In 2022, almost half of American households had no savings in retirement accounts, according to the Survey of Consumer Finances (SCF). These accounts include individual retirement accounts; Keogh accounts; certain employer-sponsored accounts, such as 401(k), 403(b), thrift savings accounts; and pensions.
Personal saving has grown more important as employers have shifted away from defined benefit plans, or pensions, putting more of the responsibility on workers to plan for retirement. In 1989, half of working households ages 50 to 60 had a defined benefit plan. In 2022, only a quarter did.
How much do people save for retirement?
In 2022, about 46% of households reported any savings in retirement accounts. Twenty-six percent had saved more than $100,000, and 9% had more than $500,000.
These percentages were only somewhat higher for older people. Those ages 50 to 54 were the most likely to have a retirement account. About 63% in this age group had any savings, and 35% had saved more than $100,000.
Households with more than $0 saved for retirement, by age
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Retirement savings accounts are not the only place that people could store money for retirement. Is it possible that people are primarily saving their money elsewhere?
Who has more than $0 in these types of accounts?
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Retirement Savings
e.g. IRA, Keogh, pensions
Checking and Savings
Including money market accounts
Financial Assets
e.g. Liquid assets, stocks, bonds
Net Worth
All assets minus debt
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. About 45 percent of the households nearing retirement age have that amount of financial assets, including checking and savings accounts,retirement accounts, stocks, bonds, and certificates of deposit.
Higher percentages of households have a net worth of at least $100,000, especially as they grow older. Net worth includes non-liquid assets, such as a vehicle or house, that would have to be sold to provide income.
Even including these assets, many Americans appear to be set up to depend heavily on Social Security benefits after they stop working. Workers currently younger than 63 are eligible for full Social Security retirement benefits at 67. The average yearly Social Security benefit is currently about $22,000.
How do your retirement savings compare to others?
Households with higher incomes have more saved no matter what is counted as retirement savings.
How do your savings compare to other households?
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At 30 to 34 years old, median retirement savings was$4.7K.
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The median household between the ages of 30 and 34 had $4,700 in dedicated retirement accounts, $7,000 in checking and savings accounts, $20,100 in financial assets, and a net worth of $89,800. (In the surveys, the age of the household reflects the male’s age in mixed sex couples and the older individual in same-sex couples.)
At ages 55 to 59, the median household had $24,500 in retirement accounts, $7,900 in checking and savings accounts, $76,000 in financial assets, and a net worth of $320,700.
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Sources & Footnotes
Survey of Consumer Finances
Last updated
October 18, 2023
As someone deeply entrenched in the realm of personal finance and retirement planning, my expertise spans across various financial instruments and trends. Drawing on my comprehensive understanding of the Survey of Consumer Finances (SCF) and the broader financial landscape, I can shed light on the intricacies highlighted in the provided article.
The data from the SCF, a reliable and widely recognized source, underscores a concerning trend in the United States—nearly half of American households had no savings in retirement accounts as of 2022. This includes various retirement vehicles such as individual retirement accounts (IRAs), Keogh accounts, employer-sponsored accounts like 401(k)s and 403(b)s, thrift savings accounts, and pensions.
A pivotal shift occurred in employer practices, moving away from defined benefit plans (pensions) to defined contribution plans, placing a greater burden on individuals to secure their retirement. In 1989, half of working households aged 50 to 60 had a defined benefit plan, but by 2022, only a quarter retained this form of financial security.
The statistics regarding the amount saved for retirement further elucidate the situation. In 2022, approximately 46% of households reported any savings in retirement accounts, with 26% having saved more than $100,000 and 9% exceeding $500,000. Notably, the emphasis on personal saving has become more critical as individuals face the responsibility to plan for retirement independently.
The article also touches on the possibility of alternative savings strategies outside dedicated retirement accounts. While most American households maintain at least $1,000 in checking or savings accounts, only about 12% surpass $100,000 in these liquid assets. However, when considering a broader range of financial assets, including retirement accounts, stocks, bonds, and certificates of deposit, about 45% of households nearing retirement age boast such financial reserves.
Net worth, encompassing non-liquid assets like real estate and vehicles, becomes a crucial metric. Many Americans, even with substantial net worth, seem poised to heavily rely on Social Security benefits after retirement. The article cites that workers younger than 63 become eligible for full Social Security retirement benefits at 67, with the average yearly benefit currently standing at about $22,000.
To contextualize individual financial situations, the article provides median figures for different age groups. For instance, the median household between the ages of 30 and 34 had $4,700 in dedicated retirement accounts, $7,000 in checking and savings accounts, $20,100 in financial assets, and a net worth of $89,800. In contrast, households aged 55 to 59 had a median of $24,500 in retirement accounts, $7,900 in liquid assets, $76,000 in financial assets, and a net worth of $320,700.
These stark realities underscore the need for comprehensive financial planning and increased awareness about retirement savings. As we navigate an evolving financial landscape, individuals must prioritize saving for retirement to ensure financial security in their later years.
