What is an average retirement a/c worth in America ?

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Zillions
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What is an average retirement a/c worth in America ?

Post by Zillions »

I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Last edited by Zillions on Tue Mar 23, 2021 6:41 pm, edited 1 time in total.
Jack FFR1846
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Re: What is an average retirement a/c worth in America ?

Post by Jack FFR1846 »

The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
Bogle: Smart Beta is stupid
TheNightsToCome
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Re: What is an average retirement a/c worth in America ?

Post by TheNightsToCome »

Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Don't ask a bunch of affluent bogleheads.

dqydj.com has what you want:

https://dqydj.com/net-worth-by-age-calc ... ed-states/

For example, if you were between 45-49 with $500K net worth (excluding home equity) in 2019, then you were in the 81st percentile in US. This is 2020 data but based on 2019 net worth, the most recent data available at dqydj.com.
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Re: What is an average retirement a/c worth in America ?

Post by samsoes »

Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
Air conditioner?
Alternating current?
Access code?
???
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JD2775
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Re: What is an average retirement a/c worth in America ?

Post by JD2775 »

Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Ummm, I fit that category but I think Ill reach 1 million in the next 5-6 years, not 20.

I think the average American mid to late 40's has far less saved for retirement than you think they do. Don't use this forum as your gauge
Topic Author
Zillions
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Re: What is an average retirement a/c worth in America ?

Post by Zillions »

Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
A/c is account.

I understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
dukeblue219
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Re: What is an average retirement a/c worth in America ?

Post by dukeblue219 »

Remember too that median VS mean is huge here. A ton of people have nothing for retirement. A few outliers (see bogleheads.org) skew the mean way up.
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Zillions
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Re: What is an average retirement a/c worth in America ?

Post by Zillions »

TheNightsToCome wrote: Tue Mar 23, 2021 6:42 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Don't ask a bunch of affluent bogleheads.

dqydj.com has what you want:

https://dqydj.com/net-worth-by-age-calc ... ed-states/

For example, if you were between 45-49 with $500K net worth (excluding home equity) in 2019, then you were in the 81st percentile in US. This is 2020 data but based on 2019 net worth, the most recent data available at dqydj.com.
Thank you so much! This seems much more realistic to me! I was starting to get really anxious and feel like a loser.
ajcp
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Re: What is an average retirement a/c worth in America ?

Post by ajcp »

Zillions wrote: Tue Mar 23, 2021 6:47 pm My question is if the millions in investments in one's 30s are realistic for most families
No, that's the 1 or 2% richest families, many of whom are here.
livesoft
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Re: What is an average retirement a/c worth in America ?

Post by livesoft »

Zillions wrote: Tue Mar 23, 2021 6:47 pmI understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
From reading Bogleheads.org for almost 15 years, I do not agree that millions in investments in one's 30s is typical on this forum. Far from it.
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Topic Author
Zillions
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Re: What is an average retirement a/c worth in America ?

Post by Zillions »

livesoft wrote: Tue Mar 23, 2021 6:52 pm
Zillions wrote: Tue Mar 23, 2021 6:47 pmI understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
From reading Bogleheads.org for almost 15 years, I do not agree that millions in investments in one's 30s is typical on this forum. Far from it.
Just read posts here about windfalls of 2M in mid 30s or a 6 figure portfolio at 23 etc. At 23, I wasn't destitute but my "portfolio" was a used car, and a few thousand in the bank
Last edited by Zillions on Tue Mar 23, 2021 6:58 pm, edited 1 time in total.
Doctor Rhythm
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Re: What is an average retirement a/c worth in America ?

Post by Doctor Rhythm »

I think you already got your answer above. Don’t go to the opera house to gauge the musical tastes of the masses, and don’t judge your financial success based on the responses here. You can Google the answer to most statistical questions about wealth and income. Spend 10 minutes doing so, and you’ll feel a lot better and hopefully recognize your good fortune.
goonie
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Re: What is an average retirement a/c worth in America ?

Post by goonie »

This forum probably represents less than 5% of America. Don't get discouraged by the crazy numbers you see thrown around here.
sailaway
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Re: What is an average retirement a/c worth in America ?

Post by sailaway »

How much will you need at retirement?

What will your spending look like?

Will you have pensions or SS?

Will you work as long as you can or are you hoping to retire early.

