Americans think they’ll need this much after retirement

Financial Planners

By Dailymail.Com Consumer Reporter Tilly Armstrong

Updated June 23, 2023 19:59, June 23, 2023 19:59

  • On average, people believe they need to save $1.27 million for retirement
  • But a Northwestern Mutual study found that the typical American saves only $89,300.
  • Nearly half of respondents expect not to have enough savings

A new study finds a worrying disconnect between how much Americans expect to need for a comfortable retirement and how much they’re saving.

On average, people think they should save $1.27 million for retirement. However, he usually saves only $89,300, which is only 7% of his goal.

A study by Northwestern Mutual also found that the amount Americans expect to need to retire comfortably is also up slightly from $1.25 million last year. People’s savings increased similarly, up 3% from $86,869 in 2022.

However, according to the survey results, nearly half of those surveyed (about 48%) confessed that they did not believe they had enough savings for their desired future.

Overall, the average American now believes he or she will have to work until age 65 to prepare for retirement, up from 64 last year.

“The magic number for Americans’ retirement readiness continues to climb,” said Aditi Javeri-Gokale of Northwestern Mutual.

“The good news is that even in this era of high inflation and market volatility, they are saving and investing more for tomorrow.” This is the opposite of last year’s result, which expanded rather than contracted.

“The difficult news is that there continues to be a huge gap between how much they think they need to retire and how much they have saved so far.”

The same survey last year found that the average retirement balance fell 11% to $86,869 as 401(k) and IRA retirement accounts were hit by soaring inflation and a falling stock market. .

This year’s survey found that the amount people expect to need to retire comfortably varies slightly by age group and the typical amount they already have in savings.

People in their 50s are expected to need the most at $1.56 million, saving an average of $110,900.

Meanwhile, those in their 20s think they’ll only need $1.2 million in retirement and have only $35,800 in their 401(K) or IRA retirement account.

Comfortable retirement benefits drop significantly for those in their 60s and 70s, at $968,000 and $936,000, respectively. This is mainly because many of these age groups are already retired.

On average, people in their 60s have $112,500 in savings and people in their 70s have $113,900 in savings.

On average, people expect to need to save $1.27 million for retirement, but the average adult saves only $89,300 for retirement.
According to Fidelity research, just 29 percent of people are on track to cover all their retirement expenses, down from 38 percent in 2020.

High net worth individuals (those with $1 million or more in investable assets) believe they need $3 million to retire comfortably.

The study found that the average American plans to work until age 65, while those who consider themselves to be disciplined financial planners delay their retirement age by two years to 63. bottom.

Meanwhile, the average tenure of non-planners increased by two years.

“One of the greatest gifts financial planning can bring is time,” says Gokhale. “Planning and discipline can make his four years of retirement possible. And professional help is everything, regardless of where he is on his financial journey.” provided to people of

The findings come after a report from Fidelity Investments, the nation’s largest 401(K) plan provider, revealed a US retirement crisis.

The survey found that less than half of Americans are on track to a comfortable retirement after the COVID-19 pandemic and blistering inflation hit their savings plans.

A Fidelity survey found that only 29% of people expect to meet all of their retirement expenses, down from 38% in 2020.

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