Savings by age: how much should you have by 30, 40, 50 & 60?

Most of us know we need to save for our future - but how much is enough?

There are several ways you can answer that question. You might want to know the amounts you need to be setting aside now to achieve financial security in the future. Or it might be more useful to know the size of the savings pot you need as a proportion of your earnings. Some people want to know how their savings compare to other people their age.

All of these can be useful in understanding how your saving is progressing. Here we lay out that information so you can see the savings landmarks you might need to hit as you move through life.

Remember - targets like these can sometimes appear hard to reach, particularly if you’ve delayed your savings to prioritise other things. That’s OK - it’s still useful to understand them and gauge your progress. Even if you feel you’re behind on your saving there is almost always something your can do to improve the picture.

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How much should you have saved by 30?

Life up until age 30 is about establishing a financial footing for the future - even if the amounts you can save seem small. It is common to have to clear debt and save for a property in these years, and other long-term saving often takes a back seat.

But don’t worry. You’ve got time on your side with many years of contributing - and hopefully savings interest and investment returns - ahead of you.

Savings as a proportion of salary

It can be useful to look at savings as a proportion of the money you earn. Fidelity has previously produced broad guidelines to help people understand how much they need to have saved by different ages, shown as a multiple of their salary.

For people aged 30, the guidelines recommend an amount in savings worth one times your salary in order that you have enough to maintain your standard of living in retirement. So, someone earning £30,000 would need that amount in savings - which can mean money both inside and outside of pensions.¹

How do you compare?

The government publishes statistics of levels of saving by age. Specifically, these cover the money held by individuals in ISAs and pensions. The most recent figures cover the period up to 2022.

The statistics group people in age bands. For the 25-34 age group, the average held in ISAs is £9,477², while the median amount held in pensions is £18,800³.

• Read more about ISAs
• Read more about Pensions

Note - these figures are the averages among people who have ISA and pension savings - there are a great many people without these, so the averages including those people would be far lower.

What do you need to generate £50k a year in retirement?

Sometimes, big, round targets work best. Lots of people will have a figure in mind for the income they hope for in retirement. For example - how much would you have to save in order to generate a £50,000 a year income when you retire?

To be clear - this is a very challenging target that requires some serious saving. In reality, only a small proportion of people are likely to generate this kind of retirement income. Nonetheless, knowing what it would take gives your something to work towards. 

The Fidelity Pension Drawdown Calculator helps you calculate the sort of pension pot you need to get that income, assuming you want your income to grow by 2% a year.

If you are 65 and seeking annual income of £50,000, the pot you need climbs to just over £1m - another big target. This is the pot that would be invested to generate income - therefore after any tax-free cash has been taken.

At those levels, your pot would run dry by age 95 with average investment performance, but just 86 if investment performance is poor.⁴

For someone aged 30, let’s assume they have begun saving from age 25. In order to hit £1m by age 65 they would need to have £34,826 saved and be contributing £544 a month, with this contribution then increasing by 2% each year. This assumes they achieve 5% investment growth after all fees.⁵

Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. Eligibility to invest in an ISA or SIPP and tax treatment depends on individual circumstances and all tax rules may change in the future. Withdrawals from a pension product will not be possible until you reach age 55 (57 from 2028). This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.