The 25x spending mentioned above is actually spending minus other sources of income besides your nest egg. If you work until you can collect SS and you have modest spending requirements, you may not need to draw from your nest egg until one spouse passes, for example.

The internet tells me that the median 401k balance in the 45-54 age range is less than $50k, or up to $100k, including IRA (different surveys vary somewhat, but all on this order of magnitude). That information tells me nothing about what you or I need to feel comfortable.

Some boglehead posters are high earners, some boglehead posters have had windfalls for various reasons. And some are just ordinary citizens who have worked hard their whole lives and barely hit a million at a traditional retirement age or even able to retire comfortably without a million. Both my parents and my in laws are still saving after a decade or more in retirement because their pensions and SS cover their expenses with a bit left over, depending on the year.
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Re: What is an average retirement a/c worth in America ?

Post by anon_investor »

Zillions wrote: Tue Mar 23, 2021 6:52 pm
TheNightsToCome wrote: Tue Mar 23, 2021 6:42 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Don't ask a bunch of affluent bogleheads.

dqydj.com has what you want:

https://dqydj.com/net-worth-by-age-calc ... ed-states/

For example, if you were between 45-49 with $500K net worth (excluding home equity) in 2019, then you were in the 81st percentile in US. This is 2020 data but based on 2019 net worth, the most recent data available at dqydj.com.
Thank you so much! This seems much more realistic to me! I was starting to get really anxious and feel like a loser.
Don't worry about what other people have. As long as you have enough, that is all that matters!
mbasherp
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Re: What is an average retirement a/c worth in America ?

Post by mbasherp »

I’d also like to add that how much money others have has no relevance for when you might be able to retire.

What determines that is simply your expenses, minus continued income (social security, pension, etc). You need a sustainable withdrawal rate (the oft cited 4% benchmark, perhaps) out of your portfolio for the remainder. That’s it. Super simple. Some can live on just a social security check. Some only need a paid off house in addition. Some need $5 million invested. But your numbers of expense, income and portfolio are all that matter for you.

Edited to add: we are asset poor and low income by bogleheads standards. But I plug in our net worth at the DQYDJ site and apparently we are 90th percentile by net worth (with or without home equity) in our age group. So there ya go.
Last edited by mbasherp on Tue Mar 23, 2021 7:05 pm, edited 1 time in total.
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Re: What is an average retirement a/c worth in America ?

Post by JoeRetire »

Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation.
Would you be reassured by the fact that most people who post their net worth here are far, far wealthier than the average?

Trying to draw conclusions about your financial situation by comparing yourself to the relatively few posters in a forum like Bogleheads is a mistake.
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DoTheMath
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Re: What is an average retirement a/c worth in America ?

Post by DoTheMath »

JD2775 wrote: Tue Mar 23, 2021 6:46 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Ummm, I fit that category but I think Ill reach 1 million in the next 5-6 years, not 20.

I think the average American mid to late 40's has far less saved for retirement than you think they do. Don't use this forum as your gauge
+1

I'm not sure when we crossed over the million mark (sometime in the last year, I guess), but I expect to hit two million in ten years or less. It's really true that once you're over 500k, account sizes start to accelerate to a shocking degree. Pretty soon new contributions are for lack of anything better to do with the money rather than their actual contribution to account growth.

Bogleheads can be misleading, but if you read more closely you'll see plenty of not-yet-millionares and late-starters. See: viewtopic.php?t=328722, for example.

It sounds to me like you are on track towards your goals. You can post details here if you want feedback on if your trajectory is going to get you where you want to be.
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averagedude
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Re: What is an average retirement a/c worth in America ?

Post by averagedude »

Also keep in mind that the net worth numbers are based on citizens in the United States, who are doing much better than other places on the globe. Actually being at the poverty line in the US would classify you as well to do in other parts of the world. Personally, I am grateful that I live here.
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Re: What is an average retirement a/c worth in America ?

Post by tibbitts »

Zillions wrote: Tue Mar 23, 2021 6:47 pm
Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
A/c is account.

I understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
A/c isn't "account" anywhere else, so you might want to edit the title to avoid snarky comments like "less than the average retirement heat pump."
livesoft
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Re: What is an average retirement a/c worth in America ?

