With inflation, tariffs, and a cost-of-living crisis squeezing American households, saving for retirement often feels like the lowest priority on the list. But multimillionaire serial investor and entrepreneur Kevin O'Leary insists that saving matters now more than ever.

"What piece of advice do I give my kids over and over and over again about money?" the Shark Tank star asked in an Instagram video earlier this year. "Don't spend it. Save it. Invest it. Let it compound. That's the gift the market gives you."

O'Leary's golden rule of investing is simple: take 15% of every dollar you earn—whether from paychecks, side hustles, or birthday money from grandma—and put it directly into the market.

"Just let it compound," he said.

For the average American worker earning $68,000 per year, he argued, that straightforward discipline ultimately pays off.

"If you make $68,000 a year, the average salary, and you do this your entire life, just 15% of your paycheck, you'll end up a millionaire at retirement at 65," O'Leary said.

View this post on Instagram: A post shared by Kevin O'Leary (@kevinolearytv) —

Does Kevin O'Leary's math check out?

Most national estimates place the average American salary at roughly $66,000 to $69,000 per year. Working from O'Leary's $68,000 figure, the numbers break down as follows.

Under the 15% rule, an American earning $68,000 per year would save about $10,200 annually, or $850 per month. Invested consistently over a 40-year career—say, from age 25 to 65—and assuming the S&P 500's historical average return of roughly 10%, that $850 monthly contribution would grow to approximately $5.3 million by retirement. Even at a more conservative average return of 7%, the average American would still reach millionaire status, with a final portfolio worth around $2.2 million. Those projections depend heavily on starting early: because compounding reinvests gains on top of gains, the majority of a long-horizon portfolio's final value typically comes from returns earned on prior growth rather than the contributions themselves.

While the math works on paper, saving that much each month is becoming increasingly unrealistic for average Americans.

Among workers in the $50,000–$79,999 income bracket, 55% report feeling behind on retirement savings, and this group is among the most likely to lack adequate preparation. The overall personal saving rate as of mid-2025 sits at just 4.4% of disposable income, according to the Bureau of Labor Statistics, meaning someone earning $68,000 saves roughly $3,000 per year toward retirement, on average. Among 401(k) participants specifically, Vanguard data show the median total contribution rate (employee plus employer) is about 11.5%, though this applies primarily to those with 401(k) access. Notably, that employer match is one lever O'Leary's rule leaves implicit: contributions to a workplace 401(k) are made pre-tax and often matched dollar-for-dollar up to a cap, effectively boosting the savings rate without additional take-home sacrifice. Policy has also pushed in this direction—the SECURE 2.0 Act of 2022 requires most new workplace plans to automatically enroll employees starting at a default contribution rate between 3% and 10%, precisely because voluntary participation has historically lagged.

For a household earning $68,000 before taxes, take-home pay is about $52,000 to $54,000 after federal and state taxes, leaving roughly $3,600 per month for other expenses.

According to RentCafe, the average rent in the U.S. is $1,740 per month, leaving about $1,860. Add groceries, which Bureau of Labor Statistics data shows can run as high as $400 per month for a single person, and the figure drops to roughly $1,460.

Then come student loan payments, averaging $434 per month, and utilities, at about $300 per month. That leaves only $726—not enough to meet the 15%-of-earnings savings level O'Leary suggested.

Even assuming 15% of the average American's take-home pay of about $52,000, they would need to invest $650 per month (still making them a millionaire by age 65), but that would leave just $150 per month in discretionary income.

O'Leary argues, however, that younger generations need to stop spending on unnecessary items.

"The best piece of advice I can give anybody: Don't buy stuff you don't need," he insisted. "Invest it instead."

What other investors say

O'Leary's guidance largely mirrors the index fund investing philosophy long championed by Warren Buffett, who has repeatedly said the average investor is best served by putting money in a low-cost S&P 500 index fund and leaving it alone.

"Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard's)," Buffett wrote in a 2013 shareholders' letter. "I believe the trust's long-term results from this policy will be superior to those attained by most investors—whether pension funds, institutions, or individuals—who employ high-fee managers."

Suze Orman, financial advisor, author, and podcast host, has likewise said Americans need to prioritize saving or investing at least 10% of their earnings each year—particularly given longer life expectancies and rising health care costs in retirement. She has even argued that 70 should be the new retirement age because Americans aren't financially prepared enough.

"You likely have plenty saved up to breeze through 15 years or so of retirement. But, people, if you stop working in your sixties, your retirement stash might need to support you for 30 years, not 15," she wrote in 2017.

A version of this story was originally published on Fortune.com on March 31, 2026.