Inflation Drives Americans’ Retirement Savings Goal To Record High Of $1.46 Million

The amount Americans believe they need to save for a comfortable retirement has reached a record high of $1.46 million, according to a recent study by Northwestern Mutual. This figure represents a significant 53% increase since 2020 when the “magic number” stood at $951,000.

The study reveals that the retirement savings goal has been outpacing inflation, rising 15% from last year’s estimate of $1.27 million. The findings highlight the growing concerns among Americans about their financial security in retirement as the cost of living continues to surge.

Despite the ambitious savings target, the average amount U.S. adults have saved for retirement has slightly decreased from $89,300 in 2023 to $88,400 today, more than $10,000 off its five-year peak of $98,800 in 2021.

“People’s ‘magic number’ to retire comfortably has exploded to an all-time high, and the gap between their goals and progress has never been wider,” said Northwestern Mutual chief strategy officer Aditi Javeri Gokhale. “Inflation is expanding our expectations for retirement savings, and putting the pressure on to plan and stay disciplined.”

The study’s findings underscore the urgent need for Americans to prioritize retirement planning and maintain a consistent savings strategy to keep pace with the rising cost of living.