How Much Do Americans Need to Feel Financially Secure?

July 27, 2021

The pandemic threw many Americans’ finances into disarray and served as a wake-up call for many of us to reconsider if we had saved enough.

When asked how much money they need to have saved to consider themselves “financially secure,” Americans, on average, said they need $516,433, according to a survey from financial services company Personal Capital.

Responses to the survey varied widely, with about 20% of respondents saying they would need more than $1,000,000. Most of the respondents, however, said that having $500,000 would be enough to cover not only bills and expenses, but future needs like retirement savings as well.

Of course, the amount needed depends on your expenses and lifestyle. One general rule of thumb for emergency savings is to have three to six months of living expenses on hand. For retirement savings, experts generally recommend saving 10 times your annual income.

Regardless of what dollar amount is right for each household, most Americans likely fall far short of “financial security.” Prior to the pandemic, a report from the Federal Reserve found that 40% of Americans would be unable to pay for an unexpected $400 expense.

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