How much should you have in savings at each age?

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Spending can be a whole lot more enjoyable than saving.

But when life throws a nasty curveball and you wind up in the hospital or your car dies on the interstate, you’ll definitely want a financial cushion to fall back on.

For now, let’s zoom out from advice on maximizing returns on your retirement investments, or deep dives on the best CD rates, the best savings accounts or mortgage rates. At the most basic level, savings enable you and your family to enjoy the freedom associated with money and avoid the pain of debt.

There are two main reasons to set money aside: insurance against bad financial weather and funding your retirement. You might also save for a down payment on a house or for your wedding, but the first two are the must-haves.

Many people, however, aren’t saving enough. In fact, according to the Center for Retirement Research at Boston College, nearly half of all Americans are at risk of having a lower standard of living in retirement.

And when it comes to emergency savings, only 39 percent of Americans would pay for an unexpected $1,000 charge out of their savings, according to a Bankrate survey.

Here’s a look at what you need to save, broken down by age:

Of course, everyone’s financial situation is different. So, think of these savings targets as less of an exact number and more of a general guide. It will show you how your personal savings and retirement account balances stack up to the averages.Below you’ll find a full savings guide that estimates how much you should have in savings and your retirement accounts right now, and at different age milestones over the course of your life.

How much do I need in an emergency fund?

Let’s start with your emergency fund. Standard financial advice says you should aim for three to six months’ worth of essential expenses, kept in some combination of high-yield savings accounts and shorter-term CDs.

“For a working individual earning income, the goal should be to have just enough cash to provide an emergency buffer to protect against any pitfalls that could hinder financial well-being,” said Sergio Garcia, a certified financial planner at Quest Capital Management in Dallas.

Broadly speaking, there are six key costs to focus on: housing, transportation, food, health care/insurance, utilities and debt, with the first two typically carrying the largest monthly payment.

How much you need to save to survive an adverse life event comes down to your and your family’s financial situation.

A two-income family, for example, may only need to cover three months’ worth of expenses. But if there is only one income, or wages are largely commission-based, “the amount held in cash should be closer to six months of expenses, or even longer,” said Garcia.

You can get a sense of what your savings’ burden looks like by your age by looking at data from the Bureau of Labor Statistics (BLS) and Federal Reserve.

How much do I need in savings by age 30?

Households led by someone between the ages of 25 and 34 earn an average of $66,470 a year, according to the BLS’s 2016 Consumer Expenditure Survey. If you take conventional wisdom, this household, which has one child, on average, should have about that much (one times their salary) socked away in retirement accounts.

As for your emergency fund, these households spend a monthly average of about $1,550 on housing, $760 on transportation, $575 on food, $242 on health care and $275 on utilities. Toss in an estimated $56 per month on debt or loan payments and that monthly essential spending costs $3,458.

Multiply that by three and by six, and you’ve got your emergency fund.

Retirement savings goal: $66,470

Emergency savings goal: $10,374 to $20,748

How much do I need in savings by age 40?

Those aged 35 to 44 earn an average income of $92,576. Conventional wisdom states this couple should have three times that amount saved for retirement.

Their estimated average monthly spending consists of $1,909 on housing, $863 on transportation, $725 on food, $340 on health care, $360 on utilities and another $100 on debt. That comes to a total of about $4,300 a month.

Retirement savings goal: $277,728

Emergency savings goal: $12,900 to $25,800

How much do I need in savings by age 50?

This is the time you hit your peak earnings. It’s also when you’ll spend the most money in your life.

Those aged 45 to 54 earn an average yearly income of $99,423. Experts tell these stressed-out folks they need six times earnings in their retirement accounts.

That might be difficult due to their spending. Housing costs actually go down slightly, to $1,836 a month, thanks in large part to paying off the mortgage. Nevertheless, you still owe $916 on transportation, $733 on food, $411 on health care, $385 on utilities and $112 on debt. That totals $4,393 a month.

Retirement savings goal: $596,538

Emergency savings goal: $13,179 to $26,358

Infographic: Prioritize your savings

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How much do I need in savings by age 60?

