Wealthy Americans say they need $2.6 million for retirement — but many are still behind

A study by British bank HSBC found that even affluent Americans are struggling to reach their retirement targets.

According to HSBC’s online survey of 9,993 affluent and high-net-worth investors ages 21 to 69, respondents said they would need $2.6 million to retire comfortably. Those surveyed had minimum investable assets of $100,000 and $2 million, respectively. That figure is up 26% from a year earlier and roughly twice what other surveys suggest ordinary Americans believe they need. In a survey conducted this spring, retirement savers told Schroders they expect to need $1.2 million to retire comfortably.

Yet affluent respondents, like many others, are still short of what they say they need. On average, they have saved only 52% of their target, HSBC said. Baby boomers have accumulated 74% of their retirement goal, Gen X has reached 55%, Gen Z stands at 45%, and Millennials are slightly behind at 42%.

“A comfortable retirement is becoming more expensive, even for those with substantial wealth,” said Racquel Oden, HSBC’s U.S. head of international wealth and premier banking.

Why is the estimated cost of retirement climbing?

“Inflation is part of the story, but retirement itself has changed,” an HSBC spokesperson said. Seven in 10 respondents said they plan to fund more than retirement alone.

While retirement remains the leading goal at 43%, wealthy Americans are also saving for personal or professional reinvention at 39% as they get older. That category can include changing careers, starting a business, taking a planned break, or learning a new skill, HSBC said. Providing support for both children and aging parents ranks third at 37%.

Longer life expectancy is also reshaping plans, with nearly six in 10 saying it has affected how they prepare. For instance, 31% said they are setting aside more money for later-life expenses such as long-term care, even if that means leaving less to heirs. Others said they are choosing to use more of their wealth now, spending on health and well-being (23%) and on experiences such as travel and passion projects (22%), HSBC said.

How can the retirement savings shortfall be reduced?

Advisers say the first step is to stop relying on a so-called “magic number” from survey results and instead focus on personal goals while staying flexible.

“Closing the gap starts with letting go of a one-size-fits-all view of retirement,” the HSBC spokesperson said. “People’s lives and priorities change and their wealth plans should be designed to change with them.”

“A realistic retirement goal comes down to the life you want, where you’ll live, when you plan to retire, your health and the income you’ll have,” the spokesperson added. “Keep revisiting the plan as your life changes.”