When Should You Start Saving for Retirement?

When should you start saving for retirement? It's not really a simple question to ask. Here are things to consider as you start planning for retirement.

A question I received on a regular basis as a stock broker was “When should you start saving for retirement?” We all have different ideas of what retirement will look like – ranging from those who want to retire early to those following a more traditional retirement model. Regardless of what approach you’ll take, saving for retirement is an incredibly important topic to consider. It goes without saying that due to this range, not to mention the particular specifics of each situation, retirement planning will look different for everyone.

This post springs from countless conversations I had with retail investors who were often struggling to make headway with their retirement planning. There were various reasons for this, but often times their challenges led back to a delay in saving for retirement. Added to that, there can be various issues related to investing for retirement – such as how to start investing in your 20s, investing while you have debt or if you waited until you’re older to invest. That being said, I believe the when should you start saving for retirement question has a relatively simple answer…


Start Saving for Retirement as soon as you Can


When should you start saving for retirement – now!  :-) This is ultimately the message many need to take to heart. I know life is often hectic, which makes it easy to fall into the mindset of thinking it’s ok to put off saving for retirement. Don’t get yourself caught in that trap! If your employer offers you a 401(k) plan, with a corresponding match it that is probably the best opportunity to start saving for retirement and why shouldn’t it be – it’s free money after all.

***Additional resource: Do you need help managing your 401(k)? With Smart401k, you can get free help managing your 401(k). Sign up through this link and use the word “Frugal” at checkout to get the service free for a year!***

I know there is an argument that if finances are tight that it’s good to bypass putting money into a 401(k) account. I would disagree with that on many levels, but ultimately falling back to not wanting to give up on the offer of free money for my retirement savings.

Unfortunately not all of us are offered a 401(k) plan or a match with our jobs, which can make saving for retirement, a little more difficult. If you’re in that situation, then generally the best option is to open a retirement account through an online brokerage. Many online brokerages, such as Etrade, allow you to start with no minimum balance. Simply put, anyone can do it.

Please don’t allow your lack of funds hold you back from saving for retirement. Even if you start out with something as small as $50 per month, start with that. Start putting that money in an IRA and allow time to do its thing and you’ll not only begin to develop a discipline of investing in the stock market, but you’ll also be actively involved in it. As someone who spoke with people on a regular basis who used this as a reason not to invest, please do not let that be you. In fact, the Center for Retirement Research shows that if you start investing at age 25 you have to put away one third of what those who start at 45 do for retirement. The moral of the story – start saving for retirement as soon as you can.

Retirement Planning is Just That…Planning


It can be difficult for many to start saving for retirement as it seems so far away. If you’re just out of college and investing that could mean as much as four or five decades – that is a lot of time. Whether you plan on pursuing the traditional retirement model, or something more entrepreneurial in nature, you’re best served by having an investment plan for your retirement savings.

That does not simply mean throwing your money into X number of the funds offered in your 401(k) plan, but taking active management of it and finding what works best for you. It means checking in on your investments on some sort of regular basis and making adjustments when necessary – essentially rebalancing your portfolio as the situation warrants.

There is no set interval for this; just do whatever works best for you as long as you’re doing it on an annual basis in the least. It is also important to keep in mind that your plan and needs will change as your life changes and your risk tolerance changes.

I know this might seem overwhelming. If you stay on top of it, it won’t be. There are free tools to use that makes staying on top of your investments relatively simple. One such tool is Personal Capital. Personal Capital allows you to monitor all of your investment accounts, making sure you’re in the cheapest options available, as well as tracking them against their benchmarks all for free. Think of it as a free, on-going, portfolio review. If you’d rather someone else to handle all of this for you, robo-advisor options, such as Wealthfront, handle all of this for you so you don’t have to worry about it.

What do you Want to Pass on?


As you’re just starting out investing in the stock market, with an eye towards retirement, this can be one of the most difficult things to keep in mind. I have always encouraged investors to look at what they want to pass on as they plan out their investing.

Speaking personally, I want us to be able to pass money on to our children. I want us to be able to help start a legacy for them and their children. Thus, we have to invest accordingly. Of course, this impacts other things beyond investing, such as frugal living and the like, but investing in the stock market plays a major role in that.

Beyond wanting to be able to provide for family members or friends, you can also think of any charities/organizations you want to be able to give to in later years. Doing so opens up a number of different possibilities and taken with passing wealth on to family members can really make saving for retirement more tangible for many. Of course, you likely want to give to organizations you support in the present, though is something you’ll want to consider as you might want to be more purposeful in later years.

When should you start saving for retirement? It's not really a simple question to ask. Here are things to consider as you start planning for retirement.

Saving for Retirement is a Marathon, Not a Sprint


If you’re struggling with when to start investing for retirement, please remember that time can be your greatest ally, but it can also be your worst enemy. Ultimately, so much of retirement planning comes down to time. While your retirement age may seem to be in the far off distance, you’ll do yourself no favors by putting off saving for retirement.

