How much should I save for retirement?

The number most people quote traces back to Fidelity's savings guideline, which suggests saving 15% of pre-tax income each year, including any employer match. It is a modeled result rather than a round number someone liked.

The assumptions behind it, as Fidelity states them:

• Saving starts at 25 and continues to retirement at 67.
• Savings replace about 45% of pre-retirement income, before taxes, with Social Security covering most of the rest. No pension is assumed.
• Income needs run through age 93.
• Wages grow 1.5% a year after inflation.
• The portfolio follows a target-date style glide path, and the simulations assume poor market conditions to reach a 90% confidence level.

Change any of those inputs and the answer moves. Someone planning to stop at 60, someone with no Social Security record, or someone whose spending will stay high in retirement needs more than 15%. Someone with a pension, or who started early and has been lucky with markets, may need less.

The benchmark is a midpoint for a particular person: a steady earner who starts at 25, retires at 67 and collects Social Security. Most real situations differ from that in at least one way, and each difference moves the rate in a predictable direction.

Your income

Social Security replaces a larger share of pay for lower earners than for higher ones, because the benefit formula is progressive. A household earning well into six figures gets a smaller share of its income back from Social Security, so savings have to cover more of the gap. Fidelity notes its 45% replacement target held fairly steady across salaries of $50,000 to $300,000, and it is less reliable outside that band.

Your retirement age

Every year of earlier retirement removes a year of contributions and adds a year of withdrawals, and it usually lowers the Social Security benefit too. That double effect is why a plan to stop at 55 needs a much higher rate than a plan to stop at 67. Working a year or two longer is the same lever pulled the other way.

A pension or other guaranteed income

A defined benefit pension covers part of retirement spending the way Social Security does, so the savings rate needed to fill the rest falls. Fidelity's model assumes no pension at all, which is the common case in private-sector jobs today but not in many public-sector ones.

What you already have saved

The late-start rates assume a balance of zero. A 35-year-old with two years of salary already invested is in a very different position from one starting fresh, because that existing balance compounds for three more decades without any new contribution.

How you plan to spend

Replacement ratios are shortcuts. A household that expects to pay off its mortgage before retiring, or to downsize, may need less income than the rule assumes; one that plans to travel heavily in its first decade, or that expects large healthcare costs before Medicare, may need more.

A percentage is easy to agree with and hard to act on. The table below puts the same 15% against several salaries, with the monthly figure that a payroll deduction or a recurring transfer would need to hit.

The last column uses a 4% match because that is the median promised match, among plans with a match formula, in Vanguard's How America Saves 2026. Your plan's formula may be richer or thinner; the summary plan description spells it out, and 401(k) employer match rules covers how the common formulas work.

Take someone earning $60,000 who saves 15%, or $9,000 a year, from 25 to 67, or 42 years of contributions. To keep the math in today's dollars, assume a 5% annual return after inflation and a salary that stays flat in real terms (Fidelity assumes it rises, which makes its version a little more generous).

The future value of a level annual contribution is the contribution times ((1 + r)ⁿ - 1) / r. Plugged in, that gives $9,000 x ((1.05)⁴² - 1) / 0.05, which works out to about $1.22 million in today's money.

At a 4% withdrawal rate, $1.22 million supports about $48,700 a year before tax, again in today's dollars. Add Social Security on top and the total lands comfortably above the 45% replacement target Fidelity designed the rule around.

Now drop the return to 4% after inflation. The same contributions reach about $943,000, which supports about $37,700 a year at 4%. One percentage point of return, compounded over 42 years, moves the outcome by more than a fifth. That sensitivity is the honest reason to treat 15% as a floor for planning rather than a guarantee. The average stock market return page has the long-run history behind assumptions like these.

Time does most of the work in a retirement account, so the same monthly amount produces very different results depending on when it starts. The table below holds the assumptions from the worked example (5% real return, annual contributions, retirement at 67) and shows what a steady monthly amount grows to.

The pattern lines up with Fidelity's late-start figures: 15% from 25, 18% from 30 and 23% from 35, each assuming no savings yet. Fidelity does not publish a rate for a start at 40, but the same arithmetic points higher again, toward a later retirement date, a higher rate, or both. Someone at 40 who already has a balance needs far less, because that balance keeps compounding. What is compound interest? walks through why the early years count so heavily.

