Let's talk about your nest egg. No, not in a "Why haven't you saved more?" way – this isn't a guilt trip. Instead, think of this as a friendly check-in. Whether your savings are soaring or just getting off the ground, it's natural to wonder: How do I measure up? And for those of you eyeing the top 10% of retirement savers, these numbers will show you exactly what it takes.
Spoiler: It's not all doom and gloom; there's always time to make moves. Let's break it down.
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The Averages: Are You Ahead or Behind?
First, let's look at what the average American has saved for retirement by age group. According to the 2022 Survey of Consumer Finances, here's where things stand:
Average Retirement Savings by Age Group
Under 35:
• Average savings: $49,130
• Median savings: $18,880
Ages 35-44:
• Average savings: $141,520
• Median savings: $45,000
Ages 45-54:
• Average savings: $313,220
• Median savings: $115,000
Ages 55-64:
• Average savings: $537,560
• Median savings: $185,000
Ages 65-74:
• Average savings: $609,230
• Median savings: $200,000
75 and older:
• Average savings: $462,410
• Median savings: $130,000
If you're beating these averages, that's worth celebrating! But maybe you're eyeing the next level – joining the top 10%. What does that look like?
The Top 10%: Where the Big Savers Are
The top 10% of retirement savers are in a league of their own. Here's what it takes to join their ranks:
Median savings: Around $900,000.
Average savings: Roughly $1.3 million.
It's important to mention the average is higher because a few ultra-wealthy savers skew the numbers, while the median shows what most people have.
By age 50, the top 10% of savers often have over $500,000 tucked away.
By 55, they're typically closing in on $750,000 or more.
And the crème de la crème? The top 1% boast savings of $2.3 million. But, when considering a broader definition of retirement assets, the number soars to $5 million, according to data from DQYDJ, using stats from the Federal Reserve.
What Should You Aim For?
Even if the top 10% feels far off, financial experts offer 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.
These milestones aren't hard rules – life happens. But they're a good starting point to see where you stand.
Trending: Many are using retirement income calculators to check if they’re on pace — here’s a breakdown on what’s behind this formula.
Want to Boost Your Savings? Here's How
If your savings feel a little underwhelming, don't stress. There are plenty of ways to catch up:
1. Max out retirement contributions: Contribute as much as possible to your 401(k) or IRA. And if your employer offers a match, grab that free money!
2. Start saving early: The earlier you start, the more compound interest works in your favor. If you're late to the game, don't worry – you can still catch up.
3. Take advantage of catch-up contributions: For those over 50, you can sock away an additional $7,500 annually in your 401(k). Starting in 2025, individuals aged 60-63 can save up to $11,250.
4. Cut unnecessary expenses: Redirect what you save toward your retirement fund. Small sacrifices now can lead to big wins later.
5. Diversify your investments. A mix of stocks, bonds and other assets can balance risk and grow your nest egg.
It's Not Too Late to Make Moves
If you're behind, don't panic – it's never too late to start. Whether you're playing catch-up in your 50s or just starting in your 20s, 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. Remember, retirement savings aren't about perfection – they're about progress.
*This information is not financial advice and personalized guidance from a financial adviser is recommended for making well-informed decisions.
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