Retirement saving tips in your 20s and 30s
Americans looking to stretch their retirement savings may want to head to states in the South or the Midwest, a recent analysis suggests.
Around the U.S., a $1 million nest egg can cover an average of 18.9 years worth of living expenses, GoBankingRates found. But where you retire can have a profound impact on how far your money goes, ranging from as a little as 10 years in Hawaii to more than than 20 years in more than a dozen states.
Tapping government data, the personal finance site estimated the number of years retirees aged 65 or older could live off $1 million in savings based on the cost of housing, transportation, utilities, health care and groceries in each of the 50 U.S. states.
The key finding: Retirees can get the biggest bang for their buck in Mississippi, where the combined cost of food, utilities, housing, health care and other essentials is $44,000 per year. Saving of $1 million in the state would last you nearly 23 years, the personal finance site said.
By contrast, retirees in Hawaii — where the annual living costs are roughly $97,000, or more than double those of retirees in Mississippi — will burn through $ 1 million in just over 10 years, according to GoBankingRates.
It's worth noting that most Americans are nowhere near having that much money socked away. According to data from financial services firm Credit Karma, Baby boomers have median retirement savings of $120,000, while nearly 30% of people aged 59 or older have saved nothing for their golden years.
That's despite the fact that many retirements now last more than 25 years, according to financial services firm Fidelity. Those meager savings also fall well below the $1.8 million in savings Americans say they need to live out their golden years comfortably, according to a recent Charles Schwab poll.
Elizabeth Napolitano is a freelance reporter at CBS MoneyWatch, where she covers business and technology news. She also writes for CoinDesk. Before joining CBS, she interned at NBC News' BizTech Unit and worked on The Associated Press' web scraping team.
