If you’ve ever scrolled through financial advice online, you’ve probably seen the same magic number pop up again and again: $1 million. That’s the supposed “gold standard” for retirement that will buy you peace of mind, freedom, and maybe a beach house.
But the reality is almost none of us actually get there.
According to the Federal Reserve’s Survey of Consumer Finances, only about 2.5% of all Americans have $1 million or more tucked away in retirement accounts. And among people who’ve already retired, only 3.2% hit that milestone.
The million-dollar myth
Many Americans think they’ll need about $1.5 million to retire comfortably, according to Northwestern Mutual’s 2024 Planning & Progress Study. That’s a realistic number given rising costs, longer lifespans, and the fact that Social Security alone doesn’t stretch nearly as far as it used to.
But if half the country doesn’t even have a retirement account, that million-dollar dream starts to look more like a fantasy. The Fed’s data shows that only 54.3% of households even have retirement accounts at all. That means almost half of Americans are heading into their later years without any dedicated savings.
Among those who do have accounts, the median balance is around $87,000. That’s a decent start, but not nearly enough to live off for 20 or 30 years.
Why most people fall short
It’s not always a story of bad decisions. A lot of it comes down to timing, access, and financial pressures.
Many workers don’t get access to employer retirement plans like 401(k)s. Others start saving late because they’re paying off student loans or dealing with high rent and childcare costs. And even when people do save, inflation and volatile markets can eat away at progress.
There’s also the simple math of compound growth: the earlier you start, the easier it is to hit big numbers. For example, someone investing $500 a month from age 25 could end up with around $1 million by 65 (assuming a 7% annual return). But start at 40, and you’d need to save nearly triple that every month to catch up.
How to catch up if you’re behind
If your retirement savings aren’t where you want them to be, you’re in good company, and you still have options.
1. Take advantage of catch-up contributions
If you’re 50 or older, the IRS lets you contribute more to your retirement accounts. In 2025, that’s an extra $7,500 to your 401(k) and $1,000 to your IRA beyond the standard limits. Here are some of the best IRAs you can open — start saving for your retirement today.
2. Get your employer’s match
If your company matches contributions, take full advantage. It’s basically free money. For instance, if you make $70,000 and contribute 6% to your 401(k), a 50% match means your employer chips in another $2,100 per year with no strings attached.
3. Automate your savings
The easiest way to build momentum is to set up automatic contributions. You’ll never “forget” to save, and you won’t miss money that never hits your checking account. You can earn around 4.00% APY with the best high-yield savings accounts available today.
4. Get some professional help
There’s a reason people pay for help with their retirement planning. It can seem overwhelming and be hard to know exactly where to start. Luckily, this no-cost quiz from our partner, SmartAsset, makes it easier to find a fiduciary financial advisor. Get on top of your retirement savings today.
Why the million-dollar goal might be overrated
Sure, $1 million sounds nice. But what really matters is income in retirement — not just a lump sum. Social Security, part-time work, or rental income can all fill the gaps.
The key is consistency. Whether you’re starting with $100 or $10,000, saving regularly and investing smartly can put you in a much stronger position over time.