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Here's how much money Americans think they need to retire comfortably
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2020 Aug 5, 6:18am 5,534 views 48 comments
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1
zzyzzx
2020 Aug 5, 6:20am
zzyzzx
2020 Aug 5, 6:20am
zzyzzx says
The average differs slightly by generation: Millennials and Gen X believe they need at least $2 million to retire comfortably, while baby boomers put the number around $1.6 million.
2
Al_Sharpton_for_President
2020 Aug 5, 6:24am
Al_Sharpton_for_President
2020 Aug 5, 6:24am
Hard to know how long you might live to. And so if you could amass enough capital to live off the returns, that might be ideal. ZIRP has destroyed a decent risk-free return, and so ideally one might siphon off a bit of capital appreciation while allowing for inflation adjusted growth of the golden egg, and then when on one's deathbed, blow it all on hookers and blow.
3
FuckTheMainstreamMedia
2020 Aug 5, 8:08am
FuckTheMainstreamMedia
2020 Aug 5, 8:08am
Anything over a million and a half is fine in much of the country, especially if you have no debt and your state is tax friendly.
But if you live on the coast, if you bought an overpriced home when you were in your mid 30’s or over...well you are fucked.
But if you live on the coast, if you bought an overpriced home when you were in your mid 30’s or over...well you are fucked.
5
RWSGFY
2020 Aug 5, 8:44am
RWSGFY
2020 Aug 5, 8:44am
FuckTheMainstreamMedia says
My BIL said that he sees no point in putting any money into 401k because "you can't make money in stocks" and that "his house is his retirement plan". He doesn't believe in paying it off before he retires either so "the plan" is apparently to wait until it appreciates enough to sell it, pay off the remainder of the mortgage and live happily ever after from the profit...
Anything over a million and a half is fine in much of the country, especially if you have no debt and your state is tax friendly.
But if you live on the coast, if you bought an overpriced home when you were in your mid 30’s or over...well you are fucked.
My BIL said that he sees no point in putting any money into 401k because "you can't make money in stocks" and that "his house is his retirement plan". He doesn't believe in paying it off before he retires either so "the plan" is apparently to wait until it appreciates enough to sell it, pay off the remainder of the mortgage and live happily ever after from the profit...
6
Ceffer
2020 Aug 5, 9:27am
Ceffer
2020 Aug 5, 9:27am
Must be an enlightened Schwab group comparatively. Polls of the general Idiopolous seem to indicate that a lot of people think 200k plus SS is enough for a comfortable retirement.
Fact is, even in California, with all the free shit, medicaid/medicare etc. and a good trailer park location, many people are still able to retire with pretty small money. I think every year to five years, California will replace non-working appliances for no cost. In one area around my home, they send social workers and handymen to fix up places for the residents. Free meal delivery is commonplace. It's like Welfare Downton Abbey for some of these people.
I know one guy who has a nice apartment on Section 8 just a very short stroll to the Santa Cruz pier and beaches. He does qualify, and I admire his ability to actually function with some severe mental conditions (he is drug and alcohol free), but, man, they have people paying million plus for true tiny crapshacks for these locations, or extremely high rents.
Fact is, even in California, with all the free shit, medicaid/medicare etc. and a good trailer park location, many people are still able to retire with pretty small money. I think every year to five years, California will replace non-working appliances for no cost. In one area around my home, they send social workers and handymen to fix up places for the residents. Free meal delivery is commonplace. It's like Welfare Downton Abbey for some of these people.
I know one guy who has a nice apartment on Section 8 just a very short stroll to the Santa Cruz pier and beaches. He does qualify, and I admire his ability to actually function with some severe mental conditions (he is drug and alcohol free), but, man, they have people paying million plus for true tiny crapshacks for these locations, or extremely high rents.
7
Tenpoundbass
2020 Aug 5, 10:30am
Tenpoundbass
2020 Aug 5, 10:30am
Own your own house, live in a multi generational household, and have a pension that will at least afford your own booze and smokes.
