You're not alone if you feel like you're blindly guessing how much you'll need to save for retirement. It's tough to estimate your needs. You don't know what your expenses will be like or how long you'll live, and there's no way to completely resolve this uncertainty.
You can get a rough idea of what you need by focusing on how much annual income you want in retirement. Here's how to figure this out if you want $75,000 per year in retirement.
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What you need to save to withdraw $75,000 per year in retirement
The 4% rule is a popular retirement rule of thumb that says you can safely withdraw 4% of your savings in the first year of retirement and adjust this amount annually for inflation. This is supposed to help your savings last at least 30 years, though your mileage can vary.
You can flip this rule around to figure out what kind of savings goal you should be targeting. You multiply the annual income you'll need to come up with on your own in retirement by 25.
Most retirees will be able to count on Social Security to cover at least some of their retirement costs, so they won't have to pay the full $75,000 on their own. The average Social Security benefit as of January 2026 was about $2,075 per month. That adds up to $24,900 per year. If we subtract this from $75,000, that leaves $50,100 you'd need to come up with on your own.
If we multiply $50,100 by 25, we get a savings target of just over $1.25 million. You may want to add a little cushion to this if you're able to in case of unplanned expenses or higher-than-expected inflation. But it gives you a good idea of what you should be aiming for.
What to do if you're worried about coming up short
Saving over $1 million for retirement is challenging for some workers. In an ideal world, you'd be able to find a way to increase your contributions, maybe by negotiating a raise or starting a side hustle. But this isn't always feasible.
You may be able to get by on less money in retirement, but be careful not to underestimate your needs. That can backfire, leaving you without enough savings when you need them most.
You could also try delaying retirement. This can reduce the overall cost of your retirement because you won't have to cover as many years of living expenses. Even a small delay can make a significant difference.
Whenever possible, continue making regular retirement account deferrals as well. Set aside whatever you can and increase your contributions when you have the opportunity.
