Americans certainly have a good idea of how much they’ll need to retire one day — they just don’t have the same savings in the bank yet.
A recent study showed many Americans believe they should have about $1.46 million stashed away to retire comfortably.
However, here’s the reality: most Americans, on average, have less than $89,000 saved for retirement, according to a Northwestern Mutual study released this week.
With inflation pounding Americans’ wallets, their retirement savings have suffered tremendously.
“People’s ‘magic number’ to retire comfortably has exploded to an all-time high, and the gap between their goals and progress has never been wider,” says Aditi Javeri Gokhal, head of institutional investments and president of retail investments at Northwestern Mutual.
“Inflation is expanding our expectations for retirement savings and is putting the pressure on the ability to plan and stay disciplined,” Gokhal continued.
Northwestern Mutual reported the staggering $1.46 million was 15% over the $1.27 million last year and 53% more since 2020, annihilating today’s inflation rate.
A poll from Northwestern Mutual’s study showed those aged 50-59 believe they need around $1.74 million saved, but only have $115.7k saved up; those aged 40-49 believe they need around $1.3 million saved, when in reality they have just $91.5k stashed.
But in a 2023 survey, only 40% of “Gen X” workers know exactly how much they will need to retire, Bankrate found.
In 2016, a poll from the US Census Bureau showed the average retirement age for women was 63 and men was 65.
New York and New Jersey were recently ranked amongst the worst states to retire in, with the Big Apple listed at No. 7 and the Garden State coming in at No. 2-worst state.
The ranking, selected from WalletHub, categorized all states into three sectors: affordability, quality of life and health care.
Due to the high cost of living and staggering rent, living in New York is 27% higher overall than the national average. Housing is 80% higher than the national average with healthcare services costing 7% higher than the national average, according to apartment listing service RentCafe.
