How Much Money Should I Have Saved By 35


As you enter your early adulthood, your future goals and plans hit you like a storm. You realize that the 10-year plan to save money you had in your mind might not be a realistic approach. However, sacrifices have to be made in your younger years to live comfortably in retirement.

Surveys show that people these days are not having enough saved for their retirement age. According to data, an average millennial saves about $2400 in total median savings, which is not enough to save about $1 million by the retirement age.

The question you should ask yourself is, are you on track? Do you think you will be able to save enough for retirement? If not, no need to worry!

Here we mention why is it important to save money, the right amount of money you should save by 35, and how you can meet the saving goals.

How much should you save by 35?

The easiest way to understand how much you should save by 35 is by doubling the amount of your annual salary. On average, that comes to around $105,000, which is a decent amount of money to have saved by your mid-30s. 

However, let’s understand that this is just a rule of thumb. It can vary widely from person to person. For example, if a person earning $60,000 plans to need just $20,000 per year in retirement, they may not need as much saved up as someone who anticipates needing much more in retirement.

These benchmarks are given to help a person to start saving more. Setting a bar too high can discourage a person from having it all together, and putting it too low can give a person a false sense of confidence.

If you have anywhere from 1.5x to 2x your annual salary saved by the age of 35, you are on the right track. However, if you’re afraid you won’t make that savings goal, or you’ve already missed it, don’t worry. Below we have made a list of ways you can help get back on track.

How to save money by 35

When saving for retirement, the best thing you can do is determine your target goal/amount and create a plan to help you achieve it. Although you have an advantage if you were able to start saving young, even if you are later to the party, there is no need to panic because everything is achievable with a bit of effort.

Here are a set of tips for you that can help you achieve your saving goals. So let’s get into them!

Create a realistic budget

As people move closer to retirement age, panic may start kicking in, and they may have to make drastic changes to meet the target savings amount. However, this indicates that their budget through their working years may not have been on the right track.

For any person, the natural reaction would be to start rushing things to reach the target; however, our best advice is to sit back, relax and think. Why was the target not met? Analyze the situation, was the target too unrealistic or is your money going somewhere else? 

If your money is going towards unnecessary expenses, you should consider cutting them out. Still, if it is going towards something unavoidable, for example, going to family needs, then the saving goal plan needs to be revised. 

It might sound like a good idea to start adding larger amounts to your retirement savings, but it may hurt your short-term emergency savings as it could increase your credit card and loan debt. Hence, it is necessary to analyze the situation before taking any action.

Tackle credit card and student loan debt

Before setting a target goal, it is necessary to consider any pending credit card or student loan debt, as paying it off should come as your number one priority. Credit card loans have high interest rates, and the longer you wait, the more you’ll owe. Next, your focus should be on paying off the private student loan debts.

Set up a saving target after considering your current debt situation. Experts advise you to save 15% of your annual income specifically towards retirement. But, if you’re currently paying 20-30% interest on your credit cards, you should probably get rid of that first.

Revise your saving goals as you pay off debt

If you are under multiple debts, the best way to get yourself rid of them is by applying the “debt avalanche.” In this method, you focus on paying off debts with high interest rates and, meanwhile, pay just the minimum amount on the other debts with lower interest rates.

After you get rid of all the debts you were in, it is now time to reallocate that money towards your retirement savings. It is essential not to delay the process of saving no matter what age you are.

Ask for a raise when needed

Asking for a raise is always difficult as a person is unsure if it is the right time or moment to ask for a raise. However, the easiest way is to question if you have been an employee for a while and are you a valuable asset to your company? If yes, then it may be time to ask for a pay raise. 

The best way to ask for a raise is to document your contributions to the business and how you have added value to the company. This document should also include the amount you are hoping to earn. Remember that the amount should be reasonable and comparable to your performance; otherwise, the request is likely to be rejected.

Key takeaway

If you want to save money to live a worry-free life by 35, then you need to start making smart decisions today. We hope that this list helps you save money effectively. If there’s something you’d like to share, please comment.

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