Saving for retirement doesn’t happen overnight. Or over a year. Or over the course of just a few years. It requires starting early, having a mindful strategy and ideally hitting some key milestones along the way. After all, you don’t want to wind up on the wrong side of some of these scary financial statistics about retirement:

  • 1 in 3 Americans have nothing saved for retirement,
  • More than half of Americans have less than $10,000 saved for retirement, and
  • Over 60% of working households (of age 55-64) have less than one times their annual income in retirement savings.

So how do you build up your retirement savings, along with improving your overall financial health, to ensure you’re set up for success – both now and in the future? It’s actually quite simple – have a plan, stick to it, check in periodically and stay the course.

Remember, it’s a marathon – not a sprint – and just like IF you were to run an actual marathon (or a half marathon… or a 5K for that matter), it requires proper training to ensure your body - and your mind - are both focused and in shape. As you train, you need to work up to the end goal, whether it be a race or a comfortable retirement. You may run shorter races to work up to the longer one. You may learn from others who have successfully achieved your goal. And although it’s important to build up your stamina, it’s also just as important to implement healthy habits to keep you going. This same idea is true in your run toward retirement. It requires healthy habits, hitting milestones and mental toughness and discipline to achieve this important goal.

To do so, here are some general milestones you can reference to ensure you’re on pace for the whole retirement run, along with other healthy financial habits to keep in tip-top financial shape along the way:

By the time you’re 30 (in your 20s):

  • Shoot to have half of your annual salary saved in a retirement plan. For example, if you make a $60,000 salary, then you would have $30,000 saved in a retirement plan.
    o Another gauge on your retirement progress is to shoot to put away around 10%-15%. If contributing less than 10%, you’ll want to bump this up by the time you’re 30.

  • Additionally, other healthy habits include:
    o Prioritize your emergency fund. This is typically between three to six months of living expenses, in case of emergency. It’s important to stash this away early so you are prepared in case you need it.
    o Set financial goals, and save! Begin thinking (and documenting) what’s important to you. Note this can – and probably will – change over time, but it’s important to start a plan early. It can include things like: traveling, new car, home purchase, etc. Be sure to include a target timeframe and dollar amount so you can begin saving for it.

By the time you’re 40 (in your 30s):

  • By now, you should have saved twice your annual salary for retirement. Taking the $60,000 example again, that means you would have $120,000 in a retirement plan.
  • Other healthy habits include:
    o Eliminate debt (that is, non-mortgage related debt). From credit cards to student loans to car loans, you may have some consumer debt that needs to get tackled. Take action to pay this debt down or completely eliminate it.
    o Think ahead for education costs. It’s no surprise that education costs continue to rise. If you have children, don’t put off saving for their future. Start a 529 plan and have a plan for what you will contribute.

By the time you’re 50 (in your 40s):

  • At this point, you should shoot to have four times your annual salary saved for retirement. If you’re still making a $60,000 annual salary, then you should have $240,000 saved.
    o Take the time to meet with a financial professional (if you haven’t already) to ensure you will have enough saved for retirement. If needed, make a plan to take advantage of any catch-up contribution limits, starting at age 50.
  • Other healthy habits include:
    o Revisit your mortgage. Ideally your consumer debt is now well behind you and you can pay some extra to your mortgage. This will help your balance go down quicker so it won’t be taking too much of your retirement funds when that time comes.
    o Cover your loved ones. Now is a good time to ensure your loved ones are taken care of – specifically, you can revisit your life insurance and will. It is also a good idea to look into long-term health care insurance so you aren’t scrambling in case it is ever needed.

By the time you’re 60 (in your 50s):

  • For retirement, you should shoot to have six times your annual salary.
    o At this point, you should meet with a financial professional to fine-tune your retirement goals and current strategy. Again, if catch-up contributions are needed, now is the time to make it happen.
  • Other healthy habits include:
    o Plan for any upcoming changes or events. Now that you’re quickly approaching retirement, make a plan for any changes or future plans you see coming. For example, you may wish to downsize your home. Or knock some travel destinations off your bucket list. Perhaps you have a wedding to pay for. Establish a plan and timeline to make it happen, and ensure it is budgeted for.
    o Enjoy the ride. You’ve trained hard for this well-deserved home stretch. Reap the rewards and feel confident about the discipline and hard work you’ve put in to accomplish this milestone.

This is a sample training schedule you can adapt to fit you and your lifestyle. Even with a solid roadmap, you can still make a wrong turn or get off course. Remember to always keep the finish line and your end goal in mind. It’s not a sprint – it’s a marathon – and you’re going to crush it!

ISU Credit Union's Banzai Online Financial Wellness program is an amazing resource to help you through your many stages of life!