Average Retirement Income in the U.S.

Shawn Plummer

CEO, The Annuity Expert

Understanding the Average Retirement Income

  • Monthly Retirement Income: In 2023, the average monthly retirement income in the U.S., as reported by the U.S. Census Bureau, is $4,381.25.
  • Annual Retirement Income: The average annual income for adults aged 65 and older stands at $75,254, which adjusts to $83,085 when considering inflation.
Retirement Income

Key Factors Influencing Retirement Income

  1. Social Security Benefits: A significant portion of retirement income comes from Social Security.
  2. Retirement Savings Accounts: Includes 401(k)s, IRAs, and other savings plans.
  3. Pension Plans: For those who have them, pension plans contribute to retirement income.
  4. Investments: Income generated from investments plays a role, though it involves risks.
  5. Other Sources: Part-time work, rental income, and annuities can also supplement retirement income.
Retirement Portfolio

What Constitutes a ‘Good’ Retirement Income?

  • Personal Goals and Lifestyle: A ‘good’ retirement income varies based on individual lifestyle choices and goals.
  • Inflation and Anticipated Expenses: Must consider future cost of living increases and health care costs.
  • Financial Planning: Consulting a financial advisor or a certified financial planner can help tailor a retirement plan to individual needs.

Estimated Annual Retirement Costs by State: 2024 Overview

StateTotal Expenditures (Est.)Comfort Buffer (20%)Estimated Comfortable Retirement Cost (Annually)
Alabama$45,400$11,400$56,800
Alaska$65,400$16,400$81,800
Arizona$56,300$14,100$70,400
Arkansas$47,100$11,800$58,900
California$72,300$18,100$90,400
Colorado$54,800$13,700$68,600
Connecticut$60,200$15,000$75,200
Delaware$55,000$13,700$68,700
District of Columbia$80,000$20,000$100,000
Florida$54,500$13,600$68,100
Georgia$46,400$11,600$58,000
Hawaii$97,000$24,200$121,200
Idaho$51,600$12,900$64,500
Illinois$47,900$12,000$59,900
Indiana$47,000$11,800$58,800
Iowa$46,000$11,500$57,500
Kansas$45,500$11,400$56,900
Kentucky$48,400$12,100$60,500
Louisiana$48,800$12,200$60,900
Maine$59,700$14,900$74,600
Maryland$64,700$16,200$80,900
Massachusetts$78,200$19,500$97,700
Michigan$47,800$12,000$59,800
Minnesota$49,600$12,400$62,000
Mississippi$44,100$11,000$55,100
Missouri$47,000$11,700$58,700
Montana$54,900$13,700$68,600
Nebraska$47,500$11,900$59,400
Nevada$53,100$13,300$66,400
New Hampshire$59,800$15,000$74,800
New Jersey$59,400$14,900$74,300
New Mexico$48,900$12,200$61,100
New York$70,800$17,700$88,400
North Carolina$50,500$12,600$63,200
North Dakota$50,800$12,700$63,500
Ohio$46,600$11,700$58,300
Oklahoma$45,200$11,300$56,500
Oregon$63,700$15,900$79,600
Pennsylvania$51,200$12,800$64,000
Rhode Island$58,000$14,500$72,500
South Carolina$50,200$12,600$62,800
South Dakota$50,100$12,500$62,600
Tennessee$47,100$11,800$58,900
Texas$48,300$12,100$60,400
Utah$53,200$13,300$66,500
Vermont$60,700$15,200$75,900
Virginia$53,200$13,300$66,500
Washington$59,400$14,900$74,300
West Virginia$46,800$11,700$58,500
Wisconsin$49,000$12,200$61,200
Wyoming$47,800$11,900$59,700

The following table presents an estimated overview of the annual cost of a comfortable retirement in each state across the United States. This estimation is based on data adapted from the Bureau of Labor Statistics, considering essential expenditures such as food, housing, transportation, healthcare, and utilities. Additionally, a 20% comfort buffer is included to account for leisure and miscellaneous expenses. The figures have been rounded to the nearest hundred for a simplified representation. It’s important to note that these values are approximations and should serve as a general guideline rather than precise financial planning metrics.

Retirement Planning Considerations

  • Saving for Retirement: It’s crucial to start saving early and consistently.
  • Diversifying Income Streams: Relying on multiple sources of income can provide more security in retirement.
  • Understanding Federal Income Tax: Knowing how retirement income is taxed is essential for planning.
  • Health Care Costs: A significant expense in retirement that needs to be planned for.
Retirement Money

Conclusion

Retirement income in the U.S. varies widely based on individual circumstances and planning. Understanding and planning for retirement needs, including savings, investments, and anticipating future expenses, is crucial for a comfortable retirement. Contact us today for a free quote.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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