How Much is the Average Person Saving for Retirement?

The average amount saved for retirement can vary significantly based on factors like age, income level, and geographic location. According to recent data, the average American's retirement savings can range widely, with some key figures to highlight.

Overall Averages

A commonly cited figure is that the average American has around $100,000 saved for retirement. However, this average can be misleading due to the influence of very high earners. This figure represents a snapshot of total savings, but it doesn't capture the significant disparity among savers.

Median Savings

The median retirement savings figure is often lower, around $30,000. The median represents the middle point, suggesting that many people have much less saved. This low median savings figure can be concerning, especially for younger individuals just starting their careers.

Age Considerations

Under 30

Many individuals in this age group may have little to no savings. For those who do, an average of around $10,000 might be typical.

Ages 30-39

Average savings for this age group tend to increase, with figures around $40,000 to $50,000.

Ages 40-49

Average savings often rise to about $100,000 for individuals in this age range.

Ages 50-59

Many individuals in this range have saved approximately $200,000. This group represents a significant milestone in saving for retirement.

Ages 60 and Older

Average savings can vary widely, but many people nearing retirement have around $300,000 or more. This group includes high-income earners and those who have saved diligently over their career.

Retirement Planning Recommendations

Financial advisors often recommend saving at least 15% of your income annually for retirement. The target is to aim for a retirement savings goal of 10 to 12 times your annual salary by the time you retire. These recommendations are based on the assumption that retirement savings combined with other sources of income will provide a comfortable lifestyle in retirement.

Understanding Your Current Financial Status

Individuals can create a more accurate retirement plan by understanding their current financial status. The Social Security Administration (SSA) report is a good starting point. This report will provide an estimate of your current and past income. While the SSA income should be part of your total retirement plan, it shouldn't be the sole source of income in retirement. Investment income from 401(k)s, savings accounts, and rental properties should also be considered.

It's essential to assess your personal financial situation and plan accordingly to ensure a comfortable retirement. Consulting with a financial advisor can provide valuable insights and help you develop a comprehensive retirement savings strategy.