What is the size of the average retirement nest egg?

Retirement Savings
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October 2015
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According to a 2015 Government Accountability Office (GAO) study, people between the ages of 55 and 64 with any retirement savings had a median amount of $104,000 in their nest eggs. For households with members between 65 to 74, the median value in retirement savings was $148,000. These figures are equivalent to an inflation-protected annuity of $310 and $649 per month, respectively.

Many American Retirees Have No Savings

These numbers are far below suggested minimums required for maintaining a comfortable lifestyle. About 29% of households with members aged 55 and over have neither retirement savings, such as 401(k) plans or individual retirement accounts (IRAs), nor a defined-benefit (DB) plan (a traditional pension). An additional 23% do have a DB plan, but no other retirement savings.

Households that do have retirement savings generally have other resources to draw on as well, such as nonretirement savings and DB plans. Social Security provides most of the income for about half of households including people 65 and older.

Start Saving as Soon as Possible

It is clear that being average when it comes to retirement savings is not a good thing. The key to having enough at retirement is to start saving as soon as possible. The difference between beginning a regular retirement savings plan in your 20s compared to your 30s can be hundreds of thousands of dollars by the time you reach retirement age.

Contributing to an IRA or an employer-sponsored 401(k) provides tax-deferred earnings and benefits from compound growth. Many professionals recommend that a 40-year-old have a nest egg twice his annual household income, increasing it to four times his annual income by age 50 and six times his current income by age 60.

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