The 10x retirement rule is a financial guideline suggesting you should save 10 times your annual income by age 67 to maintain your lifestyle in retirement. Popularized by Fidelity, it serves as a benchmark for total savings, including employer contributions, aiming to support a comfortable post-work life alongside Social Security benefits.
10X Your Age 67 Salary Rule
For example, Fidelity recommends aiming to save 10 times your pre-retirement income by age 67. So, if you make $100,000 $125,000 per year, you should have $1.25 million saved by the time you retire.
Only 3.2% of retirees have $1 million in retirement accounts vs. about 2.6% of Americans in general. The average retirement savings for households aged 65-74 is $609,000, while the median is only about $200,000. The number of "401(k) millionaires" in America reached a record of about 497,000 last year.
Average net worth at age 72
According to Federal Reserve data, households led by someone between the ages of 70 and 74 have an average net worth of about $1.7 million to $1.8 million. This is the mean figure, and it's heavily skewed by very wealthy households.
If you have annual living expenses of $40,000 and $10,000 in lifestyle choice expenses, you would need $50,000 per year. Then multiply $50,000 by 25, resulting in $1.25 million of required savings at retirement.
Roughly 7% to 9% of American households have $500,000 or more in retirement savings, though figures vary slightly by source, with data from late 2025 suggesting around 7.2% and older 2022 data indicating about 9%, showing it's a significant milestone achieved by less than one in ten families, despite higher averages driven by wealthy individuals.
Americans in their 60s have the most saved for retirement with average balances close to $1.2 million. Average account balances more than double between those in their 20s vs their 30s.
The top ten financial mistakes most people make after retirement are:
A common starting point is to estimate that you'll need about 70% to 80% of your pre-retirement income to maintain your standard of living in retirement. For example, if you earn $150,000 annually while working, you might need between $105,000 to $120,000 as a starting point in retirement.
The "27.39 rule" (often rounded to $27.40) is a simple financial strategy to save $10,000 in one year by consistently setting aside $27.40 every single day, making it an achievable micro-saving habit to build wealth or an emergency fund. It turns the daunting goal of saving $10,000 into a manageable daily action, emphasizing consistency over large lump sums.
Recommended 401(k) balances often use salary multiples, like having 1x your salary by 30, 3x by 40, 6x by 50, and 10x by retirement (age 67), though averages vary significantly by age group, with younger savers having less and older savers (55-64) often holding over $250k on average, but still needing more for a comfortable retirement. Key benchmarks suggest aiming for 10-15% total savings (including employer match) and increasing contributions as you earn more, using catch-up contributions after 50.
In the same letter, Buffett went on to explain that in his will, he advised the appointed trustee to invest the cash he planned to leave his wife (his Berkshire Hathaway shares will go to charity) the same way: 90% in a "very low-cost" S&P 500 index fund and 10% in short-term government bonds.
Data from the Federal Reserve's Survey of Consumer Finances, shows that only 4.7% of Americans have at least $1 million saved in retirement-specific accounts such as 401ks and IRAs. Just 1.8% have $2 million, and only 0.8% have saved $3 million or more.
Yes, you can live off the interest/returns from $500,000, but it depends heavily on your lifestyle and expenses, with the common 4% rule suggesting about $20,000 annually, which may require a frugal lifestyle, relocation, or significant Social Security income to supplement. With smart investing (e.g., balanced stock/bond mix) and minimal spending, it's feasible for many, but living in a high-cost area or with high expenses would make it difficult.
A good retirement nest egg aims to replace 80% of your pre-retirement income, often needing 10-12 times your final salary saved by age 67, but the exact amount varies widely based on lifestyle, desired retirement age, location, and expenses like healthcare. Key benchmarks include saving 1x salary by 30, 3x by 40, 6x by 50, 8x by 60, and 10x by 67, with a 15% savings rate of your income being a strong general goal.