A majority of U.S. adults believe they need to save $1.46 million to retire comfortably, according to a 2024 Northwestern Mutual survey. A Newsweek map shows where this pot would last the longest, based on data from a new study by GOBankingRates. The U.S. population is rapidly aging, with the number of Americans aged 65 and older expected to more than double by 2040. As the country braces for the upcoming “silver tsunami,” the strain on the U.S. retirement system is becoming evident, with the Social Security program’s fund reserves expected to be depleted by 2035. A 2024 study revealed that 80 percent of U.S. adults aged 65 and older are financially struggling or at risk of economic insecurity in retirement.
GOBankingRates calculated how long a retiree could live on a retirement savings pot of $1.5 million and their monthly Social Security benefits. The map showed that in Hawaii, Massachusetts, California, New York, and Alaska, the pot would run out fastest, while in West Virginia, Kansas, Mississippi, Oklahoma, and Alabama, it would last for 50 years or longer. The data was compiled using the national average annual expenditures for people 65 and older, as reported by the Bureau of Labor Statistics, and annual Social Security income based on the Social Security Administration’s data. This information gives a state-by-state guide to the best places to retire based on financial considerations.
Most Americans are not able to save the suggested $1.5 million for retirement. A study by the Transamerica Center for Retirement Studies found that as of late 2023, workers had saved an estimated median $64,000 in total household retirement accounts. Baby Boomer workers had the most retirement savings at $194,000, compared with Generation X, Millennials, and Generation Z. The study also found that a significant percentage of Generation X and Boomer workers had less than $50,000 in retirement savings as they approached retirement age. This highlights the financial challenges many Americans are facing when it comes to retirement planning.
The blessing of a longer life expectancy comes with the curse of widespread uncertainty over the future of Social Security, potential inflation, and possible economic shocks that could undermine Americans’ financial security. As the U.S. population continues to age, the strain on the retirement system is becoming more apparent. The depletion of the Social Security program’s fund reserves by 2035 adds to the financial insecurity faced by many older Americans. With the looming “silver tsunami” led by the Boomer generation, finding sustainable retirement solutions is becoming increasingly urgent.
The map showing how long $1.5 million in retirement savings would last in each state serves as a valuable resource for individuals planning their retirement. By providing data on the cost of living after Social Security in each state, the map offers insight into the financial feasibility of retiring in different parts of the country. The varying lengths of time the pot would last in different states highlight the importance of considering financial factors when planning for retirement. This information can help individuals make informed decisions about where to retire based on their financial situation and goals.
In conclusion, the financial challenges surrounding retirement planning in the U.S. are becoming more evident as the population ages and the retirement system faces strain. Most Americans are not able to save the suggested $1.5 million for retirement, leading to concerns about financial security in later years. The map showing how long $1.5 million in retirement savings would last in each state provides valuable information for retirement planning, highlighting the cost of living after Social Security in different parts of the country. As the country prepares for the “silver tsunami,” finding sustainable retirement solutions becomes crucial for ensuring financial security in retirement.
