Want to retire at 65 with $2 million? Here’s how much to save each month

Young Americans have mixed feelings about their ability to reach their retirement savings goals.

On one hand, around 45% of both Gen Zers (ages 18 to 26) and millennials (ages 27 to 42), feel they’re on track, slightly ahead or significantly ahead in their retirement savings, according to a recent Bankrate survey.

However, about half of both groups feel they’re slightly or significantly behind where they should be, per the survey.

Although many people are stretching their budgets as much as they can, it’s important to try not to forgo saving for retirement — especially as a young person. When you start saving for retirement early, you give your funds more time to grow through the power of compounding interest.

On average, Americans think they’ll need over $1 million to retire comfortably, according to Bankrate. They also plan to work until they turn 65, on average, per Northwestern Mutual’s 2023 “Planning and Progress” study.

With that in mind, CNBC calculated how much you would need to set aside each month in order to retire with $2 million at 65, starting at ages 21, 25 and 30. Note that these calculations assume a beginning balance of $0 and don’t account for common life events such as promotions, layoffs or market volatility.

Since experts generally recommend saving 15% of your annual income for retirement, CNBC also calculated the income you’d need to earn in order to reach a savings rate of 10% and 15%.

Earning a 3% annual rate of return: $1,822 per month

• Annual salary needed if you save 10% of your income: $218,651
• Annual salary needed if you save 15% of your income: $145,767

Earning a 5% annual rate of return: $1,039 per month

• Annual salary needed if you save 10% of your income: $124,733
• Annual salary needed if you save 15% of your income: $83,155

Earning a 7% annual rate of return: $564 per month

• Annual salary needed if you save 10% of your income: $67,683
• Annual salary needed if you save 15% of your income: $45,122

Earning a 10% annual rate of return: $209 per month

• Annual salary needed if you save 10% of your income: $25,114
• Annual salary needed if you save 15% of your income: $16,743

Earning a 3% annual rate of return: $2,154 per month

• Annual salary needed if you save 10% of your income: $258,516
• Annual salary needed if you save 15% of your income: $172,344

Earning a 5% annual rate of return: $1,305 per month

• Annual salary needed if you save 10% of your income: $156,619
• Annual salary needed if you save 15% of your income: $104,413

Earning a 7% annual rate of return: $758 per month

• Annual salary needed if you save 10% of your income: $90,905
• Annual salary needed if you save 15% of your income: $60,603

Earning a 10% annual rate of return: $314 per month

• Annual salary needed if you save 10% of your income: $37,637
• Annual salary needed if you save 15% of your income: $25,091

Earning a 3% annual rate of return: $2,690 per month

• Annual salary needed if you save 10% of your income: $322,833
• Annual salary needed if you save 15% of your income: $215,222

Earning a 5% annual rate of return: $1,753 per month

• Annual salary needed if you save 10% of your income: $210,374
• Annual salary needed if you save 15% of your income: $140,249

Earning a 7% annual rate of return: $1,104 per month

• Annual salary needed if you save 10% of your income: $132,482
• Annual salary needed if you save 15% of your income: $88,322

Earning a 10% annual rate of return: $522 per month

• Annual salary needed if you save 10% of your income: $62,691
• Annual salary needed if you save 15% of your income: $41,794

Not everyone is aiming to retire as a millionaire, but it’s important to have an idea of how much you’ll need to cover your expenses after you stop working. CNBC Make It’s retirement calculator can give you an idea of how much you should aim to save for retirement based on factors like your current age, savings and income.

And remember, it’s OK to start with what you can, even if you can’t put away 15% of your income right now. The key to reaching your retirement savings goals is to find a strategy you can stick with and consistently make contributions, according to Fidelity.

“When it comes to long-term saving, time is a powerful force and it’s on your side,” says Fidelity’s March Viewpoints report. “The earlier you begin saving and investing, the lower your savings rate can be throughout your career thanks to the power of compounding.”

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