The average 40 year old has $63,000 in savings

As a former financial planner who knows the exact retirement savings of hundreds of people, averages mean nothing.

The amount of money someone has saved by a particular age is all over the place. There are plenty of people age 40 who have $200,000+ in retirement savings and there are also plenty of 40 year olds who are completely broke.

There really is no "average" amount of savings at any age, even if a mathematical formula says that's the average.

the article posted in the op is talking about the median. if accurate, it's a meaningful metric.

this is why we must not privatize Social Security. People are terrible investors and would muck it up.

Most people do not invest close to 15% because they "can't afford it". They have to pay their high rent, car payment for a 40k car, buy the latest iPhone, drink Starbucks everyday, eat at fancy restaurants, and travel the world to pay pics on Instagram.

We've got 800K Roth, a million equity in a house, and three years until we hit the eject button.

It all started with a few thousand in late-90s tech stocks.

I have more than $200k+ at 40 but am continously told I need $3 million to retire, and it's just really defeating. I know part of that is financial advisors wanting to earn fees. But it's never enough, and I think a lot of people think why bother if I need that much when I can enjoy life now.

I'm not even that concerned with retirement. I just hate stuff.

just save 10%-15% of your gross salary into a life-cycle fund and stop thinking about it. Usually in a 401k or IRA. That's it. That's all you have to do. Don't overthink this.

Although I suppose if you feel behind schedule at 40 you may need to save more than that.

Shockingly low. I'd have expected 2-300k on the low side.

No, it's not meaningful. Do you know how many people have exactly $63,000 in retirement savings? A verrrry low percentage. Probably less than 1%.

Even if you expanded that slightly to plus or minus $5,000 and made it a range of $58,000 to $68,000, the percentage of people in that range would still be extremely low, probably less than 5%.

That $63,000 figure was just a number that a reporter used in order to write an article, but it has very little to do with people's real world savings.

Lesson to be learned - Stats, even if mathematically accurate, can be very misleading.

Financial planners usually tell you to invest more, just like insurance agents usually say you need to buy more insurance. It's how they make a living.

I used to be a financial planner so I know how it works.

Think of it this way - A) most people retire, and B) most people have less than $3 million.

If you REALLY needed $3 million to retire, then most people would never retire.

So just keep investing whatever amount you're currently investing monthly and don't stress yourself out about it.

Made 110, 140, and 150k last 3 years. Worked over 3,500 hours/year to do it last two. Quit competitive age-group triathlon last two years to work more (sucks but necessary). Haven’t saved anything other than maxing the ROTH IRA each year. In fact, I’m losing money this year to inflation related expense increases. 100k in savings 35k in emergency. 42 years old 3 kids union job with pension. Health care 15,800/year pension contribution 11%. Live very frugally in a high expense area. Do my best for my kids extra curricular (sports, dance, etc). The people I know doing well are in accounting finance law defense supported (Raytheon, Boeing). The people not doing well are everyone else.

Sounds like a good argument for free college.

it is meaningful. it means 50% of people have that much or more. it tells you if you are in the top half or bottom half.

it is meaningful, even if it's not to you.

I lost my 42k a year job today. Ugh. But I have about 115-120k in total net worth and thankfully no loans. Even on smaller salaries you can save if you are cheap.

What's most interesting about these threads is the wide variance in posters' own status or beliefs as compared to the average, and how they "can't believe the median is so [high or low, depending on their own status]!!"

Just demonstrates the tendency of most people to think most other people are in a similar situation as oneself.

Yep. Most people are terrible with money. They pay a premium for discretionary budget items for pleasure and/or status. I think when the millennial generation approaches retirement is when you'll see the first major attempt at something that amounts to government enforced wealth transfers. The same generation that wants their student loans "forgiven" will begin to push a narrative that they deserve a government provided pension beyond SS once they realize they can't afford to retire.

I have 15x the average amount for my age, having put the maximum allowable amount into my 401k for about the first 20-22 years of my career, then dropping down to the minimum that gets me full match for the last 5 years since our expenses are higher now with kids approaching college.

Learn to live on whatever income you have after maxing your 401k. That money piles up slowly but suddenly. The biggest key is to stay employed, and a secondary helper is if you take advantage to work overtime when the opportunity is there. I have a job where I could work almost unlimited overtime if I wanted to. I've averaged about 55 hours a week for the last 27 years. It's not as hard as it sounds.

You should also try to max a medical savings account now that they have them. Medical expenses will wipe you out if anything chronic happens later in your life. My mother is paying $14k a month for my father's health care...good thing they saved $1M in their 401ks or they'd be bankrupt by now.

working 67 hours per week and saving just $6000 per year? Something is very wrong here. You need to get off the hamster wheel, rethink your career and save a lot more money.

Make saving automatic - have $15,000 taken out of your paycheck per year, make sure you drive used cars worth no more than $15kish each, careful on the tech, careful on the vacations etc. If the extra curriculars are costing you retirement, stop spending that money.

Maybe you need a better job too.

This is all up to you. Don't go blaming the system or inflation or whatever. How you spend is up to you. Unless you have some bad luck like a health problem or whatnot.

I'd like to see the average savings for people in their 70s, 80s and 90s.