Post by livesoft »

Zillions wrote: Tue Mar 23, 2021 6:55 pmJust read posts here about windfalls of 2M in mid 30s or a 6 figure portfolio at 23 etc. At 23, I wasn't destitute but my "portfolio" was a used car, and a few thousand in the bank
OK, but if you think that is typical, then you have a different definition of typical than I do. Do you read the posts of people without such assets?
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Doc7
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Re: What is an average retirement a/c worth in America ?

Post by Doc7 »

If you can pay off a $1,000 bill that unexpectedly comes up tomorrow, you are much better than the average American.

You can simultaneously be much better than the average American, much worse than the average Boglehead, and either doing great for your needs or doing terrible (there is an enormous range of outcomes between average American and average Boglehead). As other posters indicated this will depend on your spending.

If you get to $1MM at retirement because you saved $30k a year of your $70K/year pre tax income, chances are you are going to be just fine.... If you get to $1MM at retirement because you saved $6K/year on $140K income, chances are you need to do some serious re-calculating.

What is your savings rate now ($ you are putting in 401ks and IRAs, divided by dollars of gross income)? How long has it been that way? If it is 15% or greater and has been since your early 20s your situation is likely very manageable. If it is 20% or greater and has been since your 20s, you are likely doing much better than you think you are. If it is employer match 4% and has been since your 20s, or only more recently, chances are you need to start massively ratcheting up your savings and reducing your spending.
Last edited by Doc7 on Tue Mar 23, 2021 7:15 pm, edited 1 time in total.
tim1999
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Re: What is an average retirement a/c worth in America ?

Post by tim1999 »

Don't compare yourself to the situations people post on here. This forum seemingly has an unusually high proportion of people who are doctors, big city lawyers, software developers/specialized big tech workers, and other unusually high paying occupations. These people are actually a fairly small percentage of American society.

Sure, if I made $500k per year in salary and RSU's working for big tech, I'd be worth a few million in my 30s too, but I don't, and I won't.

What eventually matters is not so much the size of your retirement accounts, but the multiple of your annual desired spending in retirement that they represent. Which may vary based on the individual. I know folks who probably spend $150k/year in retirement, and others who get by on their social security payments and nothing more. I don't need $5 million in my retirement accounts as I have no need or desire to annually spend the amount that can be withdrawn safely from such an account size.
JD2775
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Re: What is an average retirement a/c worth in America ?

Post by JD2775 »

I think the key is not to judge your retirement account balance vs others here on Bogleheads...

but, stay active on these forums and keep learning from others...It will do wonders for you. I know it has for me
TheNightsToCome
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Re: What is an average retirement a/c worth in America ?

Post by TheNightsToCome »

Zillions wrote: Tue Mar 23, 2021 6:52 pm
TheNightsToCome wrote: Tue Mar 23, 2021 6:42 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Don't ask a bunch of affluent bogleheads.

dqydj.com has what you want:

https://dqydj.com/net-worth-by-age-calc ... ed-states/

For example, if you were between 45-49 with $500K net worth (excluding home equity) in 2019, then you were in the 81st percentile in US. This is 2020 data but based on 2019 net worth, the most recent data available at dqydj.com.
Thank you so much! This seems much more realistic to me! I was starting to get really anxious and feel like a loser.
:sharebeer
New Providence
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Re: What is an average retirement a/c worth in America ?

Post by New Providence »

Why do you want a lot of money anyways? If you read these posts, as you say you do, you will also notice that the main goal is not to spend any money. There may be lots of millionaires in here, but most of them will never spend their money. If your plan is not to spend it, then you shouldn't worry too much about having it.
dukeblue219
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Re: What is an average retirement a/c worth in America ?

Post by dukeblue219 »

You know, you can also just Google this stuff a lot faster. The top result has a few data sources provided: https://www.synchronybank.com/blog/medi ... gs-by-age/

The median person in their 50s has $117,000 saved up. That feels about right. Heck, I know plenty of folks making high five figures or very low six figures who openly talk of having less than that saved up.

A social security retirement plus a paid off house is a *good* outcome for the average worker.
Oldaroo3
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Re: What is an average retirement a/c worth in America ?

