Do you regularly put money aside for your retirement? Even if some people still have years to go before they retire, you should start saving now.
According to experts, in order to be financially well-positioned even after you retire, you should have saved up ten times your last gross annual income.
A long-term savings plan is particularly important for women. Compared to men of the same age, women should already have saved 52,000 euros by the age of 30, according to the Weltsparen interest platform – men, on the other hand, should have saved 16,000 euros.
“You have to learn to save. That requires a certain degree of disciplining, because you also have to practice doing without,” says Helmut Jonen, ex-banker and stock market expert. Already in his early 20s, he regularly put money aside and invested it. He is now financially independent. His tip is to start saving as early as possible.
But how can you check yourself if you are saving enough money? Experts recommend various strategies as a guide – from a certain percentage of your annual salary to a fixed value based on your average net salary per month and your age group.
This is how much money you should save by the time you are 30, 40, 50 and 60, according to experts at Fidelity Investments
Experts at financial services firm Fidelity Investments advise that by the time you’re 30, you should have at least your gross annual income saved. If you earn 50,000 euros gross, ideally you should also be able to dispose of this sum.
At 40 you should Triple your annual income own. At 50,000 euros gross, that is 150,000 euros.
Six times your annual gross income you should have saved by the age of 50. Let’s assume the 50,000 euros here again: Then you should put 300,000 euros aside to protect yourself for old age.
By age 60, according to Fidelity Investments, you should Eight times your annual salary have saved. For the sake of simplicity, we again assume 50,000 euros, even if your salary usually increases with age. By the time you are 60, you should have saved 400,000 euros.
When you retire, the experts recommend that you Ten times your annual salary should have in your savings account or custody account. Of course, that sounds like a lot of money at first. But keep in mind that you have several decades to gradually build up your wealth. That’s why the same applies here: The earlier you start building wealth, the better.
This is how you close the pension gap
The Weltsparen interest platform offers a different approach. It shows an example of how much money men and women should already have set aside to close the pension gap. Weltsparen assumes that you will save ten percent of your net income without interest from now until you retire at the age of 67. The analysis also takes into account the gender pay gap of 18 percent and the higher life expectancy of women.
This is how much wealth should women who are now 30, 40, 50 and 60 years old have
As a reference for an average monthly net salary for 30-year-old women, Weltsparen assumes 2062 euros. If you save ten percent of your income every month until you are 67 years old, you will have 111,000 euros together when you retire. However, due to inflation and taxes, you will still be short of 163,000 euros if you want to live at a similar level. To make up for this gap, you should already have saved 52,000 euros.
At the age of 40, women earn an average of 2420 euros per month. According to Weltsparen, women are missing 188,000 euros when they retire. Women who are 40 years old today should therefore already have 104,000 euros.
By the age of 50, women should have around 139,000 euros.
At the age of 60, i.e. shortly before retirement, you should have reserves of 157,000 euros.
Men in their 30s, 40s, 50s and 60s should already have that much wealth today
30-year-old men earn an average of 2577 euros per month. In order not to have to cut corners in old age, you should have saved around 16,000 euros by the time you are 30.
At the age of 40, men should be able to dispose of 66,000 euros.
Ideally, men who are 50 years old today have 112,000 euros in their account to close the pension gap.
According to the platform, at the age of 60 and an average income of 3161 euros per month, men should have set aside 139,000 euros in order to be able to maintain their standard of living.
Don’t have enough reserves?
Do you have little or no financial reserves? That’s no reason to panic. It is important that you take care of your retirement provision now and consistently put money aside. With ETF savings plans, for example, you can invest even small sums of money in the long term. In addition, the so-called 50:30:20 rule can help you to manage your finances well.
According to this, you have 50 percent of your income to pay for fixed costs such as rent, utilities and insurance. You can spend 30 percent on leisure activities and hobbies and you should spend 20 percent on it to save money.
Disclaimer: Stocks, cryptocurrencies and investments are always associated with risk. A total loss of the invested capital cannot be ruled out either. The published articles, data and forecasts are not an invitation to buy or sell securities or rights. They also do not replace professional advice.
This article was updated on 03/06/2022 and first appeared on 03/04/2022.