How Much of a Paycheck Should Go Toward Retirement?

••• enjoying retirement image by msw from

Make Manageable Deductions

Any amount you set aside from your paycheck for retirement offers long-term benefits. Decide on an amount to which you can remain committed, even when times are tough. Start with a small amount, such as 10 to 15 percent of each paycheck, and increase it if you get a raise.

Estimate Needs

Consider how much you think you'll need during retirement and how long you have to save, and set your paycheck deduction according to that estimate. Some people plan to live on 75 to 80 percent of their pre-retirement incomes, while others anticipate needing the same income during retirement.

Bottom Line

Your paycheck amount that you put toward retirement should be an amount that you can afford to save consistently. The amount largely depends on when you start saving. According to Schwab MoneyWise, save 10 to 15 percent of your paycheck if you start in your 20s, save 15 to 25 percent if you start in your 30s or save 25 to 35 percent if you start in your early 40s.