Oh and don't raise your kids to be lazy louts that will let the bills go in arrears when you hand them the head of household reigns.
Oh and don't raise your kids to be lazy louts that will let the bills go in arrears when you hand them the head of household reigns.
8
SunnyvaleCA
2020 Aug 5, 5:59pm
Whether it's $2MM or $1.6MM hardly matters compared to government malfeasance. More important is how much money you can hang on to: gouging levels of taxes, clawbacks, cancelled social security and medicare, and medical expenses jacked up out of all proportion due, in part, to government ineptitude and regulation.
9
Patrick
2020 Aug 5, 6:07pm
Patrick
2020 Aug 5, 6:07pm
Very important parameter: At what age?
To retire at 55 takes a lot more than retiring at 65, just because you'll live 10 years more (inshallah, lol).
Every year you work actually takes two years off of the amount you need to retire because you've blown a year of life working, and so need that much less savings.
To retire at 55 takes a lot more than retiring at 65, just because you'll live 10 years more (inshallah, lol).
Every year you work actually takes two years off of the amount you need to retire because you've blown a year of life working, and so need that much less savings.
10
Booger
2020 Aug 5, 6:11pm
Booger
2020 Aug 5, 6:11pm
More importantly, how much to retire in Caligulan splendor at various ages?
11
Dholliday126
2020 Aug 5, 6:11pm
Dholliday126
2020 Aug 5, 6:11pm
So anyone who knows anything knows it's you run rate aka monthly nut. If you have a paid off 300k house, medicare and 1800 in monthly social security, maybe you just need a fall back nest egg of 100k. I hate these fucking articles that say you need 5 million bucks, that's a load of bullshit.
And what if the dollar goes to shit, maybe you just need 100 ounces of gold or 5 bitcoins, who the fuck knows....so stupid.
Most geniuses I know have a paid off 5+ acre farm they paid nothing for in the sticks, found a virtual way to make money, raise meat and veggies and home school. How about writing an article about that yahoo, you fucks. Just another Goldman article that makes you feel bad for not wasting your whole life to get taxed to death, save a fraction of what they are telling you too and die before you hit social security because you were busting your ass so much.
And what if the dollar goes to shit, maybe you just need 100 ounces of gold or 5 bitcoins, who the fuck knows....so stupid.
Most geniuses I know have a paid off 5+ acre farm they paid nothing for in the sticks, found a virtual way to make money, raise meat and veggies and home school. How about writing an article about that yahoo, you fucks. Just another Goldman article that makes you feel bad for not wasting your whole life to get taxed to death, save a fraction of what they are telling you too and die before you hit social security because you were busting your ass so much.
12
Patrick
2020 Aug 5, 9:55pm
Patrick
2020 Aug 5, 9:55pm
Dholliday126 says
@Dholliday126 You are right.
$5 million would put you in the top 1.5% of the country. Clearly people retire below that.
I hate these fucking articles that say you need 5 million bucks, that's a load of bullshit.
@Dholliday126 You are right.
$5 million would put you in the top 1.5% of the country. Clearly people retire below that.
13
just_passing_through
2020 Aug 5, 9:59pm
just_passing_through
2020 Aug 5, 9:59pm
Yup, he's right. I'm shooting for at least 2 though because I never married and had kids. Need the extra protection. I've always thought ending up owning a small farm/ranch was a great idea. Hard to work when you're old though so much be very small.
I want mine on the water with a sailboat too though. :D
I want mine on the water with a sailboat too though. :D
14
SunnyvaleCA
2020 Aug 5, 10:37pm
Booger says
More importantly, how much to retire in Caligulan splendor at various ages?Probably retire at age 26 or 27. Caligula only lived to age 28!
15
SunnyvaleCA
2020 Aug 5, 10:46pm
Dholliday126 says
So, if you had $5MM you would consume $200k in the first year. With no inflation and no investment gains, you'd run out of money in 25 years. It doesn't take all that much investment gain above inflation to be able to stay afloat indefinitely.
