At any age, you should be saving for retirement - yes, even when you’re 20. This can mean more than just putting a little money into your employer's 401(k) plan. It’s important to think about all the expenses you will have in the future and how you will afford them. Therefore, we wanted to share some information on how you should save for retirement based off your age. Read on to learn more! 

Twenties 

This age is becoming more in touch with finances and investing. Different apps allow you to invest in stocks and make money over time. Getting in on these investments at this age is a good idea, as it gives you ample time to learn more about this environment and change things as you grow. An advisor can help you learn about investing while also teaching you about other options such as CDs or IRAs. 

You’ll also want to make sure you are investing as much into your 401(k) as your employer is matching. This will give you the biggest bang for your buck. It's easier to save for retirement when you're young and may have fewer responsibilities, so take this time to really learn about different retirement options. One rule of thumb is to save 10% to 15% of your pay for retirement. 

Thirties 

At 30, you could try to strive to have one time your current salary in savings and two times your salary by age 35. By the time retirement comes around at 67, you should have 10 times your final salary saved. While this seems like a lot, don’t panic. Try to work towards saving what is practical for you. Aim to save 15% of your salary for retirement — or start with a percentage that’s manageable for your budget and increase by 1% each year until you reach 15%. 

At this age, you’ll want to ramp up your 401(k) contributions and start thinking about other costs you need to save for such as a kid’s college fund. Keep padding your emergency fund, too. Shoot for enough to cover six months of essential expenses. 

Forties 

At 40, you should aim to save 3 times your salary. When you get a promotion or new job, try to put more money into your retirement accounts. You should also really be working on getting rid of any final debts, as those payments can be put towards retirement as well.  

Fund your 401(k) up to the maximum limit. For someone under age 50, that’s $19,500 in 2020. Even a 1 percent increase in your contribution can seriously improve your nest egg and have only a small effect on your paycheck. 

Fifties 

You should work to have 5 times your income saved. Keep in mind that everyone will need a different amount saved based on how they want to live after retirement. This will be based off your income, planned retirement age and the kind of lifestyle you want to have in retirement. If you are just starting to take a serious look at your retirement at this age, be sure to see if the 20s-40s advice has already been completed by you or if you need to work on finishing those goals first. 

We want you to be prepared for the future. Be sure to talk to a financial advisor so you are fully aware of your savings options. Fairfax State Savings Bank offers different retirement options to fit any need - we’re happy to help you save!