Post by Oldaroo3 »

Zillions wrote: Tue Mar 23, 2021 6:55 pm
livesoft wrote: Tue Mar 23, 2021 6:52 pm
Zillions wrote: Tue Mar 23, 2021 6:47 pmI understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
From reading Bogleheads.org for almost 15 years, I do not agree that millions in investments in one's 30s is typical on this forum. Far from it.
Just read posts here about windfalls of 2M in mid 30s or a 6 figure portfolio at 23 etc. At 23, I wasn't destitute but my "portfolio" was a used car, and a few thousand in the bank
Haven't been on the forum for very long, but the one problem I see is that once you start reading some of the posts you start to compare yourself to others. I have to remind myself not to do that. Everyone and every situation is different and all we really know for certain is our own.

You are at point A and want to get to point B. Just don't forget to enjoy the journey. (Something else that I need to remind myself of quite often.)
goonie
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Re: What is an average retirement a/c worth in America ?

Post by goonie »

New Providence wrote: Tue Mar 23, 2021 7:19 pm Why do you want a lot of money anyways? If you read these posts, as you say you do, you will also notice that the main goal is not to spend any money. There may be lots of millionaires in here, but most of them will never spend their money. If your plan is not to spend it, then you shouldn't worry too much about having it.
LOL

The Bogleheads Hoarders Guild has many members. I think there's a special badge or ribbon that gets placed on your tombstone if you're the richest person in the graveyard. Dying while working also earns a prize. Points get deducted if you retire before 60. Retire before 50 and your membership is revoked.
rockstar
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Re: What is an average retirement a/c worth in America ?

Post by rockstar »

Don't sweat it.

Figure out how much you need. Figure out how much you need to save to get there. And make sure you're on track. If you're not on track, figure out what changes you have to make to get there. This is much easier to do when you're younger than older.
Slacker
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Re: What is an average retirement a/c worth in America ?

Post by Slacker »

Some of the most popular posts here are full of outliers and should not be used to assess the average, median or mode of family finances.

I take it as quite a few "humble bragging" about their $350k silicon valley salaries with $200k RSUs and buying $2million homes with $1.5 million networth at age 35 and very much enjoy the entertainment of getting to be a fly on the wall, but never use these posts to compare my family to. I will scan through these posts (and others) looking for any little tricks I may have missed out on or forgotten about to apply to the situation of my family.
goonie
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Re: What is an average retirement a/c worth in America ?

Post by goonie »

Slacker wrote: Tue Mar 23, 2021 7:46 pm Some of the most popular posts here are full of outliers and should not be used to assess the average, median or mode of family finances.

I take it as quite a few "humble bragging" about their $350k silicon valley salaries with $200k RSUs and buying $2million homes with $1.5 million networth at age 35 and very much enjoy the entertainment of getting to be a fly on the wall, but never use these posts to compare my family to. I will scan through these posts (and others) looking for any little tricks I may have missed out on or forgotten about to apply to the situation of my family.
My favorite posts are the ones asking if they can retire on 3 million dollars.
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Zillions
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Re: What is an average retirement a/c worth in America ?

Post by Zillions »

livesoft wrote: Tue Mar 23, 2021 7:11 pm
Zillions wrote: Tue Mar 23, 2021 6:55 pmJust read posts here about windfalls of 2M in mid 30s or a 6 figure portfolio at 23 etc. At 23, I wasn't destitute but my "portfolio" was a used car, and a few thousand in the bank
OK, but if you think that is typical, then you have a different definition of typical than I do. Do you read the posts of people without such assets?
Where are these threads?
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Zillions
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Re: What is an average retirement a/c worth in America ?

Post by Zillions »

Slacker wrote: Tue Mar 23, 2021 7:46 pm Some of the most popular posts here are full of outliers and should not be used to assess the average, median or mode of family finances.

I take it as quite a few "humble bragging" about their $350k silicon valley salaries with $200k RSUs and buying $2million homes with $1.5 million networth at age 35 and very much enjoy the entertainment of getting to be a fly on the wall, but never use these posts to compare my family to. I will scan through these posts (and others) looking for any little tricks I may have missed out on or forgotten about to apply to the situation of my family.

Actually, there was one that stuck out to me where I read posts telling an OP that a 300K salary in Silicon Valley for a 2-income family was "serious career mismanagement", I about fell off the chair reading that. I would be on my knees, thanking the good Lord, if my family was grossing anywhere near 300K in income per annum.

