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[[{“value”:”Image source: The Motley Fool/UpsplashAs a general rule, financial experts like to suggest saving 15% to 20% of your income for retirement. If you’re an average wage-earner, or a higher earner in an expensive city where rents come at a premium, then parting with that large a chunk of your salary may not be doable.Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
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Click here to read our full review for free and apply in just 2 minutes. But before you start thinking the worst, you should know that saving as little as $100 a month could leave you in an excellent place as far as your retirement nest egg goes. However, there’s more to the story than that.What’s your time frame?Saving $100 a month could set you up for an incredible retirement under the right circumstances. And those include saving that monthly sum for many years, and investing your money in stocks for maximum growth.Over the past 50 years, the stock market’s average annual return has been 10%, accounting for years when stocks outperformed and years when they tanked. So if you save and invest in stocks for retirement over a lengthy period of time, there’s a good chance you’ll earn 10% a year in your portfolio, too.So where does a $100 monthly investment get you? Well, it depends on how many years you give yourself to grow wealth.Let’s say your target retirement age is 65. If you start saving $100 a month at age 50 and gain 10% a year in your portfolio, by 65, you’ll have $38,000. That’s better than nothing, but let’s be honest — it’s not a ton of money for what could be a 30-year retirement.On the other hand, let’s say you start saving $100 a month for retirement at age 25, giving yourself 40 years to benefit from stock market gains. At a 10% yearly return, by 65, you’re looking at $531,000. And that’s a nice amount of money to have on hand for your senior years.The best way to save for retirementIt’s possible to retire comfortably on $100 a month. But it’s important to find the right home for your long-term savings.One option is to sign up for a 401(k) plan through your employer. This gives you a couple of benefits.First, your contributions are made through automatic payroll deductions, so you’re more likely to stay on track. Also, a lot of companies have the practice of matching worker contributions to some degree. So participating in your workplace 401(k) could mean snagging free money for your retirement.If you don’t have access to a 401(k), another great option is to open an IRA. And if you’re not sure how to choose one, start by checking out this list of the best IRAs.From there, you’ll need to choose investments for your retirement account. If it’s a 401(k), you typically can’t hold individual stocks in your workplace plan. But an S&P 500 index fund could be a good choice, and most 401(k)s offer one. The 10% stock market return above is actually based on the S&P 500’s performance. And buying shares of an index fund is a good way to keep your investment fees low, since index funds are passively managed.If you open an IRA, you can hold individual stocks in it. But you may decide to buy shares of an S&P 500 ETF (exchange-traded fund) to simplify the process.Either way, know that you don’t have to part with a ton of money each month to end up wealthy in time for retirement. A $100 monthly contribution could do you a world of good, provided you start early enough and invest in stocks for maximum growth.Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes. We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.”}]] [[{“value”:”
Image source: The Motley Fool/Upsplash
As a general rule, financial experts like to suggest saving 15% to 20% of your income for retirement. If you’re an average wage-earner, or a higher earner in an expensive city where rents come at a premium, then parting with that large a chunk of your salary may not be doable.
Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes.
But before you start thinking the worst, you should know that saving as little as $100 a month could leave you in an excellent place as far as your retirement nest egg goes. However, there’s more to the story than that.
What’s your time frame?
Saving $100 a month could set you up for an incredible retirement under the right circumstances. And those include saving that monthly sum for many years, and investing your money in stocks for maximum growth.
Over the past 50 years, the stock market’s average annual return has been 10%, accounting for years when stocks outperformed and years when they tanked. So if you save and invest in stocks for retirement over a lengthy period of time, there’s a good chance you’ll earn 10% a year in your portfolio, too.
So where does a $100 monthly investment get you? Well, it depends on how many years you give yourself to grow wealth.
Let’s say your target retirement age is 65. If you start saving $100 a month at age 50 and gain 10% a year in your portfolio, by 65, you’ll have $38,000. That’s better than nothing, but let’s be honest — it’s not a ton of money for what could be a 30-year retirement.
On the other hand, let’s say you start saving $100 a month for retirement at age 25, giving yourself 40 years to benefit from stock market gains. At a 10% yearly return, by 65, you’re looking at $531,000. And that’s a nice amount of money to have on hand for your senior years.
The best way to save for retirement
It’s possible to retire comfortably on $100 a month. But it’s important to find the right home for your long-term savings.
One option is to sign up for a 401(k) plan through your employer. This gives you a couple of benefits.
First, your contributions are made through automatic payroll deductions, so you’re more likely to stay on track. Also, a lot of companies have the practice of matching worker contributions to some degree. So participating in your workplace 401(k) could mean snagging free money for your retirement.
If you don’t have access to a 401(k), another great option is to open an IRA. And if you’re not sure how to choose one, start by checking out this list of the best IRAs.
From there, you’ll need to choose investments for your retirement account. If it’s a 401(k), you typically can’t hold individual stocks in your workplace plan. But an S&P 500 index fund could be a good choice, and most 401(k)s offer one. The 10% stock market return above is actually based on the S&P 500’s performance. And buying shares of an index fund is a good way to keep your investment fees low, since index funds are passively managed.
If you open an IRA, you can hold individual stocks in it. But you may decide to buy shares of an S&P 500 ETF (exchange-traded fund) to simplify the process.
Either way, know that you don’t have to part with a ton of money each month to end up wealthy in time for retirement. A $100 monthly contribution could do you a world of good, provided you start early enough and invest in stocks for maximum growth.
Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.
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