Staying afloat indefinitely brings up an important point. Theoretically, as soon as you have that level of money invested for retirement (or are willing to reduce your spending enough), you can retire at any age regardless of life expectancy. The flip side is that if something goes wrong 20 years after you retired at age 40, now you've lost all your job skills and connections, and are trying to re-enter the workforce at age 60.
I hate these fucking articles that say you need 5 million bucks, that's a load of bullshit.Articles I've said have mentioned that you spend 4% of your retirement savings in the first year (or up to 6%, depending on risk factors etc). Then, you spend that same amount every year after adjusting upward for inflation. That makes assumptions about real investment returns.
So, if you had $5MM you would consume $200k in the first year. With no inflation and no investment gains, you'd run out of money in 25 years. It doesn't take all that much investment gain above inflation to be able to stay afloat indefinitely.
Staying afloat indefinitely brings up an important point. Theoretically, as soon as you have that level of money invested for retirement (or are willing to reduce your spending enough), you can retire at any age regardless of life expectancy. The flip side is that if something goes wrong 20 years after you retired at age 40, now you've lost all your job skills and connections, and are trying to re-enter the workforce at age 60.
16
Al_Sharpton_for_President
2020 Aug 6, 4:26am
Al_Sharpton_for_President
2020 Aug 6, 4:26am
SunnyvaleCA says
A medical catastrophe could be another, but with $5MM in the bank, you can ride that out assuming you had health insurance. Your biggest risk is halving your wealth through divorce.
The flip side is that if something goes wrong 20 years after you retired at age 40,I assume you mean if your money is gone, perhaps due to a WW stock market crash. But if that happens, you won't be alone in the world of hurt and so current job skills at 60 probably won't matter. Probably more important to have enough ammo and arms, food and water.
A medical catastrophe could be another, but with $5MM in the bank, you can ride that out assuming you had health insurance. Your biggest risk is halving your wealth through divorce.
17
zzyzzx
2020 Aug 6, 4:53am
zzyzzx
2020 Aug 6, 4:53am
Patrick says
How much to get into the top 1%?
Patrick says
But not in Caligulan splendor.
$5 million would put you in the top 1.5% of the country.
How much to get into the top 1%?
Patrick says
Clearly people retire below that.
But not in Caligulan splendor.
18
zzyzzx
2020 Aug 6, 4:55am
zzyzzx
2020 Aug 6, 4:55am
Dholliday126 says
Yeah, 6 million and a paid off nice enough house would be better.
I hate these fucking articles that say you need 5 million bucks, that's a load of bullshit.
Yeah, 6 million and a paid off nice enough house would be better.
19
Ceffer
2020 Aug 6, 10:24am
Ceffer
2020 Aug 6, 10:24am
How much retirement money is minimal for a daily diet of imported Asian hookers?
20
zzyzzx
2021 Jan 5, 5:08am
zzyzzx
2021 Jan 5, 5:08am
What's the point in retireing unless you can do it in Caligulan splendor?
Serious question here:
How much cash (not securities, etc.) I mean cash in the bank would you want to be comfortable retiring without any pension (because I doubt very many people here are getting an actual defined benefit pension)?
In my case I would want that amount, plus enough to buy a house someplace I'd want to retire (because my current house is maybe worth $35K-$55K range, I can't count on selling it to get the proceeds to buy something someplace else where I'd like to live, which is going to cost way more than that.,
Serious question here:
How much cash (not securities, etc.) I mean cash in the bank would you want to be comfortable retiring without any pension (because I doubt very many people here are getting an actual defined benefit pension)?
In my case I would want that amount, plus enough to buy a house someplace I'd want to retire (because my current house is maybe worth $35K-$55K range, I can't count on selling it to get the proceeds to buy something someplace else where I'd like to live, which is going to cost way more than that.,
21
astronut97
2021 Jan 5, 5:37am
astronut97
2021 Jan 5, 5:37am
zzyzzx says
I'm guessing you live in a very rural area or a small town?
because my current house is maybe worth $35K-$55K range
I'm guessing you live in a very rural area or a small town?
