Many Americans aspire to retire comfortably, but rising housing and living costs can make this goal seem unattainable for some. A recent AARP survey revealed that 1 in 4 U.S. adults aged 50 and older believe they’ll never retire, with 70% expressing concern about expenses outpacing income growth.
For those planning retirement, determining the appropriate savings amount is complex, influenced by spending habits, lifestyle choices, and location. A study by GoBankingRates highlighted the significant disparity in retirement funding needs, with Miami, Florida, requiring over $1.1 million for a 25-year retirement compared to nearly $570,000 in McAllen, Texas.
While comparing savings with peers can provide insights, financial services firm Edward Jones notes that it’s essential to focus on personal goals and needs rather than external benchmarks. Federal Reserve data shows the median retirement savings account balance for U.S. families at $87,000, with an average balance of $333,940, influenced by wealthier households.
Fidelity offers a guideline tying savings targets to age and income. By age 30, it suggests having saved one year’s salary, increasing to 10 times income by age 67. However, Fidelity emphasizes that these targets are aspirational and may not be entirely achievable. They serve as benchmarks to assist in creating a retirement savings plan tailored to individual needs and aspirations.
