How Much to Save for Retirement: The 15% Rule, the Match, and Savings by Age

A widely-used guideline is to save about 15% of your income for retirement, including any employer match, but the single most important rule is to always contribute enough to capture the full employer 401(k) match first. That match is free money. Beyond it, how much you should save depends on when you start and how big a nest egg you are aiming for. The encouraging truth is that steady saving plus an employer match plus decades of compounding does most of the heavy lifting.

For years I saved more or less at random, whatever was left at the end of the month, which is to say not much. Turning it into a percentage I paid myself first changed everything. So here is how to think about the number, checked by a CERTIFIED FINANCIAL PLANNER: the rate, the match, the limits, the milestones, and what to do if you are starting late. For the wider plan, see the pillars of retirement income.

Start with the match: free money first

Before any savings-rate guideline, there is one rule that beats all the others: always contribute at least enough to get the full employer match. A typical 401(k) match might be 50 cents on the dollar up to 6% of pay, or dollar-for-dollar up to 3%. Either way, it is an instant return on your money that no investment can reliably match.

Put it in plain terms: if your employer matches dollar-for-dollar up to 3% and you contribute 3%, you have just earned a guaranteed 100% return on that money before it is even invested. Skipping it is turning down part of your pay. So whatever else you do, fund the match first; everything in this article comes after that.

The 15% guideline (and why it is only a guideline)

With the match secured, the common target is a savings rate of about 15% of your gross income, counting the employer match toward it. So if your employer adds 4%, you supply about 11% yourself. It is a sensible default for someone starting young.

But the number bends with your start date:

• Start in your 20s: around 15% is often enough.
• Start in your 30s: closer to 15% to 18%.
• Start in your 40s or later: often 20% or more to catch up.

Do not let a big target stop you from starting small. Beginning at 6% and raising it one point a year, especially with each raise, is far better than waiting until you can do 15% all at once. The discipline of automatic, pay-yourself-first saving matters more than hitting the exact figure.

The 2026 contribution limits

There are legal ceilings on how much you can shelter in these accounts each year, set by the IRS and updated most years. For 2026:

Account	Limit (2026)	Catch-up (50 and over)
401(k), 403(b), 457, TSP	$24,500	$8,000 (up to $32,500)
IRA (traditional or Roth)	$7,500	$1,100 (up to $8,600)

There is a special boost under SECURE 2.0: savers aged 60 to 63 get a higher 401(k) catch-up of $11,250 instead of $8,000. Most savers will not hit these caps, but high earners and late starters can use them to pack in serious money fast. The full detail lives in retirement contribution limits, and the order to fund accounts is in how to start saving for retirement.

Track progress with savings-by-age benchmarks

A savings rate tells you what to do this year; benchmarks tell you whether you are on track overall. A widely-cited Fidelity guide expresses targets as a multiple of your salary:

Age	Target saved
30	about 1x salary
40	about 3x salary
50	about 6x salary
60	about 8x salary
67	about 10x salary

Treat these as a progress check, not a verdict. If you are behind, you have a great deal of company, and the gap usually looks worse on paper than it turns out to be. The point is direction, not perfection.

Starting early vs catching up

The strongest argument for saving early is compounding: returns earn returns, so a dollar invested at 25 has decades to multiply, while a dollar invested at 55 has only a few years. As a rough illustration, $300 a month invested from age 25 to 65 at a 7% average return could grow to well over $700,000, while starting the same amount at 40 leaves you with a fraction of that, because the early years do the most work.

But starting late is genuinely not hopeless, and I am living proof; I got serious in my late fifties and still moved the needle. Three things favor late starters: catch-up contributions after 50, your peak earning years often falling in your 40s and 50s, and the fact that money saved even for 15 to 20 years still has real time to grow. A higher savings rate and a couple of extra working years can close a remarkable amount of the gap.

Keep it growing and keep it cheap

Saving is only half of it; the money has to be invested to outrun inflation, usually in low-cost index or target-date funds. And because investments can lose value, your balance will not climb in a straight line; expect down years and keep contributing through them, which actually buys more shares when prices are low.

Watch costs too, because high fees quietly erode decades of saving. This is general information, not personalized financial advice; your right savings rate depends on your income, age, and goals. For a plan tailored to you, see choosing a financial advisor, and use the free, unbiased tools at Investor.gov and the U.S. Department of Labor to check your own numbers.