If you struggle to save for retirement, you're not alone. A scary new statistic from the Employee Benefit Research Institute suggests that almost a quarter of workers have less than $1,000 saved for retirement — and that's between them and their partner, CNN Money reports.
How much you'll need to save by retirement depends on a lot of factors, of course — where you live, what your expenses are, and how much it costs to maintain your definition of a comfortable lifestyle— but a good rule of thumb is to aim for 85% of your pre-retirement income. So, if you earn $100,000 a year, you'll want to aim to save $85,000 per year you plan to spend in retirement.
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That's not to say that you're expected to put away 85% of your earnings, of course. For most people, that would be totally impossible. Experts recommend saving 10% of your income for retirement. That money is then invested (whether through your company's 401K program or an individual retirement account or by your financial planner) and grown into that elusive "nest egg" you're always reading about.
Thanks to the magic of compound interest, starting to save early is one of the most important factors in retirement planning. This is why having only meager retirement savings by the time you're, say, 30, could prove to be a big problem down the line.
According to the Employee Benefit Research Institute, almost half of all those surveyed said they had less than $25,000 saved for retirement. That might seem like a big number, but CNN Money suggests that someone who's 30 years old and earns $50,000 a year should actually have about $30,000 saved for retirement.
Even though most of the data in the report suggests that people are, on the whole, not really that prepared for retirement, 60% said they felt confident they'd have enough money to retire comfortably.
Consider this a good reminder to do some soul searching if you're in the middle of the Venn Diagram of "haven't saved much for retirement" and "believe I'll be totally fine in retirement."