Here’s the Average American’s Retirement Savings by Age in 2024


JANUARY 21, 2024

A retired couple looking at a basket of flowers. – Getty Images

If you’re nervous about saving for retirement, you’re not alone.

According to a recent survey from Bankrate, 56% of Americans said they feel behind on saving for retirement. In another survey, a third of Americans said they would need at least $1 million to retire comfortably, but 45% said it’s unlikely they’ll be able to reach that milestone.

Saving for retirement isn’t easy. Many Americans say they frequently live paycheck to paycheck as core expenses like rent or mortgage payments, health insurance, child care, student loans, car payments, medical bills, utilities, credit card debt, and taxes eat into their budgets. The pandemic disruption and uncertainty, plus two years of abnormally high inflation, have only made things more difficult for millions.

In light of these challenges, it may be helpful to understand how you compare to the average American.

Average retirement savings in the U.S. by age

According to research from The Motley Fool, the median retirement savings for American households in 2022 was $87,000. Not surprisingly, retirement savings increased for each age bracket until retirement age.

The research also found a disparity in retirement savings based on education and race. For example, Americans with a high school degree have median retirement savings of $44,000, while those with a college degree have $141,700. White Americans have a median of $100,000, compared to Black Americans at $39,000 and Hispanics at $55,600.

The chart below shows how much Americans have saved for retirement based on the median at each major age group.

Age Under 35 35-44 45-54 55-64 65-74 Over 74
Median amount saved $18,880 $45,000 $115,000 $185,000 $200,000 $130,000

Data source: Federal Reserve. 

And below is the mean, or average, each age bracket has saved.

Age Under 35 35-44 45-54 55-64 65-74 Over 74
Mean amount saved $49,127 $141,517 $313,220 $537,563 $609,229 $462,411

Data source: Federal Reserve. 

As you can see, there’s a considerable difference between the mean and median retirement savings by age. Just keep in mind the mean numbers are skewed by wealthier Americans.

Overall, these numbers provide context to why many Americans feel they don’t have enough saved and need Social Security to help sustain their lifestyles in retirement.

How you can boost your retirement savings

If you’ve already made an effort to reduce your spending and you have an emergency fund in place, you should be ready to contribute to your retirement savings. One of the easiest ways to do so is by automating direct deposits to a retirement account, either through your employer’s 401(k) or another type of account such as an IRA.

Your next step is to invest whatever you save, and a popular choice is a broad-based ETF like the Vanguard 500 Fund, which tracks the S&P 500 at a low cost. Other good options for ETFs are the Invesco QQQ Trust, which tracks the Nasdaq-100, an index that has historically beaten the S&P 500. Or you could consider the Schwab U.S. Dividend Equity ETF, which offers an attractive yield of 3.5%.

Whatever you decide to invest in, the sooner you do it, the better. Time is your biggest ally when it comes to the magic of compounding and the effect it can have on your returns. Regardless of where you currently stand with your retirement savings, the steps you take now to save or invest more could have a major impact on your retirement. Your future self will thank you.

The $21,756 Social Security bonus most retirees completely overlook

If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $21,756 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after.

Courtesy: The Motley Fool