My issue is that we - spouse & I - did bungle our finances when we were young and had time on our side. When we finally woke up, it was almost too late but then the bull market helped some. We don't hope to get that lucky. Most of my angst is the constant fear we won't leave enough for our son to live off of, after our time. That keeps me up many nights, aside from constant guilt that I screwed up my career so that I could stay home and take better care of him. I did try to go back to work but there was too large a gap on my CV plus I really am not that high IQ to begin with.

So, to see 6 figures in their 20s and millions in their 30s makes me feel inadequate and a real loser, UNTIL I saw that calculator posted above. I have to consciously remind myself that some of these threads are from the very well off. Also, I really am grateful that we have what we have. It could have been 100x worse.

Also, thank you all for your kind words. I really needed to read some of your feedback today.
Last edited by Zillions on Tue Mar 23, 2021 8:28 pm, edited 1 time in total.
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Re: What is an average retirement a/c worth in America ?

Post by dboeger1 »

I realize others have already touched on the futility of trying to be the biggest fish in a big pond, but I would like to add that one's financial situation often says way more about one's luck and less about one's financial discipline than many realize. Yes, it's true that to a large extent, successful people make their own luck, but luck plays a huge role nonetheless, and it's common for people to dismiss, ignore, and even hide negative outcomes. Medical conditions and associated costs are a major cause of bankruptcies in the US, and you'll rarely hear from people who suffer such fates on a site like Bogleheads. My father had a successful restaurant business and was worth probably over $1m in a cheap, small town in his late 30s without a college degree. Then our family suffered a medical emergency and his restaurant burnt in a fire which spread from a neighboring business. He was crippled financially for many years and forced to sell our home and return to low-wage service jobs. He's only just now building a small positive net worth again in his late 50s. He still works 50+ hour weeks and is climbing the ranks in a transportation company, but that's a fraction compared to the 100-hour weeks he used to regularly work in his restaurant when I was growing up. He was easily the hardest working person I've ever known by far, with not even a close second. He grew up doing all kinds of manual labor and served in the military until he was honorably discharged following an on-base injury. I'll probably never work like he used to, and I almost certainly surpassed him in net worth the day I started my first job out of college with a 6-figure salary. Our paths are universes apart. There's really no comparing them at all.

The same can apply to extremely successful people. I had a coworker join a company I was working at after me, and he was extremely nosy, so he made it a point to learn everybody's salaries in the office and gossip about them without permission. I tried to hide my compensation from him, but I accidentally let him see the details when we were reviewing some benefits elections together (which I didn't want to do but he magically showed up during open enrollment to peak at the changes I was making). That's when I learned that he was making more than me even though I had been there for over a year and he was just starting. I wouldn't have cared so much because he technically had a higher degree than I did, but what really bothered me was that he was a serious drain on everyone in the office and basically relied on others to coach him through basic processes repeatedly. He ended up leaving for a higher-paying job within 6 months. At one point, we were having lunch together and he mentioned that his family had special government connections back in his country of origin, and he talked about extreme excesses like gambling hundreds of thousands of dollars, owning lots of real estate, going on lavish vacations, etc. I forget what the exact topic of conversation was, but something about common people's finances like minimum wage came up, and I remember saying something to the effect of it being unfortunate that many Americans struggle to cover basic expenses like food. He replied something like, "But I thought America was a rich country. I thought everyone had a house and lots of good food." I remember later reading a bunch of posts on Reddit about rich people being oblivious to common problems many people face, and many of them reminded me of this guy. I wouldn't hire him to clean my house let alone in our field, but he mastered tech interviews, leveraged connections, job-hopped frequently, and made his way into a pre-IPO tech unicorn. Life is funny like that. As much as I dislike it, I will credit him with teaching me that relative financial outcomes can be quite disconnected from one's contributions or any notion of fairness. Recognizing that has helped me negotiate for myself with more conviction and also disregard comparisons of my finances to people with far more money than I have.
GoldenFinch
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Re: What is an average retirement a/c worth in America ?

