ECONOMY & WORK
MONEY 101
NEWS
PERSONAL FINANCE
NET WORTH
About Us Contact Us Privacy Policy Terms of Use DMCA Opt-out of personalized ads
© Copyright 2023 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.
MARKETREALIST.COM / ECONOMY & WORK

Here's How Much Money Americans in Their 30s Have Set Aside for Retirement

27% of people say that paying down their credit card debt has become a barrier to saving.
PUBLISHED MAR 25, 2024
Cover Image Source: Pexels | Photo by Towfiqu barbhuiya:
Cover Image Source: Pexels | Photo by Towfiqu barbhuiya:

Inflation is down from the peak, but Americans are still looking at high prices. This is why, many Americans are failing to save for emergencies, let alone retirement. According to Bankrate, only 22% of Americans have contributed to their retirement funds in 2022. As per sources, Americans need close to $1.3 million to retire comfortably. However, as per a recent study by Fidelity Investments, Americans who are in their 30s have saved significantly less than the required amount. As per the study, the median amount the Americans in their 30s have in their 401(k) is around $20,400.

The low amount is due to several reasons. One of the biggest reasons is the rising living cost which has made it tough for people to live comfortably with their wages, let alone saving.

27% of people say that paying down their credit card debt has become a barrier to saving. However, according to Anne Lester, a retirement expert, the good news is that it's not too late for people who are in their 30s.



 

In a conversation with CNBC Make It, she said that people in their 30s still have plenty of time. " You’re just going to end up saving at a slightly more aggressive rate than if you started earlier, and that’s fine," she said.

Fidelity urges people in their 30s to contribute 15% of their income towards retirement savings, however, the percentage Americans were contributing was 4% shy of the recommended percentage. 

Americans who have not started saving yet and are already in their 30s are recommended to make a few short-term sacrifices to kickstart their savings. 

“If you promise yourself that you’ll save future raises, it actually won’t be as painful as it sounds,” Lester says. 

She also talks about how boosting the emergency savings can also help with contributing to 401(k).

"My recommendation is boost your emergency savings, contribute enough to your 401(k) to get your employer match, and then save for the good stuff like a vacation," she adds. 



 

According to Forbes, there are a few steps that you can take today to improve your retirement planning. The first step is to evaluate, how much you need to save. To evaluate that, you will need to take a look at the number of vacations you take each year, the possibility of medical emergencies, and more. You can also use the 25x Rule to calculate your retirement requirements. All you need to do is estimate your annual expenses in retirement and multiply it by 25. This means if you currently spend $50,000 a year, you will need to save $1.25 million to retire comfortably. 

It's also important to understand that while experts say that the ideal age to start saving is at the age of 25, no set age will work for everybody. Having said that, if you are 35 and older and have not started saving, then Forbes recommends setting aside 24% of your income until age 62 and then 15% of your income until age 65. It's also recommended to increase your savings rate from time to time. This will help you to combat inflation in the long term.

MORE ON MARKET REALIST
The sharks did not expect the product to taste as good as it did, considering what it was made from.
4 hours ago
The designer was also commissioned by top brands and worked for the royal family.
5 hours ago
The host had a look of bewilderment on his face which was absolutely hilarious.
6 hours ago
Things did not seem to be going well for the entrepreneur due to her high energy.
9 hours ago
The guest might have had high expectations, but they were quickly brought down to earth.
10 hours ago
The contestant was unable to contain her excitement and hugged the model.
1 day ago
Two of the players got it right, and while the player who lost didn't mind, fans were not satisfied.
1 day ago
Lisa celebrated her birthday in style with a perfect two-card guess to win the big prize.
1 day ago
Rick Harrison did what he could to console the guest who said that he had lost faith in NASCAR.
1 day ago
Both the guest and the expert were fascinated by how well the automaton worked.
2 days ago
One of the entrepreneurs broke down in tears, explaining all the struggles they had to go through.
2 days ago
She couldn’t believe it when her doll was appraised at a five-figure sum, and laughed in disbelief.
2 days ago
Ken Jennings truly has embraced "Jeopardy!" in every way possible at this point.
2 days ago
The comedian was impressed by the simplicity of the product and amused by the pitch.
3 days ago
Harrison usually makes smart deals on the show, but this vintage car buy turned into a costly mistake.
3 days ago
Had she started the game in a better way, she might have won the five-figure prize money.
3 days ago
Barbara Corcoran made the exact same offer, and she wasn't happy about being rejected.
4 days ago
The guest believed that it was worth a modest amount of money, but that was clearly not the case.
4 days ago
With James Holzhauer in the lead, Amy Schneider and Andrew He decided to joke around.
4 days ago
Barbara Corcoran told the founders that she had never seen Greiner so passionate.
4 days ago