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4 Ways to Get Your Retirement on Track in Your 30s


It’s natural for your financial priorities to shift once you reach your 30s. Instead of living on a broke college student’s budget, you’re likely earning more. And if you haven’t done it already, now is the time to start building your nest egg. Even though your retirement is still decades away, there are some steps you’ll need to take to plan for your golden years.

Find out now: How much do I need to save for retirement?

1. Get Your Spending in Check

Bringing home a bigger paycheck in your 30s is great but only if you’re using the extra cash wisely. If your spending increases every time your salary does, you’re not leaving yourself enough room to save. Making some cuts to your budget might not appeal to you, but it can benefit your financial health in the long run.

Aside from doing things like cutting your cable bill or eating out less, you’ll also have to consider reducing your largest expenses. If housing is eating up a big part of your pay, for example, you might want to think about moving someplace cheaper or taking on a roommate or two. The more trimming you do, the more money you can funnel into your retirement accounts.

2. Whittle Down Your Debt

4 Ways to Get Your Retirement on Track in Your 30's

Spending every penny you make is bad enough but what’s worse is using a credit card to pick up where your paycheck leaves off. If you’ve fallen into the credit card trap, you’ll want to break free of it before the big 4-0 rolls around.

On average, earnings for women and men usually peak at ages 39 and 48, respectively. If you’re still carrying around high-interest debt, you’re making it much harder to capitalize on a bigger salary. If you’ve actively cut back on spending, the next step is using the extra money in your budget to knock out expensive debt.

Check out our credit card calculator.

3. Recognize Where You Are

If you think you’ve been diligent about saving, it may be time for a reality check. A recent analysis from the Employee Benefit Research Institute says that investors in their early 30s have saved up a median of $7,661 in IRA accounts. If you’ve got less than that saved, it might be time to step up your game.

The actual amount you’ll need to set aside will depend on factors like your income, the amount you’ve already socked away, the year you plan to retire and the kind of lifestyle you’d like to live once you stop working. Our calculator will show you how much you’ll want to save.

Here’s an example. Let’s say you’re 35, you’ve got $42,000 in your 401(k) and you plan to retire in 30 years with $1 million saved. To hit your target, you might need to save a little over $1,000 a month. By comparison, someone who’s 32 with that same balance might need to save around $935 a month to reach the $1 million mark by age 65.

Knowing where your starting point is can make it easier to work toward reaching your savings goal.

Try out our 401(k) calculator.

4. Don’t Be Afraid to Take Risks

4 Ways to Get Your Retirement on Track in Your 30's

When it comes to saving for retirement, time is on your side and the younger you are, the more of a gamble you can afford to take with your investments. That means potentially earning bigger returns with riskier investments like stocks rather than playing it safe with bonds.

You’ll need to consider your risk tolerance in order to figure out how to allocate your assets. If you don’t know where to start, you can use your age as a guide. Generally, experts say you can take on more risk the further you are from retirement.

The more risk you’re comfortable with, the more growth you’ll potentially see, assuming that your investment fees are low. That extra growth early on can make a huge difference in the size of your nest egg and the kind of retirement lifestyle you’ll be able to enjoy.

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