When you're 50, retirement is close on the horizon. It's a critical time in your life to make sure you're getting ready for a future without a paycheck when you'll have to support yourself with savings.

So, just how much should you have saved by the time you turn 50, and are most Americans on track? Let's take a look at some expert recommendations, along with some data on how much money most people have socked away in their retirement plans by their 50th birthday.

This is how much you should have saved by age 50

According to Fidelity, you should aim to have around six times your current annual salary saved by the age of 50. This would put you on track to have 10 times your final salary by 67, which is the full retirement age for Social Security benefits (making it a good time to retire since you can claim an unreduced retirement check). This would mean if you were making $60,000, you would ideally have around $360,000 in a 401(k) or other retirement plan by the time you turned 50.

Unfortunately, many people are very far behind when it comes to hitting their target of saving six times their salary by that age. The Bureau of Labor Statistics reports median annual earnings of $76,440 for men between the ages of 45 and 54, and median annual earnings of $59,852 for women. This would mean men should have around $458,640 for men and $359,112.

In reality, the Motley Fool's research revealed that median retirement savings in 2022 was $115,000 for Americans ages 45 to 54. That's far smaller than the recommendation for both men and women. Many people simply have not put aside enough money for their future and are not on track to replace the income they need as seniors.

How can you set your own savings goals?

The Fidelity estimates are a good rule of thumb aimed at making it easier to set savings goals, but they aren't necessarily accurate for everyone. For one thing, while it's true that women often earn less than men and have less income to replace, they also tend to live longer, so they may need more retirement savings than their male counterparts rather than far less, as Fidelity's formula suggests.

Another thing is that Fidelity's estimates are just generalized rules that don't take your own retirement plans into account. If you want to retire before 67 because you'd prefer to enjoy your freedom at a younger age, you'd need much more saved by 50 than six times your salary. Your savings would need to support you sooner, you'd have less time to grow your account balance, and you might end up with a smaller Social Security check if you claimed your benefits ahead of full retirement age to accommodate your early retirement.

You should think about how much you actually plan to spend as a senior and when you plan to retire. Then, work backward from there to decide how much to save. If you want your investments to produce $50,000 in income for you, multiply that number by 25 to figure out how much your final nest egg balance should be (assuming you plan to follow the 4% rule and withdraw 4% of your money in your first year of retirement and adjust upwards for inflation). Once you know your final desired number, you can use the calculators on Investor.gov to determine exactly how much you should be saving each month to achieve your goal by your desired retirement age.

Focusing specifically on how much you have saved by 50 isn't all that useful in this process since it doesn't matter in the end. If you have far less than you need by 50 but you get serious about saving, take advantage of catch-up contributions and devote yourself to investing aggressively, you can still end up with the money you need to leave work in your 60s and enjoy a comfortable future.

The key is to start from where you are today, figure out what you must save each month to have enough to retire at your desired age, and set up automatic contributions to your retirement plan for the necessary amount so you can make your retirement dreams a reality.

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