22
zzyzzx
2021 Jan 5, 5:43am
zzyzzx
2021 Jan 5, 5:43am
astronut97 says
Shitty part of Baltimore City. If I lived in a very rural area or small town I'd probably retire in place. I'm looking to go to Florida.
I'm guessing you live in a very rural area or a small town?
Shitty part of Baltimore City. If I lived in a very rural area or small town I'd probably retire in place. I'm looking to go to Florida.
23
theoakman
2021 Jan 5, 7:22am
I'm sure you would need millions of dollars to retire in California. Florida, not so much.
24
BoomAndBustCycle
2021 Jan 5, 8:24am
theoakman says
Yeah, if you basically just putt around your house in retirement... you can survive on social security alone if your house is paid off and it’s not high property taxes. My neighbors in CA only pay tax on $180k due to prop 13. You might be eating a lot of soup and bread.. but it’s being done everywhere. The saving grace about CA is PROP 13. It’s why even that commercial prop 13 repeal failed... retirees smelled the next step would be residence prop 13 repeal and didn’t want to go down that road.
'm sure you would need millions of dollars to retire in California. Florida, not so much.
Yeah, if you basically just putt around your house in retirement... you can survive on social security alone if your house is paid off and it’s not high property taxes. My neighbors in CA only pay tax on $180k due to prop 13. You might be eating a lot of soup and bread.. but it’s being done everywhere. The saving grace about CA is PROP 13. It’s why even that commercial prop 13 repeal failed... retirees smelled the next step would be residence prop 13 repeal and didn’t want to go down that road.
25
B.A.C.A.H.
2021 Jan 5, 8:32am
B.A.C.A.H.
2021 Jan 5, 8:32am
BoomAndBustCycle says
See it on a lot of my meals on wheels deliveries in SJ-Milpitas.
Tell tale signs are the peeling paint; 1960's original single-pane windows; deteriorating composite single roofs; dead lawns that haven't been converted to low-water landscaping; rusting, paint-peeling old beater cars, some with flat tires; scattered among hipster homes with all the upgrades.
Yeah, if you basically just putt around your house in retirement... you can survive on social security alone if your house is paid off and it’s not high property taxes. My neighbors in CA only pay tax on $180k due to prop 13. You might be eating a lot of soup and bread.. but it’s being done everywhere. The saving grace about CA is PROP 13. It’s why even that commercial prop 13 repeal failed... retirees smelled the next step would be residence prop 13 repeal and didn’t want to go down that road.
See it on a lot of my meals on wheels deliveries in SJ-Milpitas.
Tell tale signs are the peeling paint; 1960's original single-pane windows; deteriorating composite single roofs; dead lawns that haven't been converted to low-water landscaping; rusting, paint-peeling old beater cars, some with flat tires; scattered among hipster homes with all the upgrades.
26
PeopleUnited
2021 Jan 5, 8:33am
PeopleUnited
2021 Jan 5, 8:33am
Apparently it’d only take half a bitcoin to retire in Caligulan splendor. Buy now or cry later. (Sarcasm off)
27
Bitcoin
2021 Jan 5, 10:07am
Bitcoin
2021 Jan 5, 10:07am
PeopleUnited says
@PeopleUnited
By taking parts of your statement it makes it a valid argument IMO. With a couple of Bitcoin some people will be able to be set for life in the near future.
Owning just one Bitcoin is out of reach for many though. There is a rush into crypto from all sides/angles. Bitcoin's market cap is still below one trillion. Gold has over 10 Trillion market cap. Since Bitcoin is digital gold, there is lots of upside for Bitcoin as a store of value.
"Apparently it’d only take half a bitcoin to retire"
"Buy now or cry later."
