Average Savings by Age: 2024 Data for the USA and Canada
Spoiler
The average savings for both Americans and Canadians in 2024 can be summarized as:
- Age 20 - 30: $16,000 (USA) / $12,000 (Canada)
- Age 30 - 40: $45,000 (USA) / $40,000 (Canada)
- Age 40 - 50: $90,000 (USA) / $80,000 (Canada)
- Age 50 - 60: $160,000 (USA) / $150,000 (Canada)
- Age 60+: $200,000 (USA) / $180,000 (Canada)
Ever wonder how your savings stack up compared to others in your age group? Understanding the average savings by age can be a huge motivator to either stay on track or get serious about boosting your nest egg. In this guide, we'll break down the average savings for different age groups in both the USA and Canada, while also giving you practical tips to improve your financial future!
Savings in Your 20s: Starting Your Financial Journey
Ah, your 20s! This decade is all about figuring things out, including your finances. According to data from the Federal Reserve in the USA, the average savings balance for people in their 20s is around $16,000. Meanwhile, Canadians in their 20s have slightly less, with an average savings of about $12,000 CAD, based on a report from Statistics Canada.
Financial Challenges and Opportunities
In your 20s, student loans and entry-level salaries might make saving a challenge, but it's the perfect time to start building an emergency fund and taking advantage of employer-sponsored retirement plans like 401(k)s in the USA or RRSPs in Canada.
Smart Saving Tips for Your 20s
Use tools like the Retirementize online income calculator to help you see the impact of saving early. The earlier you start, the more time your money has to grow through compound interest. Experts recommend saving at least 15% of your income, but even 5% is better than nothing when you're just getting started.
Savings in Your 30s: Building Wealth
Your 30s are typically when most people start earning more and hitting financial milestones like buying a home or starting a family. In the USA, the average savings for people in their 30s is about $45,000, while in Canada, it’s around $40,000 CAD.
Planning for Big Life Events
This is the decade when you need to start thinking seriously about your long-term goals, like retirement. Have you checked out our retirement budgeting guide? Use it to set realistic savings goals based on your future plans.
Strategies for Retirement Savings in Your 30s
This is the perfect time to max out employer matching contributions to retirement plans like 401(k)s or RRSPs. Don’t forget to factor in potential housing costs or market crashes. Consider starting contributions to Roth IRAs or TFSAs.
Savings in Your 40s: Hitting Your Stride
By your 40s, you should be seeing a more substantial savings balance. The average American in their 40s has about $90,000 saved, while Canadians typically have around $80,000 CAD.
The Midlife Financial Balancing Act
Between family expenses, mortgage payments, and thinking about future retirement, your 40s can feel like a financial balancing act. If you haven't already, now is a great time to explore passive income options like rental properties.
Preparing for Retirement
At this stage, you should aim to have at least three times your annual salary saved for retirement. If you feel behind, don’t worry—it’s never too late to make catch-up contributions. You should be diversifying your portfolio by now, with contributions into 401k/RRSP, IRA, Roth IRA/TFSA, Savings, and Rental Properties.
Savings in Your 50s: Preparing for Retirement
The 50s are all about crunch time for retirement planning. On average, Americans in their 50s have saved around $160,000, and Canadians have saved about $150,000 CAD.
Maximizing Retirement Contributions
Take advantage of catch-up contributions to retirement accounts like 401(k)s, RRSPs, IRAs, and TFSAs. Want to know more about how IRAs work? Check out our post on traditional IRA withdrawal rules. Make sure you're also factoring in healthcare costs, which can be a major retirement expense for Americans.
Assessing Retirement Readiness
Are you ready for retirement? Use our Retirementize calculator to figure out if your savings are on track. If you're not where you want to be, consider downsizing your home or delaying retirement to give your savings more time to grow.
Savings in Your 60s and Beyond: Retirement and Beyond
By the time you hit your 60s, your focus should shift from saving to spending strategically. In the USA, the average savings for those 60 and older is about $200,000. In Canada, it's roughly $180,000 CAD.
Managing Your Withdrawals
Now that you're entering the decumulation phase, it's important to manage your withdrawals carefully to ensure your savings last throughout retirement. Check out our retirement withdrawal calculator for help with this process.
Other Income Sources in Retirement
Social Security and Canada Pension Plan (CPP) will likely make up a significant part of your income. You can opt to take it at various ages to suit your situation.
Fun Facts
- The average American household has about $65,000 in retirement savings, while the median balance is much lower, at $20,000.
- In Canada, around 25% of adults have no retirement savings at all, relying solely on government programs like CPP, OAS, and GIS.
- Only 55% of Americans feel they are financially prepared for retirement, according to a 2024 study by Fidelity.
Conclusion
Understanding average savings by age can help you benchmark your progress and set realistic financial goals. Whether you're in your 20s just starting out or in your 60s preparing to retire, it’s never too late (or too early!) to optimize your savings plan. Remember, the key is to stay consistent, take advantage of tax-advantaged accounts like 401(k)s and RRSPs, and use tools like Retirementize to keep your retirement goals on track.