I think of it in this way, my wife is wanting to someday compete in a marathon. While I think she’s just a bit crazy to do that to herself, she can’t very well go out and run 26 miles at the drop of a hat. She needs to plan and prepare for weeks and months leading up to it so she can prepare her body to go through that stress.

Saving for retirement is very much like that as we don’t, generally, just wake up one day and have a fully funded retirement portfolio. It takes years of hard work and management to create a healthy retirement portfolio and bring it to the point that it’ll provide for those retirement years. With that in mind, please enter into your retirement planning with that mindset and you’ll be well served in the long run.

When did you start saving for retirement? Is there anything you wish that you would’ve done differently?


Additional resource: If you’re looking for somewhere to start saving for retirement with little money, you can open a Motif Investing account for as little as $250. I personally use Motif as they offer a great way to get started as well as allowing for instant diversification, not to mention promotions when you open a new account with them. 

Open a Motif Investing account today!


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I'm the founder of Frugal Rules, a Dad, husband and veteran of the financial services industry. I'm passionate about helping people learn from my mistakes so that they can enjoy the freedom that comes from living frugally. I'm also a freelance writer, and regularly contribute to U.S. News & World Report, Investopedia, Credit Karma and more. If you're wanting to learn how to monetize your blog, check out my blog coaching services to see how I can help you take your site to the next level.


  • I totally agree with you John, saving for retirement should be done as soon as possible and the early you start the better. Great post man, keep it up! :)

  • I think as long as you are putting SOMETHING in it’s better than nothing. Especially for 20-somethings who can’t even imagine retirement, it’s more important to just start putting a small amount into the 401k or an IRA.

  • As others have said, the sooner you start saving for retirement the better off you will be since you have time working for you for 30+ years.

  • I wish I would’ve started saving for retirement sooner, of course. We didn’t really start until our late 20’s. Better late than never?

  • Starting to save for retirement should started on DAY ONE of your first adult job. When I graduated from college and started my career, I had to fill out the tax paperwork, the direct deposit form, and oh yes the form that indicated how much I wanted to contribute to my 401K. It should just be automatic!

    • John says:

      I agree Travis. The problem is that there is so much lack of knowledge out there that many allow that to hold them back. Employers do not make it easy either with horrible 401k plans.

  • Kevin @ Reward Boost says:

    I definitely agree that saving money early is the best way to build a large nest egg for retirement. I started contributing to my 401k and maxing out my Roth IRA as soon as I graduated from college.

    However, over time things have changed a bit and now I’m more worried about putting money into creating a sustainable business than I am looking to save money to retire. I can “retire” a lot sooner (aka be self employed and be my own boss) if I direct money towards my business.

    • John says:

      That’s awesome you were able to start out so well and so early.

      Being a business owner myself, I can understand that shift in thinking. Here’s to hoping it works out for both of us. :)

  • Michelle says:

    Start saving NOW! :)

  • I started saving when I was 22 – only a couple of years ago for me. I admittedly didn’t save very much for the first year or so; now i have an okay amount in there but I am stepping it up.

    • John says:

      That’s awesome Daisy! It’s not so much the amount you’re starting with, but that you’re doing it in the first place. Starting early helps develop that discipline.

  • We been investing ever since we were married. I guess technically we started planning for retirement when we opened our first Roth IRA. We now have two Roths, a 403(b) and a Simple IRA (with a company match…hooray for that one!) that we regularly put money into. Biggest tip…start early like you said.

  • Matt Becker says:

    Great advice here. The absolute key take away has to be to start as soon as possible. Even if you don’t yet have an investment plan, don’t know how much money you’ll need, don’t know about kids, etc., just get started putting money away. You should definitely figure those things out, but until you do having money socked away will only help.

    • John says:

      Thanks Matt! I agree, having the plan helps, but don’t let that hold you back. Try and find some solid index funds and get started with what you can.

  • Monica says:

    Such an important question! Start saving RIGHT NOW! I kept telling myself I’d start saving for retirement 1) When I make more money 2) When I can afford it 3) some other random reason.

    But the truth is, I just procrastinated for about 5 years. I finanlly did start but I wish I did sooner!

    • John says:

      So many people face that situation Monica and before they know it they’ve lost a decade. That can equate to a boatload of money.

  • I started with my first real job. I only wish I’d set the thing to max out from the beginning. Going from a pauper salary, I would not have missed it. Starting early just gives you more options about when you want to retire and what you want retirement to be. I’ve already started our daughter with a Roth. I want her to earn things herself, but if I can get her started with a bit of a nest egg early one, I hope it will be easier for her. On the flip side, I guess she might cash out the money and join a polka band, but I have to hope we’re doing the right thing.

    • John says:

      I agree Kim, starting early gives you more options. That’s awesome you started your daughter with a Roth…though I’d make her promise not to cash out and join a polka band. 😉

  • I started putting money into my 401k plan immediately after getting my first job. My dad opened an IRA for me before I even started the job (I did have earned income from working in college and summer jobs). I’m glad I started early and it was probably thanks to my dad for his influence.

