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Here’s How Much Each Generation Thinks They’ll Need to Save for Retirement

Every generation is marked by unique trends and outlooks that set them apart from the ones that came before. You can see this in everything from music to home decor, but it also extends to financial concerns, like saving for retirement.

A Northwestern Mutual survey recently asked members of several generations how much they thought they’d need to retire comfortably and their answers were, predictably, different. But as for which is correct, that’s harder to answer.

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How much does each generation expect to need in retirement?

I probably don’t need to tell you that you’re not going to be retiring on $50,000, unless you only expect that retirement to last for a year or two. For most people, retirement lasts decades. You’ll have some money from Social Security — yes, even if you’re retiring decades from now — but you’ll still need personal savings to live comfortably.

Those Northwestern Mutual surveyed estimated they’d need $1.46 million for retirement on average, but each generation had its own opinion, listed below:


Amount Expected

Baby Boomers


Generation X




Generation Z


Data source: Northwestern Mutual Planning & Progress Study.

The general trend is that younger adults expect to need more for retirement than older adults, and this makes sense. Inflation makes everything more expensive over time, meaning your dollars won’t go as far in the future as they do today. Younger adults who don’t expect to retire for decades will feel this erosion in buying power more than the older adults surveyed, some of whom may already be retired.

So it’s possible that all generations are correct about how much they’ll need for retirement, but it’s just as possible that they’re incorrect. Everyone’s retirement plan is unique, and that makes it difficult to put a price tag on retirement.

We can safely assume that someone who plans to travel the world will probably spend more than someone who works part-time while living in their paid-off home. But unexpected costs, like health issues or vehicle breakdowns, could influence this.

How much do you need to save for retirement?

Your best shot at retiring comfortably is to create a personalized retirement plan that takes your health and lifestyle into account. Start by thinking about how much you’ll expect to spend annually in retirement. This could be less than your income today.

Many seniors need about 80% of their pre-retirement income after they leave the workforce. You could use this as a baseline, but adjust this amount based on your plans. If you’re going to travel or devote a lot of time to expensive hobbies, you’ll need more. The same goes for those who hope to donate a lot to charity, help their family out financially, or live in a more expensive area in retirement.

Keep in mind, you won’t have to pay for all your retirement expenses out of pocket. You’ll have some money from Social Security and some workers may also get a pension from their employer. You might choose to work a part-time job or rent out an extra property to provide a steady source of income in retirement as well. These things will reduce how much of your retirement costs you need to save for.

Subtract the amount you expect to get from other sources from your estimated yearly retirement expenses to figure out approximately how much of your annual expenses you’ll need to cover annually. For example, if you think you’ll need to spend $60,000 per year and you’ll get $20,000 from Social Security, you’d only need enough to cover the remaining $40,000 on your own.

From here, there are a few ways you could go. You could enter your information into a retirement calculator to come up with an estimate of what you need to save per month and overall to reach your goal.

Or you could try the 4% rule. This says you should save 25 times the estimated annual income you’ll need for retirement. Then, in your first year of retirement, you withdraw 4% of what you have. You increase this amount in subsequent years just enough to counter inflation.

This is supposed to help your savings last 30 years, but it doesn’t work for everyone. If you expect to spend more than 30 years in retirement, you’ll obviously want to save more. Or if you want to be conservative, you could aim to spend just 3% or 3.5% in your first year of retirement.

Only you can decide what you feel you need for retirement and when you’d like to quit the workforce. It’s possible your opinions could change over time. That’s OK. Choose a savings goal based on the best information you have right now. Then, aim to make regular contributions to a retirement account. Check back in with yourself once or twice per year or whenever your finances experience a major shakeup and make adjustments as you get closer to your goal.

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