How much do people have saved for retirement?

[Anonymous]

Anonymous wrote:DH is early 40s and has 350k, I'm mid 30s and have 500k. I feel we are a bit behind...

Probably better than us, 350k for me (about to turn 40), ~250k for my spouse (mid-40s). Also have almost 200k in home equity. I started investing early but I wasn't able to put much in for a long while - have only had the means to max out my TSP for the last 4-5 years.

I should be getting a federal pension as well, which will help at least.

[Anonymous]

We are in our 50s. Two teenage kids. We are both long time federal workers (but FERS not the older system). Net worth is about $7 million, with about $4.5 million in retirement accounts. About $1 million came from inheritances.

[Anonymous]

Anonymous wrote:

Anonymous wrote:DH is early 40s and has 350k, I'm mid 30s and have 500k. I feel we are a bit behind...

Probably better than us, 350k for me (about to turn 40), ~250k for my spouse (mid-40s). Also have almost 200k in home equity. I started investing early but I wasn't able to put much in for a long while - have only had the means to max out my TSP for the last 4-5 years.

I should be getting a federal pension as well, which will help at least.

You're not doing all that bad. Think about it: if everything goes to plan, you'll work another 25 years. And the last 15 you can contribute a lot more to 401ks and IRAs. You see people on this board with $3 million, $5 million, heck $7 million in assets. This is the top 1% of America. You don't need 5 million dollars to have an enjoyable retirement. That is, unless your idea of "enjoyable retirement" is skiing in the Alps and spending summers in the Italian countryside, dining out at 5-star restaurants and leaving your kids multi-million dollar trust funds. But I'd imagine that's not how you're living now. If you can pay off your home, you'll have your pension and plenty of retirement savings to live a really nice life.

[Anonymous]

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Anonymous wrote:This is a dumb question. On dcum, it turns into a pissing match and everyone on here seems to have $1+ million by late 20s/30s, which is an absolute farce.

Median numbers are easily searchable. Your avg American has way less than $200k by their 40s.

Not in this area. OP will struggle with what she has.

Except you'd have to be a moron to stay in this area during retirement.

Why? If your house is already paid for when you retire, your housing expense will be limited to taxes + utilities. Not much different than anywhere else, considering there are many parts of the country with property tax rates higher than DC metro. Most retirees aren't heading out to the pricey trendy bars and restaurants. If you can afford it, DC is a great place to be a retiree - tons of free cultural activities that you can take advantage of when you have time on your hands.

There are states where there are 0% taxes on retirement account withdrawals or 0% income taxes. Plus done states have other perks like reduced property taxes, lower rates for insurance on basically everything, and much lower cost of living overall. Paying 0% income tax on 401k income is huge amounts of money to consider. It isn't worth it at all to stay in this region in retirement to pay 3x sticker price on everything just to have access to amenities and a job market you no longer need.

Where is that?

Here you go: https://www.kiplinger.com/slideshow/retirement/t054-s001-taxes-in-retirement-how-all-50-states-tax-retirees/index.html

Well, there's 0 state tax occasionally, often made up by higher sales or income taxes in places, but of course there's still federal which is the far bigger tax issue.

The best states for retirees have special rules for retirement income & property tax for seniors. States like Texas, with zero income tax for everyone, but high property taxes, are not good for retirees. However, a state that, for example, does not tax pensions, waives state property tax for seniors and has very low property tax, would be really good. You need to read the fine print.

Actually Texas has an over-65 Homestead exemption that keeps property taxes in check for seniors.

The freeze on property taxes at 65 doesn’t help if you move in from somewhere else. There is an additional reduction, but it varies from place to place & generally doesn’t offset How high the taxes are to begin with (unless you’re moving in from somewhere like Westchester County, in which case, they may not look so bad).

Texas doesn't tax Social Security benefits, pensions, 401ks, IRAs or any other retirement income. And the housing costs are very affordable. It's not the cheapest state to retire in, due to the property taxes, but it's better than most of America.

[Anonymous]

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Anonymous wrote:This is a dumb question. On dcum, it turns into a pissing match and everyone on here seems to have $1+ million by late 20s/30s, which is an absolute farce.

Median numbers are easily searchable. Your avg American has way less than $200k by their 40s.

