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Key Takeaways
- Experts suggest saving 70% to 80% of your pre-retirement income for retirement.
- Almost half of the U.S. population doesn’t have retirement savings.
- Leisure activities can be expensive. For instance, photography can cost thousands of dollars, an RV hundreds of thousands, and a vacation home millions.
- Plan and save for leisure and recreation by understanding the costs and narrowing your focus.
Retirement is a dream for many people. It frees up your time so you can do things you may have put off during your working life, such as traveling or buying a vacation home. But, all of this costs money.
While the rule of thumb has generally been to save between 70% and 80% of your pre-retirement income (remember, that’s just a suggestion) to accomplish your goals, many Americans still find trouble saving money for their nest egg.
Here’s what financial advisors suggest to get you closer to your dream.
How Much Are People Saving?
Over 54% of Americans are prepared for retirement, with most using employer-sponsored plans like 401(k)s and 403(b)s to save for the future. In January 2025, Empower reported that the average American’s retirement savings balance was $492,795. Those in their 60s were reported to have the highest balances at an average of about $1.2 million.
But, most savers aren’t taking full advantage of the retirement options available to them, according to Pam Horack, certified financial planner (CFP) at Pathfinder Planning in Lake Wylie, South Carolina. “Many of them don’t maximize the savings they can make here and have little other savings outside of that,” she told Investopedia in an email.
Having some retirement savings is better than nothing, though, especially when you consider that 46% of Americans reportedly had none at all. This can be troubling if you want to retire, as experts say that you shouldn’t rely on Social Security alone to achieve your goals—especially if you want to include leisure and recreational activities into your lifestyle.
Note
Consider tax-free income sources, such as a Roth IRA, cash-value life insurance, and municipal bonds, to supplement any other investments you have for your retirement nest egg.
How to Afford Leisure During Retirement
Some of the most common things people say they want to experience after they retire include buying a vacation home or recreational vehicle, traveling, and taking up different hobbies. Make sure you understand the associated costs so you’re prepared ahead of time (remember: these costs are likely to change):
| The Cost of Leisure in Retirement | |
|---|---|
| Vacation home | $340,000 to $928,900 |
| Recreational vehicle | $20,000 to $100,000 (towable); $50,000 to $600,000 (motorhome) |
| One week vacation in the U.S. | $3,971 |
| One-week vacation to France | About $3,800 |
| Photography (beginner to advanced setup) | $500 to $4,000 |
| Gardening (seeds, tools, soil) | $2.80, $100, $534 to $2,400 |
You should be as specific as possible so you can plan and make realistic savings goals, according to Horack.
For instance, if you’re interested in travel, she suggests narrowing down where you want to go (domestic or international), whether you want active vacations or sightseeing tours, and whether you want to travel first class or with a mission team. “Helping define the goal by equating it with their values allows us to plan better,” she said.
Remember, though, that it’s important to plan for your day-to-day living expenses before you start saving for recreational pursuits, according to Jonathan Barrett, founder and managing partner of Barrett Financial Solutions in Woodbridge, New Jersey.
“Many individuals aspire to achieve ‘luxury’ goals in retirement. The first step is to devise a financial plan to meet your ‘needs’ in retirement,” he said. “If you have the capacity to save beyond that, allocate whatever is feasible within your means to achieve future aspirations.
The Bottom Line
Start saving for retirement as early as possible so you can maintain your standard of living and afford some of the things you want to do, whether that’s traveling or a new hobby. When you’re younger, you have a greater tolerance for risk, which means you can ride out market and economic volatility and still have time to recover.
Your investments will also grow more because of compounding. If you’re older, don’t fret, because you still have time. Barrett suggests the best way to start is to look for areas where you can cut your discretionary spending so you can allocate that money for savings.
