„How much should I set aside monthly to live in retirement like I do today?“ The most common question I hear from clients. There's no universal answer — it depends on age, goals and current situation. Here are concrete numbers by the age you start.
How much money do you actually need in retirement
Standard rule: you need 70–80% of your current net income in retirement. If you live on 45 000 CZK net today, in retirement you want at least 31–36 000 CZK. The Czech state pension averages 21 000 CZK — so you need to cover the 10–15 000 CZK gap yourself.
Over 20 years of retirement, that's a nest egg of 2.5–3.5 million CZK you need by retirement age.
How much to save by age — concrete scenarios
These numbers assume 6% average annual return (diversified portfolio) and a target of 3 million CZK by retirement at 65.
At 25 (40 years to retirement)
Only 1 800 CZK/month needed.
Over 40 years at 6% and 1 800 CZK monthly, you save around 3.4 million CZK. Your contribution: 864 000 CZK. The rest is compound interest.
At 30 (35 years)
You need 2 500 CZK/month.
At 35 (30 years)
You need 3 500 CZK/month.
At 40 (25 years)
You need 5 500 CZK/month.
At 45 (20 years)
You need 8 500 CZK/month.
At 50 (15 years)
You need 13 000 CZK/month. The point is clear — the later you start, the harder you have to pay.
The cost of waiting: if at 30 you save 2 500 CZK/month instead of 3 500 (as if you were 35), the difference is 1 000 CZK/month = 12 000 CZK/year. Over 35 years? Around 1 500 000 CZK on final value. That's the price of 5 years of waiting.
Where to put the money
Not all in one account. Reasonable mix:
- Supplementary pension savings (DPS) — 1 700 CZK/month because the state adds 340 CZK (20% instant "return"). More conservative funds.
- DIP (Long-term investment product) — additional, when you have room. Tax relief up to 48 000 CZK/year. Freer fund choice (even stock ETFs).
- Regular investing (broker account) — the rest. Maximum flexibility, no cap, but no tax advantages.
- Rental property — advanced, when you have capital. Diversification + passive income in retirement.
If you're already behind — 3 things to do now
- Start now, not from New Year. Every day of delay = lost compound interest.
- Max out state contribution and tax relief. That's money the state literally gives you — 4 080 CZK/year state contribution + tax saving on 48 000 CZK = ~7 200 CZK. Per year, free.
- Accept slightly more risk. With 15+ years to retirement, allow at least 50% stock allocation. Without it you won't catch up.