Can You Guess How Many Americans Have $2 Million Saved for Retirement? It's Probably Less Than You'd Expect - Latest Global News

Can You Guess How Many Americans Have $2 Million Saved for Retirement? It’s Probably Less Than You’d Expect

Can you guess how many Americans have $2 million saved for retirement? It’s probably less than you’d expect

While it may seem rare to retire with a $2 million nest egg, it’s more in line with what many Americans today believe they need to retire comfortably.

A survey from Northwestern Mutual shows Americans believe they need $1.46 million for a comfortable retirement, a number that has increased 53% since 2020. This dramatic increase, influenced by inflation and growing financial pressures, suggests that a $2 million goal may not be as far-fetched as it seems, especially for someone who is 60 and five years from now wants to retire.

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According to recent data from LIMRA, only a small portion of American households report having at least $2 million in investable assets, particularly those headed by a person age 60 or older. This figure represents just 7% of these households, indicating a significant gap between the wealthiest retirees and the majority.

Despite the rarity, those who achieve this financial milestone enter their later years with great confidence. LIMRA research found that 80 to 90% of these wealthy households expect their savings to easily last until they are 90. This is in stark contrast to households with lower savings, where confidence drops significantly. For example, among those with $1 million to $2 million, confidence is noticeably lower and continues to decline as wealth declines.

The research also sheds light on broader economic concerns that influence retirement planning. Many Americans are increasingly relying on guaranteed lifetime income sources such as pensions to ensure financial stability in retirement. This trend reflects concerns about Social Security sufficiency and traditional retirement plans, which fewer future retirees believe will cover their basic living expenses.

Trend: 82% of Americans don’t use it This government secured a passive income stream of 5%Are you one of them?

To close the gap on the path to a sizable retirement nest egg, here are some practical tips:

1. Start early and save consistently: The effect of compound interest increases over time, so starting saving early can have a significant impact on your retirement savings.

2. Diversify your investments: Don’t put all your eggs in one basket. Diversifying your investments can help manage risk and increase your chances of achieving your financial goals.

3. Maximize contributions to retirement accounts: Take full advantage of retirement accounts like 401(k)s and IRAs, especially if they offer employer matches.

4. Consider pensions as guaranteed income: Pensions can provide stable income in retirement, which can be particularly valuable as a supplement to Social Security.

5. Plan for healthcare costs: Healthcare can be a significant expense in retirement. Consider long-term care insurance and other ways to reduce these costs.

6. Work with a financial advisor: A professional can give you personalized advice based on your financial situation and retirement goals.

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*This information is not financial advice. In order to make informed decisions, personal advice from a financial advisor is recommended.

Jeannine Mancini has written about personal finance and investing for the past 13 years at various publications, including Zacks, The Nest, and eHow. She is not a licensed financial advisor and the content herein is for informational purposes only and does not constitute, nor is it intended to constitute, any investment advice or service. Although Mancini believes that the information contained herein is reliable and has been obtained from reliable sources, there is no representation, warranty or undertaking, express or implied, as to the accuracy or completeness of the information.

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