The uncomfortable truth for most Americans is you’re not saving enough for retirement, if you’re even saving at all. According to the Federal Reserve’s most recent Survey of Consumer Finances, median retirement savings amongst all U.S. adults, regardless of age, is just $87,000. Worse, a quarter of all people have no retirement savings at all.

While a lot depends on a person’s lifestyle, cost of living, taxes, and numerous other financial considerations, most people believe they will need about $1.4 million in savings to finance their retirement. 

That’s a wide and troubling gap, but it’s what those figures don’t say that’s important. They don’t tell you where you are in relation to where you should be based on your age and income.

24/7 Wall St. Insights:

• Although most people are putting away money for retirement, most are well behind where they should be. More worrisome is the statistic that fully one-quarter of all U.S. adults have no retirement savings.
• While the average retirement savings account has $334,000 in it, the median savings is just $87,000. That’s due to a select few individuals who are well ahead of the savings game.
• If you want to retire at age 65 and have a household income of $200,000, the chart below can show you where you should be based on your age bracket. There are also some tips if you find yourself falling behind as well as some for those who are well ahead of schedule.

Location is not as important as direction

The financial services company Edward Jones recently published an article showing where most people are in their savings journey and where they should be based on their age. If your household is making $200,000 a year and planning on retiring at age 65, this is what it looks like.

Retirement Savings with $200,000 Household Income
Age Bracket	Current Savings Range
20s	$0 – $445,000
30s	$345,000 – $945,000
40s	$810,000 – $1,615,000
50s	$1,430,000 – $2,500,000
60s	$2,260,000 – $3,170,000

Source: Edward Jones calculations. Retirement at age 65.

While the numbers may seem very high — and your retirement account may seem woefully inadequate — remember, this is to maintain your current standard of living after you get your gold watch. 

What to do if you’re behind schedule

If you’re like me and see that you have less in your account than expected, there are things you can do to catch up. First, don’t panic. Some of the easiest steps to take include maximizing your 401(k) retirement plan so that you can get the full employer match, if your company offers such an option. And if you’re older than 50, you can also utilize the catch-up provision of the law to make additional contributions for years where you didn’t contribute the full amount.

For younger wage earnings, you can either start saving or save more often. Even if you can only afford to save a small amount each month, it will add up over time. For older people, consider paying down your debt and then don’t incur anymore. You may also want to consider working with a financial advisor to create a retirement plan.

Congrats! You’re ahead of schedule. Here’s how to go turbo

There are people who look at that chart and say, pfft! I’m well past those levels. Well, if you’re among the fortunate few who are ahead of schedule, congratulations! But don’t stop now. 

According to the Federal Reserve, while the median savings rate is below $90,000, the average retirement savings level is $334,000. That’s because there is a smaller number of people with much more saved. So if you’re one of them, kudos to you.

Still, there’s even more you can do. If you’re not already maxing out your 401 (k), you should do so too. If you have maxed it out, consider investing in a taxable brokerage account. This provides flexibility as you won’t face penalties for withdrawing funds before retirement age.

If you expect to be in a higher tax bracket in retirement, convert a traditional retirement account to a Roth account so your money grows tax-free. Also consider a Health Savings Account, as withdrawals for non-medical expenses after 65 are taxed like a traditional IRA. Think of it as a supplemental retirement account.

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