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Average American retirement savings: Is your strategy on track?

The average ($260K) and median ($80K) retirement savings are a good way to check if your savings are falling behind or ahead of schedule. Compare your strategy and average balances by age to adjust your goal and savings.



May 30, 2024

5 min. read

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Key Takeaways:
  • Retirement savings are increasing as more people access tax-advantaged accounts, but the median American’s savings isn’t keeping up with expert timelines.
  • We estimate you’d need $826,000 invested to retire comfortably, living off interest alone, but you can swing a nice retirement with less to cover your expected annual income needs. 
  • Comparing your savings to the median can help you gauge your strategy’s effectiveness, but you should understand your own goals and timeline for the best understanding.

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      Retirement is a long-term strategy that spans decades of your working years, so it can be tricky to tell how much you need to save and if you’re on track.

      Luckily, we know a thing or two about strong retirement strategies, and there’s plenty of data to help us determine the average retirement savings in the U.S.  

      As of 2022, here are the typical American pre-retirement balances according to The Federal Reserve:

      • Average savings: $260,358
      • Median savings: $80,000

      Of course, your savings balance at age 27 will differ from when you’re 47, so a little context goes a long way when establishing savings goals. Below, we break down retirement savings by age, as well as expert wealth-building strategies to help you stay on track. 

      Average retirement savings by age — does your balance stack up?

      When we look at the full age range, 20-75+, average and median retirement account balances are a little higher than the balances of only pre-retirees:

      • Average savings: $352,178
      • Median savings: $122,500

      This is because most retirement accounts grow with compound interest over time. 

      The more money you accumulate, the more you can invest, and the larger your returns will be. This cycle continues for as long as you have money invested in your retirement accounts. 

      So, the sooner you start investing in retirement, the better off you’ll be. 

      Here’s a full breakdown of average and median retirement savings balances by age.

      Age range Average savings Median savings Expert recommendations
      18-34 $49,130 $18,880 20s: 1/2 your salary
      35-44 $141,520 $45,000 30s: 1x your salary
      45-54 $313,220 $115,000 40s: 3x your salary
      55-64 $537,560 $185,000 50s: 5x your salary
      65-74 $609,230 $200,000 60s: 8x your salary
      75+ $462,410 $130,000 70s: 10x your salary

      You probably picked up on a key trend — the average savings for every age group exceeds expert recommendations, but the median savings never catches up. 

      In many situations, the median data point better represents “typical” than the average. That’s because outliers don’t impact the median like they do with the average. 

      This is especially important for retirement savings, where some investors can save millions while others have a couple hundred thousand dollars invested for retirement. 

      It’s not realistic for everyone to have $1 million by age 65, and it’s important you don’t compare yourself to those people. Look at the expert recommendations based on your income and retirement goals to see if you’re on track. 

      For a more productive comparison to your peers,  check out the median balance instead. 

      Graph compares median and average savings over time with recommended growth goals.

      Average 401(k) balance

      Another major component of retirement savings is the 401(k). It’s a tried-and-true retirement plan that millions of Americans use to kickstart their savings. 

      The overall average and median balance of a 401(k) are:

      • Average balance: $359,669
      • Median balance: $103,219
      Age range Average 401(k) balance Median 401(k) balance
      20s $74,460 $29,753
      30s $160,517 $69,718
      40s $344,182 $151,274
      50s $558,740 $247,338
      60s $555,621 $209,382
      70s $417,379 $103,219
      80s $385,783 $78,534

      It’s no surprise that the total average and median align with the total average and median retirement savings as a whole. 

      401(k)s are extremely popular, with some of the highest contribution limits among tax-advantaged accounts. Some companies even auto-enroll employees and offer employer-match contributions, so they naturally become major retirement assets. 

      Retirement savings through the years

      Retirement savings weren’t always as massive as they are now. It’s partly because plan participation has increased, but other factors are at play. 

      Cost of living and inflation continue to increase year over year. Smart investors know their savings have to outpace and account for inflation, or else their retirement income might not cut it. 

      There are also worries about Social Security access for future retirees and how much cash will still be in the coffers come retirement. 

      All of this folds into the fact that Americans currently planning for retirement know they need to save more. 

