Saving for Retirement: Are You Guessing or Planning?
Long version
Let’s say you dream of spending your retirement mornings on a warm beach, coffee in hand, waves rolling in. To get there, you had a simple plan: save $1 million and buy the beach house you always wanted.
But when retirement arrives, reality hits. After accounting for keeping your current home, everyday expenses and health care, $1 million doesn't stretch as far as you thought, and the beach house remains a dream. The problem wasn't your discipline – it was that your number was never really your number. It was arbitrary, not anchored to what your ideal retirement would actually cost.
How can you make sure your retirement number is right for you?
A solid savings goal starts with a clear picture of the retirement you want. Think through where you plan to live, whether you'll keep your current home or downsize, how much you plan to travel, if you'll help children and grandchildren financially and what health care might cost you later in life. Build a realistic monthly budget, then multiply by 12 months to find your annual need. Adjust this amount for inflation until the first year of retirement.
Then, multiply that figure by 25 to get a sense of how much may be needed to save. It's a formula based on the idea of withdrawing 4% annually from your savings, assuming you retire in your mid-60s. If you need $60,000 a year, your target is around $1.5 million. You may need more or less depending on your lifestyle, health, unexpected expenses, Social Security benefits and other income. No single rate or strategy will work for everyone. A financial advisor can help you determine your number and strategy.
Once you know your target, the path forward becomes clearer. Here are a few tips for next steps:
Start early. The sooner you begin saving, the more time compound interest has to work in your favor. Small amounts set aside automatically each paycheck have the opportunity to grow significantly over decades.
Live below your means. Spending less than you earn is one of the most powerful wealth-building habits. When your income rises, save and invest the difference instead of upgrading your lifestyle.
Keep your debt under control. Since credit cards and other high-interest debt can slow your progress, pay off balances monthly when possible.
Invest consistently. If your employer offers a 401(k), aim to contribute at least 10%-15% of your salary, and increase your contributions after every raise. If you max out your 401(k), a traditional IRA or Roth IRA may offer additional tax-advantaged growth (eligibility and contribution limits apply).
Boost your income when you can. Develop new skills, ask for a raise or explore a side income. Every extra dollar saved moves you closer to your goal.
The difference between a retirement you love and one full of compromises often comes down to the planning you do today. Know your real number, build a solid plan and get the right help along the way.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
Edward Jones, Member SIPC
Number of words: 496
Short version (radio/print/online)
PSA: Saving for Retirement: Are You Guessing or Planning?
TBA: May 18, 2026
How much do you need to save for retirement? Rather than picking a number out of thin air, $1 million for example, find a number that will actually support the lifestyle you envision.
Begin by imagining your daily routine: Where are you living? Are you still in your current home? Will you travel more, or help family financially? Once you visualize it, you can estimate what that lifestyle will cost and start building toward it.
Here are five tips to get the building started:
One: Start saving as early as you can. Even small amounts can grow significantly over decades.
Two: Live below your means.
Three: Keep your debt under control and pay down high interest debt that slows your progress.
Four: Invest consistently and increase your saving when your income rises.
And five: Look for chances to boost your income, perhaps through new skills or side work.
The planning you do today determines the retirement you'll live tomorrow.
This content was provided by Edward Jones for use by (FA’s NAME), your Edward Jones financial advisor at (branch address or phone number). Member SIPC
Number of words: 158 (excluding FA’s name, address/phone number)