  • I started in my mid-20s when I first started working after university. It was just $25/ month. I definitely save a lot more now, but I wished I looked into investing in stocks sooner. I held most of my money in bonds and guranteed investment certificates. I just renewed the term, because I didn’t know what else to do. I

    • John says:

      That’s great you started so early and did not allow the small amount hold you back. That all helps and develops that discipline you have now. :)

  • Jake @ Common Cents Wealth says:

    I think it’s important to realize that it’s a marathon, not a sprint like you mentioned above. So many people don’t start saving because they don’t think they have enough money to start. This is a myth because even $20 a month will add up and who can’t afford $20 a month. Just eat out one less time a month and you have that covered.

  • Technically, I started saving once I got my first job and they gave me a 401k. I always have funded the 401k, but when I was paying off my debt, I didn’t invest in my retirement at all. I do regret it now, but I am working on catching up. I feel that I started just last year.

    • John says:

      That is a tough balance to walk Grayson and many do not even put money in their 401k. That puts you ahead of the game as far as I am concerned.

  • I started saving for retirement as soon as I got a full time job out of college. I wish I started earlier, but I never had any money. Hopefully, I can help our kid start very early.
    I’m not sure if I agree with the marathon thing. I like saving up as much as you can up front and slow down a bit later. That’s a sprint right?

    • John says:

      That’s awesome!

      I think you’re point about saving more early on and then slowing down is a good one and likely a more effective way to go about it. That said, unless you start out making a nice salary, starting out with more can be difficult for many. Even with the faster at the start mentality, it’s still a marathon – just at a different pace.

  • I opened my IRA as soon as I started my first job out of college.

  • pauline says:

    In France you need to have worked 40 years to retire. Used to be 37.5. Your retirement contributions are mandatory and taken off your paycheck. So if you work from age 18 you qualify for a pension at 58. If you don’t work enough you can get a partial pension but still have to wait the 40 years, no early retirement… I started at 18 with my first official paycheck but I have only 7 years or so between odd jobs, good thing jobs in the rest of the EU counted too.

    • John says:

      That sounds like quite the way to go Pauline! Does it count for your first job – say if you start working at 14 or 15? That would be pretty nice. :)

  • Troy says:

    I started investing when I was 18. Only wish I had done it sooner.

  • So true John! I want to say I started around 26 or 27. Of course my advice is what yours and probably a lot of other people’s is…start early even if it’s just a little.

  • I’m really lucky that I started saving for retirement when I was pretty young (20). I got in on some great stocks when they were low and I have earned around 16% since then on my whole portfolio. Too bad it was a relatively small pool of money to begin with!

  • jim says:

    It is so refreshing to hear this younger generation being so much smarter than my generation was re: investing for retirement. Of course, we didn’t have the internet back in the day and no “polite” person ever discussed money. Good for you guys. I wish you all the best. A word to the wise – it takes a really, really long time to build up enough of a nest’s egg to retire on and God help you during those inevitable crashes.

    • John says:

      I agree Jim, it does take such a long time (unless you come from money) to build up a retirement portfolio that is truly substantial. I’ve spoken to way to many investors who let the years slip by and the next thing they know it has been 10-15 years. Sure, you can try and catch up, but you’ll never get that lost time, in terms of compounding, back.

  • The only real answer is as soon as possible! It’s really amazing how even small amounts can compound and grow given enough time.

  • I completely agree that now is the best time to save for retirement. Not only that little bits saved now will grow strong and nice in 30 years or so, but it’s also great to have a good starting point. In today’s economy when nothing can be taken for granted anymore, having some funds put away to let you sleep at night is the way to go. I personally am more pessimistic and I don’t think that I will get the chance to enjoy too many years of retirement (if any) but I still have to start saving for retirement, just in case I am wrong :))

    • John says:

      I could not agree more. We shouldn’t allow for any of that to hold us back. I hope we’re wrong in being pessimistic, though I’d much rather be prepared as possible.

  • No Waste says:

    The only correct answer is…YESTERDAY!

  • Daniel says:

    I started investing the first day I started my first job out of college. I was enrolled in our 401k plan and I think I even contributed up to the max in my Roth IRA that very first year. I had student loan debt, but didn’t even grasp the concept at that point that people pay for things on credit and don’t have the money saved before spending it.

    • John says:

      That’s awesome you started so early Daniel! I think paying off debt/investing can be a challenging balance to manage. Kudos to you for not allowing it to hold you back.

  • I totally agree with you. Everybody should start as soon as he or she realizes it is necessary and everybody must realize it as soon as possible. And in this moment it is the parents responsibility to help their kids find out early, so they can start when they are in their early 20s. Not like me who acted like an idiot in the past and now has to change the marathon into a sprint to catch all those lost years. My train has left the station many years ago.

  • Derek Chamberlain with says:

    This is a great article. I’m in your same camp. Everyone should be saving as much money as they can now versus waiting for another day.

    It’s hard to convince people of this when there is all kinds of bad information out there. Marketwatch just ran an article today about why to avoid investing in a 401K. Argh!!!

  • MMD says:

    I completely agree that retirement planning is just that – planning! You never really know what’s going to happen, and you adjust along the way as you go. But overall you set your goals and try to achieve the big picture.

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