Almost every week, a couple sits down across from me at my desk. Before we even open their financial statements, they lean in and ask the question I hear constantly. Are we doing this right? Are we where we’re supposed to be? What they really want to know is if their retirement savings measure up to what everyone else has saved. They want to know if they are normal or if they are falling behind.

I understand why this weighs on people. Retirement planning feels like walking through a dark room without a flashlight. You put money away year after year, but there is no scoreboard telling you if you are winning or losing. Unlike buying a house where you can compare prices or negotiating a salary where you know the market rate, retirement savings feels isolated. Most of us

have no idea what our friends or neighbors have actually saved because nobody talks about it. Here is the good news. We are not actually in the dark. Research gives us a clear window into what is really happening across America. Two major sources track this data. Vanguard’s annual report, How America Saves, and the Federal Reserve’s Survey of Consumer Finances.

Between these two sources from 2023, we can paint an accurate picture of retirement savings at different life stages. Today, I want to walk you through the real numbers for people in their 30s through retirement age. More importantly, I want to help you figure out what those numbers mean for you. Here is what I have learned after analyzing hundreds of retirement plans.

Knowing the average is interesting, but understanding whether you are on track for your specific goals is what actually matters. Now, before I show you the charts, we need to talk about averages versus medians. They tell very different stories. I know this seems like a math lesson, but please stick with me because this is crucial for understanding the numbers. An average

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takes all the account balances, adds them up, and divides by the number of people. A median is simply the middle point. It is the line where half the people have more money than that amount, and half the people have less. This is important because super rich people can mess up the average. Imagine three people sitting in a room. One has $100,000 saved.

The second person has $250,000. The third person has $800,000. The median here is $250,000. That is the middle number. But the average would be roughly $383,000. That average is actually higher than what two out of the three people have saved. That one large account pulls the average way up.

This is why when I work with clients, I find the median is much more useful for understanding what is normal. It gives you a better sense of what the typical person has actually saved. Let me break this down by age group. I will pause between each group so you can see where you fit in. Let’s start with what Vanguard found in their 2023 report. They looked at 401k

balances across millions of accounts. Keep in mind, this data only captures what people have in their employer retirement plans through Vanguard. Vanguard is one of the three largest 401k providers in the country. So it is a good sample. For people between the ages of 35 and 44, the average 401k balance sits at $91,200.

But the median for this age group is only $35,537. That means half the people in their late 30s and early 40s have less than $36,000 in their 401k. That is a really big difference from the average. When you move up to the 45 to 54 age bracket, the average climbs

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to $168,600. However, the median comes in at only $61,530. Notice how the median is still less than half of the average. For those 55 and older, we see an average of $228,669 and a median of just $88,000.

$488. Now here’s where these numbers can be confusing if we are not careful. This Vanguard data only shows one piece of the puzzle. It does not include IRAs that people rolled over from previous jobs. It does not include Roth IRAs, brokerage accounts, savings accounts, or real estate equity. Every client I work with has assets spread across multiple accounts.

If we limit our view to just 1-401-K, we dramatically understate what people have actually saved. That is where the Federal Reserve study becomes so valuable. They look at total retirement savings across all accounts. Setting aside the Vanguard data for a moment, let’s look at what the Federal Reserve found when they examined total retirement savings.

When you add everything together, the picture changes quite a bit. For people aged 35 to 44, total retirement savings averages $141,542. The median sits at $45,000. In the 45 to 54 bracket, the average jumps to $313,220 with a median

of $115,000. That is nearly triple what the younger group had saved at the median level. The group aged 55 and older gets interesting because we can break it down further. For those between 55 and 64 who are still in their peak earning and saving years, the average total retirement savings is $537,560. The median

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is $185,000. People aged 65 to 74, many of whom have already retired, show average savings of $609,230 and a median of $200,000. For those 75 and older, the average drops to $462,410 with a median of $130,000.

