The Federal Reserve’s latest Survey of Consumer Finances, conducted in 2022 and published in October 2023, provides a detailed look at the retirement savings of Americans. The survey found that the median retirement account value was $87,000. However, it’s important to consider other types of investments as well.
About 7% of participants had money in certificates of deposit, with a median balance of $26,000. Bonds were owned by just 1% of participants, but those who did own them had a median value of $211,000. Stocks were the second-most common asset, with 21% of participants reporting ownership.
The median value of stock investments held directly in brokerage accounts was $15,000. Pooled investment funds, including bond and stock funds, were reported by 12% of participants, with a median value of $150,000. The survey also found that retirement savings increased with age, peaking among those aged 65 to 74 before declining as they began withdrawing funds in retirement.
This highlights the importance of starting to save for retirement as early as possible.
Survey of retirement savings trends
Despite these figures, many Americans are still behind on their retirement savings.
The good news is that there are steps you can take to catch up, even if you’re already in your 50s. One important step is to make sure you’re claiming your full employer 401(k) match. Some people opt out of their company’s 401(k) plan because of high fees or limited investment choices, but it’s important to contribute enough to get the full match.
Another option is to work a second job to boost your savings. As of 2022, 36% of Gen X workers and 22% of baby boomers had a side hustle. This extra income can make it easier to save more for retirement.
Finally, it’s important to make sure your investments are working for you. Even if you’re close to retirement, your portfolio shouldn’t be completely devoid of stocks. Instead, you should scale back their presence but still include them to help boost your savings and continue growing your portfolio during retirement.
By taking these steps and staying dedicated to your retirement savings, you can improve your financial health and work towards a comfortable retirement, even if you’re starting later in life.
