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Retirement Savings Starting at Age 42

Retirement at 65 after starting at 42 gives 23 years to save. See the balance for $500 a month at 6.5 percent.

On the starting figures the balance at 65 is $317,666. Growth accounts for 57 percent of it.

years
years
$
$
%
Balance at retirement
$317,666
Total you put in
$138,000
Growth
$179,666
Years of saving
23
Year by year
YearTotal put inBalance
43$6,000$6,182
44$12,000$12,778
45$18,000$19,816
46$24,000$27,325
47$30,000$35,337
48$36,000$43,886
49$42,000$53,007
50$48,000$62,739
51$54,000$73,122
52$60,000$84,202
53$66,000$96,023
54$72,000$108,636
55$78,000$122,093
56$84,000$136,452
57$90,000$151,772
58$96,000$168,119
59$102,000$185,560
60$108,000$204,169
61$114,000$224,025
62$120,000$245,210
63$126,000$267,815
64$132,000$291,933
65$138,000$317,666
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How the balance is worked out

Turn the yearly return of 6.5 percent into a monthly rate of 0.5417 percent by dividing by twelve. Apply that rate to the balance once a month for 276 months. Add $500 at the end of each month. Nothing else goes into the result.

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Worked example

A saver aged 42 who puts $500 a month into a retirement account until 65 makes 276 deposits of $500. At 6.5 percent the balance reaches $317,666.

Growth supplies 57 percent of the final amount. That is $179,666 that you did not have to deposit.

Questions about this calculator

How much does waiting 5 years cost when saving $500 a month from age 42 to 65 at 6.5 percent?

Starting at 47 with the same $500 ends at $204,169 instead of $317,666. That is $113,497 less.

How much a month would it take to reach $1,000,000 by 65 from age 42 at 6.5 percent, compared with $500?

About $1,574 a month at 6.5 percent. That is $1,074 more than the $500 in the example.

What if you saved double, $1,000 a month, from age 42 to 65 at 6.5 percent?

The balance at 65 would be about $635,332 instead of $317,666. That is 2 times as much.

What if returns averaged 5 percent instead of 6.5 percent for $500 a month from age 42 to 65?

The $500 a month would reach $258,079 by age 65. That is $59,587 less than the $317,666 shown at 6.5 percent.

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This page is for education only and is not financial or tax advice.