What to Save for Retirement, at 6 Ages, When Starting From Scratch

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Related: How Much Investors Should Have Saved for Retirement, at 5 Different Ages

Households in the upper income brackets that hope to maintain an equivalent lifestyle in retirement are well advised to start saving early. Not doing so will mean having to put away increasingly large amounts of income with advancing age.

Take a 45-year-old with a gross household income of $175,000, but no savings. That person may need to save 26% every year until retirement, according to J.P. Morgan Asset Management’s 2024 guide to retirement. 

The guide provides a useful breakdown of savings rates at six ages and different income levels that can help advisors keep their clients on track.

J.P. Morgan’s researchers based their model on proprietary long-term capital market assumptions returns, and an 80% confidence level. The model assumes a 60/40 pre-retirement portfolio and a 40/60 one after retirement. It also assumes an inflation rate of 2.5%.

The primary earner in the model intends to retire at 65, and his or her spouse at 63. The model assumes that they will spend 35 years in retirement.

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