American workers, on average, believe they need $1.8 million saved for retirement, according to the 2023 401(k) Participant Study published by Charles Schwab.
The average 401(k) balance for Americans aged 65-70 is $185,858, per Empower, but even those who end up with a $1 million-plus retirement cushion have to consider how long the money will last them — and where they live plays a significant role.
Related: 401(k)s Might Be the Only Retirement Option for Many Americans — But They’re Also a Major Risk, Experts Warn
GoBankingRates analyzed how long $1 million retirement savings would last in every state and determined it wouldn’t be enough for 25 years of retirement expenses anywhere in the U.S.
Even large nest eggs deplete quickly in high-cost-of-living states, including Hawaii, New York and California, where $1 million disappears within 15 years, per the research. Retirees in those states can expect annual grocery costs of roughly $5,000 or more and yearly housing costs upwards of $20,000.
Related: Some Retirees Are More Likely to Face This ‘Life-Destroying’ Event — Here’s How to Keep Your Savings Safe No Matter What
That $1 million will go the furthest in states like Kansas, Oklahoma and Mississippi, where it can support retirees for 21 years or more. In fact, Mississippi was recently named the No. 1 state to retire in, according to a CreditDonkey report, which examined nine factors including food and beverage expenditure and house prices.
Here are the six U.S. states where you can expect your retirement savings to last the longest, according to GoBankingRates:
6. Georgia
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Annual groceries cost: $4,335.11
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Annual housing cost: $8,070.70
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Annual utilities cost: $3,528.90
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Annual transportation cost: $3,668.08
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Annual healthcare cost: $6,783.95
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Total annual expenditures: $46,353.35
How long $1 million will last in savings: 21 years 6 months 26 days
5. Iowa
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Annual groceries cost: $4,407.06
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Annual housing cost: $7,333.22
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Annual utilities cost: $3,744.56
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Annual transportation cost: $3,914.26
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Annual healthcare cost: $6,952.67
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Total annual expenditures: $45,988.36
How long $1 million will last in savings: 21 years 8 months 26 days
4. Alabama
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Annual groceries cost: $4,416.05
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Annual housing cost: $7,083.93
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Annual utilities cost: $3,928.84
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Annual transportation cost: $3,614.74
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Annual healthcare cost: $6,291.85
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Total annual expenditures: $45,414.81
How long $1 million will last in savings: 22 years 0 months 6 days
3. Kansas
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Annual groceries cost: $4,240.67
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Annual housing cost: $7,478.64
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Annual utilities cost: $3,870.03
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Annual transportation cost: $3,951.19
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Annual healthcare cost: $7,107.33
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Total annual expenditures: $45,519.09
How long $1 million will last in savings: 21 years 11 months 19 days
2. Oklahoma
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Annual groceries cost: $4,258.66
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Annual housing cost: $7,520.19
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Annual utilities cost: $3,724.95
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Annual transportation cost: $3,750.14
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Annual healthcare cost: $6,432.45
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Total annual expenditures: $45,206.25
How long $1 million will last in savings: 22 years 1 months 12 days
1. Mississippi
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Annual groceries cost: $4,132.74
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Annual housing cost: $7,115.10
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Annual utilities cost: $3,470.09
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Annual transportation cost: $3,799.38
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Annual healthcare cost: $6,994.85
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Total annual expenditures: $44,059.15
How long $1 million will last in savings: 22 years 8 months 12 days
