At 59, my husband and I have $250K saved for retirement. But my friend says he’s got $700K. Are we unprepared?

Core Insights - The couple has saved approximately $250,000 for retirement, which is above the median savings for their age group but below the perceived necessary amount for a comfortable retirement [3][4] - They expect a monthly pension of $1,100 and combined Social Security benefits of $1,800 to $2,300, which could significantly enhance their retirement income [4][5] - The average American believes that $1.26 million is needed for a comfortable retirement, highlighting a disparity between public perception and actual savings [2] Retirement Savings Analysis - The average savings for Americans aged 55 to 64 is $537,560, but the median is only $185,000, indicating that the couple is ahead of many in their demographic [3] - If they retire at 65, their total monthly income from Social Security and pension could be around $5,000, allowing their retirement savings to last approximately 17 years at a $2,000 monthly withdrawal rate [6] - By maximizing their 401(k) contributions over the next six years, they could potentially increase their savings to $447,250, which would last over 30 years at the same withdrawal rate [7] Strategies for Improvement - The couple may need to work a few more years to improve their financial situation, as their retirement readiness is heavily influenced by their expenses and potential additional income [8] - Selling their home and accessing $300,000 in equity could significantly enhance their financial position, although housing costs must still be considered [8] - Retirement savings should be personalized based on individual spending habits, desired lifestyle, and health considerations [9] Retirement Planning Recommendations - To calculate retirement needs, a common method is to take 80% to 90% of current expenses and multiply by 25, which provides a rough estimate of required savings [10] - Individuals aged 50 and over can make catch-up contributions to retirement accounts, allowing for increased savings potential [11] - Downsizing or reassessing expenses can free up cash flow, which can be redirected into retirement savings [14]