Speaking to a good friend of mine a couple of weeks ago, he mentioned that he needed to do more for retirement. He had read some statistic, and I remembered it, but I was hazy on the details. How much does the average American investor have saved for retirement? Sometimes it is good to see where we fall on the scale. It can be encouraging or discouraging. A brief online search gave me three sets of statistics. On April 1, 2014, USA Today published an article stating that, in a poll, a third of all workers polled had less than $1,000 saved for retirement. Sixty percent (60%) of those polled stated that they had less than $25,000 saved for retirement. Twenty-two percent (22%) stated that they had more than $100,000 in their retirement accounts (USAToday, 4/1/2014). Statisticbrain.com stated that the average savings of a 50-year old was $44,000 (http://www.statisticbrain.com/retirement-statitistics.com/). Learnvest.com reported a 2012 study in their “how do you compare” series, that workers in the age group of 25-32 had a median $12,000 in their retirement accounts and an average of $37,000. Age group 33-44 had a median of $61,000 and an average of $157,000; and age group 45-54 had a median $101,000 and an average of $219,000 in their retirement accounts. They noted specifically that they had 1300 respondents (http://www.learnvest.com/2012/11/retirement-savings-by-age-how-do-you-compare/). My guess is that none of these polls are scientifically valid. But, they do give you an idea of what individuals say they have saved for retirement in an invalid poll. I would add that many people save for retirement outside of a qualified retirement planning vehicle.
For me, the responses are interesting, but irrelevant. In the end, every individual has to figure out what their lifestyle is and will be in retirement, and how they will prepare for it. These numbers will be different for every single investor. Based on your income, you can plan for a specific savings rate to enhance your retirement. And, as long as you spend less than you make, your retirement will be a successful one. My take-away is simple. It is encouraging for all of us to know that we could all do a little more to prepare for retirement; both in the planning process and the saving/investing process. If we raise our retirement saving/investing rate by just a little bit today, we can have a more secure and joyful retirement in the future.