Am I saving too much for retirement?

@Money March 6, 2012: 5:44 PM ET

NEW YORK (CNNMoney) -- I'm 28 and on track to save 40% of my salary in retirement and other accounts this year. I wonder, though, whether I'm focusing too much on stashing away money rather than enjoying it more at my age. Am I overdoing it? -- Adam, Minneapolis

There's no question that you're socking away money at a much higher rate than most people are able to manage financially or would chose to do.

A 2010 Aon Hewitt survey of contribution rates to 401(k) plans shows participants in their 20s contribute 5% of salary on a pre-tax basis compared to a rate of about 7% for participants of all ages.

Clearly, you're a champion saver. Does the fact that you're saving so much more than your peers mean you're overdoing it?

If overdoing it means saving more than is necessary to fund a comfortable retirement, then sure, it's possible you're going overboard in that sense.

Say you want to retire at age 65 on 80% of your pre-retirement salary. If you go to our What You Need to Save calculator and plug in your age and an annual salary of, say, $40,000, you'll see that the recommended savings rate is just over 9% -- and that's if we assume you haven't saved a dime to date.

Investing for retirement when you're just starting out

Of course, you'll have to save considerably more if you want to retire early or live large after you call it a career. You can try different retirement ages and target retirement incomes using T. Rowe Price's calculator. But it's hard to imagine you'll fall short of a secure retirement at any reasonable age if you consistently save 40% of your salary a year.

Ah, but is it really likely you'll be able to continue this pace throughout your career? My guess is that as you get older and take on more financial obligations like maintaining a house and raising kids, you'll find that it gets tougher to save.

There may also be periods where saving is a challenge. At some point over the next few decades, you could find yourself out of work due to a layoff or health issues or some other reason, for example.

If things get bad enough, you could end up having to draw down your savings in order to get by, as many diligent savers have been forced to do as a result of the recession.

Given all that can happen between now and your eventual retirement, I don't think that saving at such a high rate today translates into saving too much. You could look at your current savings rate as a precautionary measure, a way to ramp up your nest egg while you've got the spare cash to create a cushion should you find it more difficult to save later on.

Ask the Help Desk your questions about retirement planning

As for the question of saving for the future versus enjoying your money today, I suppose you could say you're saving too much if your penchant for saving interferes with leading the life you want to live, preventing you from traveling, socializing with friends or buying a bigger home or nicer car.

It's not as if someone is forcing you to put this money away. You're probably saving because you derive pleasure from doing so. People who set goals and take steps to achieve them, such as saving and controlling debt, tend to be happier than those who don't.

Bottom line: As long as your savings rate isn't interfering with your life, then I wouldn't worry about it. After all, the worse that can happen is that you end up being able to retire earlier.

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