Your Retirement Savings: A Reality Check
Are you wondering how your retirement savings stack up against the rest? Let’s take a closer look at the numbers to give you a better understanding of where you stand.
The Average American’s Retirement Savings
According to the 2022 Survey of Consumer Finances, here’s what the average American has saved for retirement by age group:
- Under 35: $49,130 (average) and $18,880 (median)
- Ages 35-44: $141,520 (average) and $45,000 (median)
- Ages 45-54: $313,220 (average) and $115,000 (median)
- Ages 55-64: $537,560 (average) and $185,000 (median)
- Ages 65-74: $609,230 (average) and $200,000 (median)
- 75 and older: $462,410 (average) and $130,000 (median)
If you’re beating these averages, congratulations! But if you’re aiming for the top 10%, here’s what you need to know:
The Top 10% of Retirement Savers
To join the ranks of the top 10% of retirement savers, you’ll need to aim for:
- Median savings: Around $900,000
- Average savings: Roughly $1.3 million
By age 50, the top 10% of savers often have over $500,000 saved, and by 55, they’re typically closing in on $750,000 or more. The top 1% boast savings of $2.3 million, and when considering a broader definition of retirement assets, the number soars to $5 million.
What Should You Aim For?
Financial experts recommend the following benchmarks to keep you on track for a comfortable retirement:
- Age 30: Save 1x your annual salary
- Age 40: 3x your salary
- Age 50: 6x your salary
- Age 60: 8x your salary
- Age 67: 10x your salary
Boosting Your Savings
If your savings feel a little underwhelming, don’t worry. Here are some ways to catch up:
- Max out retirement contributions and take advantage of employer matches
- Start saving early to benefit from compound interest
- Take advantage of catch-up contributions for those over 50
- Cut unnecessary expenses and redirect them towards your retirement fund
- Diversify your investments to balance risk and grow your nest egg
It’s Never Too Late to Start
Remember, it’s not too late to start building your retirement savings. Whether you’re in your 20s or 50s, every little bit counts. The key is consistency and making smart financial choices now to give your future self a leg up.
So, how does your nest egg stack up? If you’re already ahead of the averages, you’re in a great spot. And if not, now’s the perfect time to build a plan and take control of your financial future.
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