kali9 via Getty Images
It’s the question that keeps older people up at night: Will the recommended $1 million in retirement savings actually be enough?
The answer depends in part on where you live, according to a new GOBankingRates study.
The $1 million figure is thrown around by AARP and others as the amount of savings needed to replace between 70% and 80% of a person’s work income. But that’s a rough estimate and there are a lot of variables in retirement planning: How large is that income you hope to replace? How long will you live? Should you count your home equity as part of your savings if you’re not planning on selling your home? How will taxes and investment returns affect your retirement income? How will inflation affect your expenses? What happens if you suffer a sudden or long-term incapacitating illness?
Advertisem*nt
The reality is that few retirees have saved anything close to $1 million. The latest Retirement Survey of Workers conducted by the TransAmerica Center for Retirement Studies found that baby boomers have just $152,000 saved for retirement, on average.
That means many people will need to stretch their savings and maybe relocate to the states where their money could last the longest.
GOBankingRates, a personal finance website, pegged Mississippi at the top of the list: In that state, $1 million could cover the needs of the average retiree for 23 years, 2 months and 2 days. Hawaii is where you’re likely to blow through those savings the fastest ― in 10 years, two months and 29 days.
Advertisem*nt
The website determined the average total annual expenses for people 65 and older (counting groceries, housing, utilities, transportation and health care) and then multiplied total expenses by each state’s cost-of-living index to calculate the state-specific yearly cost. Housing is generally the big-ticket item.
The U.S. Census puts the average retirement age at 63. At age 65, Americans’ average life expectancy is about 19 more years. So that leaves you with two decades during which savings, pensions, home equity and Social Security become your principal means of financial support.
If you’ve managed to sock away $1 million, here are the five states where GOBankingRates says it will last the longest:
Mississippi (23 years, 2 months, 2 days)
Oklahoma (22 years, 8 months, 17 days)
Arkansas (22 years, 6 months, 22 days)
New Mexico (22 years, 3 months, 10 days)
Tennessee (22 years, 2 months, 4 days)
And the seven states where it will disappear the fastest:
Hawaii (10 years, 2 months, 29 days)
New York (14 years, 3 months, 22 days)
California (14 years, 3 months, 7 days)
Oregon (14 years, 7 months, 29 days)
Massachusetts (15 years, 1 month, 6 days)
New Jersey (15 years, 10 months, 18 days)
Alaska (15 years, 3 months, 24 days)
How did your state fare? Check it out on the map above.
Support HuffPost
Our 2024 Coverage Needs You
Your Loyalty Means The World To Us
At HuffPost, we believe that everyone needs high-quality journalism, but we understand that not everyone can afford to pay for expensive news subscriptions. That is why we are committed to providing deeply reported, carefully fact-checked news that is freely accessible to everyone.
Whether you come to HuffPost for updates on the 2024 presidential race, hard-hitting investigations into critical issues facing our country today, or trending stories that make you laugh, we appreciate you. The truth is, news costs money to produce, and we are proud that we have never put our stories behind an expensive paywall.
Would you join us to help keep our stories free for all? Your contribution of as little as $2 will go a long way.
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. Would you consider becoming a regular HuffPost contributor?
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. If circ*mstances have changed since you last contributed, we hope you’ll consider contributing to HuffPost once more.
Already contributed? Log in to hide these messages.
Before You Go
