Nearly half of American households have no retirement savings (2024)

FAQs

Nearly half of American households have no retirement savings? ›

According to the Survey of Consumer Finances, in 2022 almost half of American household retirement savings accounts were empty. The accounts included individual retirement accounts; Keogh accounts; certain employer-sponsored accounts, such as 401(k), 403(b), thrift savings accounts; and pensions.

Among the chief shortfalls of the U.S. retirement system is access to a workplace retirement plan, experts said. About half of workers don't have access and are unlikely to save for retirement outside a 401(k)-type plan, they said.

And saving for retirement is only becoming more difficult as Americans deal with rising costs. Escalating housing, healthcare, and long-term care costs in retirement are creating financial obstacles for many Americans.

As of May 2023, more than 1 in 5 Americans have no emergency savings. Nearly one in three (30 percent) people in 2023 had some emergency savings, but not enough to cover three months of expenses. This is up from 27 percent of people in 2022.

Nearly half of American households have no retirement savings, says USA Facts. The cost of living has been the topic of conversation across the country. As families continue working to make ends meet, a report from USA Facts reflects that almost half of American households have no retirement savings.

Without savings, it will be difficult to maintain the same lifestyle an individual had in working years. Some retirees make adjustments by: Moving into a smaller home or apartment. Reducing television or streaming services.

The Federal Reserve also measures median and mean (average) savings across other types of financial assets. According to the data, the average 70-year-old has approximately: $60,000 in transaction accounts (including checking and savings) $127,000 in certificate of deposit (CD) accounts.

How much money does the average American retire with? ›

The Federal Reserve's most recent data reveals that the average American has $65,000 in retirement savings. By their retirement age, the average is estimated to be $255,200.

By some measures, millennials lag on retirement preparedness and net worth relative to older generations such as Gen X and baby boomers. There are many reasons for this, such as a shift away from pensions toward 401(k) plans and high student debt burdens.

Most American households have at least $1,000 in checking or savings accounts. But only about 12% have more than $100,000 in checking and savings.

The harsh truth is that $1,000 per month is very hard to live on, even if you lower your costs to the bare minimum. With inflation causing the prices of goods and services to increase every year, $1,000 a month will become harder and harder to live on going forward.

According to the Federal Reserve's most recent Survey of Consumer Finances, the median savings account balance for all families was $8,000 in 2022. Savings account balances can vary greatly depending on income, age, education and race.

About 29% of respondents have between $501 and $5,000 in their savings accounts, while the remaining 21% of Americans have $5,001 or more. Few hold much cash in their checking accounts as well. Of those surveyed, 60% report having $500 or less in their checking accounts, while only about 12% have $2,001 or more.

Almost half of Americans don't have a dedicated retirement savings account, according to the Federal Reserve's 2022 Survey of Consumer Finances.

What are two reasons Americans don't save more for retirement? Aside from inflation, respondents cited stagnant or reduced income, new expenses and the desire to keep more cash on hand as key reasons they're not saving more.

More Than Half of Americans Have Less Than $10,000 Saved

Many Americans have a long way to go when it comes to affording retirement. According to the survey, 53% have less than $10,000 saved.

About 69 million workers, or 56% of the nation's workforce, lack access to a retirement plan through their workplace, the Economic Innovation Group found in its analysis of 2021 Census data.