Average Retirement Savings – Baby Boomers vs Next Generations
The average retirement savings for baby boomers and the following generations show some surprising statistics. Baby boomers are over 45 but have not yet reached 65 years old and retirement age. This is the generation that will start retiring within the next decade, and the average American retirement savings in this age group is higher than others because baby boomers have had a significant amount of time to prepare for their retirement. Individuals between 60 and 65 have an average savings of between $58,028 and $344,849, with the actual amount dependent on the annual income level and salary range of the individual. Most baby boomers from 55 to 64 years old have savings on average of $270,600 to retire on. Most individuals in this age range have saved and planned for retirement carefully.
The average retirement savings for those individuals who are aged 45-54 is $154,900. This age group still has 10-20 years left to save before retirement and the average savings show this gap. According to a number of surveys experts believe that many baby boomers are unprepared for retirement and have not saved enough to meet their financial needs after retiring. This is not true with younger generations who have started early retirement planning and are willing to take more risks when investing retirement funds. Baby boomers tend to be low risk individuals who settle for small gains and little risk, while people from generation X are more willing to take on these risks in order to gain higher returns.
The group of individuals who are between 35 and 44 years old have a much lower average retirement savings of around $80,100. This group still has time to make up any shortages before reaching retirement age though, and this generation has planned for this event carefully with a majority of individuals using financial experts to help with retirement planning. Comparing the average retirement savings by age can show how each generation is saving for retirement. The economy has played a big role in the amount saved for retirement, and in the last few years many baby boomers withdrew funds from retirement accounts to make ends meet. Younger generations tended to use other means rather than withdrawing retirement savings.
Young adults who are still in their 20s have the lowest average retirement savings because this group is still just starting out and has not made significant progress towards meeting financial goals. The average amount saved for retirement for individuals in their 20s is $33,135. This amount may seem small but it is a start. Financial experts advise that this is the prime time to start saving for retirement to take advantage of compounding interest. The retirement savings statistics can show whether retirement planning is on track or whether additional funds will be needed for retirement purposes. When it comes to retirement the baby boomers are more concerned than younger generations but that is not surprising because the baby boomers will be the next generation to retire. Generation X and younger generations plan for retirement but are not highly concerned with this event yet.