The American Dream Now Costs $4.4 Million

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The American Dream now costs $4.4 million—that’s the estimated lifetime household cost of common milestones, including getting married, raising two children, buying a home, having new cars, saving for retirement, going on yearly vacations, and more.

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Saving for Retirement: $1.6 Million
Avg Age: 22 - 65

The dream is to start saving for retirement during your first job after college and to continue saving from the ages of 22 to 65, and to have approximately $1.6 million in retirement savings to withdraw 4% each year (adjusting for 2.5% annual inflation) for 20 years.

The reality is that many Americans don't hold retirement accounts—and those who do have accounts don’t have $1.6 million in them. About 54% of American families hold retirement accounts, according to the most recent Survey of Consumer Finances from 2022.
2 The Fed. "Chart: Survey of Consumer Finances, 1989 - 2022."The average amount held in a retirement account by 55- to 64-year-olds is $185,000 in 2022 dollars, according to the survey.

While expenditures can help define a savings target, many personal factors can affect retirement costs, especially healthcare needs. According to a recent study, the average monthly cost of an assisted living facility is $5,350 or $64,200 per year, while a private room at a nursing home is $116,800 annually.
3 Additionally, economic factors such as high inflation over the past few years have affected savings and increased debt levels, making U.S. adults less sure of their retirement savings. According to AARP’s Financial Security Trends survey from January 2024, about 33% of U.S. adults 30 and older who are regularly saving for retirement said they will not have enough money in retirement at the current rate they’re saving (up from 29% in January 2023).

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