How Long Will My Money Last in Retirement?

From unexpected costs to lifestyle choices, your retirement savings could go further than you think if you play it right.

an elderly couple sits near a beach, enjoying their retirement money

Author: Justin Estes
Last updated: June 2025

Staring sleepless at the ceiling, tallying dollar signs? You’re not alone. Retirement should feel like freedom, yet the fear of outliving your nest egg sneaks in after lights-out.

Net-net, longevity of your savings boils down to three levers: what you spend, how you live, and how diligently you saved on the way up. Nail those, and you can craft a retirement that’s both worry-proof and joy-rich.

Key Takeaways

  • Follow the 4 % rule: A 4 % annual withdrawal rate—about $40k a year from a $1 million portfolio—has a high probability of stretching your savings roughly 30 years.

  • Mind the big-ticket expenses: Housing, healthcare, food, transportation, property taxes, and HOA fees (plus surprise repairs and medical bills) are the real drivers of how quickly your nest egg drains.

  • Hit the savings checkpoints: Aim for ~3× your salary saved by 30, 6× by 40, 8× by 50, and 10× by 60 to stay on track for a long retirement.

  • Start early to harness compounding: Investing just $200/month from age 25 can snowball to nearly $500k by 65 at a 7 % return—waiting until age 40 slashes that outcome dramatically.

  • Control the three levers: How long your money lasts ultimately depends on (1) disciplined saving, (2) smart spending/lifestyle choices, and (3) flexible withdrawal adjustments as markets and lifespans evolve.

How Much Do You Need To Retire?

What you need for retirement depends largely on your spending and your expected lifespan. One practical rule of thumb is the 4% rule. This suggests you can withdraw 4% of your savings annually, and your money should last about 30 years. Here's what that looks like:

  • $500,000: Gives you about $20,000 each year

  • $1 million: Provides around $40,000 yearly

  • $2 million: Allows for $80,000 per year

These numbers shift based on how your investments perform, what you spend, and those curveballs life throws your way. If you need $60,000 yearly from a $1 million nest egg, your money might only stretch 20 years instead of 30. And if you retire at 55? Your savings need to last potentially 30-40 years, which means being even more careful with withdrawals.

Monthly Expenses That Impact Retirement Savings

Your everyday costs play a huge role in how far your retirement money will go. Here are the main expenses most retirees face:

  • Food: Typically runs $500-$1,000 monthly, depending on what and where you eat

  • Housing: Usually costs $1,500-$3,000 monthly, covering your mortgage or rent, utilities, and keeping your place in good shape

  • Car Expenses: Around $500-$800 monthly for car payments, insurance, gas, and repairs

  • Health Insurance and Medical: Often exceeds $500 monthly, with unexpected procedures potentially costing thousands

  • Property Taxes: Generally $2,000-$10,000 yearly, varying widely based on where you live

  • HOA Fees: Typically $100-$500 monthly, if you live in such a community

Don't forget those expenses that tend to slip through the cracks—fixing the roof, dental work, mobility aids, or hiring help around the house. These costs often pop up when least expected and can throw a wrench in your budget. Planning for these ahead of time helps protect your nest egg and gives you room to actually enjoy your retirement years.

Retirement Savings by Age

When it comes to saving for retirement, starting early gives you a massive advantage. But what should your savings look like at different points in your life? Here's a practical guide to help you stay on track for a retirement that lets you sleep at night.

In Your 20s: Start Strong

Your 20s are full of possibilities, and retirement probably feels like something from another lifetime. The truth is, though, this decade matters most for building your nest egg. The earlier you start, the more time your money has to grow.

Think about this: if you put away just $200 monthly starting at 25 and keep at it until 65, with an average 7% yearly return, you'll have nearly $500,000 waiting for you. That modest $200 monthly doesn't seem like much now, but over 40 years, it turns into serious money.

Bottom line: Try to save at least 10-15% of your paycheck for retirement in your 20s. It may not feel like much now, but this habit paves the way for bigger contributions later.

In Your 30s: Step It Up

By 30, you probably have more breathing room in your budget and fewer financial fires to put out. This is the perfect time to increase what you're saving and focus on growing your investments.

Start maxing out tax-advantaged accounts like 401(k)s or IRAs—especially if your employer offers a match. That's literally free money on the table.

If you can sock away $500 monthly from ages 30 to 65 (with that same 7% return), you'll have about $900,000 by the time you retire. That's almost double what saving $200 monthly in your 20s would give you.

Where you should be: In your 30s, aim to have 3x your yearly salary saved. Earning $50,000? Your target should be $150,000 saved before you hit the big 4-0.

In Your 40s: Get Serious

Now retirement no longer seems like science fiction, and you might be wondering how to catch up if you've fallen behind. Don't panic—there's still plenty of time. But you will need to buckle down in your 40s to build a substantial retirement fund.

Saving $1,000 monthly starting at 45 could grow to over $1.2 million by 65. Yes, it's a chunk of change each month, but future you will be grateful.

Your checkpoint: At 40, try to have 6x your yearly salary tucked away. This helps you know if you're still on the right track.

In Your 50s: Max Out Everything

In your 50s, you can probably see retirement on the horizon, and it's time to kick savings into high gear. You now qualify for catch-up contributions—extra money you can put into 401(k)s and IRAs after 50. This is a perfect chance to boost your savings, especially if you've been playing catch-up.

If you can save $2,000 monthly in your 50s, you might reach $1.5 million by retirement, depending on your returns. Those catch-up options let you save beyond normal limits, helping fill any holes in your retirement plan.

Target to hit: by 50, shoot for 8x your yearly salary. If you make $75,000, that's around $600,000 saved by 50. You're in the final stretch—make every dollar count.

In Your 60s: Protect What You've Built

By 60, you're likely within a few years of retirement, so it's time to fine-tune your plan and position your savings to keep growing while protecting what you've built. Consider shifting toward more conservative investments as retirement approaches to avoid market roller coasters.

Saving $2,500 monthly in your 60s could build a nest egg of over $1.8 million by 65, assuming that 7% return holds. At this point, focus more on keeping what you've earned rather than chasing aggressive growth.

Finish line: By 60, aim for 10x your salary saved for retirement. That cushion will make a world of difference once you stop working.

Why You Should Start Saving for Retirement Now

Waiting to save means missing the power of compound interest, which becomes your best friend when building wealth. If you start investing at 25 and put away $200 monthly with a 7% return, you'd have nearly $500,000 by 65. Wait until 40 to start, and you'll end up with far less.

Even small contributions make a huge difference when given enough time to grow. Start today, invest wisely, and your future self will thank you.

Make Sure Your Money Will Last In Retirement

Running out of money in retirement isn't inevitable. By planning ahead, adjusting your spending, and making smart investment choices, you can enjoy retirement without money stress. Understanding how long your money will last takes honest planning and keeping your eyes open financially. With a solid strategy, your savings can last longer than you might think.

The key? Start now! Whether retirement is five years away or 30, what you do today shapes how comfortable your future will be. Prioritize smart saving, and you'll build a retirement that lasts as long as you need it to.