Americans believe they should save around $1.46 million before retiring, but in states like Hawaii, the minimum amount needed is much higher at $2,051,077. This amount, combined with Social Security benefits, is calculated to cover necessities and savings over a 25-year retirement period. GOBankingRates determined these minimum retirement savings requirements by analyzing expenses for groceries, transportation, housing, utilities, and healthcare for Americans 65 and older, using data from the Bureau of Labor Statistics. They also factored in each state’s cost of living to determine the amounts needed for retirement in each state.
The top 10 states where the most retirement savings is needed are listed, with Hawaii at the top of the list requiring over $2 million. Hawaii is known for its high cost of living, with a median home sale price of around $813,000 as of March 2024. Retirement savings in Hawaii would run out in about 10 years, the fastest of any state, as income from retirement savings accounts is fully taxed. Despite the expenses, Hawaii offers attractive features for retirees such as beautiful landscapes and easy access to beaches.
Planning for retirement is crucial, as everyone’s definition of a “comfortable retirement” will differ. Having a clear savings goal can help determine how much needs to be saved in order to retire comfortably. Utilizing resources like CNBC Make It’s retirement calculator can assist in figuring out the amount needed based on factors like age, income, and current savings. While a location’s cost of living is important when deciding where to retire, personal preferences and factors like proximity to family or lifestyle choices should also be considered.
It’s important to consider additional income streams for retirement planning, such as passive income sources. CNBC offers an online course on earning passive income online to provide guidance and tips on getting started. Subscribing to CNBC Make It’s newsletter can also offer valuable insights and advice on success in work, money management, and life. Retirement planning requires careful consideration and preparation to ensure a comfortable and fulfilling retirement. By understanding expenses and savings requirements based on personal goals and preferences, individuals can effectively plan for their future retirement needs.
