The Average Retirement Savings by Age

Retirement is inevitable assuming you live long enough to reach retirement age. Are you saving enough? Even if you are saving enough, are your peers? The sad answer is probably not. How bad is the average retirement savings? Let’s take a look at it by age group.

median net worth

Although it is not exactly the same as the data discussed in this article, CNN Money has a Net Worth Calculator that will show you the median net worth for people in your age and income group.

What is the Average Retirement Savings?

Let’s say that the results are, well, not pretty. We should all be striving to be well above average based on the latest results from the Retirement Confidence Survey done by the Employee Benefit Research Institute.

Total Savings, Regardless of Age

This is kind of unbelievable to me. Among all workers survey, regardless of age, 48% had less than $10,000 in savings for retirement. That is only two years worth of fully funding a Roth IRA.

How about above the $10,000 level? 60% of workers had less than $25,000 in savings. When a majority of people have less than $10,000, it isn’t surprising to see sparse results above that level.

Retirement Savings for Workers in Early Career

Not surprisingly, workers at the beginning of their career (ages 25 to 34) had the least amount of savings. Where 48% of all workers had less than $10,000 in savings, 57% of this group had less than $10,000 and 88% of these workers had less than $50,000 set aside for retirement.

With many younger workers struggling in a poor economy, saddled with student loan debt, and likely underwater on a home mortgage, it is easy to see why many haven’t set aside funds for the future.

Retirement Savings for Workers in Middle of Career

Workers aged 35 to 44 didn’t fare much better. 51% of these workers had less than $10,000, and still 72% had less than $50,000 set aside for retirement despite retirement being much closer. They improved over the younger workers a bit, but not nearly enough.

Retirement Savings for Workers in Late Career

These workers aged 45 to 54 barely, just barely, got under the total average for all workers. Whereas 48% of all workers had less than $10,000 in savings, 46% of these workers had less than that amount set aside.

That’s not much of an improvement considering they are one to two decades closer to retirement.

The big difference in this age group is the number of workers with more than $250,000 in retirement savings. The early career only has 1% reporting that much saving, the middle career workers don’t do much better at 3%. But this group, at least a portion of them, seem to finally have received a wake up call. The number of workers with $250,000 or more set aside for retirement jumps to 17% here. Still a miserably low number at least than 1/5th of those workers, but a massive improvement over the previous sets of workers.

Retirement Savings for Workers Getting Ready to Retire

If I were in this group I would be terrified. Workers aged 55 or older simply don’t have enough savings for retirement on average. How would you like to know you were less than 10 years from retirement and had less than $10,000 set aside for that retirement? That’s where 38% of these workers found themselves.

Thankfully there is some improvement toward the higher retirement amounts: 22% have more than $250,000 and 40% had at least $100,000 in savings. But that leaves 60% below the $100,000 mark and well on their way to a miserable retirement based primarily on work and Social Security income.

How to Break Through the Averages

Sometimes it can sound like personal finance writers are beating a dead horse, but the basics of improving your financial situation remain.

If you want to avoid being on the negative side of these averages, you have to do three basic things:

  • Spend less than you earn. If you spend more than you make you are going into debt and won’t have any money left over for retirement savings, so you have to get this first.
  • Automate your retirement savings. Instead of trying to remember to contribute to your retirement accounts, take the money out of your possession before you have a chance to spend it with automated savings.
  • Increase contributions as you age. If at all possible increase your retirement contributions each year as you age, even if by just a little bit. An extra half of a percent every year can do wonders for your retirement nest egg.

About the Author

By , on Aug 14, 2012
Kevin Mulligan
Kevin Mulligan is a debt reduction champion with a passion for teaching people how to budget and stay out of debt. He's building a personal finance freelance writing career and has written for, Discover Bank, and many others.

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Leave Your Comment (3 Comments)

  1. Bryan@Fatwallet says:

    I’m above average at this point, but like you said, I automate my savings and build my budget around it. Once you get used to it, you wonder why you didn’t start saving earlier!

  2. I’m well on my way to beating these numbers. I agree with your keys as I spend less than I earn and automate my retirement savings. I’ve also increased my savings whenever I get a raise or change jobs. If you can do these things and start saving with a health percent when you start your first job you’ll never miss the money you never had.

  3. Ornella says:

    I would even add to keep costs low by considering low cost index funds.

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