How Much Should You Have Saved by 35? Expert Tips to Ensure You’re on Track

^{Source: The Federal Reserve’s “Survey of Consumer Finances” (2022), median transaction account balances by age group. Transaction accounts include checking, savings, money market, and brokerage cash accounts, and prepaid debit cards.}

In addition to what’s in bank accounts, the median saver under age 35 has these assets:

With the $5,400 in the bank, these amounts total $39,200. Additionally, this age group has a median retirement account balance of $18,880.

Regardless of these numbers, it’s important to note that there’s no universally correct amount to save. 

“Don’t compare yourself to others,” said Chloé Moore, certified financial planner (CFP) and founder of Financial Staples, a financial planning and investment management firm. “Just focus on yourself and make sure that you set good, intentional goals for yourself and that you work toward achieving those goals.”

Savings Targets to Aim For Before Hitting 35

To reach a savings goal, you first need to set one. You can start by tracking your income and expenses for a few months to see where your money goes and where you can improve. This can help you decide on a realistic target. A financial advisor can also help you set your goal and create a plan to reach it.

Moore generally recommends saving at least six months of take-home pay for an emergency fund, for example, but that varies based on personal circumstances. Instead of suggesting specific dollar amounts, she offers guidelines for her clients, many of whom are young tech professionals and first-generation wealth builders. 

She offers some tips to boost your savings habit:

• Start small: If saving six or 12 months of expenses sounds intimidating, she said, start by trying to save one month of living expenses. “Review your cash flow and just see if there are places where you can essentially save a little bit more each month,” Moore said.
• Add income: If you have valuable things or other possessions that you don’t need, Moore suggested that you consider selling them or look into getting a side hustle to generate more income if you can’t lower your expenses. 
• Have a plan: If you receive a lump sum of cash, whether it’s unexpected or something like a tax refund or bonus, know what you are going to do with it. “Try to have a plan for those before you receive them and not just think of it as free money that you can just spend,” Moore said. 

Accounts That Can Help You Grow Your Money Faster

You can grow your savings faster by choosing accounts that earn interest, such as high-yield savings accounts and CDs. 

For high-yield savings accounts, check out those with the highest savings account APYs available. In addition to the rates, look at the features of the accounts you’re considering. One feature that Moore likes is the ability to earmark savings for different goals.

“There are some accounts where you can set up an emergency fund bucket or a travel bucket or a down payment bucket,” Moore said.

If you have some money you can save without touching it, a CD can be a good additional option. CDs can earn higher rates than savings accounts in exchange for leaving your money for a set time period—usually anywhere from 3 months to 10 years. One key benefit of a CD is that the rate is fixed, so regardless of what happens with rates elsewhere, the amount you’ll earn when your CD matures is guaranteed.

If you open a CD with some of your money, you’ll want to use a hybrid strategy and keep some of your cash in a top high-yield savings account where it’s easy to access. If you have an unexpected need for your money, you can access the savings account funds first and possibly avoid cashing out your CD before maturity, which would trigger an early withdrawal penalty.