Saving in Your 20s, 30s, 40s, and Up...What Changes?
No matter how old you are, it’s never too early (or late) to save money for retirement. Each decade comes with different goals, investment types, and risk factors, but understanding the differences can help you be prepared for when your retirement comes around.
Entering the Workforce: Your 20s
Your early career is going to be the most important time to save money for your retirement. With compound interest, the money that you put in your account in your 20s has about 40 years to accumulate, giving you a large return on your initial investment. Understandably, contributing a large portion of your paycheck is not attainable for most participants, but any contribution is better than none. Always aim to maximize your company’s match - it’s free money!
Level Up in Your 30s and 40s
You’ve already started your career; you’ve moved up and began earning more money than in your 20s, which means it’s time to increase your contributions. Bump up your percentage, and, if feasible, turn on auto-escalation to increase your contributions year after year. If you are still working on repaying loans such as auto or student loans, revisit your investment options annually and re-evaluate your options.
Close to the Finish Line: Your 50s and Early 60s
The time has finally come to start planning your retirement, but not so fast! You still have time to boost those savings before you fully retire from the workforce. After 50, you have the opportunity to contribute catch up contributions up to $7,500 (as of 2025) on top of the $23,500 usual limit for a total of $31,000. As a bonus, if you are 60-63, you can access an even higher limit of $34,750 for a “super” catch-up contribution1. If you maximize that extra bump, that is an extra $15,000, which could mean having an extra $100 per month for over 12 years.
No matter what age you are, saving for retirement is important for securing a financially stable future. Don’t know where to start? Reach out to your retirement planning specialist for help!
[1] This is an optional plan feature. Please check with your Plan Administrator to see if this option is available to you, through your employer-sponsored retirement plan.
Return to Participant Insights
For more information, contact a Financial Advisor today!
IMPORTANT DISCLOSURE INFORMATION
MCF Advisors, LLC (“MCF”) is a SEC registered investment adviser. Registration as an investment adviser does not imply a certain level of skill or training. The oral and written communications of an adviser provide you with information about which you determine to hire or retain an adviser. More information about the adviser can also be found by visiting: https://adviserinfo.sec.gov/firm/summary/130372. The above commentary is for informational purposes only. Information prepared from third-party sources is believed to be reliable though its accuracy is not guaranteed. This is not intended as an offer or solicitation with respect to the purchase or sale of any security. MCF may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. Please remember that past performance is not indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by MCF), or any non-investment related content, made reference to directly or indirectly in this blog/newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog/newsletter serves as the receipt of, or as a substitute for, personalized investment advice from MCF. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. MCF is neither a law firm nor a certified public accounting firm and no portion of this content should be construed as legal or accounting advice. A copy of MCF’s current written disclosure statement and customer relationship summary (“Form CRS”) discussing our advisory services and fees continues to remain available upon request. The scope of the services to be provided depends upon the needs of the client and the terms of the engagement. If you are a MCF client, please remember to contact MCF, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services.