Wondering how much you should have in your 403(b) to retire comfortably? It’s a common question for educators, healthcare workers and employees of non-profit organizations who rely on these tax-advantaged retirement plans. The answer varies based on your desired retirement lifestyle, expected expenses, other income sources and retirement age. While financial advisors often suggest aiming to have put away eight to 10 times your annual salary by retirement age, your target may differ.
Consider working with a financial advisor to help you better understand and plan for your retirement.
Setting Savings Targets for Your 403(b)
There is no single answer to how much you should have in your 403(b). Whether your retirement account balance is likely to be adequate to retire depends on your savings habits, salary growth, investment performance and other factors.
Some of these, such as your age when you retire, may be under your direct control, while others are not. Over long periods, some uncertainty is unavoidable. However, using benchmarks such as age-based multipliers or contribution percentage guidelines can help you set clear, achievable targets over time.
The Multiplier Method
One way to get an idea of how much you should have in your 403(b) to retire comfortably is by using the age-based multiplier method. This rule of thumb says that by age 30, you may want to aim to have saved the equivalent of your annual salary.
Other benchmarks apply to later stages in your retirement preparation journey. For instance, by age 40, target three times your salary, six times by 50, and eight to 10 times between ages 60 and 67. These benchmarks provide clear milestones to track your progress.
Below are the specific age-based savings targets that Fidelity recommends (assuming retirement at age 67):
Percentage-Based Goals
Another approach to setting realistic savings targets for your 403(b) retirement account uses percentage-based goals. Financial experts typically recommend contributing 10% to 15% of your gross income to retirement accounts. This approach automatically scales your contributions as your income grows, helping you maintain consistent progress toward retirement security.
And if you’re wondering how much you should save based on the age at which you start, Schwab offers the following target ranges:
| Age | Percent of Your Annual Gross Income |
|---|---|
| 25 | 9%–13% |
| 30 | 13%–18% |
| 35 | 17%–22% |
| 40 | 21%–28% |
| 45 | 26%–35% |
| 50 | 33%–43%+ |
Suppose you are 35 years old and earn $70,000 annually. Following Schwab’s guidance, you would aim to contribute between 17% and 22% of your salary to your 403(b) each year. That means contributing between $11,900 and $15,400 annually. Maintaining this savings rate—and adjusting it upward as your income grows—can help you stay on track to build a sufficient retirement nest egg by your early to mid-60s.
Estimating Your Retirement Income
The income replacement method is a widely used approach to assessing retirement readiness. Financial experts typically recommend aiming to replace 70% to 80% of your pre-retirement income. This approach accounts for reduced retirement expenses while maintaining your living standard. Consider your current annual salary and multiply it by this percentage to establish a baseline annual income target
For example, if you currently earn $80,000 annually, you might need between $56,000 and $64,000 per year during retirement to maintain your lifestyle.
General guidelines such as this may not perfectly help you set your personal savings goals. To determine if a specific income replacement rate will be sufficient, factor in your expected expenses during retirement, including housing, healthcare, travel and daily living costs.
Add up all these expected expenses to arrive at your total retirement budget. If you anticipate spending $5,000 per month in retirement, your 403(b) withdrawals and other sources of income will need to generate $60,000 per year.
Don’t forget to account for inflation, which historically averages around 2% to 3% annually. Inflation causes your money’s purchasing power to decrease over time.
Account for Social Security Benefits
Be sure to factor in Social Security benefits when calculating your retirement income needs. The average monthly benefit for retired workers was $1,997 in March 2025, though your actual benefit will depend on your earnings history and retirement age. Subtract your expected Social Security income from your total income needs to determine how much must come from your 403(b) and other retirement accounts.
Choosing a Withdrawal Strategy
A common guideline for retirement withdrawals is the 4% rule. This suggests you can withdraw 4% of your retirement savings in your first year of retirement, then adjust that amount for inflation each subsequent year.
Working backward, if you need $60,000 annually and expect $20,000 from Social Security, you’ll need to withdraw $40,000 from your 403(b) in your first year of retirement. Dividing $40,000 by 0.04 indicates you should aim for approximately $1 million in your 403(b) and other retirement accounts.
If you expect to live longer than 30 years after retiring, you may need a lower withdrawal rate. Likewise, if your spending needs are greater, you may need a higher withdrawal rate or plan to work longer.
Consider Additional Income Sources
Many retirees have multiple income streams beyond their 403(b). These might include pension benefits, part-time work, rental income or taxable investment accounts. Be sure to include these sources when estimating your retirement income needs. The more diverse your income sources, the less pressure on your 403(b) balance to fund your entire retirement.
Understanding Healthcare Costs in Retirement
When determining how much you should have in your 403(b) to retire comfortably, healthcare expenses deserve special attention. Medical costs typically increase as we age and can consume a significant portion of our retirement savings.
While Medicare provides valuable coverage starting at age 65, it doesn’t cover everything. You’ll still face premiums, deductibles, copays and coinsurance. Plus, Medicare doesn’t cover dental, vision or hearing aid services; you’re likely to need more as you age. Consider setting aside an additional 15% of your retirement savings specifically for these gaps in coverage.
According to Fidelity, a 65-year-old who retired in 2024 may need $165,000 in savings specifically for healthcare expenses throughout retirement, not including long-term care costs.
Long-term care represents one of the largest potential healthcare expenses in retirement. The median cost of a semi-private room in a nursing home was over $111,000 in 2024, according to Genworth, a long-term care insurance provider. Meanwhile, the median cost of a home health aide was over $75,000 per year in 2024.
As you can see, a few years of care could dramatically impact your savings. Consider whether long-term care insurance or setting aside additional funds in your 403(b) makes sense for your situation.
Bottom Line
Your retirement planning should balance all these factors—from income replacement and withdrawal strategies to healthcare costs and additional income sources. By taking a comprehensive approach to determining your 403(b) savings target, you may be better positioned to enjoy the retirement lifestyle you’ve worked so hard to achieve.
Tips for Retirement Planning
- It’s important to plan well in advance to reach the retirement you’re dreaming of. A financial advisor can give you the knowledge and experience you need to make the right decisions so that your finances are ready for retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Consider using a retirement calculator for help estimating what you may need to save for retirement.
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