Time to wind down. You’ve probably moved on from the most stressful period of your career, either voluntarily or not, and now you’re preparing for the last third of your life and retirement. That’s why earnings and spending start to fall.

Those aged 55 to 64 earn an average yearly income of $80,474. You’ll want to have saved at least eight times that for retirement.

Thankfully you need less in your savings account. You spend $1,554 on housing, $811 on transportation, $606 on food, $459 on health care, $354 on utilities and $100 on debt. That’s a monthly total of $3,884.

Retirement savings goal: $643,792

Emergency savings goal: $11,652 to $23,304

Other common savings goals

Of course, there is more to life than simply saving up for emergencies or socking away every spare penny for your retirement, important as that can be.

You’ll also want to save so you can take advantage of the good things life throws your way, whether it’s getting married, buying a house or simply going on a Caribbean vacation with your family.

Whatever it is, you’ll want to have some money saved up, especially if you want to avoid getting saddled with thousands of dollars in expensive, credit-card debt.

Take vacation. On average, Americans will spend $1,979 on vacations this summer, according to a Bankrate survey. By some estimates, a simple summer vacation can cost a family of four more than $4,000.

In order to foot the bill, Americans are using their credit cards, accumulating an average debt of $1,108, according to a 2017 survey by LearnVest.

If you think a vacation is expensive, try getting married, with the average cost of a wedding having hit $33,931 in 2018.

That’s only surpassed by the cost of a new car, which averaged $37,577 in 2018, Kelley Blue Book reports.

And if you are thinking of buying a house, you’ll need considerably more than that for the down payment. The average down payment was 13 percent in 2018, the National Association of Realtors reports.

Based on the median price of a home in the U.S. of $254,800, that amounts to more than $33,000.

You may want to open separate savings accounts for these additional expenses in order to avoid diluting your emergency fund. If you are looking to save a couple years out, say for a new car or down payment on a home, you might consider putting money into a money market fund or a CD, which could earn a bit more interest than your typical savings account.

However, when you start saving for college for a child, the costs graduate into an entirely new level of expense.

Tuition and fees at private colleges averaged $35,676 during the 2018-2019 school year, with public colleges costing $9,716 for in-state students, according to U.S. News & World Report.

For parents, that means having to save a lot of money. (You can crunch the numbers using Bankrate’s college cost calculator.)

For college, you may want to look at a 529 savings plan, which are offered by most states. These college savings plans work like an IRA or 401(k), with contributions invested in mutual funds and other financial assets. Money invested in 529s are after-tax dollars, but your earnings grow tax free.

It’s never too early to start saving

Your 20s are a great time to start saving.

By the time you’re 30, you will want to have stashed away more than $66,000 for retirement while also putting away as much as $20,000 in an emergency fund.

But there are many other things, beyond emergencies, which you’ll need money for in your 20s, including furniture, first and last month’s rent and a security deposit for a new apartment, which can add up to thousands of dollars. You might also be saving for a down payment on a house, which can require tens of thousands of dollars.

Paying off high-interest student debt and automating your savings so you squirrel away a piece of each paycheck are good places to start.

What you can do?

Remember, your retirement saving has some advantages. The contributions you make in your 401(k), for example, aren’t taxed when you invest the money, and you might also get a matching contribution from your employer. The money itself takes advantage of compounding interest. If you save 10 percent to 15 percent of each paycheck, including any match, you’ll be on track.

Your emergency savings, meanwhile, is funded with after-tax money that earns barely any return at all. And you can’t expect to get help from your employer except for the paycheck. Kids cost $275,000 to raise (and that doesn’t include college), roofs leak, family and friends need help, hips break and layoffs happen. Your emergency fund needs to weather all that.

To make sure your emergency fund is properly funded when you need it, set up automatic contributions to your savings account — you probably won’t even notice the money is missing every two weeks.

Other savings tips: bank any bonus or raise. Try to live beneath your last salary. And when a debt is paid off, or an ongoing expense evaporates, put that money toward your emergency fund.

Constant vigilance is the only antidote to disaster.

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