@PeopleUnited
By taking parts of your statement it makes it a valid argument IMO. With a couple of Bitcoin some people will be able to be set for life in the near future.
Owning just one Bitcoin is out of reach for many though. There is a rush into crypto from all sides/angles. Bitcoin's market cap is still below one trillion. Gold has over 10 Trillion market cap. Since Bitcoin is digital gold, there is lots of upside for Bitcoin as a store of value.
28
clambo
2021 Jan 5, 9:06pm
I’m struggling with the concept today.
I believe that many people can get by with social security and $1/2 million.
$500k could provide $2500/month, and with social security a guy could make ends meet probably.
I have more, but it’s strange; I am so attached and possessive of my investments that I struggle to sell anything to use for income.
I won’t mind spending social security of course but I’m greedy and like the capital appreciation I got in the last 2-3 years.
I took a friend to dinner tonight for her birthday and she said “Don’t wait, you have enough, you can spend it.”
I’m worried about the people who have no savings nor investments. They better wake up and smell the coffee.
I believe that many people can get by with social security and $1/2 million.
$500k could provide $2500/month, and with social security a guy could make ends meet probably.
I have more, but it’s strange; I am so attached and possessive of my investments that I struggle to sell anything to use for income.
I won’t mind spending social security of course but I’m greedy and like the capital appreciation I got in the last 2-3 years.
I took a friend to dinner tonight for her birthday and she said “Don’t wait, you have enough, you can spend it.”
I’m worried about the people who have no savings nor investments. They better wake up and smell the coffee.
29
HeadSet
2021 Jan 6, 8:00am
HeadSet
2021 Jan 6, 8:00am
clambo says
You might need worry about the number of those folks with no retirement savings. They may number enough to get left wing politicians vote to have your savings redistributed "fairly." After all, no autocratic government like to see independent self sufficient citizens. From the days of Pharaoh thru Communism and Sadam, the autocrats want to own all and distribute it out according to their "generosity."
I, just like you, am a saver. I had no inheritances, but have have set aside enough money during my working life so far to retire comfortably for decades along with a paid for house. But I see the an uncomfortable attitude gaining traction, with forgiveness of student loans. I started saving for my daughters college from when she was born, and during that time, I watch the price of college skyrocket mainly because of easy access loans taken by irresponsible people. It is sickening to see a family who bough two luxury cars over the 18 years their kid grew up rather than put it in a college fund get a free education. The kid's college will cost me $120k, or about the price of two Lexus cars. This same attitude may spill over to retirement savings.
I’m worried about the people who have no savings nor investments. They better wake up and smell the coffee.
You might need worry about the number of those folks with no retirement savings. They may number enough to get left wing politicians vote to have your savings redistributed "fairly." After all, no autocratic government like to see independent self sufficient citizens. From the days of Pharaoh thru Communism and Sadam, the autocrats want to own all and distribute it out according to their "generosity."
I, just like you, am a saver. I had no inheritances, but have have set aside enough money during my working life so far to retire comfortably for decades along with a paid for house. But I see the an uncomfortable attitude gaining traction, with forgiveness of student loans. I started saving for my daughters college from when she was born, and during that time, I watch the price of college skyrocket mainly because of easy access loans taken by irresponsible people. It is sickening to see a family who bough two luxury cars over the 18 years their kid grew up rather than put it in a college fund get a free education. The kid's college will cost me $120k, or about the price of two Lexus cars. This same attitude may spill over to retirement savings.
30
B.A.C.A.H.
2021 Jan 6, 8:37am
B.A.C.A.H.
2021 Jan 6, 8:37am
HeadSet says
Another one is a federal bailout for states and municipalities.
Just who are we bailing out?
Public employee pensions and bond holders.
As much as I loathe punk-ass draft dodging coward McConnell I hafta agree with him on that one.
uncomfortable attitude gaining traction, with forgiveness of student loans
Another one is a federal bailout for states and municipalities.
