We’re going to take a look at how much money you should have saved for retirement in your 30s, but I want to be clear here that none of this is actual financial advice.
I recently turned 31 and began wondering if I was on track for retirement. There are a lot of factors that contribute to each of our retirement savings, but the consensus online generally tends to agree that your retirement savings should equal your annual pay by the time you are 30.
Goal: have 1x your income saved for retirement by age 30
For example, if you earn an annual salary of $40,000, then your retirement savings accounts should add up to be $40,000.
According to the Social security administration, the average income in the US in 2019 was right around $52,000 per year.
Let’s compare this to the national average 401k balance, and according to Fidelity’s retirement savings analysis tool, the average American in their 30s has a 401k balance of $38,400.
So by that math, the average person in their 30s is behind on their retirement savings by 25%.
Why Saving Early is Important
Recommended retirement savings quickly ramps up over the next 3 and a half decades to 10 times your annual salary by the time you are 67.
Age | Annual Salary Saved |
30 | 1x |
40 | 2x |
45 | 4x |
50 | 6x |
55 | 7x |
60 | 8x |
67 | 10x |
Compound interest will help grow your savings, but time is single handedly the most important factor when it comes to long term savings.
Take for example as a 30 year old you save an extra $500 per month. In 37 years at a conservative 7.2% rate of return, you’ll have over a million dollars saved up whereas you only contributed $222,000 out of your pocket.

On the other hand if you wait to start saving until you are 40 years old, and even if you save the same $222,000 out of your pocket by contributing an extra $200 per month, you’ll have less than $650,000 saved up by the time you retire.

The best thing you can do is start saving as early as possible i.e. now, and if you are already saving for retirement, put aside just a little bit more.
If you are in your early 30s, something as simple as contributing just $50 a week to a Roth IRA, in 37 years, you will have over a half of a million dollars saved up tax-free for retirement, and again in this case you have only contributed less than $100,000 out of your pocket during that time.

I not only like to explain these concepts to you, but I also like to be very practical too. If you aren’t sure where to get started, then I would suggest your employer’s 401k. If that’s not an option, then you can look into opening an IRA which stands for Individual Retirement Account.
I personally use Wealthfront for my Roth IRA and have been saving for retirement with them for the past 5 years.
If that’s something you’re interested in, use my referral link to get your first $5,000 managed for free, and if you want to see how my portfolio has performed since opening my account with Wealthfront, then check out this video right here.
One last thing. The tool I used to generate the graphs in this post the Compound Interest Calculator at investor.gov. Give it a try for yourself!