Saving for retirement should be something you work on throughout your entire lifetime if you want to enjoy your later years. Unfortunately, far too many Americans either have no retirement savings goals at all or haven't taken steps to set the right ones.

You don't want to end up off track on your path to financial security because you don't have a roadmap to get to your destination. In order to be certain you're making the right moves, you'll need to set a retirement savings goal that will help you build the nest egg you need. Fortunately, doing that isn't very hard. In fact, it just takes four simple steps. 

Smiling woman putting money into piggy bank.

Image source: Getty Images.

1. Estimate what you'll spend as a retiree

The purpose of saving for retirement is to make sure you'll have enough money to cover your needs. That means you have to figure out what your needs will be by estimating likely spending in your later years.

If you're near to retirement, the best way to make an accurate assessment is to make a budget and actually calculate the amount of money that'll be required to cover your costs. If you're a long way away from leaving the workforce, doing this probably won't make sense though. In that case, you can get a good idea of your spending needs by assuming you'll need to replace about 80% to 90% of your pre-retirement salary. 

To figure out what your pre-retirement salary will most likely be, estimate how many years it'll be until you leave work, take your current salary, and assume a 2% raise each year until then. This'll give you a good idea of your final salary, and you can plan to replace about 90% of it if you want to be on the safe side and make sure you can maintain your standard of living.

2. Calculate your Social Security benefit amount

Chances are good Social Security and your savings will be your sole sources of retirement income, since most people don't receive defined benefit pensions from employers any more. That means you'll need to know how much you'll get from Social Security in order to set your retirement savings goals. You can get an estimate of your likely benefit by signing into your online Social Security account.

When you sign in, you'll notice the SSA has estimated your benefit amount at different ages. It's usually a good idea to assume you'll retire at 62 and accept a lower benefit even if you don't plan to do so. Many people end up forced to claim their benefits early due to circumstances beyond their control, such as a health problem or job loss. If you assume that will happen to you, you won't face a financial shortfall if you end up getting a smaller Social Security check than anticipated. If it ends up that you can work longer, you'll just be better off.

3. Figure out the shortfall

Once you know the amount of money you'll need to cover your costs as a retiree and how much your Social Security benefit will be, you can figure out how much money your savings needs to provide. If you find you'll need $50,000 to cover your costs in retirement and your Social Security benefit is worth $20,000, you need your savings to produce $30,000 worth of annual income. 

4. Determine how much to save to cover it

Finally, you have to figure out how large your nest egg needs to be to give you the income you need to supplement Social Security.

There are a few ways to do that, including using online calculators. But if you plan to follow the 4% rule, one of the easiest is to multiply the desired amount of income by 25. If you need your savings to produce $30,000 worth of annual income, for example, you'd need to have a $750,000 retirement account balance by the time you leave the workforce.

With this big goal in mind, all that's left to do is to break it down into smaller goals. Use an online calculator to assess how much you need to save each week, month, or year to hit your target number in the time you have left until retirement. You'll have a clear answer for how much to invest for your future, and can hopefully get started in saving that amount so you'll have the funds you need to enjoy life in your later years.