Here’s hoping you’re not among the 51% of Americans who don’t have a large enough nest egg for retirement.
Selena Maranjian
 | The Motley Fool
Migration patterns in Latin America have shifted south
Border crossings have fallen to record lows as Trump’s immigration crackdown takes hold.
I suspect that most working Americans, like me, are looking forward to retirement. It’s a time I’ve seen referred to as “preferment” — a time when you can do the things you prefer, not the things you’re required to do to keep food on the table and the lights on.
But as millions of us march closer to retiring every day, there’s danger afoot, as was revealed in a recent Motley Fool research report on Americans’ readiness for retirement. Here’s a look at some of its findings — which might help you figure out whether you will be ready for retirement when the time comes.
Millions are not ready for retirement
The Fool report starts out with this depressing news: “47% of working households are in danger of not having enough retirement savings, according to analysis from the Center for Retirement Research at Boston College.” It added that, “The median retirement account value in 2023 was $87,000.”
Those numbers seem to fit with the findings below, from the 2025 Retirement Confidence Survey:
Amount in savings and investments*
Percentage of workers
Less than $1,000
16%
$1,000 to $9,999
9%
$10,000 to $24,999
7%
$25,000 to $49,999
7%
$50,000 to $99,999
12%
$100,000 to $250,000
13%
$250,000 or more
37%
Source: 2025 Retirement Confidence Survey. Calculations exclude the value of a primary home
See? Fully 51% of workers have less than $100,000 socked away, and 32% have less than $25,000. Such low sums can be OK for workers in their 20s or 30s, but as we enter our 40s and 50s, our retirement savings programs should be well under way, and, ideally, we should have bigger nest eggs growing.
How much money do you need for retirement?
So how much should you sock away? There’s no single answer that suits everyone, but the flawed-but-still-helpful “4% rule” can help you get an idea. It suggests that retirees can withdraw 4% from their nest egg in their first year of retirement and then adjust subsequent annual withdrawals for inflation. The table below shows how much you’d withdraw in your first year of retirement with nest eggs of various sizes:
Nest Egg
4% First-Year Withdrawal
$250,000
$10,000
$300,000
$12,000
$400,000
$16,000
$500,000
$20,000
$600,000
$24,000
$750,000
$30,000
$1 million
$40,000
$1.5 million
$60,000
$2 million
$80,000
$2.5 million
$100,000
Source: Author calculations.
Clearly, those who are approaching retirement soon with even a $250,000 nest egg are facing trouble. That $10,000 withdrawal likely won’t last long, even when paired with Social Security benefits — which averaged about $2,008 per month as of August (which comes to about $24,000 over a year).
It’s worth taking some time to develop a realistic idea of how much income you’ll likely need in retirement — and then to figure out how you’ll get it. Here’s a list of likely spending categories to start with:
GroceriesDining outClothingHealthcareTransportationInsuranceUtilitiesEntertainmentEducationTravelGiftsCharity donationsMembershipsHousehold expenses, maintenance, and repairsTaxesWhat can you do to plan for retirement?
So — what can you do, especially if you’re behind in your retirement savings? Here are some ideas:
Save aggressively and invest effectively (such as in an S&P 500 index fund) via a regular, taxable brokerage account, a 401(k), and/or an IRA, among other options.Consider working a few more years, if you can. Delaying your retirement means your nest egg will have to last for fewer years, and you can beef it up more before retiring. You may also be able to remain on an employer-sponsored health insurance plan for longer, potentially saving money.Consider delaying claiming Social Security until age 70, if you can. This won’t work if you simply need the income sooner, but for most people, age 70 is the best age at which to claim your benefits in order to maximize them.Perhaps take on a part-time job for your first few years of retirement — or a side gig such as making and selling things or giving music or language lessons.Think outside the box. If you need more income during retirement, you might take in a boarder or look into a reverse mortgage.
Know that all is not lost, even if you’re one of the many millions of Americans who aren’t ready for retirement. There’s likely still time to improve your financial condition.
The Motley Fool has a disclosure policy.
The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.
The $23,760 Social Security bonus most retirees completely overlook
Offer from the Motley Fool: If you’re like most Americans, you’re a few years (or more) behind on your retirement savings. But a handful of little-known “Social Security secrets” could help ensure a boost in your retirement income.
One easy trick could pay you as much as $23,760 more… each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we’re all after. Join Stock Advisor to learn more about these strategies.