July 23


Retirement Reality Check: How Much Does the Average 65-Year-Old Really Have Saved?

By Harrison O'Reill

July 23, 2023

According to a recent study, the average 65-year-old American has a retirement savings account balance of $280,000. While this may seem like a significant amount, financial experts warn that it may not be enough to sustain retirees through their golden years.

With increasing life expectancies and rising healthcare costs, retirees need to ensure they have enough savings to cover their expenses and maintain their quality of life.

However, retirement savings vary widely among individuals based on factors such as income, occupation, and savings habits. Some 65-year-olds may have saved enough to comfortably retire, while others may have little to no savings.

It’s important for individuals to assess their own retirement savings and create a plan to ensure they have enough to meet their needs in retirement.

Retirement Savings

Retirement savings vary by age, with older individuals typically having more saved up. According to the Federal Reserve, the median retirement account balance for those aged 55-64 is $89,700, while those aged 65-74 have a median balance of $87,700+. However, these numbers may not be sufficient for many individuals to retire comfortably.

Retirement Savings Benchmarks

Retirement savings benchmarks can be helpful for individuals to determine whether they are on track for retirement.

For example, Fidelity recommends that individuals have saved at least ten times their final salary by the time they retire. However, this benchmark may not be appropriate for everyone, as it does not take into account individual financial situations or retirement goals.

Retirement Savings and Income Gap

There is a significant income gap when it comes to retirement savings, with higher-income individuals typically having more saved up.

According to a study by the Transamerica Center, the median retirement savings for those with household incomes of $100,000 or more is $500,000, while the median for those with household incomes of less than $50,000 is only $10,000. This income gap can make it difficult for lower-income individuals to retire comfortably.

Social Security

Social Security is a government program that provides retirement, disability, and survivor benefits to eligible individuals. It is funded by payroll taxes paid by workers and employers.

The amount of Social Security benefits you receive is based on your average earnings over your working years and the age at which you start receiving benefits. The full retirement age is currently 67, but you can start receiving reduced benefits as early as age 62.

It’s important to note that Social Security benefits are not meant to be the sole source of retirement income. It’s recommended that you have other sources of retirement savings in addition to Social Security.

Retirement Accounts

Retirement accounts are an essential part of retirement planning. They are designed to help individuals save for their retirement years and provide a steady source of income during retirement. Two of the most popular retirement accounts are Individual Retirement Accounts (IRA) and 401(k) plans.


An IRA is a type of retirement account that allows individuals to save for retirement while enjoying tax benefits. There are two main types of IRAs: traditional and Roth.


A traditional IRA allows individuals to make tax-deductible contributions, which means that they can reduce their taxable income. The money in a traditional IRA grows tax-free until retirement, when it is taxed as income.

A Roth IRA, on the other hand, allows individuals to make after-tax contributions. The money in a Roth IRA grows tax-free and can be withdrawn tax-free during retirement.


A 401(k) is a type of retirement account that is offered by employers to their employees. It allows employees to save for retirement while enjoying tax benefits. The money in a 401(k) grows tax-free until retirement, when it is taxed as income. Some employers also offer a matching contribution, which means that they will match a percentage of the employee’s contribution.

Retirement accounts are an excellent way for individuals to save for their retirement years. IRA and 401(k) plans offer tax benefits and can provide a steady source of income during retirement. It is essential to start saving for retirement as early as possible to take advantage of the power of compounding.

Retirement Planning

Retirement planning is an essential aspect of financial planning, especially for those who are nearing retirement age. It involves creating a financial plan that will help you maintain your lifestyle after retirement. Here are some ways to plan for your retirement.

Retirement Plan

A retirement plan is a comprehensive financial plan that outlines how you will save and invest your money to achieve your retirement goals. It should take into account your current financial situation, your expected retirement expenses, and your expected sources of income during retirement.

Retirement Calculator

A retirement calculator is a tool that helps you estimate how much money you will need to save for retirement. It takes into account factors such as your current age, retirement age, expected retirement expenses, and expected sources of retirement income. Using a retirement calculator can help you determine whether you are on track to meet your retirement goals.

Financial Advisor

A financial advisor can help you create a retirement plan and provide guidance on how to achieve your retirement goals. They can help you create a diversified investment portfolio, maximize your retirement savings, and manage your retirement income. When choosing a financial advisor, look for someone who is experienced in retirement planning and has a track record of success.

In conclusion, retirement planning is essential for a comfortable retirement. By creating a retirement plan, using a retirement calculator, and seeking the guidance of a financial advisor, you can ensure that you have enough money to maintain your lifestyle after retirement.


In conclusion, the average retirement savings for a 65-year-old varies depending on several factors, including income, expenses, and lifestyle choices.

It’s important to note that this amount may not be sufficient for some retirees, especially those with high medical expenses or who plan to travel extensively. Therefore, it’s crucial to plan and save carefully for retirement to ensure a comfortable lifestyle in the golden years.

Some effective strategies for saving for retirement include contributing to a 401(k) or IRA, reducing expenses, and investing wisely. It’s also important to consider working with a financial advisor who can help create a personalized retirement plan based on individual goals and needs.

In summary, while the average retirement savings for a 65-year-old may not be enough for everyone, careful planning and saving can help ensure a comfortable retirement. By taking steps to save and invest wisely, individuals can increase their chances of achieving financial Security and peace of mind in their golden years.

Frequently Asked Questions

Here are some common questions about this topic.

How much should I have saved for retirement by age 65?

The answer to this question depends on various factors, such as your lifestyle, health, and retirement goals. However, as a general rule of thumb, financial experts recommend that you should have saved at least 10 to 12 times your current annual income by age 65.

What if I haven’t saved enough for retirement?

If you haven’t saved enough for retirement, don’t panic. There are still several options available to you. You can delay your retirement, work part-time, or consider downsizing your lifestyle. You can also consult with a financial advisor to create a retirement plan that suits your needs.

Can I rely on Social Security for my retirement income?

While Social Security can provide some income during retirement, it is not enough to cover all of your expenses. The average Social Security benefit for retired workers in 2021 is $1,543 per month. Therefore, it is important to have additional sources of retirement income, such as personal savings, pensions, or investments.

Should I invest my retirement savings in the stock market?

Investing in the stock market can be a good way to grow your retirement savings, but it also comes with risks. It is important to have a diversified portfolio that includes a mix of stocks, bonds, and other assets. You can also consider consulting with a financial advisor to help you make informed investment decisions.

What if I need to withdraw money from my retirement savings early?

Withdrawing money from your retirement savings early can result in penalties and taxes. However, there are some exceptions, such as if you become disabled, have medical expenses, or need to pay for higher education expenses. It is important to consult with a financial advisor before making any early withdrawals from your retirement savings.

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