Clients are always clamoring for information about how much they need to save to ensure themselves a comfortable retirement.
In attempting to answer these inquiries, advisors must factor in a vast array of financial and health variables that are unique to each individual. One of the most important among these considerations is where the client lives.
We collated data from several studies to try and form a picture of which state’s residents are doing the best job in terms of saving for retirement. The headline number we’re using is average retirement balance, but that doesn’t tell the whole story.
Only looking at the state-by-state average account size breakdown may be unfair when you think of different tax burdens and cost of living metrics that vary between states. Unlike tax rates, which vary widely based on an individual’s circumstances, tax burden measures the proportion of total personal income that residents pay toward state and local taxes (property taxes, individual income taxes and sales and excise taxes).
Additionally, for a variety of reasons, some states simply have a higher percentage of wealthy residents, who will naturally have larger retirement account balances simply by virtue of having more money in general, so we also included the percentage of each state’s household that are millionaires.
Here’s a list of the 10 states with the most and least retirement savings: