How much money should you have saved by age 40?

Throughout our lives, we may often think about early retirement or whether we have saved enough for our future. This latter question, especially, tends to arise around the age of 40, when many savers wonder if they have saved enough to handle future responsibilities and financial goals.

In this article, we will cover everything you need to know, offering a complete practical guide to help you understand how much you should have saved by this age and what factors influence this amount.

The importance of saving at 40

By the time you reach 40, you enter a critical phase in financial terms. This is often the stage where many have achieved job stability. This stability should reflect in accumulated savings that can support both the present and future years. However, this is not always the case, and there are those who, at 40, still face obstacles and tighten their belts to try to live comfortably.

Turning 40 is a good time to review long-term goals, such as retirement, as well as mid-term goals, such as funding your children’s education or purchasing a home.

At this age, savers should have a clear direction and a plan to set and pursue their goals effectively.

Factors influencing the amount of savings

However, focusing on the idea of saving, achieving goals, or knowing what you want in the future does not necessarily guarantee success. In fact, several factors affect your ability to achieve this objective.

Lifestyle and personal expenses

Spending habits and lifestyle play a fundamental role. Those who lead a frugal lifestyle will have more room to save than those who spend on luxury items or maintain a high level of consumption.

Income and job stability

Both job stability and income growth directly affect how much money you can save. If you’ve progressed in your career, you’ve likely had the opportunity to increase your savings in recent years.

Family responsibilities

Family obligations, such as childcare or caring for dependents, can reduce your capacity to save. However, careful planning can help balance these commitments with your financial goals.

General savings recommendations at 40

A common recommendation is that you should have saved the equivalent of three times your annual salary by the age of 40. This ensures a solid financial cushion for future contingencies and paves the way for a secure retirement.

Of course, achieving this requires saving as much as possible, considering daily expenses and other unexpected costs.

Additionally, adjust your savings goals according to your lifestyle. Those with higher expenses should consider increasing their savings to maintain their standard of living in the future. This provides assurance that, in the face of any unforeseen events, there is a financial cushion to rely on.

Strategies to increase your savings

In addition to thinking about saving, you should also consider other ways to grow your capital. Below are some of the most effective strategies to help you achieve your savings goals and build a solid financial cushion by the age of 40.

• Expense optimization - Optimizing expenses is a key strategy to free up more money for savings. Avoid unnecessary spending to positively impact your savings growth.


• Debt reduction - Reducing debt is crucial to ensuring success when saving. Renegotiate debt terms to manage or even eliminate outstanding balances.


• Smart investments to maximize capital - Besides saving, it’s essential to invest to grow your capital. Investing in financial instruments such as crowdlending through platforms like Inversa allows you to earn returns without taking excessive risks, helping to improve your financial cushion.

Are you saving enough, or do you need a strategy change?

In summary, by the age of 40, you should have built a solid savings fund, with a goal of three times your annual salary as a general reference.

However, your personal situation may vary depending on your income, lifestyle, and family responsibilities. The most important thing is to assess your progress, adjust your savings strategy, and invest wisely to achieve your long-term financial goals.