CHARLOTTE, N. C. — Planning for retirement can feel overwhelming, which is why many Americans tend to put off the task indefinitely. It may be easier to push retirement aside for now, but this strategy is almost assured to backfire once old age starts to set in. A recent survey asked 816 working Americans of various ages about their retirement goals, strategies, and mindsets, and some of the subsequent findings paint an unsettling image of many American’s financial futures.
The research, commissioned by MagnifyMoney, discovered that just over a quarter of surveyed Americans between the ages of 54-73 believe there is no amount of money that could sit in their savings account that would make them feel comfortable retiring. Many millennials (14.4%) and generation Z (15.2%) respondents shared the same sentiment.
While those respondents clearly represent an extreme side of the saving for retirement spectrum, many other respondents, particularly millennials, seem to be greatly underestimating just how much they’ll have to save to retire at a reasonable age.
All in all, 73% of surveyed Americans would feel great about retiring at the age of 66 with one million dollars in savings. Another 20% of millennial respondents said they would quit their jobs and retire early tomorrow if their bank statement read $500,000, and 14% said the same if they had amassed $750,000. It isn’t just millennials, though, who believe less than one million dollars is enough to retire on; regardless of age groups, 20% of all participants said that $500,000 would be enough.
Meanwhile, 20% of surveyed baby boomers believe that $500,000 would be more than enough to retire tomorrow, and 15% said they would need at least $750,000.
Additionally, 17.4% of all respondents said that no less than one million would suffice for retirement.
Among all the surveyed age groups, baby boomers are the most likely to keep working into old age, mostly because many within this age bracket believe they must earn as much as possible while they still can.
Overall, over 10% of respondents have some pretty ambitious goals for their retirement savings. In fact, roughly 12% want to have over three million dollars in savings before retiring.
Of course, at the end of the day, everyone’s individual retirement is going to be a bit different and no one set amount is going to apply to everyone. For example, one million dollars in retirement savings would equate to $50,000 in annual spending money over a 20-year retirement. So, if you plan a retirement longer than twenty years, you may need more than one million dollars, depending on how much you plan to spend on a yearly basis.
For what it’s worth, according to Fidelity, by the age of 30 an individual should have about one year’s salary saved in their bank account. As the years pass, that amount should increase to three times your yearly salary by age 40, six times by age 50, and a whopping eight times by 60 years old.
Again, all of this can seem incredibly overwhelming, especially if you’ve been slacking on getting started with your personal savings. Still, there’s no time like the present to begin saving and start planning for your future.
The survey was conducted by Qualtrics.