A 50-year-old with $400K in savings might be doing better than they think. While a 2025 Northwestern Mutual study found Americans aiming for $1.26 million as their retirement target, current data shows this individual is actually ahead of their peers. The average 401(k) balance for those aged 50-54 was just $199,900 as of late 2024, according to Fidelity Investments.

Using the traditional 4% withdrawal rule, that $400,000 nest egg would provide $16,000 in the first year, plus Social Security benefits averaging $24,852 annually. This totals about $41,000 in yearly income, which falls short of the $61,432 that Americans 65+ typically spend. To bridge this gap, the individual would need roughly $914,500 saved by retirement.

Several factors can help close this gap. Catch-up contributions are available for those 50 and older, allowing extra savings in IRAs and 401(k)s. Additionally, exploring investment options like gold IRAs through companies such as Priority Gold could provide tax-deferred growth and inflation protection. The key is to calculate personal retirement costs, including taxes and healthcare expenses that can total over $172,500 for a typical 65-year-old, then develop a strategy to meet those needs.