This drop makes perfect sense because they have been spending money from those accounts for years. Now please do not panic if you are below these numbers. Also, do not get too confident if you are above them. Let me explain why these figures do not tell the whole story. When I first looked at these numbers closely, I will admit something surprised me. I think many of us

walk around assuming everyone else has it more together financially than we do. Maybe it is because we see people driving nice cars or taking expensive vacations. We assume that means they have substantial savings, but the data tells a different story. I also think our perception gets twisted by the stories we hear in the media. You always read

about the 45 year old who retired early with millions of dollars. That gets the headlines, but that is not reality for 99 % of people. Most Americans retire gradually between age 62 and 70. They do not take a victory lap at age 50. Financial struggles are common for everyone at some point.

because money is not something we openly discuss with our friends. If you looked at those numbers and found yourself at or below the median, do not immediately assume you are behind. When you add in the equity you have built in your home, it changes things. Add in any rental properties generating income. Add in the social security you have earned over your working years.

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add in pensions if you are lucky enough to have one. When you add all that up, most people discover they have 30 % to 40 % more resources than they initially thought. That is a huge difference that can completely change how you feel about your future. But here is what I really want you to understand from my experience working with retirees. Your retirement is not about

matching some national average. What matters is whether your savings will support your specific lifestyle. In one scenario, a person might retire comfortably on $40,000 a year. Someone else might need $100,000 to maintain their standard of living. The number that matters is yours, not the national median. This brings me to the common rules of thumb

you have probably heard about retirement savings. These rules exist for a good reason. They give people something concrete to aim for when retirement feels overwhelming. But here is where they fail in the real world. The first is the 80 % rule. This suggests you should plan to live on 80 % of your pre-retirement income.

So if you are currently spending $100,000 a year, the theory goes that you will need $80,000 in retirement. Based on analyzing hundreds of retirement plans, I have found this rule does not match reality. Even when someone pays off their mortgage or gets rid of commuting costs, those savings get used by other expenses. Travel increases,

Home maintenance projects happen, healthcare costs rise. More often than not, I see people spending the same or even more in those first active retirement years. Later on, spending usually decreases, but not right away. The second rule you will hear is the 25 times rule. This says you should save 25 times whatever you plan to withdraw annually from your portfolio.

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Do you need $60,000 a year beyond Social Security and pensions? Then the rule says you need $1.5 million saved. This is really just another way of expressing the 4 % rule. While many financial planners still use this rule, the research and my client experience shows it is far too conservative for most people. It assumes

you will spend the exact same amount every year adjusted only for inflation. That is not how real life works. We find that most clients can actually withdraw more than 4 % safely when we account for how spending naturally changes throughout retirement. Rules of thumb serve a purpose as starting points. They are helpful early in your planning journey, but

They cannot account for your individual variables. They do not know where you live or what your health situation is. They do not know your lifestyle expectations. They do not know if you have a pension or what your social security will be. They also do not know how tax efficient your savings are. So how should you measure your readiness? Here is the three step process I use with clients.

First, run a complete financial inventory. List everything, accounts, debts, assets, old 401ks, and home equity. Within this inventory, track your actual spending for 90 days. Do not guess. People almost always spend more than they think they do. Real numbers beat guesses every time. Second,

Map out the cost of your specific retirement lifestyle. Generic percentages won’t work. Which expenses disappear? Mortgage? Commuting? Which will increase? Travel? Healthcare? Remember that spending typically follows a smile pattern. High and early retirement, dipping in the middle years, and potentially rising later for care. Third, calculate your income gap.

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This is the difference between your guaranteed income, social security, pensions, and what you want to spend. That gap is what your portfolio needs to fill. That is the only number that matters. After seeing where your savings compare to others, understand that averages are just reference points. They do not tell your story. Your personal retirement number depends on factors unique to you.

Most individuals real retirement numbers look dramatically different from what they assumed. Sometimes they are in better shape than they feared. Sometimes they need to make adjustments. But having clarity always beats wondering. You need to move from guessing to knowing. When you stop looking at your neighbor and start looking at your own data, the fear usually goes away.

the peace of mind that comes from knowing your specific number and having a plan is worth far more than knowing the national average. If you want help running these numbers for your situation, use the link in the description to schedule a free retirement assessment. We will walk through your financial picture and show you exactly where you stand.