Financial Trajectory
Your savings rate against a mean of 15% (SD 10), with a wealth projection to age 65 at a 7% real return. Saving 50% of income reaches independence in about 17 years regardless of salary.
The percentile compares your savings rate with a normal curve, mean 15% and SD 10, our fit to the Federal Reserve Survey of Consumer Finances (2022). The projection compounds what you have plus what you add each year at a 7% real return to age 65.
Your savings rate is higher than
50%
of US households. The mean rate is 15%.
Savings multiple
0.3×
of annual income
At 65, projected
$1.5M
in today's dollars, at 7% real return
Savings rate distribution, US households
The arithmetic that drives this: at a 4% withdrawal rate you need 25 times your annual spending to stop working. Save 15% and that takes about 43 years; save 50% and it takes about 17, whatever the salary. On your inputs the pot is $1.5M at 65, which is 24.3 years of your current income.
In context
The Federal Reserve's 2022 Survey of Consumer Finances puts the median retirement account at $87,000 among families that have one, and the mean at $333,000; the gap between those two numbers is the top 10%. About 54% of families hold any retirement account at all. The 7% real return is the long-run US stock average after inflation; a bond-heavy mix has returned closer to 2 to 3%, which roughly halves the projection.
Advertisement
Related tests
About this test
Enter your age, income and current savings. The module projects wealth forward at a 7% real annual return, the long-run S&P 500 average, and places your savings rate on a normal curve with mean 15% and SD 10%, informed by the Federal Reserve's Survey of Consumer Finances (2022) and OECD pension data.
The savings rate is what moves the result. At 5% you need about 66 years to reach financial independence; at 50% about 17. A 25% rate is higher than about 84% of households on the module's curve. Returns are not guaranteed, inflation is handled by using real returns, and taxes are ignored.
What is a good savings rate?
Above the 15% mean puts you in the top half of households. 20% is about the 69th percentile, 30% about the 93rd. Financial-independence circles target 50 to 70%, which is off the end of the curve for most practical purposes.
What is the 4% rule?
A withdrawal rule of thumb: with 25 times your annual spending saved, taking 4% a year has historically lasted 30 years in US data (Bengen 1994; the Trinity study, 1998). The module uses 25 times expenses as its independence target.
How much does the average American have saved for retirement?
A median of about $87,000 and a mean of $333,000 among families with retirement accounts, in the Federal Reserve's 2022 Survey of Consumer Finances. The gap between median and mean is the top end pulling the average up.
Percentiles above come from the same parameters the Financial Trajectory module uses. See the methodology for how they are calculated.