May 20, 2026
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Being in the seven-figure club is considered essential for a comfortable retirement by many Americans. That’s according to Northwestern Mutual’s 2026 Planning & Progress Study, which found that the average magic number for most people is $1.46 million.
But in reality, seniors across the country are entering retirement with assets that fall far below that target. Households led by someone between the ages of 65 and 74 had a median net worth of just $409,900, according to the Federal Reserve’s most recent survey of consumer finances.
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However, home equity can be a significant amount of net worth — something that seniors can’t fully rely on for their daily expenses. So actual retirement savings could be considerably less for most retirees. According to Fidelity Investments’ Building Financial Futures Q3 2025 report, a typical Baby Boomer has an average 401(k) balance of roughly $267,900.
Simply put, most Americans are not retiring as millionaires. Far from it. Here’s how they’re managing their finances and lifestyle — plus how you might be able to get ahead.
How retirees are making ends meet
Retirement savings of $267,900 are not nearly enough for a comfortable lifestyle. Applying the standard 4% rule yields an annual withdrawal of just $10,716. That’s an unreasonably tight budget for most people in most parts of the country.
To plug the gap, many retirees rely heavily on Social Security. As of January 2026, the average benefit check is $2,071, according to the Social Security Administration (SSA). That means a dual-income household of retirees can expect annual benefits to cover a significant chunk of their budget.
Many retirees also, unfortunately, rely on debt to cover the gap. Seniors over the age of 70 saw their aggregate debt balloon 36.2% over five years, according to a 2025 report by The Kaplan Group. That makes them the fastest growing age group of borrowers.
Those in their 60s are not far behind, with aggregate debt expanding 21.9% over the same five-year period.
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Simply put, seniors are offsetting their lack of savings by relying on borrowed funds and Social Security, neither of which are reliable foundations of a stable retirement.
Debt is risky at any age, but particularly worrying when you’re on a fixed income, while the trust fund underlying Social Security is due to be depleted by 2032 unless lawmakers reform the system, according to the University of Pennsylvania’s Penn Wharton Budget Model.
In other words, if you’re planning for retirement in the future you may need a better plan.
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Planning for a better retirement
In 2026, a better retirement plan could include some elements to reduce your reliance on Social Security and lean more heavily on personal savings and your own safety net. As with all things investing, starting sooner rather than later can lead to compound growth over the course of 30-years. But taking the time to invest daily can be taxing.
Platforms like Acorns can help with that. The app turns spare change from every purchase into a long-term investment. So that $3.50 latte turns into 50 cents invested in a portfolio of robust funds managed by the likes of Vanguard and BlackRock. You can also tailor your investments to your risk tolerance.
Then, once you’re comfortable with your round-ups, you could consider setting up a monthly contribution to boost your saving power.
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Even better, if you commit to a $5 recurring monthly deposit, you can get a $20 bonus investment to start you off on the right foot.
If you’re closer to retirement, you need more predictable returns and cash flow that are as dependable as a Social Security benefit check. Certificates for Deposit or CDs can help with that. These lock in a set amount of money at a fair rate, guaranteeing you a certain payout after the certificate matures. Typically, CDs come in six month, one year or five year terms.
For those seeking predictable, reliable growth, a platform like CD Valet can help you find higher-yield options that work for you, whether you’re saving for something soon or building a cushion for the long haul.
CD Valet tracks over 40,000 verified rates from FDIC-insured banks and NCUA-insured credit unions nationwide. Unlike other websites, they show every publicly available rate, ensuring you have a comprehensive view of the market.
Plus, their CD rates are updated continuously, so you can shop, compare and open CDs with ease.
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Vishesh Raisinghani is a financial journalist covering personal finance, investing and the global economy. He's also the founder of Sharpe Ascension Inc., a content marketing agency focused on investment firms. His work has appeared in Moneywise, Yahoo Finance!, Motley Fool, Seeking Alpha, Mergers & Acquisitions Magazine and Piggybank.
