The threshold for retiring has always been set to no less than a million dollars. But a lot of retirees are quietly showing that life can feel steady and comfortable without hitting that magic number.
The hack boils down to lifestyle choices, shifting priorities, and some added income sources. If you’ve ever wondered whether your nest egg could still carry you far, stick around—you might be surprised at what’s possible.
The Million-Dollar Benchmark
For years, retirement planning has leaned on the idea that you need at least $1 million saved. According to a Northwestern Mutual study, many Americans now believe that $1.46 million is the actual amount required for comfort. That’s a steep hill, especially when saving competes with mortgages and kids’ tuition. And, of course, not forgetting everyday costs.
This gap between expectations and reality raises the big question: if the savings target feels unreachable, how are retirees actually managing?
The Reality Of Retirement Savings
The Federal Reserve reported that the median retirement savings for Americans aged 65 to 74 was only $200,000 in 2022. For those 75 and older, the median dropped to $130,000. These numbers fall far short of the million-dollar goal, painting a very different picture of retirement security.
Yet the story doesn’t end with those balances. In fact, the next set of findings turns that story on its head.
Retirees Say They’re Doing Fine
The Federal Reserve’s most recent Survey of Household Economics and Decisionmaking found that 82% of retirees aged 65-plus with less than $1 million still described themselves as doing “OK” or even “comfortable.” Among those with just $50,000 to $99,999, 81% reported the same. That’s a striking vote of confidence from those living it.
If retirees themselves say life feels manageable, what’s driving that confidence? The answers point to more than just savings accounts.
Social Security And Other Income Sources
Savings don’t tell the whole story. In 2023, 80% of retirees aged 65 and older reported at least one source of private income such as pensions, part-time work, or investment returns, according to the Federal Reserve. Add that to Social Security benefits, which averaged $1,976, with some reports showing it reached $2,002.39 by May. This gives a fuller financial picture.
Those steady checks mean many households have enough to cover essentials—and in some cases, even a little more.
Lower Expenses In Later Life
Spending patterns often change in retirement, too. A 2019 study done by the Employee Benefit Research Institute found that total expenses generally decline as people age. Housing and child-rearing costs decrease, while commuting expenses disappear. Census data show that raising a child can cost over $21,000 a year, and mortgage payments average more than $2,100 per month.
Freeing yourself from those obligations creates breathing room, making smaller savings stretch much further.
Lifestyle And Priorities Shift
Retirement often brings different priorities. Downsizing homes or simply spending less on work-related expenses all factor in. But health care remains a big unknown. As the Federal Reserve’s survey reminds, planning ahead for long-term care or unexpected medical needs matters—because peace of mind isn’t just about numbers in an account.
This balance of lowered costs and new priorities explains why retirees can feel secure even without massive savings.
So, Do You Really Need $1 Million?
The short answer: not always.
The old benchmark no longer accurately reflects how most retirees live today. Many are piecing together income from Social Security, pensions, and modest savings while enjoying lifestyles that feel comfortable to them. That doesn’t mean saving more is bad—but it does mean the million-dollar rule might not be the only path forward.
