Average Retirement Savings of Retirees 2011

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Based on the Federal Reserve Board Panel Survey of Consumer Finances, median retirement savings (plus investments, not including a primary residence or value of pensions) is $333,000 for families where the head of household is retired for 2009.   The average non-residential debt was $42,000 for net financial assets of $291,000.

Note that this is a measurement by household and not by retired individual.

This appears to be much more than other sources report, although insufficient for retirement comfort (see following analysis).  The discrepency between sources may depend on how "retired is defined."  The above data was based on surveys and apparently on how the survey respondent classified themselves.  Other data sources however define retired as receiving some type of retirement compensation (e.g. pension, social security, etc).

Based on very limited data from a recent survey by the EBRI in 2011, average retirement savings (plus investments, not including a primary residence or value of pensions) is in the neighborhood of $20,000 - $50,000 (see table below). It may be more accurate to state that the figures below reflect the median, rather than an average.

Only 17% reported savings exceeding $250,000.  Based on many calculations I have done, retiring in 2011 would require at least $1 million to live comfortably yet very conservatively (assuming no other income).  Of course, if one receives a $4,000 monthly pension and lives in rural Alabama, you could likely retire comfortably with no retirement savings.

It is a widely agreed in the financial community that 4% is a safe annual withdrawal rate from a retirement nest egg. That means from a one million-dollar portfolio, one could safely withdraw $40,000 annually and increase that $40,000 by 3% annually to offset inflation and never run out of money.  If a hypothetical retiree requires the $40,000 annually as per our example, and feels comfortable relying on the $20,000 social security annually due him, then he needs only $20,000 annually from savings.  This could be fulfilled by a $500,000 portfolio. (You can get your own estimates of retirement income and required savings).

But as the table below indicates, average retirement savings are sorely lacking as 68% of retirees say that social security, a tenuous source of income, is a major source of retirement income.  The second most important source, again uncontrollable by the retiree, is employer pensions (which particularly in the public sector, are at risk). View the table: