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You're 30 Years Old. Here's How Much You Need to Save to Retire a Millionaire. A comfortable dotage requires being a bit less comfortable in your youth and middle years.

By John Rampton Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

Jose Luis Pelaez Inc | Getty Images

Americans aren't exactly known for their saving skills. In fact, 69% have less than $1,000 in savings. Even worse the Economic Policy Institute (EPI) reported that "nearly half of families have no retirement account savings at all."

Considering that it's recommended that the average American who is near retirement should have around $1.3 million in savings, this is a big problem.

But, it's not impossible. Remember, a million dollars is just an arbitrary number. You may need more or less than that figure. It depends on how much you need to live comfortably.

That still doesn't mean that you should be neglecting your retirement. You still need a plan for retiring and should start sooner than later - preferably in your 20s. This will make it much easier to reach that million-dollar goal since you'll be enjoying the benefits of compound interest.

However, it's still completely possible to become a millionaire by the time you retire if you don't start until you're 30. And, to accomplish this, here's what you'll need to save.

How a 30 Year Old Can Retire as a Millionaire

NerdWallet came-up with a handy chart that illustrates how much you'll need to put aside each day, month and year in order to have $1 million saved by the time you're 67. The personal finance site assumed that this is if you have nothing saved. It also assumes various average annual investment returns. I've added a few of my own variations to it to help you out.

A four percent annual return (I've found this one the most realistic):

  • $33 per day
  • $982 per month
  • $11,769 per year

A six percent annual return:

  • $21 per day
  • $610 per month
  • $7,413 per year

An eight percent annual return (not likely to get for unsofisticated savers like myself):

  • $12 per day
  • $366 per month
  • $4,552 per year

A 10 percent annual return:

  • $7 per day
  • $213 per month
  • $2,755 per year

Overall, here's how much a 30-year old would have to save if they earn:

  • $40,000: 18.3 percent of each paycheck
  • $60,000: 12.2 percent of each paycheck
  • $80,000: 9.2 percent of each paycheck
  • $100,000: 7.3 percent of each paycheck
  • $120,000: 6.1 percent of each paycheck

I typically see people earning more in their paycheck putting away less and less. This should not be the case as these people need more than the average people to retire. If you're earning $100,000+ a year, I'd imagine that you will need more than $1,000,000 to retire to maintain the same lifestyle as before. Up those numbers as social security and your savings will not keep you where you're at.

A general rule of thumb that I encourage all my friends is to save/invest 10 percent and 15 percent of your income for retirement. If you're earning $150,000 a year, goal would be to save $15,000 to $25,000 each and every year. That's $2000 after taxes. This will require budgeting, I even go so far as setting up calendar reminders to remind me to save. This along with automatic withdrawals from primary checking into savings with each check I get.

"Setting up a savings goal linked to your income can help simplify your planning, and help you determine if you are on track throughout your working life," says Ken Hevert, Fidelity senior vice president of retirement. "Having a guidepost is particularly important in today's workplace, where job switching, and life's inevitable twists and turns, can get in the way of saving for retirement."

Brad Kingsley over at Maximize Your Money adds that at a 9% average annual return on the money, which is less than total average annualized returns of the S&P 500, you would need $339/month. This is actually an achievable amount for most 30 year-olds.

Put Your Money to Work

While setting aside couple of hundred bucks each month is a start, you also need to put your money to work.

The first place to start is by investing in your employer's 401(k) plan, which is a tax-advantaged retirement savings account. Next, look into alternate retirement savings accounts. This could be a Roth IRA, traditional IRA, and/or a health savings account.

Warren Buffett is a fan of low-cost index funds. There's online investment platforms known as robo-advisers and money apps like Acorns, Robinhood, and Tip Yourself that automate your savings to help you achieve your financial goals.

I would also suggest that you side hustle or look for ways to start earning money passively. Having multiple streams of income is a tried and true method of increasing your chances of becoming a millionaire.

Final Words of Advice

Retiring as a millionaire isn' far-fetched - even if you don't start saving until later. It just takes having a plan of action and the discipline to follow it through.

It also involves being prepared. Padding your savings account for a home or emergency can prevent you from dipping into your retirement savings. And, having more than once source of income ensures that you'll have enough money to set aside for retirement.

If you're still unsure on how much you'll need to retire, there are several retirement calculators from CNN, Bankrate, Vanguard, and InvestingAnswers.

John Rampton

Entrepreneur Leadership Network® VIP

Entrepreneur and Connector

John Rampton is an entrepreneur, investor, online marketing guru and startup enthusiast. He is founder of the online invoicing company Due. John is best known as an entrepreneur and connector. He was recently named #3 on Top 50 Online Influencers in the World by Entrepreneur Magazine and has been one of the Top 10 Most Influential PPC Experts in the World for the past three years. He currently advises several companies in the San Francisco Bay area.

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