Just who are we bailing out?
Public employee pensions and bond holders.
As much as I loathe punk-ass draft dodging coward McConnell I hafta agree with him on that one.
31
RWSGFY
2021 Jan 6, 8:44am
RWSGFY
2021 Jan 6, 8:44am
IHLary floated the idea of confiscating all IRAs/401k and such into SS. I can see it coming back. Because crisis.
32
MAGA
2021 Jan 6, 8:49am
MAGA
2021 Jan 6, 8:49am
I have a positive cash flow from my savings and investments as a retiree. I have no interest in doing something stupid like buying an expensive sports car. I enjoy a frugal lifestyle
33
MAGA
2021 Jan 6, 8:51am
MAGA
2021 Jan 6, 8:51am
FuckCCP89 says
I forget about that. Maybe Uncle Joe will think about doing that.
IHLary floated the idea of confiscating all IRAs/401k and such into SS. I can see it coming back. Because crisis.
I forget about that. Maybe Uncle Joe will think about doing that.
34
clambo
2021 Jan 6, 9:58am
Like Headset and MAGA I’m afraid that the cocksucking liberals will come after retirement assets.
They know that is where the money is.
I met some young people in Florida, some of whom I dated.
“You’re so lucky to have money.”
“Luck is being born with a brain; the rest was from saving and investing.”
“You can do it; $500/month for 33 years will be a million bucks.”
I was practically screaming at them since 2015 to do this.
One guy is 32 and has had free rent for 3+ years, his parents retired and he lives with them.
“Get a Roth IRA! Quit fuckin around!”
“Stocks up, cocks up!” I text him after a good day in the stock market.
He and the girl resist, I cannot convince them, and they will vote for the asshole who wants to confiscate my blood sweat and tears, I have no doubt.
They know that is where the money is.
I met some young people in Florida, some of whom I dated.
“You’re so lucky to have money.”
“Luck is being born with a brain; the rest was from saving and investing.”
“You can do it; $500/month for 33 years will be a million bucks.”
I was practically screaming at them since 2015 to do this.
One guy is 32 and has had free rent for 3+ years, his parents retired and he lives with them.
“Get a Roth IRA! Quit fuckin around!”
“Stocks up, cocks up!” I text him after a good day in the stock market.
He and the girl resist, I cannot convince them, and they will vote for the asshole who wants to confiscate my blood sweat and tears, I have no doubt.
35
PeopleUnited
2021 Jan 6, 10:04am
PeopleUnited
2021 Jan 6, 10:04am
A retirement account is the epitome of white privilege. For the sake of humanity our great leader will relieve you of this burden. (Sarcasm off)
36
Patrick
2021 Jan 6, 10:15am
Patrick
2021 Jan 6, 10:15am
clambo says
That will be the point at which millions pick up their guns and waste those fuckers.
cocksucking liberals will come after retirement assets
That will be the point at which millions pick up their guns and waste those fuckers.
37
Blue
2021 Jan 6, 10:32am
HeadSet says
I know one of my past neighbors, somehow was able to show empty pockets and get a free medical seat for his daughter at a good college at east coast. About 4 years later bought multi million dollar house around. Over the period, I have seen couple of varieties of these kind of scams. None of them need money from either private or public to pay for their own kids.
This system needs massive changes.
It is sickening to see a family who bough two luxury cars over the 18 years their kid grew up rather than put it in a college fund get a free education. The kid's college will cost me $120k, or about the price of two Lexus cars. This same attitude may spill over to retirement savings.
I know one of my past neighbors, somehow was able to show empty pockets and get a free medical seat for his daughter at a good college at east coast. About 4 years later bought multi million dollar house around. Over the period, I have seen couple of varieties of these kind of scams. None of them need money from either private or public to pay for their own kids.
This system needs massive changes.
