3 Ways To Think About Retirement Savings

investing retirement Feb 11, 2026

When it comes to retirement savings, one of the most overwhelming questions people ask is:

“How much is enough?”

The honest answer? It depends. But there are a few helpful frameworks that can give you guardrails as you think about long-term planning.

Today, we’re exploring three common ways to think about retirement savings:

“Enough Is Enough” (Lifestyle-Based Planning)
The 10x Salary Rule
The Rule of 25

Each approach answers the same question from a different angle.

1. “Enough Is Enough” (Lifestyle-Based Planning)

This approach starts with a simple but profound question:

What kind of life do I actually want to live?

Instead of focusing first on a dollar amount, this method asks you to imagine your future lifestyle.

Where will you live?
Will you work part-time?
Do you want to travel often?
What healthcare costs might you anticipate?
Do you plan to give generously?

From there, you estimate your annual retirement expenses. Many planners use the 70–80% income replacement guideline as a starting point (meaning you may need about 70–80% of your pre-retirement income annually), but your actual number depends on your desired way of being.

If you determine you’ll need $60,000 per year in retirement, that becomes your anchor.

This approach is powerful because it aligns your savings with your values. It asks not, “What’s the magic number?” but rather, “What kind of life am I building toward?”

2. The 10x Salary Rule

The 10x Salary Rule is straightforward: Aim to have 10 times your annual salary saved by retirement (often by age 67). So if you earn $80,000 annually, the target would be: $800,000 saved by retirement.

Many financial institutions suggest milestone markers along the way (for example: 1x salary by 30, 3x by 40, 6x by 50, etc.).

This method works well because it’s:

Simple
Easy to calculate
A helpful benchmark for progress

But it assumes a relatively stable income over time and doesn’t always account for pensions, Social Security, inheritance, or dramatic lifestyle differences.

Think of it as a ballpark estimate, not a verdict.

3. The Rule of 25

The Rule of 25 is rooted in what’s often called the 4% rule. It works like this:

Estimate how much you’ll spend annually in retirement.
Multiply that number by 25.

That total is the amount you’d need invested to sustainably withdraw about 4% per year.

For example:

If you need $60,000 per year →
$60,000 × 25 = $1.5 million

The theory is that withdrawing 4% annually from a diversified portfolio gives you a strong probability of not outliving your money over a 30-year retirement.

This method is especially popular among financial independence communities because it ties your savings target directly to your spending.

It shifts the question from: “How much do I need to save?” to “How much do I need to live?”

So… Which One Is Right?

Here’s the truth: none of these are perfect. And none of them are wrong.

They are simply different lenses:

Enough Is Enough → Values-first and lifestyle-centered
10x Salary → Income-based benchmark
Rule of 25 → Spending-based calculation

If you’ve been building out your financial approach through something like the My Money Mosaic framework, you might notice your preference here reflects your broader financial design:

Those who love structure may gravitate toward the 10x rule.
Those who value flexibility may prefer the lifestyle approach.
Those who love measurable independence may resonate with the Rule of 25.

The key is this:

Retirement planning isn’t just math. It’s imagination + discipline + time.

A Final Word

You don’t need a perfect number to get started. You need:

A starting estimate
A long-term investing strategy
Consistency
The humility to adjust along the way

Retirement savings is less about hitting one exact figure and more about building a life that feels stable, generous, and aligned with who you are becoming. Start with one framework. Run the numbers. Then refine as your life evolves.

Because ultimately, retirement isn’t about stopping work.

It’s about having enough to choose what comes next.

Disclaimer: This article is for educational purposes only and does not constitute individualized financial advice. Consider consulting a licensed financial professional before making investment decisions.