If you have $3 million in retirement savings, you are among a tiny percentage of American households with a nest egg that large. When calculating what percentage of retirees have $3 million, the Employee Benefits Research Institute (EBRI) analysis found that just 0.8% of households have saved $3 million in retirement. While that may seem like a large sum, longevity, healthcare costs and lifestyle choices can influence lasting financial security. Many retirees rely on a mix of savings, Social Security and pensions to fund their later years. However, the vast majority holding far less than multimillion-dollar portfolios.
A financial advisor can help you save for retirement and manage your savings throughout your golden years. Find an advisor who serves your area.
How Many Americans Have Nest Eggs of $3 Million?
The Employee Benefits Research Institute estimates that only 0.8% of U.S. households have at least $3 million in retirement savings. This figure is based on data from the Federal Reserve’s 2022 Survey of Consumer Finances (SCF), a comprehensive study assessing American household wealth, debt and financial behavior.
While 0.8% may seem small, it represents hundreds of thousands of households with substantial savings. Most retirees rely on more modest nest eggs, Social Security and other income sources to support their post-work years.
How Much Do Americans Actually Have Saved for Retirement?
Retirement savings vary widely across U.S. households. The 2022 Survey of Consumer Finances shows the average retirement savings for American households was $334,000, while the median savings was nearly $87,000.
Households headed by someone nearing retirement (ages 55 and 64) have an average of $537,560 in retirement accounts. The median retirement savings for this cohort is just $185,000.
The average retirement savings increases to $609,230 for households whose reference person is between 65 and 74 years old. It is $462,410 for households headed by someone 75 or older. Meanwhile, the median retirement savings for the 65-74 and 75+ cohorts are $200,000 and $130,000, respectively.
For younger workers, savings tend to be lower. Many rely on employer-sponsored plans like 401(k)s and IRAs to build their retirement funds. Social Security also plays a significant role, with many retirees depending on it as a primary income source.
These figures highlight the wide disparity in retirement preparedness. While some retirees accumulate substantial savings, others face financial uncertainty in their later years.
How to Build a Nest Egg of $3 Million
Building a $3 million nest egg for retirement takes consistent saving, strategic investing and disciplined financial management. Tax-advantaged accounts like 401(k)s and IRAs can significantly enhance savings, particularly when paired with employer-matching contributions.
Investing in a well-diversified portfolio with a strong allocation to equities can drive long-term growth. Stocks historically yield higher returns than other asset classes, making them essential for those with a long investment horizon. As retirement approaches, shifting to a more balanced asset allocation can help manage risk while preserving capital.
A high savings rate plays a crucial role in reaching this milestone. For example, a 30-year-old earning $100,000 annually who saves 20% of their income and achieves an average return of 7% per year could accumulate over $3 million by age 65. Even those who start later can still reach this goal by saving aggressively and leveraging compound growth.
By combining strategic savings, investing and expense management, individuals improve their chances of securing a robust retirement fund. To further support long-term wealth accumulation, minimize unnecessary expenses, avoid high-interest debt and maintain a disciplined financial plan.
Example of a $3 Million Nest Egg
A $3 million retirement portfolio can provide a comfortable income, depending on withdrawal rates and investment strategy. Using the widely cited 4% rule, a retiree could withdraw $120,000 annually while maintaining a reasonable probability of preserving their wealth over 30 years. Adjusting for inflation, this withdrawal strategy could sustain a retiree’s lifestyle for decades without depleting savings too quickly.
If the portfolio is invested in stocks, bonds and other assets generating an average return of 5-6% annually, the nest egg could last even longer. For example, a retiree spending $120,000 annually but continues earning modest returns may see their balance grow or deplete at a slower rate, depending on market conditions.
Alternatively, more conservative retirees—perhaps withdrawing $100,000 annually or supplementing income with Social Security and pensions—may extend the longevity of their savings well beyond 30 years. This flexibility allows for adjustments in case of unexpected expenses or economic downturns.
Bottom Line
Research shows that less than 1% of households have $3 million or more in retirement savings. While this amount is uncommon, those who consistently invest, save diligently and manage their spending can build significant retirement assets over time. A financial advisor can help you build your retirement portfolio so you have enough to live comfortably during your golden years.
Retirement Planning Tips
- A financial advisor can help you develop a savings strategy to reach your retirement goals. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Mandatory distributions from a tax-deferred retirement account can complicate your post-retirement tax planning. SmartAsset’s RMD calculator can help you estimate how much your required minimum distributions will be.
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