? If you move somewhere less costly, you’ll not only have a reduced budget but may also be able to stash away some money when you sell your current house.


  • Do you anticipate doing a lot of travel in retirement? 63% of Americans over 50 cited travel as an important retirement goal, according to an Ipsos poll. And, on average, retirees spend a little more than $11,000 per year on travel costs. Since travel is a common and costly goal, it’s critical to think through what your travel goals are. Do you hope to take a big trip every year?


  • Are you hoping to leave money to children and/or grandchildren? Estate and legacy planning should play an essential role in your overall retirement plan. Your financial team can help you craft an estate plan that lets your legacy shine and pass your wealth to heirs efficiently and effectively.


  • Are you in good health? Many pre-retirees underestimate healthcare costs in their golden years, but financially planning for health care is a must, since it could account for roughly 15% of your retirement budget.

The specific answer to these questions is less important than whether you simply can answer them. In other words, it’s okay if you plan to travel more in retirement. It’s also okay if you don’t.


The key here is to have a plan so that you know what your target is. Writing your retirement goals will help you adjust your savings strategy and ensure you’re on track to live the retirement lifestyle you desire, whatever that is for you.


While you won’t have an exact answer for everything, and things won’t always go exactly as you plan (the pandemic certainly taught us all that hard lesson), anticipating how you will spend your retirement dollars puts you on a much stronger path.


Calculate Your Current Savings and Expectations


When thinking about how much you need to save for retirement, start with where you are right now.

  • How much do you have saved in retirement-specific accounts (401k, individual retirement account (IRA), Roth IRA, etc.)?

  • What do your savings look like in other investment accounts (brokerage account, real estate, etc.)?

  • What sources of guaranteed income will be available to you? (pension, Social Security, annuity, etc.)?

Knowing how much you currently have saved is critical to figuring out how far you have left to go and what adjustments you need to make to get there.