Americans’ “magic number” for retirement hits new record high

The going rate for a comfortable retirement is now somewhere around the price of a modest luxury yacht, according to most Americans.

• The average resident now believes they need $1.46 million to retire comfortably, per a recent Northwestern Mutual survey of 4,375 US adults.
• That “magic number” has risen from $1.25 million in 2022 to this year’s current high point.

The reality behind the “magic”

The $1.46 million figure isn’t a hard and fast rule, and most planners say it’s not even close to universal. A more grounded benchmark suggests saving about 10x your annual income by age 67, amounting to ~$800,000 for the typical US household based on recent median income levels.

Still, many Americans are falling short. The median US household in the 65-74 age range has ~$200,000 in retirement savings, while the average stands at ~$609,000, per a 2023 federal survey.

The retirement paradox: Recent research shows the youngest generation in the workforce is actually the most prepared for retirement at this stage in their lives. A Vanguard study found 47% of US workers aged 24-28 are on track to have enough money to maintain their lifestyle in retirement, while all other generations come in around 40%-42%.