Retirement & The S&P 500: A Mild Panic

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Right. So, retirement. It’s looming, isn’t it? A bit like a slow-motion train wreck, only instead of metal screeching, it’s the sound of my bank account weeping softly. Vanguard’s latest report – How America Saves, rather optimistically titled, I thought – says the average person has around $148,000 tucked away. Which sounds… substantial. Until you realize it’s skewed. Massively. Apparently, only three in ten of those accounts actually have over $100,000. Three. Honestly, it feels like a statistical anomaly. Like someone accidentally added a few billionaires to the spreadsheet.

The median, which is, let’s face it, a more realistic number, is $38,176. Thirty-eight thousand, one hundred and seventy-six dollars. It’s… not nothing, I suppose. But it won’t buy a small island, or even a particularly nice shed. And okay, some of those accounts are new, or belonged to people who hopped jobs a lot (me, mostly), but it’s still… alarming. Units of Worry Consumed Today: 8. Attempts to Avoid Checking Retirement Account: 5.

Saving Doesn’t Have to be a Herculean Effort

The thing is, you don’t have to be some financial whiz, making daring bets on obscure tech stocks (I tried that once. It didn’t end well). You don’t even have to try that hard. Which is good, because frankly, my energy levels are already committed to just getting through the day. I was pondering this, naturally while staring blankly at my coffee, and it occurred to me: what if you’d just done one sensible thing, twenty years ago?

Let’s say, just for argument’s sake, you’d invested $10,000 in a low-cost S&P 500 index fund. Like the Vanguard S&P 500 ETF (VOO +0.13%) or the Vanguard S&P 500 Index Fund Admiral Shares (VFIAX 0.42%). Twenty years ago. March 2006. Which, let’s remember, was just before everything went spectacularly wrong with the financial crisis. And then, because life enjoys a good challenge, we had a pandemic, a bear market in 2022… you get the picture. A lot of turbulence. I mean, seriously, what are the odds?

And yet. And yet. That $10,000, left to quietly do its thing, would be worth nearly $78,000 today. Seventy-eight thousand. Which, let’s be honest, is more than half of all Vanguard retirement accounts. I’m starting to feel slightly inadequate. Number of Times I’ve Considered Becoming a Hermit: 2.

Now, this is just a one-time investment. A single, sensible act. Imagine if you’d kept adding to it. If you’d started with that $10,000 and then, you know, actually saved a bit each year – say, $5,000 – you’d have over $513,000 today. Over. Half. A million. It’s almost offensively optimistic. Warren Buffett says you don’t need to do extraordinary things to get extraordinary results. He’s right, of course. It’s just… so hard to be sensible. Lists Made Today: 4. (To-Do, Groceries, Things to Panic About, Potential Escape Routes).

So, yeah. Retirement. Still looming. Still terrifying. But maybe, just maybe, not entirely hopeless. I think I need another coffee. And possibly a spreadsheet. And definitely a very long lie-down.

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2026-03-03 15:22