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Money Fix: Saving for retirement

The time to start saving for retirement is

The time to start saving for retirement is in your 20s, although anytime is a good time, the experts say. Photo Credit: iStock

Most of us don't know how much we'll need to retire. In 2011 only 42 percent of Americans surveyed said they've attempted to figure out how much they'll need, according to the Employee Benefit Research Institute.

And confidence in a comfortably funded retirement is at a 21-year low: Just 27 percent of respondents said they feel they'll have enough for their "golden years."

Gail MarksJarvis, Chicago-based author of "Saving for Retirement without Living like a Pauper or Winning the Lottery," did the math.

For example, to live on $70,000 per year (including income from Social Security) for 30 years of retirement, you'll need $1 million saved, she said. (Click here to calculate what you'll need at choosetosave.org.)

To save $1 million, using an IRA or 401(k), and assuming a 10 percent return on the stock market over time, here's how much you'll have to save now:

Starting in your 20s: Save 10 percent of your pay, or $25 a week.

Starting in your 30s: Save 12 to 15 percent of your salary, or $100 a week.

Starting in your 40s: Save 20 to 25 percent, or $300 a week ("That's when it gets painful," said MarksJarvis.)

Starting in your 50s: It may be too late to save $1 million, but deposit every penny you can into your 401(k) to save, perhaps, half a million.

If it seems impossible, start small, and have the savings drawn directly from your paycheck, said MarksJarvis.

New Year's resolution: Start now!

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