      While it’s not an exact science, looking at historical data can help you see how expectations change over time. Check out the average savings 30 years ago vs. now for the same age range, and you’ll see how expectations have increased: 

      Year 18-34 35-44 45-54 55-64 65-74 75+
      1989 $9,220 $23,060 $39,190 $55,330 $34,580 $36,890
      1992 $9,320 $18,850 $58,020 $62,160 $41,440 $58,020
      1995 $11,610 $28,260 $54,190 $61,930 $56,130 $45,480
      1998 $12,760 $36,470 $63,820 $85,700 $69,290 $54,700
      2001 $11,720 $47,880 $80,360 $92,070 $100,440 $80,360
      2004 $17,280 $44,000 $87,210 $130,420 $125,700 $47,140
      2007 $13,740 $52,950 $90,150 $143,100 $110,190 $50,090
      2010 $14,480 $42,340 $81,950 $136,580 $136,580 $73,750
      2013 $15,270 $54,350 $110,740 $132,370 $189,650 $87,830
      2016 $14,830 $45,630 $101,140 $148,000 $155,650 $148,000
      2019 $15,070 $69,550 $115,920 $155,330 $190,110 $96,210
      2022 $18,880 $45,000 $115,000 $185,000 $200,000 $130,000

      Go for the gold: Average U.S. retirement income

      Knowing the average retirement income is a good way to set savings goals — just be sure to consider inflation. 

      In 2022, the average retirement wage was $63,795.

      This income comes from a variety of sources, including:

      Source Retirees with this income source
      Social Security 78%
      Pension 56%
      Interest, dividends, or rental income 42%
      Wages, salaries, or self-employment 32%
      Cash transfers (excluding Social Security) 9%

      So consider if $63,795 sounds like a sufficient income to you. If so, take a look at inflation rates and estimate what this would be by your ideal retirement age. From there, you’ll have a pretty solid starting retirement goal. 

      Don’t forget to factor in income sources. If you’re not confident in Social Security or don’t want to work part-time, you’ll need to save more with your personal investments. 

      How much retirement income will I need each year?

      Want to dig a little deeper into your retirement goals? There are two common guidelines to estimate your retirement needs. 

      First, the 80% rule. With this guideline, you’re aiming to live off of 80% of your pre-retirement income. So, if you make $150,000, you’ll aim to have $120,000 for each year in retirement. 

      This is great if you’re a high earner or looking for a comfortable and casual retirement. You should be able to cover your expenses, and ideally, you cut most of your debt, including your mortgage, ahead of retirement to ease the burden. 

      Then, factor in the 25x spending rule. This asks you to save 25 times your expected retirement income to cover your final years. 

      If you retire at age 65, this will guarantee income until age 90 — well-past the average life expectancy. You have a little wiggle room, but we recommend upping your spending goal if you want to retire early

      So, taking that $120,000 estimated retirement income with the 80% rule, you’d need $3 million to retire with the lifestyle you want. 

      Playbook tip:

      The ultimate retirement plan is living off interest. If you can invest enough before you retire, you can live off investment earnings alone. The original goal balance will continue to earn interest year over year, so you don’t have to worry about running out of funds.

      The Playbook take: Don’t dilly-dally on your retirement strategy

      The cost of living continues to increase as retirement concerns around Social Security funds also loom large. Your best bet is to take charge of your retirement strategy to guarantee bright, comfortable golden years. 

      Understanding the median and average retirement savings in the U.S. can reveal how your strategy stacks up and whether you need to adjust it. Just remember that median is a better representation of a realistic balance vs. average.

      Need help organizing your finances to see how much you can invest? Get started with a custom financial plan provided by Playbook

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      About the author

      Theo Katsoulis, CFA

      Head of Investments

      Theo brings an extensive background in Institutional Asset Management. With a B.A. from Villanova University's School of Business, and having passed the rigorous Series 65 and CFA examinations, he brings significant expertise from portfolio management to understanding intricate financial infrastructures. As Head of Investments at Playbook, he ensures consumers receive exceptional diligence and care for their investment portfolios.

      Tanza Loudenback, CFP®


      Tanza is a CFP® certificant, writer, and editor. From 2015 to 2021, she was a top-read author and editor at Insider. Her work focuses on helping people make smart decisions with their money and is published by a variety of online publications.

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