Many workers are saving for retirement. That's the good news. The bad news is many people are not saving nearly enough. In fact, the estimated median retirement account balance is very low and would produce only a tiny amount of annual income every year. 

Here's how much workers have saved, and what this nest egg would actually do for them in their later years. 

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This is the median savings among workers

According to the Transamerica Center for Retirement Studies, the estimated median retirement savings in the United States is $54,000. This is an estimate of total household retirement savings across all accounts.

If this number sounds really low, that's because it is. Retirees are often advised to follow a 4% rule and withdraw no more than 4% of their invested balance during their first year of retirement to ensure they do not run out of money while still relying on their portfolio to provide income. For those with the median savings who are following this rule to avoid draining their accounts, a $54,000 account would give them just $2,160 to live on each year. 

With the average Social Security benefit coming in at $1,661 per month, retirement checks plus withdrawals from the median retirement account would leave seniors living on only $22,092 per year. For the majority of people, that's not nearly enough to make ends meet, much less to have a comfortable retirement.

How to save more than the median

Of course, $54,000 is the median account balance, so some people will have much more saved (and others will have much less). If you want to have the security you deserve in retirement, you're going to need to aim to become one of the people with a much larger account balance. There are a few key ways you can set yourself up to do that. You should:

  • Set a retirement savings goal. You can do this by assuming you will need 10 times your pre-retirement salary invested by your target retirement date. 
  • Break your big goal down into small, manageable monthly goals using the calculator at
  • Build your budget around investing a sufficient amount for retirement so you are prioritizing saving for your later years over any unnecessary expenditures.
  • Set up automated investments so the right amount of money is deposited each month into your retirement account.
  • Take advantage of accounts that provide tax breaks for retirement savings, such as an IRA or 401(k), to make it easier to invest the amount required.
  • Understand the rules for earning an employer 401(k) match if you are eligible for one so your employer can provide free money to help you save for retirement.
  • Invest wisely, building a balanced portfolio of sound investments that you hold for the long term and that expose you to the right level of risk.

By taking these steps, you should be able to beat the median $54,000 retirement account balance easily so you aren't left struggling to live on far too little as a senior.