The order most planning guides suggest is roughly: capture the full employer match, then fund tax-advantaged space, then use a taxable brokerage account for anything beyond that. The 2026 limits from the IRS set the ceiling on the tax-advantaged part:

• 401(k), 403(b), governmental 457 plans and the federal Thrift Savings Plan: $24,500 in employee deferrals, plus an $8,000 catch-up at 50, or $11,250 for ages 60 to 63.
• IRA (traditional or Roth): $7,500, plus a $1,100 catch-up at 50.

Filling both a 401(k) and an IRA at the base limits comes to $32,000 a year, or about $2,667 a month, which exceeds 15% for anyone earning under about $213,000, so for most households the account limits are not the binding constraint. The detail on each account is in how much can I contribute to a 401(k) and how much can I contribute to a Roth IRA, and the choice between pre-tax and Roth money is in traditional 401(k) vs Roth 401(k).

Most people save less than the benchmark. The US personal saving rate, which counts all saving across all households and not only retirement, was 4.1% of disposable income in August 2026 according to the Bureau of Economic Analysis. The longer history is on the personal savings rate page.

Workplace savers do better. In Vanguard's How America Saves 2026, the average total contribution rate in 401(k) plans it administers, employee plus employer, was 12.1% for 2025, with an average employee deferral of 7.6%. So the typical plan participant is roughly three points short of 15%, and most of the gap is on the employee side.

Coverage is the bigger gap. The Federal Reserve's 2025 Survey of Consumer Finances, released in October 2026, put retirement plan participation, counting account-type plans, IRAs and pensions, at around 65% of families. The rest have no plan at all. More on balances is in retirement savings statistics.

Walnut is an AI investing app that connects to the brokerage accounts you already have. It does not hold your money and does not move money from your bank. With a savings plan, it can do five things.

1. Connect a brokerage account

Link the account you invest through. Many brokers connect read-only, which is enough for Walnut to see your actual holdings and balance. If you do not have a brokerage account yet, Public and Robinhood both work with Walnut.

2. Set a retirement goal

A goal carries a target amount and a date. Walnut projects whether your current balance is on track for it, which turns "am I saving enough?" into a number you can check each month instead of a feeling.

3. Set up a recurring investment

At a broker that allows trading through Walnut, a basket can carry a recurring investment: on a schedule, it spends a fixed amount across the basket's target weights. It spends cash that is already in your brokerage account, so the money still has to arrive there first, from your paycheck or your broker's own bank transfer. If the cash is not there, the contribution is skipped and you are told.

4. Compare what you hold to the S&P 500

The dashboard shows how your holdings have done against the S&P 500. Over decades, a savings rate and a return assumption are the two numbers that matter, and this is the check on the second one.

5. Ask the assistant

The assistant can read your connected portfolio and goals, so a question like "if I raise my contribution to $900 a month, does my goal still look short?" gets an answer grounded in your balance rather than a generic calculator. How to set investment goals with AI covers this step in more detail.

• Leaving match money behind. Contributing 3% when the employer matches up to 5% is a pay cut you chose. Many guides put this first for that reason.
• Counting the match twice. The 15% benchmark already includes it. Saving 15% of your own pay on top of a 5% match is 20%, which is fine, but it is a different plan.
• Saving a flat dollar amount for decades. $500 a month at 25 is a large share of pay. At 45 it may be a small one. Revisiting the percentage after each raise keeps the rate from quietly falling.
• Assuming the 15% covers early retirement. It was modeled for a stop at 67. Plans built around 50 or 55 need a much higher rate; see how much do I need to retire at 50.
• Using a nominal return with today's prices. A 10% nominal return in a spreadsheet next to today's spending overstates the outcome. Pick real returns with real spending, or nominal with inflated spending, and keep them consistent.
• Raiding the account. Early withdrawals usually carry tax plus a 10% additional tax, and they remove the dollars that had the most compounding ahead of them. An emergency fund is what keeps that from happening.

Savings guideline and late-start rates: Fidelity, How much should I save each year?. Contribution rates and median match: Vanguard, How America Saves 2026 (2025 contribution rates, which Vanguard labels as estimates). 2026 contribution limits: IRS. Personal saving rate: BEA, Personal Income and Outlays, August 2026. Plan participation: Federal Reserve, 2025 Survey of Consumer Finances. The worked example and age table are Walnut's own arithmetic on the stated assumptions. Walnut is informational and is not an investment adviser; this guide is educational and not personalized financial advice.