Americans Now Target $1.46M for Retirement: Are You on Track with These Age-Related Goals?

Traditionally, retirement is a milestone every hardworking American looks forward to enjoying. Unfortunately, too many people report this goal feels completely out of reach. The Federal Reserve revealed that the average American family has just $87,000 saved. Even worse, roughly 45% of U.S. citizens have no retirement savings at all. When factoring in the staggering $1.46 million Americans collectively believe they will need for their retirement years, these statistics are devastating.

None of us are immune to economic changes, including rising cost of living, inflation, and tariffs on foreign goods. These factors, alongside market volatility, are forcing expectations regarding retirement savings to rise substantially. Experts state that households earning $200,000 should aim to save at least $1.43 million by the time retirement comes around. However, many people are nowhere near this goal.

This slideshow provides a detailed breakdown of financial retirement goals according to age. We cover practical tips to help accelerate the savings process, if you feel you’ve fallen behind. You’ll learn various methods to take control of your financial future, from investing in IRAs to maximizing your 401(k).

The Retirement Reality

• Many Americans have not saved enough for retirement.
• The average family has only $87,000 saved.
• Almost half of Americans have no retirement savings whatsoever.

How Much Money Is Enough?

• Americans now estimate they’ll need $1.46 million to retire comfortably; this number is up from $951k in 2020.
• Fears surrounding rising inflation and cost-of-living are pushing retirement targets higher each year.

Savings Goals by Age

• High earners should hit specific savings goals by each decade of life, according to Edward Jones.
• In your 20s, you should save up to $445K; by your 30s, this number should be closer to $945K.
• Once your reach your 40s, this goal is over $1.6M; 50s is set at $2.5M, and 60s is a staggering $3M.

What if You’re Behind?

• Don’t panic—there are ways to catch up even if you’re not on track.
• The key is to start now and use all tools available to build your retirement cushion.

Tip #1: Max Out Your 401(k) Match

• If your employer matches contributions, contribute at least that amount.
• Matching is free money—take full advantage to double part of your savings each year.

How to Apply Tip #1

• Check your employer’s match rate, often around 6%.
• If you earn $75K and contribute 6%, with a match, you’ll save about $6,750 per year.
• Always contribute enough to capture the full match.

Tip #2: Start a Traditional IRA

• A traditional IRA lets your investments grow tax deferred.
• You may also get a tax deduction on your contributions, depending on your income.

How to Apply Tip #2

• Consult a financial advisor to determine eligibility.
• Open an IRA with a brokerage or bank and set up automatic monthly contributions.
• Consider using tax refunds to boost your IRA savings.

Tip #3: Open a Roth IRA

• A Roth IRA offers tax-free growth and tax-free withdrawals in retirement.
• Contributions are made with after-tax dollars, which can benefit future tax planning.

How to Apply Tip #3

• Make sure you meet income limits before contributing.
• Prioritize Roth contributions if you expect higher taxes in retirement.
• Diversify your retirement accounts with both Roth and traditional options.

Tip #4: Solo 401(k) for the Self-Employed

• If you’re self-employed, you can contribute up to $69,000 in 2024 with a Solo 401(k).
• Includes additional catch-up contributions if you’re 50 or older.

How to Apply Tip #4

• Work with a financial advisor or tax pro to set up a Solo 401(k).
• Maximize contributions while reducing your taxable income.
• Take advantage of higher limits if you’re behind on retirement savings.