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how much to save for retirement

How Much to Save for Retirement

How Much to Save for Retirement Depends on Your Dreams

When you ask, “How much should I save for retirement?” Our answer always is the same: “It depends.”

And, that’s the truth. Determining how much to save for retirement depends on your dreams for retirement, which are unique to you and your family. It’s our job, as your wealth advisors, to determine whether there’s enough of a nest egg to make those dreams come true. And if there’s not, we’ll help you create a plan to get there.

Conventional Wisdom on How Much to Save for Retirement


There’s no shortage of retirement planning advice. A study from the Center for Retirement Research at Boston College found that:

  • The typical household should save about 15 percent of earnings for financial security in retirement.
  • About 50 percent of working-age households aren’t saving enough to maintain their current standard of living in retirement.
  • For high-income households, about 50 percent of retirement income must come from retirement savings plans.

For yet another take on how much to save for retirement, consider Fidelity Investment’s age-based guide for how much you should have in your retirement savings account. Fidelity suggests that:

  • At 35, you should have one time the amount of your salary.
  • At 45, you should have three times the amount of your salary.
  • At 55, you should have five times the amount of your salary.
  • At 67, you should have 8 times the amount of your salary.

And, of course, you don’t need to look far for online retirement calculators. (This is one example, a retirement calculator from FINRA, the Financial Industry Regulatory Authority.)

These guideposts may be a good starting point for thinking about how much to save for retirement. But they don’t consider your unique financial situation, and, more importantly, your dreams and goals.

How Much to Save for Retirement is Driven by Your Goals

At Windward, for us to provide you with the best retirement planning advice possible, we ask:

  • What dream do you want to achieve?
  • What investments, including retirement accounts, do you have?
  • What insurance policies do you have, including health insurance?
  • What other liabilities, including mortgage, do you have?
  • What annual distributions do you need now?
  • What annual distributions will you need in the future?
  • What level of liquidity do you need to provide for unexpected events?
  • What types and amounts of charitable giving are you planning?
  • What types and amounts of family giving are you planning?
  • What is your tolerance for investment risk?
  • How would you feel if investments fell by 30 percent, as happened in 2008, based on different investment and/or distribution scenarios?
  • What is your estate plan and is it structured to help you achieve your financial goals, such as leaving money to your children or community?

To know you is to understand the answers to these questions. By understanding your needs, financial goals and currently situations, our financial advisors can recognize what you want to do in retirement, how you want to live and help you plan for that.

More Considerations for How Much to Save for Retirement

There are even more elements that go into calculating how much to save for retirement. To offer holistic retirement planning advice, a Windward advisor also will talk with you about:

  • Longevity: Congrats to you if members of your family tend to be long-lived. If you retire at 65 and live into your 90s, you’ll need 30 years of retirement income.
  • Inflation: The cost of everyday goods — groceries, gas, etc. — keeps going up. This means your purchasing power, if you’re on a fixed income, could go down.
  • Risk tolerance: Do you have time and can you handle some risk? The stock market could be a better place to grow your money vs. safer alternatives with lower returns.
  • Taxes: If you haven’t considered the impact of taxes on your retirement, you’re not alone. This commonly overlooked retirement expense can change your retirement position in a significant way.

With all these factors in mind, Windward Wealth Strategies will help you discover a personalized combination of retirement funding sources that works on your timeline.

How Much to Save for Retirement Is One Part of Big Picture

How will you know it’s time to retire? Indicators of retirement readiness are different for everyone, as is how much to save for retirement. Signs could include having no more dependent children, desiring more time with grandkids or feeling at ease with career accomplishments.

Windward’s retirement planning advice will tell you to take with a grain of salt opinions from peers, media and even your own family about when to retire. There is no retirement deadline. You have the freedom to work as long as you please.

Similarly, there is no “wrong” way to retire. (That said, failing to plan for retirement may severely limit ability to achieve your retirement goals.) That’s why our team focuses on  determining your unique timeline and how much to save for retirement. Your advisor will help make the noise go away as you articulate your dreams — and develop a plan to achieve them.

You’re invited to explore additional retirement planning resources and insight: