Retirement planning decade by decade

For some, retirement is a vague idea somewhere in the future. Others see it as a challenge to conquer, with the goal of retiring young. If you’re like most people, you probably fall somewhere in between.

The good news is you don’t need to figure everything out at once. Instead, focus on the steps to take now. Here’s how retirement planning can look in each decade.

Your 20s: Use time to your advantage

Early in your career, it can feel like more money is going out than coming in. Budgeting is new, and retirement seems like it’s a million years away. This decade is about building habits, and time is on your side. Even if you can only put away a little, the key is to start.

• Sign up for your workplace retirement plan. 
  If your employer offers a 401(k) with matching contributions, contribute at least enough to get the full match. It’s free money! If retirement savings are not part of your benefits, open an individual retirement account (IRA) to start saving. Use our 401(k) Investment Calculator to see how your retirement savings could grow.

• Consider a Roth. 
  Some retirement plans come in traditional and Roth versions. With a Roth, you pay taxes now while your income is lower. Then in retirement, withdrawals are tax-free. Our IRA Growth Calculator can help you compare options.

• Build financial basics.
  Now is a good time to start learning about investments, retirement plans, and your tolerance for risk. Find a financial advisor who listens to you and explains your choices in a way you understand.

Your 30s: Build momentum

By your 30s, you may be juggling a mortgage, family expenses, and student loans. Retirement still feels far-off, but this is the decade to increase your commitment.

• Boost your contributions.
  Aim for 10–15% of your income, including your employer match. If that’s not possible, contribute what you can and increase as you are able to.

• Take your retirement savings with you.
  If you change jobs, roll your 401(k) into your new employer’s plan or an IRA. Cashing it out can trigger penalties and taxes.

• Don’t cash out.
  As your balance grows, you may be tempted to use it for today’s expenses. Resist the urge. Your future self will thank you.

Your 40s: Keep up the good work or catch up if needed

These are usually your peak earning years and often your peak expense years, with kids, aging parents, and household costs. Stay the course and contribute what you can.

• Check your progress.
  Use our Retirement Planning & Savings Calculator or your account statements to see if you’re on track.

• Refine your investments.
  Keep a mix of stocks and bonds that matches your risk tolerance. Don’t be swayed by short-term market swings.

• Use catch-up strategies.
  If you got a late start, increase your contributions whenever you get a raise or bonus. Even small amounts add up.

Your 50s: Step up your savings

In your 50s, the IRS allows you to make catch-up contributions. In 2025, that’s an extra $7,500 on top of the $23,500 limit for younger savers.

• Maximize your contributions. 
  Take advantage of higher IRS limits.

• Pay down debt.
  Your savings will go farther when you’re debt-free.

• Estimate your expenses. 
  Consider housing, healthcare, and lifestyle costs and plan from there.

Your 60s and beyond: Transition to retirement

Currently, the average retirement age is 62 . Careful planning now will help your money last.

• Decide when to claim Social Security.
  Waiting past age 62 increases your benefit, with the maximum reached at age 70.

• Enroll in Medicare on time.
  If you miss the 7-month window around your 65th birthday, you could face long-lasting penalties and coverage delays.

• Adjust your investments. 
  Many people move toward a more conservative mix, but don’t eliminate growth potential entirely. Your money may need to last 20–30 years.

• Plan your withdrawals.
  Know which accounts to tap first to minimize taxes.

Start where you are.

Retirement planning isn’t about hitting a perfect number with every paycheck. It’s about making steady progress over time. Use Flagstar Wealth Services within Flagstar Bank as a resource, too. For generations, their financial consultants have helped individuals, families, and businesses plan for today and tomorrow.