Most Americans Are $1.37 Million Behind on Retirement Savings Goals, Survey Finds
Written by
Gabrielle Olya
Edited by
Gary Dudak
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Many Americans have lofty retirement savings goals.
The average American now believes they will need $1.46 million to retire comfortably — but their actual savings are falling far short, a new Northwestern Mutual study found. According to the study, the average American has $88,400 currently saved for retirement. This means they are a whopping $1.37 million short of their goal.
Here’s a look at why this gap exists — and what can be done to narrow it.
The Gap Between Retirement Expectations and Reality Is Widening
The amount Americans believe they will need to save to retire comfortably is increasing, while their level of savings is declining, the survey found. In 2023, the average American believed they would need $1.27 million to retire comfortably and had $89,300 saved, making the gap between expectation and reality $1.18 million.
This year, as the amount Americans think they will need to retire comfortably has increased and the amount they have saved has decreased, that gap has grown to $1.37 million for the average person.
“Americans, including my clients, have goals for retirement that are higher than in years past,” said Chad Armstrong, private wealth advisor at Northwestern Mutual. “Many factors play into it, including longer lifespans and uncertainty around the future of Social Security and pensions.”
Can Americans Catch Up To Their Lofty Retirement Savings Goals?
While $1.37 million is a very large gap to fill, Armstrong believes that many Americans can achieve their retirement goals with discipline and planning.
“It’s more important than ever for Americans to plan comprehensively and begin saving — and to do both with intention,” he said. “The challenge I’ve run into is clients feeling like they can pull from their 401(k) like an ATM, which has an impact on their retirement savings.”
On a positive note, Armstrong said that Americans are beginning to plan for retirement earlier than ever. Many Gen Zers have already started saving for retirement, and members of this generation have an average of $22,800 currently saved for retirement.
“The research shows us Gen Zers are starting to save at 22, ” Armstrong said, “earlier than Americans ever have before and 15 years before boomers say they’ve started.”
More From GOBankingRates
