How Much Do Early Retirees – Or Extremely Early Retirees – Have Saved?

July 28th, 2018 by 
Picture of rocky canoyns and a sky at sunset or morning.

In this post, we'll look at early retirees - and some of their extreme early retiree counterparts. How much do they have saved for retirement? How do they differ from the general population?

Let's find out using the 2017 Federal Reserve Survey of Household Economics and Decisionmaking.

Savings of American Early Retirees

The SHED has two ways to classify adults as retired.

  1. The surveyors classify the respondent as retired
  2. The respondent self-classifies as retired

There isn't, of course, 100% overlap in those designations. In this post we'll look at people who have self-selected as retired.

One of the questions on the survey also asks when a respondent retired. For folks who answered, we'll use that to classify extreme early retirees (40 or younger) or early retirees (56 or younger).

Savings Accumulated by Early Retirees

We only include here people who were asked and gave an answer:

Savings and InvestmentsExtreme Early RetireesEarly RetireesAll Early RetireesAll Retirees
Not sure1.0%4.3%3.8%2.9%
Under $50,00056.3%40.5%43.0%39.8%
$50,000 - $99,9998.8%12.7%12.1%11.1%
$100,000 - $249,99913.3%14.1%13.9%13.8%
$250,000 - $499,9998.9%8.3%8.4%12.0%
$500,000 - $999,9992.7%9.0%8.1%9.1%
$1,000,000 or more9.0%11.0%10.7%11.2%

... We're with you! That's not what we were expecting from the responses. In fact, it's even the opposite of what we expected to see.

The exact question text is, "What is the approximate total amount of your household's savings and investments?".

Early Retiree Savings by When Retired, Current American Retirees 2017
Early Retiree Savings by Retirement Age, Current American Retirees 2017 (Click to zoom)

Before you ask: this wasn't a question about strict retirement assets.

It also wasn't a question about how much they had when they retired. Maybe they spent it down before this survey, they are already retired. The next section might shed some light on that possibility.

Savings of Current Self-Classified Retirees

In the last section, we used a person's reported age of retirement to look at the differences in savings among retirees.

It gave some strange results, to say the least...

In this section, let's look at the current retiree population based on their age at survey time. Again using self-classified retirees, here's what folks have saved based on their current age:

Savings and InvestmentsExtreme Early Retirees (< 41)Early Retirees (41-56)All Early Retirees (< 56)All Retirees
Not sure4.36%5.44%5.20%2.94%
Under $50,00054.34%49.71%50.77%39.80%
$50,000 - $99,99919.03%12.40%13.91%11.15%
$100,000 - $249,9999.13%11.97%11.32%13.75%
$250,000 - $499,9994.63%9.12%8.09%12.00%
$500,000 - $999,9998.50%5.01%5.80%9.13%
$1,000,000 or more0.00%6.36%4.91%11.22%

And once again... a head-scratcher!

The Savings of Early Retirees: Unexpected?

As you look at more expansive retirement populations and older populations, the savings amounts increase.

When sitting down to research this post, we predicted early retirees and extreme early retirees would have more resources saved than older retirees. Earlier, research showed how important Social Security is to retirement age: if people are waiting out Social Security, we thought their assets would be lighter in retirement since they could lean on a reliable stream of income.

That, obviously, does not show up in the data!

  • Are the early retirees spending their resources quickly?
  • Have they calculated their needed savings down to the cent?
  • Are some savings an investments misclassified?

Are some early retirees - as theorized by many of you readers - mis-classified or "inappropriately" self-declaring in-retirement? Were we expecting the wrong thing going into this post?

Strange Results on Early Retiree Savings

It's tough to say what's happening here. We know wealth is out there (see our net worth by age calculator for examples).

Do you have a theory based on what this data is showing?

Along with this post we have a few more on retirement. We looked at the early retirement age (and the extreme early retirement age), as well as survey data on how common early retirement is. We also looked at how the population of American retirees pay for retirement.



PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK lives in New Hampshire with his wife, kids, and dog.

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