By Steve Dinnen
So you’ve tucked away $1 million for your golden years. Congratulations, statistically you are among just 10% of Americans who have set aside that much for retirement! The rest of us have some catching up to do.
A survey by the Federal Reserve shows that average retirement savings for the 55-64 age group is just $408,420. From there, it goes downhill: People aged 45-54 have saved an average of $254,720, while those 30 and younger have saved even less, averaging $30,170.
Numbers crunchers at T. Rowe Price suggest a 30-year-old should earmark at least half a year of earnings for retirement. That figure rises as we age, and by 60, we should have 11 times our annual income.
An OECD survey of 30 nations shows that Americans save on average 5% of their income. The Swiss, with comparable wages, save 19%.
The Finns save nothing. Finland has the best-ranked pension system in the world, says wealth management firm Blacktower. Could Finns be lousy savers because they have great confidence in their pension systems?
The United States scores nowhere near the top of any survey about pension-plan adequacy. So let’s get serious—and that means saving more than a nickel from every dollar earned.