Retirement Readiness Score
Find out if your retirement savings are ahead, on track, or behind — and what to do about it.
Are You On Track for Retirement?
The average American retires with $255,200 in savings (Federal Reserve SCF), but the recommended amount is 10-12x your final salary. For someone earning $75,000, that's $750,000-$900,000. The gap between reality and recommendation explains why 46% of Americans worry they won't have enough for retirement (Gallup 2025). This decision tool scores your readiness from 0 to 100, shows your projected balance at retirement, and tells you exactly how much to adjust if you're behind.
The key insight most people miss: retirement savings is not primarily about how much you earn — it's about how early you start and whether you maintain contributions through life disruptions. A 25-year-old saving $300/month at 7% returns accumulates $720,000 by age 65. A 35-year-old must save $620/month to reach the same amount. And a 45-year-old needs $1,400/month. Every year of delay doubles the required monthly contribution.
Fidelity's Age-Based Savings Benchmarks
Fidelity Investments recommends these savings milestones relative to your annual salary: 1x salary by age 30, 3x by 40, 6x by 50, 8x by 60, and 10x by 67. If you earn $80,000, you should have approximately $240,000 saved by age 40. These targets assume you begin saving at age 25, save at least 15% of income annually (including employer match), invest in a balanced portfolio, and plan to retire at age 67.
If you're behind, don't panic — but do act urgently. A 40-year-old with $100,000 saved (versus the $240,000 benchmark on $80,000 income) can close the gap by increasing contributions to $1,200/month ($14,400/year). With employer match, that's often achievable at 15-18% of gross income. The 2026 401(k) contribution limit is $23,500 ($31,000 if 50+, or $34,750 if 60-63 under the enhanced catch-up from SECURE 2.0 Act).
How Life Events Derail Retirement — And How to Recover
Divorce at 40: Losing half of retirement savings ($120,000 of a $240,000 balance) costs approximately $690,000 in retirement wealth at age 65 (at 7% growth over 25 years). Recovery strategy: maximize 401(k) contributions immediately ($23,500/year), utilize catch-up contributions when eligible at 50, consider Roth conversions during the lower-income divorce year (you're in a lower bracket temporarily), and ensure the QDRO is filed promptly to secure your share. See our 401(k) Divorce Guide.
Job loss at 45: A 12-month gap in retirement contributions at age 45 costs approximately $52,000 in retirement wealth at 65. The critical mistake is cashing out your 401(k) — resist this at all costs. Leave the balance in your former employer's plan or roll to an IRA. If you absolutely need cash, take a QDRO distribution if available (penalty-free) or borrow from family before touching retirement funds. The compound growth loss from a $50,000 cashout at 45 is approximately $200,000 by age 65.
Career change at 38: Switching careers often means a 6-12 month period of reduced or zero retirement contributions. Our Retirement Gap Analysis shows this creates an average $47,000 gap at age 65. The most impactful mitigation: maintain even $100/month in IRA contributions during the transition. This preserves the savings habit and reduces the total gap by 30-50% through continued compound growth. Voluntary career changers typically earn 15-25% more within 3 years, making accelerated catch-up contributions feasible once reestablished.
The 4% Rule and Your Magic Number
This decision tool uses the 4% rule to determine your target savings: the amount you need to safely withdraw 4% annually and not run out of money over a 30-year retirement. The formula is simple: multiply your desired annual retirement income by 25. If you want $60,000/year in retirement (80% of a $75,000 salary), you need $1,500,000. If you expect $25,000/year from Social Security, you need to fund the remaining $35,000/year from savings, requiring $875,000.
The 4% rule was derived from historical market data (the "Trinity Study") and has been validated across multiple market conditions. However, recent research suggests that a 3.5% withdrawal rate may be more appropriate for early retirees (before age 60) or periods of elevated market valuations. The decision tool uses 80% income replacement as the default target, which accounts for reduced expenses in retirement (no commuting, no retirement saving, potentially no mortgage).
How This Tool Works
Enter your current age, income, total retirement savings, monthly contributions, and target retirement age. The decision tool projects your balance at retirement using 7% average annual returns (the historical real return of a diversified stock/bond portfolio), then compares it to your target based on the 4% rule with 80% income replacement. Your score (0-100) reflects the percentage of your target you're projected to reach. A score above 90 means you're on track; below 50 means you need to significantly increase contributions or delay retirement.
The "additional monthly contribution needed" calculation shows exactly how much more per month would close the gap. This number gets smaller the earlier you start and larger the longer you wait — every year of delay increases the required adjustment by approximately 10-15%. For a comprehensive retirement planning strategy during a life transition, explore our Protecting Retirement in Divorce Guide and our Roth Conversion Strategy Guide.
Sources: Fidelity Investments, "Retirement Savings Assessment" (2025). Federal Reserve, "Survey of Consumer Finances" (2022). Bengen, W., "Determining Withdrawal Rates Using Historical Data," Journal of Financial Planning (1994, updated 2024). Social Security Administration, benefit projection tables (2026). SECURE 2.0 Act contribution limits.