Post by GoldenFinch »

Zillions wrote: Tue Mar 23, 2021 8:13 pm
livesoft wrote: Tue Mar 23, 2021 7:11 pm
Zillions wrote: Tue Mar 23, 2021 6:55 pmJust read posts here about windfalls of 2M in mid 30s or a 6 figure portfolio at 23 etc. At 23, I wasn't destitute but my "portfolio" was a used car, and a few thousand in the bank
OK, but if you think that is typical, then you have a different definition of typical than I do. Do you read the posts of people without such assets?
Where are these threads?
People post all the time about how they are just getting serious about personal finance or feeling like they are late to the game. There are a lot of people on this forum who are very successful at managing their money. Some have huge salaries, but others have more modest, average or below average incomes. What’s great is how much one can learn from all these knowledgeable people they would otherwise never get to meet. So instead of comparing yourself to the windfall people or super high earners, just learn about smart investing practices you can use. This site isn’t about how much money you have, but what you should do with the money you do have to make it grow tax efficiently without a bunch of behavioral/emotional mistakes made along the way. So keep reading! :happy
Topic Author
Zillions
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Re: What is an average retirement a/c worth in America ?

Post by Zillions »

DoTheMath wrote: Tue Mar 23, 2021 7:05 pm
JD2775 wrote: Tue Mar 23, 2021 6:46 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Ummm, I fit that category but I think Ill reach 1 million in the next 5-6 years, not 20.

I think the average American mid to late 40's has far less saved for retirement than you think they do. Don't use this forum as your gauge
+1

I'm not sure when we crossed over the million mark (sometime in the last year, I guess), but I expect to hit two million in ten years or less. It's really true that once you're over 500k, account sizes start to accelerate to a shocking degree. Pretty soon new contributions are for lack of anything better to do with the money rather than their actual contribution to account growth.

Bogleheads can be misleading, but if you read more closely you'll see plenty of not-yet-millionares and late-starters. See: viewtopic.php?t=328722, for example.

It sounds to me like you are on track towards your goals. You can post details here if you want feedback on if your trajectory is going to get you where you want to be.
Does this include home equity? We're heavily invested in the 3-fund portfolio and are renters. If this doubles in the next 10 years (assuming a 7% return after accounting for inflation) we should be millionaires, too.
csmath
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Re: What is an average retirement a/c worth in America ?

Post by csmath »

Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
25 times annual spending needs after considering what a discounted pension/SS will cover right?
Triple digit golfer
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Re: What is an average retirement a/c worth in America ?

Post by Triple digit golfer »

csmath wrote: Tue Mar 23, 2021 8:46 pm
Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
25 times annual spending needs after considering what a discounted pension/SS will cover right?
Yes. If you need $80k and a pension and SS will cover $30k, you need $50k a year from your portfolio, so $1.25 million would be 25x that.
snshew12
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Re: What is an average retirement a/c worth in America ?

Post by snshew12 »

DoTheMath wrote: Tue Mar 23, 2021 7:05 pm
JD2775 wrote: Tue Mar 23, 2021 6:46 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?

Thanks.
Ummm, I fit that category but I think Ill reach 1 million in the next 5-6 years, not 20.

I think the average American mid to late 40's has far less saved for retirement than you think they do. Don't use this forum as your gauge
+1

I'm not sure when we crossed over the million mark (sometime in the last year, I guess), but I expect to hit two million in ten years or less. It's really true that once you're over 500k, account sizes start to accelerate to a shocking degree. Pretty soon new contributions are for lack of anything better to do with the money rather than their actual contribution to account growth.

Bogleheads can be misleading, but if you read more closely you'll see plenty of not-yet-millionares and late-starters. See: viewtopic.php?t=328722, for example.

It sounds to me like you are on track towards your goals. You can post details here if you want feedback on if your trajectory is going to get you where you want to be.
The definition of CoastFI...when your money finally sweats harder than you, but you still like to add a little to the pile.
Last edited by snshew12 on Tue Mar 23, 2021 9:19 pm, edited 1 time in total.
Go strong. Go long.
tj
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Re: What is an average retirement a/c worth in America ?

Post by tj »

Zillions wrote: Tue Mar 23, 2021 6:47 pm
Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
A/c is account.

I understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
Is this a serious question? No, most people in their 30s are not millionaires. :oops: Hell, I would say mot bogleheads in their 30s aren't millionaires.
Saving$
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Re: What is an average retirement a/c worth in America ?

Post by Saving$ »

This forum draws a disproportionate share of its users from two groups:
- People who have unusually high paying jobs, or somehow acquired wealth early (startup, inheritance, etc.)
- People who are more deliberate/disciplined/detailed than the average person, whether they have a low, average or high income or net worth

While the first group simply has higher income/net worth than average, the second group probably has a higher savings rate than average.
The combination of the two puts the average BH poster with a far higher net worth than the average person in the US.
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Nate79
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Re: What is an average retirement a/c worth in America ?

