Money

How much money you have to save each month to retire by age 40

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The typical American retires at age 62, but as everyday people have shown us, retiring before 40 is more than possible.

To give you an idea of how much money you'd have to sock away to join the early retiree club, personal finance site NerdWallet created a chart showing how much you need to save each month to have $1 million in the bank by age 40. It assumes you start with zero dollars at various ages and also assumes various average annual investment returns.

While $1 million is the oft-cited amount needed to retire comfortably, depending on when you retire and what you want your lifestyle to look like in your golden years, you may need more or less than that. To help you figure out the right amount to fund your retirement, check out NerdWallet's retirement calculator.

If you're aiming for the $1 million mark, here's how much you have to save per month to reach that goal. Scroll over the chart to see the exact numbers.

Here's the full breakdown of just how much you'd have to save each month to reach $1 million by age 40, assuming:

A four percent annual return:

$2,717 a month, if you start at age 20
$4,050 a month, if you start at age 25
$6,768 a month, if you start at age 30
$15,033 a month, if you start at age 35

A six percent annual return:

$2,153 a month, if you start at age 20
$3,421 a month, if you start at age 25
$6,071 a month, if you start at age 30
$14,261 a month, if you start at age 35

An eight percent annual return:

$1,686 a month, if you start at age 20
$2,870 a month, if you start at age 25
$5,429 a month, if you start at age 30
$13,519 a month, if you start at age 35

A ten percent annual return:

$1,305 a month, if you start at age 20
$2,392 a month, if you start at age 25
$4,841 a month, if you start at age 30
$12,806 a month, if you start at age 35

Ready to put your money to work? The simplest starting point is to invest in your employer's 401(k) plan, a tax-advantaged retirement savings account. Next, consider alternate retirement savings accounts, such as a Roth IRA, traditional IRA and/or a health savings account.

You can also research low-cost index funds, which Warren Buffett recommends.

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