Are you saving enough to retire? See how your contribution compares to others like you

Even though younger generations are starting to save earlier than ever, typical savings are still not enough rest comfortably. Indeed, many may not even know about it.

“We ask people how much they think they need to save for retirement to feel financially secure. Then we ask them how they got to that number, and almost half say they guessed it,” Catherine Collinson, CEO of the Transamerica Institute, which surveyed 5,000 middle-class Americans about their readiness to retirehe said Investopedia.

Here’s how much a typical person in your age group or income group has saved for retirement.

Compare where you stand

Your retirement savings should increase as you age, but the amount you save in your 401(k) and other retirement accounts will change as your needs change and your life circumstances evolve. The study found that middle-class Americans in their 20s saved an average of $43,000, a number that increases with each decade to about $277,000 for people over 60.

Why such a large jump in median savings? Timing and compounding are on your side if you start early. “If you are younger and have more time, the time value of money and accumulation of investments is extraordinary,” Collinson said.

But there is another factor: the people in theirs years of peak earnings– typically people in their 50s and 60s – can contribute more aggressively when major expenses like mortgages and children’s education expenses come to an end. The study found that among middle-class Americans in their 60s, 16% had saved at least $1 million, compared with just 1% of people in their 20s.

Of course, income is the most important predictor of retirement savings. Vanguard customers with defined contribution accounts, e.g 401(k)s The average balance for those earning less than $15,000 is $4,055, while those earning $150,000 or more have $221,220, or more than 50 times as much, according to the Vanguard report.

The gap widens dramatically at higher income levels. Workers earning between $30,000 and $49,999 saved an average of $10,928, but jumped into the $50,000-$74,999 range, and the balance more than doubled to $27,528. Just look at the six-figure numbers and the numbers skyrocket: $98,434 for those earning between $100,000 and $149,999.

How to catch up

If typical savings data seem daunting, and if you’re behind on your retirement savings, there’s still time to make real progress, no matter when you start. The key is to turn vague goals into a concrete plan and eliminate the guesswork that many use.

There may be reasons beyond your control for you to have savings less than typical numbers. “Generation X is in retirement danger zone because they are less likely to have traditional pension. “If they were offered a 401(k) when 401(k)s come online, there would be a lack of public awareness of how absolutely crucial it would be for them to start saving earlier and build and grow their savings,” Collinson said.

Here are the steps experts often suggest to close the gap:

• In the 1920s and 1930s: Focus on consistency. Even small, automatic contributions to a 401(k) or IRA can have an avalanche effect over time due to compounding. Aim to increase your savings rate by 1% each year.
• In the 1940s and 1950s: Focus supplementary contributions. After age 50, the IRS allows you to add an additional $7,500 per year to your 401(k). Increasing your savings rate during your peak earning years can make a huge difference.
• At age 60 and beyond: Revisit yours withdrawal strategy. Delaying your Social Security claim or reducing your expenses in a timely manner can significantly extend the life of your savings.

At any age, if your employer offers: gamenever leave this “free money” on the table. Matching 50% of your contributions to 6% of your salary is effectively a guaranteed return.

Another key piece of advice, regardless of age or income: “Don’t beat yourself up,” Collinson said. You don’t have to tackle everything at once – break it down into manageable tasks. “Maybe you have a 10-step plan. If you take one step a month, by the end of the year you’ll have a plan that’s much better than if you did nothing.”