What Is the Median Net Worth of Retirees?
The median net worth of retirees represents the midpoint where half of households have more and half have less. It is a more stable measure than the average, which can be skewed by a small number of very wealthy households. For households aged 65 and older, the median net worth is typically much lower than the mean, reflecting the reality most retirees face in retirement planning.
How Does Net Worth Change by Age in Retirement?
Net worth tends to peak in the late 50s and early 60s, then gradually decline as retirees draw down savings. Households in their early 60s often have higher net worth than those in their 70s and 80s. This pattern reflects spending, healthcare costs, and the depletion of retirement accounts over time. The Federal Reserve’s Survey of Consumer Finances provides detailed age-based breakdowns of these trends.
What Drives the Median Net Worth of Retirees?
Home equity and retirement account balances are the largest contributors for most retirees. Other factors include Social Security income, pension coverage, outstanding debt levels, and healthcare expenses. Households without a mortgage or with defined benefit pensions usually show higher net worth at retirement age. Lower earners and those with limited access to workplace retirement plans often have much smaller balances.
