How much money do you need for a comfortable retirement? There's no single right answer, yet most people agree that $1 million is a pretty good target to aim for. According to a 2015 survey by the Transamerica Center for Retirement Studies, the average American thinks that $1 million is the magic number to sustain a financially secure retirement. Yet most millennials fear they'll fall short in achieving that savings goal. According to a newly released Wells Fargo study, almost two-thirds of working millennials feel they won't ever manage to amass $1 million in their lifetime, and it's not hard to see why. With student loan debt and high living costs eating up so much of millennials' income, saving enough to accumulate $1 million may seem like an impossible task. But believe it or not, a $1 million savings balance may be more attainable than you'd think -- as long as you start early and invest wisely.

Stressed Young People


Saving for retirement: the earlier, the better

The point at which you first start saving can play a big role in helping you grow your nest egg. Wells Fargo reports that while 59% of millennials have already begun saving for retirement, 41% have not. If you make a habit of saving and investing early on, you stand a greater chance of hitting that seemingly unreachable $1 million target.

Let's say your goal is to retire at 67, and that your investments generate an average annual return of 8% -- a figure that's more than reasonable for a stock-heavy portfolio. If you start saving $250 a month starting at age 22, by age 67, you'll have well over $1 million to your name.

But watch what happens if you wait even five years to start saving that money. If you begin saving $250 at age 27 and generate an average annual 8% return, by 67, you'll have about $777,000 -- a respectable sum, but well short of $1 million. Worse yet, if you wait until age 32 to start saving that $250, you'll be left with just $517,000 by age 67 -- half of what you'd amass by starting 10 years earlier. The sooner you start saving, the sooner you get to take advantage of long-term compounding. Compounding allows you to earn interest on interest, and for many savers, it's a key driver of wealth.

Choosing stocks for higher returns

While your emergency savings -- money you need on hand to cover unforeseen expenses -- should generally be stored in an accessible bank account, the money you save for retirement should be invested to fuel its growth. If you want a shot at outpacing inflation and amassing enough to cover your living expenses in retirement, you'll need to generate a decent return on your investments.

Historically speaking, stocks have delivered higher returns than bonds. If you invest in stocks when you're young, you have time to ride out the market's ups and downs to come out ahead in the long run.

Let's say you start saving $250 a month starting at age 22, you put most of your money into bonds, and your investments generate an average annual 4% return. By the time you're 67, you'll have roughly $363,000. But if you invest that money in stocks and generate an average annual 8% return, by the time you reach 67, you'll have well over $1 million. While investing in stocks is a riskier prospect, it can also be far more rewarding, and it can certainly get you much closer to that $1 million mark.

Though the idea of accumulating $1 million in your lifetime might seem implausible at first, in reality, it's probably more attainable than you'd think. In all of the scenarios outlined above, we reached $1 million based on a monthly contribution of $250 -- a reasonable figure even for someone on an entry-level salary. In other words, you don't need to stick $1,000 a month into a retirement account to eventually hit $1 million. If you start early and invest aggressively, you can turn a relatively small amount of money into a huge lump sum right in time for retirement.

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