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In 2024, the average American believed they needed $1.46 million.
Is $1.26 Million Needed for a Comfortable Retirement?
Although Americans have tempered expectations compared to 2024, $1.26 million is still a sizable nest egg.
The amount you might need is heavily influenced by the lifestyle you envision once retired.
Canalizo noted that many Americans will realistically need $1 million-plus to fund a comfortable retirement.
And with rising healthcare costs, its essential toconsider these expenseswhen estimating the necessary retirement savings.
However, everyones needs will be different.
If Social Security benefits come into play, it can impact how much individuals need to save.
Why Has the Magic Number Decreased Since 2024?
People may now prioritize experiences over material wealth, leading them to believe they need less money saved.
The earlier you start saving for retirement, the better, Canalizo said.
Compound interest from regular contributions can significantly grow your retirement savings.
To start, Canalizo recommended taking advantage of your companys 401(k) match, if available.
Take full advantage by investing up to the maximum amount, he said.
Its also important tohave liquid cash available to serve as an emergency fund.
Finally, he recommended working with a financial professional.
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