Post by Nate79 »

Zillions wrote: Tue Mar 23, 2021 8:21 pm
Slacker wrote: Tue Mar 23, 2021 7:46 pm Some of the most popular posts here are full of outliers and should not be used to assess the average, median or mode of family finances.

I take it as quite a few "humble bragging" about their $350k silicon valley salaries with $200k RSUs and buying $2million homes with $1.5 million networth at age 35 and very much enjoy the entertainment of getting to be a fly on the wall, but never use these posts to compare my family to. I will scan through these posts (and others) looking for any little tricks I may have missed out on or forgotten about to apply to the situation of my family.

Actually, there was one that stuck out to me where I read posts telling an OP that a 300K salary in Silicon Valley for a 2-income family was "serious career mismanagement", I about fell off the chair reading that. I would be on my knees, thanking the good Lord, if my family was grossing anywhere near 300K in income per annum.

My issue is that we - spouse & I - did bungle our finances when we were young and had time on our side. When we finally woke up, it was almost too late but then the bull market helped some. We don't hope to get that lucky. Most of my angst is the constant fear we won't leave enough for our son to live off of, after our time. That keeps me up many nights, aside from constant guilt that I screwed up my career so that I could stay home and take better care of him. I did try to go back to work but there was too large a gap on my CV plus I really am not that high IQ to begin with.

So, to see 6 figures in their 20s and millions in their 30s makes me feel inadequate and a real loser, UNTIL I saw that calculator posted above. I have to consciously remind myself that some of these threads are from the very well off. Also, I really am grateful that we have what we have. It could have been 100x worse.

Also, thank you all for your kind words. I really needed to read some of your feedback today.
You've set the bar a little too high with your forum name.... Don't worry what other people have or do. As long as you have enough for your future that's all that matters.

:sharebeer
RyeBourbon
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Re: What is an average retirement a/c worth in America ?

Post by RyeBourbon »

tibbitts wrote: Tue Mar 23, 2021 7:07 pm
Zillions wrote: Tue Mar 23, 2021 6:47 pm
Jack FFR1846 wrote: Tue Mar 23, 2021 6:41 pm The ultimate goal is to have on the order of 25 times your annual spending in liquid assets at retirement. Average would not help unless your spending is indeed average.

What does a/c mean?
A/c is account.

I understand that lifestyle matters. My question is if the millions in investments in one's 30s are realistic for most families or if BH forums are more likely to be populated by those with a high net worth.
A/c isn't "account" anywhere else, so you might want to edit the title to avoid snarky comments like "less than the average retirement heat pump."
https://www.accountingcoach.com/blog/what-is-ac

Definition of a/c
In accounting, a/c is the abbreviation for account.
Retired June 2023. AA = 55/35/10
MathWizard
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Re: What is an average retirement a/c worth in America ?

Post by MathWizard »

My NW at age 41 was under $150K, and my oldest was 6 years from college.

Before age 60 I had passed the million mark in retirement accounts, and paid off all debts, including mortgage, and had the kids through college.

You are doing what you need to do.
Max the Roths and move towards maxing the 401k's.

Starting at about age 36, I would put at least half of every pay raise
(net raise after taxes) into savings . That's how we had a down payment at age 41.

We drove old cars. Until 2017, we'd never had a car newer than 4 years old, and most were bought even older, and we drove them into the ground.
bhsince87
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Re: What is an average retirement a/c worth in America ?

Post by bhsince87 »

goonie wrote: Tue Mar 23, 2021 7:53 pm
Slacker wrote: Tue Mar 23, 2021 7:46 pm Some of the most popular posts here are full of outliers and should not be used to assess the average, median or mode of family finances.

I take it as quite a few "humble bragging" about their $350k silicon valley salaries with $200k RSUs and buying $2million homes with $1.5 million networth at age 35 and very much enjoy the entertainment of getting to be a fly on the wall, but never use these posts to compare my family to. I will scan through these posts (and others) looking for any little tricks I may have missed out on or forgotten about to apply to the situation of my family.
My favorite posts are the ones asking if they can retire on 3 million dollars.
Ok, so I was one of those posters. Struggled with it a long time, eventually pulled the trigger. Now a few years later at age 55, we're up close to $4.5 million. So far so good, but we still worry...

