How much cash should a 70 year old have?
For example, one rule suggests having a net worth at 70 that's equivalent to 20 times your annual expenses. If you spend $100,000 a year to live in retirement, you should have a net worth of at least $2 million.
How much does the average 70-year-old have in savings? We were curious, too, so we asked. Our 2023 Planning & Progress study found that the average amount of retirement savings for 70-year-olds in the U.S. is $113,900.
By age 70, you should have at least 20X your annual expenses in savings or as reflected in your overall net worth. The higher your expense coverage ratio by 70, the better. In other words, if you spend $75,000 a year, you should have about $1,500,000 in savings or net worth to live a comfortable retirement.
| Age by decade | Average net worth | Median net worth |
|---|---|---|
| 40s | $713,796 | $126,881 |
| 50s | $1,310,775 | $292,085 |
| 60s | $1,634,724 | $454,489 |
| 70s | $1,588,886 | $378,018 |
According to data from the BLS, average 2022 incomes after taxes were as follows for older households: 65-74 years: $63,187 per year or $5,266 per month. 75 and older: $47,928 per year or $3,994 per month.
| Age | Average 401(k) | Median 401(k) |
|---|---|---|
| 40s | $344,182 | $151,274 |
| 50s | $558,740 | $247,338 |
| 60s | $555,621 | $209,382 |
| 70s | $417,379 | $103,219 |
| Age | Average Account Balance | Median Account Balance |
|---|---|---|
| 45 to 54 | $48,200 | $6,400 |
| 55 to 64 | $57,670 | $5,620 |
| 65 to 74 | $60,410 | $8,000 |
| 75 and older | $55,320 | $9,300 |
At age 60–69, consider a moderate portfolio (60% stock, 35% bonds, 5% cash/cash investments); 70–79, moderately conservative (40% stock, 50% bonds, 10% cash/cash investments); 80 and above, conservative (20% stock, 50% bonds, 30% cash/cash investments).
According to the Fed data, the median net worth peaks between ages 65 and 74 and then falls when retirees enter their late 70s and beyond. Americans ages 75 and up have a median net worth of $254,800.
Reading, working puzzles, and learning new things are just some of the many brain-stimulating activities that can help seniors in their 70s maintain good brain health. Families who find it difficult to care for their aging loved ones without assistance can benefit greatly from professional respite care.
Does net worth include home?
Household wealth or net worth is the value of assets owned by every member of the household minus their debt. The terms are used interchangeably in this report. Assets include owned homes, vehicles, financial accounts, retirement accounts, stocks, bonds and mutual funds, and more.
| Age group | Average retirement savings balance amount |
|---|---|
| 35-44 | $141,520 |
| 45-54 | $313,220 |
| 55-64 | $537,560 |
| 65-74 | $609,230 |
“A general rule of thumb is that retirees need 60% to 80% of their preretirement income to live comfortably.” With this method, then, your number might be 70% of your current annual income multiplied by 15, 20 or however many years you think you'll need it to last.
Social Security offers a monthly benefit check to many kinds of recipients. As of December 2023, the average check is $1,767.03, according to the Social Security Administration – but that amount can differ drastically depending on the type of recipient. In fact, retirees typically make more than the overall average.
| State | Average Retirement Income |
|---|---|
| California | $34,737 |
| Colorado | $32,379 |
| Connecticut | $32,052 |
| Delaware | $31,283 |
However, not a huge percentage of retirees end up having that much money. In fact, statistically, around 10% of retirees have $1 million or more in savings. The majority of retirees, however, have far less saved.
Understanding the $1K Per Month in Retirement Rule
With the $1,000 per month rule, if you plan to withdraw 5% of your savings each year, you'll need at least $240,000 in savings. If you aim to take out $2,000 every month at a withdrawal rate of 5%, you'll need to set aside $480,000.
However, a popular approach is to invest in stocks and other growth assets while saving up, then convert your portfolio into an annuity upon retirement. With $400,000, if you buy an annuity at age 62 and then retire, you might expect monthly payments of around $2,400 for the rest of your life.
If you're 70, you should keep 30% of your portfolio in stocks. However, with Americans living longer and longer, many financial planners are now recommending that the rule should be closer to 110 or 120 minus your age.
Is $20,000 a Good Amount of Savings? Having $20,000 in a savings account is a good starting point if you want to create a sizable emergency fund. When the occasional rainy day comes along, you'll be financially prepared for it. Of course, $20,000 may only go so far if you find yourself in an extreme situation.
What is a good net worth to retire?
| Age Range | Median Net Worth | Average Net Worth |
|---|---|---|
| 55-64 | $212,500 | $1,175,900 |
| 65-74 | $266,400 | $1,217,700 |
| 75+ | $254,800 | $977,600 |
| Income percentage | Account balance |
|---|---|
| 60-79.9% | $7,924 |
| 80-89.9% | $13,434 |
| 90-100% | $43,631 |
| National average | $8,814 |
Generally, you want to keep a year or two's worth of expenses in cash when you're retired. Your investments will probably fluctuate over time. If you left all your savings invested until you needed the money, you'd run the risk of withdrawing your funds when your portfolio was down.
Saving 15% of income per year (including any employer contributions) is an appropriate savings level for many people. Having one to one-and-a-half times your income saved for retirement by age 35 is an attainable target for someone who starts saving at age 25.
The right amount of cash to have on hand
During your working years, you should aim to have enough cash in an emergency fund to cover three months' worth of living costs at a minimum. For retirement, you'll really want more like one to two years' worth.
