Fidelity suggests how much money is needed to retire comfortably and maintain desired lifestyle.

It's never too late to start saving for retirement. If you haven't started yet, now is the time to begin. Fidelity Investments, a multinational financial services corporation, recently revealed that there is no one-size-fits-all dollar amount for retirement savings. Michael Shamrell, Vice President of Workplace Investing Thought Leadership at Fidelity, says that putting a dollar amount on retirement savings can be too much pressure.

“That can seem daunting,” he said. “The last thing you want to do is put out a dollar amount that’s going to be discouraging.”

The focus should be on the fact that saving for retirement is necessary, regardless of the amount. Advisers are often asked how much people need to save and if they are on track for reaching their goal. However, there is no concrete amount due to different circumstances. Shamrell states that reports do not take into account the various cost of living in different areas of the country.

Fidelity has new guidelines that are applicable to individual savings journeys. Instead of suggesting a dollar amount, the firm recommends having at least 1x your annual salary saved by age 30, 3x by 40, 6x by 50, and so on. If these numbers are not realistic, Fidelity suggests other ways of catching up, such as taking a long-term approach.

“Life happens, jobs are going to come and go, the economy is going to go up and down. The best thing that we can encourage people to do is take a long-term approach,” Shamrell said. “Don’t try to make changes to your savings strategy based on short-term events. Try to take a long-term approach and make sure that any changes you might be making are part of your long-term strategy.”

Fidelity's report from August 2023 shows positive progress towards retirement. According to CNN, the average 401 balance has increased to $112,400, a 39% jump. People who have been saving regularly since 2008 can have an average balance of $499,000. It's important to consider options for retirement funds, whether it's through savings, investments, or other sources.

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