It can be difficult to figure out exactly how much to save for a comfortable retirement. After all, the rules keep changing for how much you can safely withdraw, and there are ongoing concerns about how much income Social Security will provide with the program’s trust fund at risk.
Recently, though a survey from Northwestern Mutual revealed how much Americans think they’ll need invested for their later years. Based on this survey, here’s exactly how much adults anticipate needing when they quit work for good.
Americans expect to need a big nest egg for retirement security
According to Northwestern Mutual, U.S. adults believe they’ll need an average of $1.46 million saved for retirement. This target represents a significant shifts from previous years as macroeconomic expectations fluctuate.
For those who hit their target, the $1.46 million in retirement savings should produce around $54,020 to $58,400 per year in annual income depending on whether you follow the traditional 4% rule or a more conservative 3.7% rule.
The 4% rule is a longstanding rule of thumb that says retirement money should last 30 years if you take out 4% in year one and adjust for inflation each year — but experts now say 3.7% is a better bet to make sure your money lasts given more conservative estimates for future returns.
When combined with Social Security, this level of income should provide a reasonably comfortable retirement for most individuals. So, they aren’t selling themselves short despite changing economic conditions.
Will Americans hit their goal?
While most future retirees should be in decent financial shape if they hit their $1.46 million saving goal, that’s a very big if.
The Northwestern Mutual study found that nearly a quarter of those with retirement savings have one year or less of their annual income put away. Furthermore, Gen Xers are among the least confident in their retirement preparedness, with 20% reporting they have had to delay their retirement due to financial concerns.
Of course, since people in their working years aren’t retired yet, they still have time to save — but bridging the gap and catching up to their target number could be a real challenge. Assuming a standard 7% rate of return compounded daily, an individual starting to save entirely at age 40 would need to put away $1,547 per month, while someone starting at age 50 would need to invest $3,958 per month to build a substantial nest egg.
While saving this much might be doable for some, it’s likely out of reach for most people. While there are some ways to make it easier, including taking advantage of any employer matching funds and investing in tax-advantaged accounts like 401(k)s, investing heavily each year would be a big ask considering current median salary thresholds.
The good news is, while $1.46 million is a good goal to aspire to, it’s not necessarily the amount everyone needs. You can figure out your personalized number by working with a financial advisor or can take a simple shortcut and multiply your estimated final salary by 10 to get a rough idea of your savings needs.
Whatever you do, though, you should have a clear objective and should be working today toward accomplishing it because retirement will be here before you know it.
Editor’s Note: This article has been updated to reflect the latest retirement figures from the Northwestern Mutual 2026 Planning & Progress Study, adjusting the average national target savings from $1.56 million to $1.46 million and updating corresponding annual income projections, millennial/Gen Z metrics, and monthly catch-up contribution models.
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