Not in this area. OP will struggle with what she has.

Except you'd have to be a moron to stay in this area during retirement.

Why? If your house is already paid for when you retire, your housing expense will be limited to taxes + utilities. Not much different than anywhere else, considering there are many parts of the country with property tax rates higher than DC metro. Most retirees aren't heading out to the pricey trendy bars and restaurants. If you can afford it, DC is a great place to be a retiree - tons of free cultural activities that you can take advantage of when you have time on your hands.

There are states where there are 0% taxes on retirement account withdrawals or 0% income taxes. Plus done states have other perks like reduced property taxes, lower rates for insurance on basically everything, and much lower cost of living overall. Paying 0% income tax on 401k income is huge amounts of money to consider. It isn't worth it at all to stay in this region in retirement to pay 3x sticker price on everything just to have access to amenities and a job market you no longer need.

Where is that?

Here you go: https://www.kiplinger.com/slideshow/retirement/t054-s001-taxes-in-retirement-how-all-50-states-tax-retirees/index.html

Well, there's 0 state tax occasionally, often made up by higher sales or income taxes in places, but of course there's still federal which is the far bigger tax issue.

The best states for retirees have special rules for retirement income & property tax for seniors. States like Texas, with zero income tax for everyone, but high property taxes, are not good for retirees. However, a state that, for example, does not tax pensions, waives state property tax for seniors and has very low property tax, would be really good. You need to read the fine print.

Actually Texas has an over-65 Homestead exemption that keeps property taxes in check for seniors.

The freeze on property taxes at 65 doesn’t help if you move in from somewhere else. There is an additional reduction, but it varies from place to place & generally doesn’t offset How high the taxes are to begin with (unless you’re moving in from somewhere like Westchester County, in which case, they may not look so bad).

Texas doesn't tax Social Security benefits, pensions, 401ks, IRAs or any other retirement income. And the housing costs are very affordable. It's not the cheapest state to retire in, due to the property taxes, but it's better than most of America.

Wow. Austin is a great place, although the housing is getting so $$$$ near Zilker Park.

https://www.redfin.com/TX/Austin/1529-Barton-Springs-Rd-78704/unit-25/home/31111258

[Anonymous]

Anonymous wrote:

Anonymous wrote:I just used a retirement calculator available online and it said that we need to save $1,330 per month for retirement based on what we have saved now. We are beating that significantly annualized. It expects that we will need 9M to retire! That seems overly optimistic and a bit nuts. I feel like you can drive yourself crazy with these calculators, esp. if you are under age 40.

Garbage in, garbage out.

You did not put in accurate numbers if you got $9M out. Unless you have multiple homes and expect to need a ton of disposable income.

Those calculators assume 80% of income generally. Most people aren't going to need to spend 200k a year + in retirement

Also most of your expenses should be done kids, college, mortgage plus SS I still stand by my original numbers

If you aren't in DCUM land 1 million is plenty to retire on for the vast majority of folks. and really 500k is fine too. The average retiree in America has under 500k in retirement savings at retirement and does fine.

[Anonymous]

We’re 46 and have about $1 million in our combined 401ks. HHI about $200k. We also have about $100k equity in our house and about $30k in our son’s college fund. We live in a pretty low COL area right now so our expenses will be reasonable when we retire.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:DH is early 40s and has 350k, I'm mid 30s and have 500k. I feel we are a bit behind...

Probably better than us, 350k for me (about to turn 40), ~250k for my spouse (mid-40s). Also have almost 200k in home equity. I started investing early but I wasn't able to put much in for a long while - have only had the means to max out my TSP for the last 4-5 years.

I should be getting a federal pension as well, which will help at least.

You're not doing all that bad. Think about it: if everything goes to plan, you'll work another 25 years. And the last 15 you can contribute a lot more to 401ks and IRAs. You see people on this board with $3 million, $5 million, heck $7 million in assets. This is the top 1% of America. You don't need 5 million dollars to have an enjoyable retirement. That is, unless your idea of "enjoyable retirement" is skiing in the Alps and spending summers in the Italian countryside, dining out at 5-star restaurants and leaving your kids multi-million dollar trust funds. But I'd imagine that's not how you're living now. If you can pay off your home, you'll have your pension and plenty of retirement savings to live a really nice life.