Now to hopefully make the OP feel better, here is our progression.

And keep in mind, inflation is a big factor here.

I was one of the lucky folks to graduate from Dear Old State with a positive net worth. About $500. IIRC, $66 was cash, the rest was "stuff" I owned.

Got a decent engineering job. Nothing fancy. $27k per year.

By age 30, I was living large! Making $50k per year. Nice clothes, went out 3 times a week, went to sports games and concerts, "owned" my second BMW, a little 4X4, and my first house.

Networth was about negative $5,000.

I actually had been saving and investing since my second paycheck 8 years earlier, so I had some cash and stocks on hand. But the debt outweighed it. And the house was the real killer. It depreciated quickly.

Then I started to figure things out.

By age 40 I had changed jobs 3 more times. Finally found my dream job. Was making about $100k per year.

I stopped buying BMWs, bought a sensible home, and settled down. I also started saving a LOT more. Hit about $1 million net worth around 41-42. Never got a stock option, inheritance, or windfall of any type.

One big difference here, I think. DW and I have no children. We tried, and tried to adopt. Spent about $80k on it before we gave up in the mid 40's.

At age 50, we were at a bit less than $2 million. $3 million at age 53 when I retired. DW kept working for a while, but then stopped (and started back again temporarily). Now a few months away from 56 and around $4.5 million.

And still no windfalls. Just saving and compounding.

Saving really does become easier later in life. Your income usually goes up, and compounding kicks in. And if you keep the lifestyle creep in check (if that's your thing), you can really sock the money away in the last decade or so before retirement. 401k rules change at age 50 too.

So don't fret just yet! By all means save what you can. But time really is on your side.
Time is what we want most, but what we use worst. William Penn
msj16
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Re: What is an average retirement a/c worth in America ?

Post by msj16 »

very help post bhsince87 +1 to the power of compounding - keep socking it away.
Independent George
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Re: What is an average retirement a/c worth in America ?

Post by Independent George »

Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?
If you want to be miserable, compare yourself to a bunch of strangers on social media. If you want to prepare for a happy retirement, compare your savings against your own projected expenses, then decide if that means you should adjust your savings or expenses up or down.
Jacotus
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Re: What is an average retirement a/c worth in America ?

Post by Jacotus »

Independent George wrote: Tue Mar 23, 2021 11:11 pm
Zillions wrote: Tue Mar 23, 2021 6:37 pm I'm looking for some reassurance, and to better manage my expectations.

My family's networth is less than a million (not counting my daughter's Coverdell).

I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.

What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?
If you want to be miserable, compare yourself to a bunch of strangers on social media. If you want to prepare for a happy retirement, compare your savings against your own projected expenses, then decide if that means you should adjust your savings or expenses up or down.
+1.

Also, high-income and wealthy folks are drawn to this forum so the sample of members is skewed far from the US population.
tomsense76
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Re: What is an average retirement a/c worth in America ?

Post by tomsense76 »

Zillions wrote: Tue Mar 23, 2021 6:37 pm I see posts here from people in their 30s with 1.5 million in investments, people in their 20s with 6 figures in assets etc, "windfalls" in the millions etc, & frankly I'm getting nervous with our situation. It gives the impression that we're terribly behind & might never be able to retire.
There's probably some correlation between people willing to post and higher amount of assets. So wouldn't read too much into that. Plus there seems to be a set of people working at large growth tech companies paid in part with equity (again not representative of the population at large) or other similarly well paid professions (lawyers, doctors, etc.). It also depends a lot on how much debt it took to get through school, when you bought a house, etc.
Zillions wrote: Tue Mar 23, 2021 6:37 pm What is the size of the average of retirement assets in America for those in their mid to late 40s? We're now aggressively maxing out our Roths & one 401K. Anyone else out there between 45 to 50 with less than a million in assets (not counting education a/cs) but feel you'll make it to a million+ in the next 20 odd years ?
I'd recommend listening to this Rational Reminder podcast with Michael Kitces ( https://rationalreminder.ca/podcast/112 ) an expert in retirement planning. In particular 43-48mins he talks about something really relevant (I think) to your case. To put it plainly it is very common for people in their 40s to be in this situation (Bogleheads and some of the groups noted above are the outliers). Though this is a good time to think about making a plan and saving more (putting away raises and bonuses for example)
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
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