38
HeadSet
2021 Jan 6, 12:06pm
HeadSet
2021 Jan 6, 12:06pm
Patrick says
They won't. If people were that protective of their rights, this vote fraud would never have happened. Just like with vote fraud, it will be a faceless entity that taps your and everyone else's retirement accounts.
clambo sayscocksucking liberals will come after retirement assets
That will be the point at which millions pick up their guns and waste those fuckers.
They won't. If people were that protective of their rights, this vote fraud would never have happened. Just like with vote fraud, it will be a faceless entity that taps your and everyone else's retirement accounts.
39
Misc
2021 Jan 6, 4:26pm
Whaddya mean, Uncle Joe said #1 priority is getting out $2000 checks to everyone. (except you)
With money coming in like clockwork from the government, who needs investments? He will probably put back in the Democrats' favorite giveaway an extra $600 per week in extra unemployment from the Federal government as a supplement to the lucrative amount from the State. So who needs a job?
For the disadvantaged, maybe he will make good on those reparation talks. A monthly reparation check will go a long way to combating racism.
Expand Obamacare, of course. As an extra benefit, we need it to cover undocumented immigrants as there are no "illegal" people.
... and it is all free
Saving the best for last ... trillions and trillions to bail out those state and municipal pension plans.
With money coming in like clockwork from the government, who needs investments? He will probably put back in the Democrats' favorite giveaway an extra $600 per week in extra unemployment from the Federal government as a supplement to the lucrative amount from the State. So who needs a job?
For the disadvantaged, maybe he will make good on those reparation talks. A monthly reparation check will go a long way to combating racism.
Expand Obamacare, of course. As an extra benefit, we need it to cover undocumented immigrants as there are no "illegal" people.
... and it is all free
Saving the best for last ... trillions and trillions to bail out those state and municipal pension plans.
40
Patrick
2021 Jan 6, 5:36pm
Patrick
2021 Jan 6, 5:36pm
HeadSet says
There's a difference. People more protective of their money than they are of their Constitutional rights.
If you want to get someone to pick up a gun, take away everything they've worked decades for.
They won't. If people were that protective of their rights, this vote fraud would never have happened.
There's a difference. People more protective of their money than they are of their Constitutional rights.
If you want to get someone to pick up a gun, take away everything they've worked decades for.
Comments 1 - 40 of 48 Next » Last » Search these comments
A nationwide survey by Charles Schwab of 1,000 currently employed 401(k) participants found that on average, respondents believe they need to save $1.9 million for retirement, a 12% increase compared to 2019.
The average differs slightly by generation: Millennials and Gen X believe they need at least $2 million to retire comfortably, while baby boomers put the number around $1.6 million.
But many believe their retirement goals are out of reach. Only 37% think they are "very likely" to achieve their goals, 49% say they are "somewhat likely" and 14% say it is "not likely" they will achieve their goals at all.
One in five, or 21%, said they expect to retire later than originally planned because of the economic downturn caused by the pandemic.
As a result, the virus-induced crisis is causing Americans to reconsider and make changes to their retirement plans and goals. More than 40% of respondents made changes to their 401(k) as a direct result of the pandemic and the economic downturn that it triggered.
About one in six individuals, or 15%, rebalanced their portfolios, while 12% increased their contribution rate. Another 8% increased their exposure to stock funds and equity, while 7% pared down their exposure.
“Saving for retirement has been a top financial stressor for people even when the markets were setting records and we were living through the longest bull market in history,” said Catherine Golladay, executive vice president at Charles Schwab. “Now we are in a new reality where people are trying to navigate the health and financial challenges right in front of them, while also worrying about their long-term goals."
There is a higher rate of action among the 25% of individuals who consulted a financial professional. Of those who sought guidance, 67% made changes in their 401(k), with 26% rebalancing, 22% increasing the contribution rate and 17% increasing exposure to stock funds and equity.
“Getting help and leveraging the financial planning tools and resources your company makes available can help you understand whether you are on track, or need to make adjustments to meet your long-term retirement goals, despite the challenges of the current environment," Golladay said.