Thanks! I think sometimes I have to remind myself the "normal" here and on sites like Bogleheads is not really representative of how most people live. I've run the numbers and I think we'll be in pretty good shape so long as we keep maxing out accounts.

[Anonymous]

I'm 42. Was married. We had over a million. Now divorced. We each have about 550k. We did not split it in the divorce. We kept our own.

You are 23 years older than me. You should have much more.

[Anonymous]

OP, we are 55 and 57. We each have about $1.5 million for retirement in our main savings plans (TSP/401k) plus another $300K in IRAs (we're old, we started these before ROTH came along). One of us is retiring next year, which is okay because there is a pension involved, and the other will keep working. The key is looking at how many multiples of HHI you have saved. I think the rough rule of thumb is that you need 10 times your annual income (or expenses, if you can ascertain them with accuracy) when you retire at 65.

[Anonymous]

Anonymous wrote:This is a dumb question. On dcum, it turns into a pissing match and everyone on here seems to have $1+ million by late 20s/30s, which is an absolute farce.

Median numbers are easily searchable. Your avg American has way less than $200k by their 40s.

And they work until they become disabled, and die with debt. DC is a very expensive place to live. Google the median income here, not in South Carolina.

[Anonymous]

Anonymous wrote:I always feel that DCUM oversaves

I don't get why people need over 100k in retirement. For most people SS almost gets you halfway there. And SS isn't going away, the age might go up and benefits might slightly decrease but most people should be expecting at least 2500 a month if they are working

Main point being 1-3 million retirement account fund at age 60-65 is plenty.

Some realistic benchmarks 1 million at 55

500k at 45

250k at 35

Our HHI is over $400K a year. We are certainly not going to retire if we have to live on 25% of what we currently make. It depends on current income and current and expected lifestyle

[Anonymous]

Anonymous wrote:Thanks to everyone for all this good info. I should have indicated that my husband does have a pension, but the lump amount was included in the $881K figure. The pension monthly estimate at 65 is $10K provided he keeps putting in at the same amount we have been now. And I think the health care costs are supposed to be partially covered in retirement, though I know our portion of the premium will go up. My apologies for not being more clear. I really appreciate the info, though, and think we should be putting more in. I don't think we need the full HHI that we have now, but we were thinking we'd rent out our house here and move somewhere else. We have EU citizenship so that's a dream plan to live in Italy or Ireland, but not sure we'll have enough nerve to actually do that.

To the poster who noted that posting on DCUM is an anxiety wish, you're probably right. I always think it will be interesting to hear perspectives, and have to then remind myself of the vast differences in perspectives, some will make me feel great, others like garbage and wonder where we went so wrong. I think we're all just doing the best we can, no matter how much we make, and we need to not be so hard on ourselves, while still trying to secure our financial future. Thanks all.

I'm the one who wrote that DCUM is an anxiety wish and living in this area with the focus on competition and money is all anxiety inducing. Even though I have a trust, I work in non-profit, and when I get on this board, and talk to some of friends in higher paying jobs I get major anxiety. There are always always going to be people with more or less. So you can only worry about yourself and stop comparing and try to find a way to be happy.

[Anonymous]

Mid-40s, we have about $600,000 in retirement accounts and about $600,000 in taxable investments, plus about $250,000 in kids' 529s and about $350,000 in home equity. We also have some small pensions from work, though I don't know how much those are worth (probably the equivalent of about $50,000 total right now). The calculators all seem to suggest we're on track to have enough to generate a little more than our current income in retirement if we keep saving at the rate we've been doing, but who knows.

[Anonymous]

So much depends on two things: if your mortgage is paid off or not, and the lifestyle you want to live when you're retired. It's obviously a lot more manageable if you're only paying property taxes and homeowner's insurance. And then lifestyle: we like to hike, ride our bikes, see an occasional movie. Maybe eat out or go for a drink a couple times a month. I don't need millions of dollars to do this. Yes, my health care costs will likely go up. But this idea that you'll need to pay for assisted health care for 10-20 years isn't the reality. The vast majority of people, when they get so ill they need constant medical attention, do not live decades with said condition.