While many Americans struggle to save for retirement, the top 1% are accumulating significant nest eggs. This begs the question: How much are they saving and how does this compare to the national average?
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Data from DQYDJ, using Federal Reserve statistics, shows that the average retirement age in the United States is about 60, with an average age of 62. The statistics also reflect the ongoing economic activity of people who, although reaching retirement age, may continue to work or gradually use their savings.
The total retirement savings of the richest 1% is about $2.3 million. Looking at a broader definition of retirement savings, the number is $5 million.
Here’s a breakdown of the top 1% estimated retirement savings by age group:
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18-24 years: $150,000
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25-29 years: $365,000
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30-34 years: $365,000
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35-39 years: $730,000
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40-44 years: $1,234,600
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45-49 years: $1,397,000
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50-54 years: $2,311,000
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55-59 years: $3,105,000
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60-64 years: $3,550,000
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65-69 years: $4,574,000
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Savings are starting to decline, particularly among those over 70, suggesting a shift from saving to spending in retirement:
According to a report from The Motley Fool using Federal Reserve data, the median retirement account balance for all working-age households (ages 25 to 64) in 2022 was closer to $87,000.
This shows the significant gap between the top 1% with millions of dollars in savings and the average American who is unable to even reach a six-figure bank balance.
The following factors contribute to this gap:
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Cost of living: The rising cost of living, particularly housing costs, may force many Americans to prioritize basic needs over saving for retirement. This bottleneck in disposable income disproportionately affects low and middle earners.
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If you are fortunate enough to be a top earner, you should consider maximizing your contributions to retirement accounts, exploring investment opportunities that meet your risk tolerance, and consulting with a financial advisor to ensure your wealth continues to grow and meet your retirement savings goals can be achieved.
While the numbers may seem unattainable for the top 1%, it’s important to remember that everyone’s financial situation is unique. You can still take steps to improve your retirement prospects. Every dollar saved grows over time thanks to compound interest.
Consulting a financial advisor can also be helpful for those trying to catch up. They can assess your circumstances, create a customized plan that takes into account your income, risk tolerance and retirement goals, and help you get the most out of your financial resources. By taking these proactive steps, you can start building a secure and comfortable future in retirement, no matter where you are on the economic ladder.
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This article: Are you on track to be in the top 1% of retirement savings? Here’s How Much They Have at Each Age originally appeared on Benzinga.com
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