15 Signs Your Retirement Savings Puts You in a Better Position Than the Average American

While you might feel you aren’t prepared for retirement, the average American isn’t either.
Updated Nov. 27, 2023
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Saving for retirement is not easy, especially when you're trying to stop living paycheck to paycheck. But it becomes much easier once you create a budget and get out of debt.

If you feel like you’re behind on retirement savings, you’re not alone. But you might be more prepared than you think. See how your retirement plan stacks up to the rest of Americans.

Do you dream of retiring early? Take this quiz to see if it's possible.

You’ve determined how much you need in retirement savings

insta_photos/Adobe senior lady sitting at table with laptop calculator and cup reviewing taxes at home

You’re one step ahead of half of Americans if you’ve determined how much money you’ll need in retirement.

It’s not possible to know how long your retirement will last or if you’ll experience major health concerns. But factoring in inflation, lifestyle, and accounting for emergencies can help you come up with an estimate.

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You started saving before age 27

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The earlier you can start saving for retirement, the better. Workers in their 20s may make less than they will in later years, but saving any amount for retirement is a good start.

Transamerica Center for Retirement Studies (TCRS) revealed 27 is the median age Americans begin retirement savings. If you haven’t reached 27 yet — or started saving before then — you’re more prepared than most.

You’re under 35 and have more than $12,300 in savings

dusanpetkovic1/Adobe man sitting at table in front of laptop reviewing bills in hand

According to PriceWaterhouse Coopers (PWC), the median retirement savings for Americans under 35 is $12,300. This amount does not include other types of savings.

If you have more than this in personal retirement savings or in a 401(k), you are already doing better than most.

You're 35-44 and have more than $37,000 in savings

Allistair/peopleimages.com/Adobe couple sitting on countertop at kitchen reviewing monthly budget on papers

PWC found that the median retirement savings of 35-44 year-olds was $37,000. If you fall in this age group but haven’t hit this number yet, make sure you take advantage of your employer matching.

You’re 45-55 and have more than $82,600 in savings

goodluz/Adobe attractive senior couple reviewing financial budget using laptop with papers and cup on table

By age 55, you’re only 10 years away from full retirement age, yet PWC noted Americans 45-55 only had a median of $82,600 saved for retirement.

If you have more money than this saved, you’re in better shape than most. But you’ll want to grow this number significantly to enjoy a comfortable retirement.

You’re 55-64 and have more than $120,000 in savings

Wesley JvR/peopleimages.com/Adobe african american couple sitting on couch reviewing financial statements at home with laptop on table

$120,000 is not a lot of money, considering it might need to last 20 or more years. But this was the median retirement savings for adults 55-64, according to PWC.

Retirees with only $120,000 in savings might have to rely on Social Security benefits or continue to work during “retirement.”

You have a retirement plan and haven’t dipped into it

Andrey Popov/Adobe drawing retirement plan growth graphs on paper

A Bankrate survey found that 51% of Americans with an IRA or 401(k) took early withdrawals. Dipping into these retirement accounts comes with added costs, such as penalties and taxes.

You can avoid needing to take early withdrawals from your retirement account by growing a healthy emergency account that you can dip into instead.

You have an HSA

utah51/Adobe health savings account paper on clipboard with stethoscope and money on wooden table

A health savings account (HSA) can prevent you from needing to make early withdrawals from your 401(k) for qualified medical expenses.

Contributions and qualified withdrawals aren’t subject to tax, so you can keep more money in your pocket.

Although HSAs have become more popular, many Americans still don’t take advantage of them.

You have less than $5,000 in credit card debt

maxbelchenko/Adobe woman using card for online payment

Although credit card balances decreased in 2021, the average American still carries over $5,000 in credit card debt, according to Experian.

Carrying a balance from month to month could hurt your financial goals, especially when it comes with high-interest rates. Pay off debts and keep current card balances manageable to stay on track for retirement.

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You’ve paid off your student loans

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According to a Bankrate survey, more than half of Americans ages 18-41 put off making significant financial decisions due to student loan debt.

And 27% have cited student loan debt as a reason for not growing their emergency savings.

If you’ve paid off — or are close to paying off — your student loan debt, you are in a much better financial position than other Americans in this age group.

Debt isn’t preventing you from saving or making financial decisions

fizkes/Adobe female real estate agent sitting across african american couple on table with coffee discussing mortgage

Student loan debt isn’t the only thing that can impact your financial decision-making. Mortgages, car loans, personal loans and medical debt can hinder your savings progress.

Paying down debt will put you in a better position to save for retirement. Improving your credit score can help you get approved for credit cards with lower rates.

You fully understand Social Security benefits

gunnar3000/Adobe social security benefits form on table with glasses and pen

While many Americans know they shouldn’t rely on Social Security retirement benefits, less than 25% of people fully understand them, according to TCRS.

Knowing how these benefits work, how much you can expect, and if they are guaranteed will help you plan more effectively for retirement.

You stay up to date on retirement planning strategies

Prostock-studio/Adobe african american couple sitting in front of female financial advisor having discussion with papers and cup on table

It’s a good idea to stay up to date on the latest retirement planning strategies and regulations, but most Americans don’t do this.

It’s not always easy to follow constantly changing laws or adjust to new conditions. A qualified financial planner can determine the best retirement strategies when new regulations arise.

You make more than $1,085 per week

pitipat/Adobe boss lady in suit giving salary to businessman in suit at office with laptop on table

The more money you make, the more you can save. According to a report from the U.S. Bureau of Labor Statistics, the median weekly pay for full-time working Americans was $1,085 in the last quarter of 2022.

You should try to allocate at least 15% of your pre-tax income for retirement if possible. If you’re making the median wage of $1,085, that comes out to $162.75 each week.

You live a healthy lifestyle

NDABCREATIVITY/Adobe couple looking at each other tying laces for jogging outdoors

Some people fail to realize how much money they can save by living a healthy lifestyle. Staying active, eating healthy, and avoiding things like smoking can reduce the risk of significant health problems.

Obesity can lead to heart disease and even heart failure. And smoking can cause terminal illnesses, such as cancer. Choosing to live a healthy lifestyle could save you tens of thousands of dollars.

Bottom line

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Saving for retirement can take decades of saving and a lot of planning, especially when you want to retire early.

The truth is that most Americans are behind on retirement savings, but you can do better. And it’s never too early to start saving. Here are some tips to help you plan — and move — ahead.

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Author Details

Katelyn Washington Katelyn Washington is a writer with a passion for finance and business. She put herself through business school as a single mother of three and has had pieces commissioned by national magazines. When she’s not writing, she enjoys spending time with her family and editing manuscripts for indie authors.

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