I Retired at 65 With $7.8 Million and Feel Like I Over-Saved. My 40-Something Son Is on the Same Path. Should I Tell Him to Reconsider?

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Question: I retired at 65 with $7.8 million and feel like I over-saved. My 40-something son is on the same path. Should I tell him to reconsider?

Answer: It sounds like you did an excellent job of teaching your son how to work hard and save money. At 65, however, you have a better sense of the sacrifices required to amass such wealth.

The average 401(k) balance for Fidelity account holders age 60 in 2025 was $255,200. That data is limited, as it only draws from the 401(k) plans Fidelity administers. But the Federal Reserve, which has far more comprehensive data in its 2022 Survey of Consumer Finances, says that as of three years ago, the average retirement savings balance among Americans ages 65 to 74 was $609,230.

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The takeaway? The typical older American has a pretty modest nest egg. If you managed to amass $7.8 million in savings by 65, you clearly surpassed most retirees in that regard.

The benefit of having such a large nest egg is enjoying more financial freedom in retirement. Want that lake house you never bought? Go for it. It might cost a fraction of your wealth. That $12,000 luxury watch you’ve always coveted? At this stage of life, there’s no reason not to splurge if it brings you joy.

What if your $7.8 million nest egg came at the cost of pushing yourself too hard to save and not enjoying life enough along the way? It’s a mistake you might not want your own adult child to repeat.

Still, you might not want to discourage your son in his 40s from saving aggressively. Rather, it could pay to focus on helping him strike a better balance than what you managed to achieve.

It’s important to look at the big picture

If you see your son adopting similar habits to you — denying himself certain enjoyments to sock away every last penny — then you might be eager to help him avoid reaching retirement age with a bucket of regrets. Before you discourage your son from saving at an aggressive pace, recognize that you can’t predict what his costs will look like in retirement, and how much of a cushion he’ll ultimately need to feel secure.

As Stephanie Sherman, CFP and financial planner at Prudential Advisors, says, “There are lots of variables to consider that can impact how long savings will last in retirement.” These include annual cash flow needs, inflation, income taxes, and portfolio returns, she explains.

Rather than suggest that your son cut back on savings, a better bet might be to encourage him to work with a professional to determine how much savings he’ll need and whether he’s taking the right approach.

Sherman says that in the course of retirement planning, it’s important to consider all income sources, including Social Security and pensions. From there, it’s easier to see if you’re over-saving, not saving enough or right on target.

She also says that in this situation, you might be in a position to gift some of your excess savings to your son.

That's particularly easy with the passage of the 2025 tax bill, which extends and raises the lifetime gift tax exemption to $15 million in 2026. That means you can gift up to $15 million in your lifetime, as long as you file IRS Form 709 for any amount above the annual limit ($19,000 in 2025).

Such a large gift could also reduce your son's estate tax burden if you live in one of the states that levies estate or death taxes. Ultimately, a substantial gift or inheritance could have a huge impact on his savings needs and plans, so that’s something to discuss.

All told, Sherman says, the best guidance you might be able to give your son is to look at the big picture and make sure his savings plan is comprehensive.

“Perhaps your son shouldn’t save less, but can adjust his savings strategies to be more efficient,” she suggests.

Understand that everyone’s needs are different

To you, a $7.8 million retirement nest egg might seem like overkill. But your son might have different long-term financial needs than you do.

As Nesrine Jabbour, founder/director at Pretium Wealth Management, says, "It’s rare to hear someone say they’ve saved too much." But, she continues, "Not everyone’s retirement is the same, and we simply do not know the expenses that will arise."

A general rule of thumb Jabbour uses for retirement readiness is to have around 20 times your desired annual income in investable assets.

"For someone targeting $250,000 a year in retirement income, $5 million would typically suffice," she explains.

At $7.8 million, you most likely have more than enough to maintain your lifestyle, preserve purchasing power, and still leave a meaningful legacy. But because you don't know what your son's needs will entail, you don't necessarily want to tell him to save less.

Jabbour recommends that workers today sock away at least 20% of their income. If your son is saving more, she says, "encourage him to define what 'enough' looks like."

Don’t turn a success story into a failure

If you feel you made too many sacrifices to get to a $7.8 million nest egg, it’s natural to want your child to avoid the same trap. But recognize that you’ve achieved a remarkable feat — and reward yourself for it rather than bemoan it.

As Stephen Day, Ph.D., director at Virginia Commonwealth University's Center for Economic Education, says, “Having several million dollars available in retirement is great because you can leave a legacy, support causes you care about, and set your children up for financial security.”

However, if you recognize that saving all that money came at the cost of your day-to-day life, then that’s something you may want to warn your son about — and help him develop strategies to strike an ideal balance.

"I've always been a great saver. But there were times where I should have been more generous,” Day shares. “I've had to teach myself how to be more generous over time. I'm still on track for a solid retirement, but I've also taught myself when to spend when the time is right."

Your son might need a similar wakeup call if you feel he’s pushing himself too hard and not making the most of his money in the near term. But you can frame that conversation in a way that celebrates your accomplishment without belittling the value of having a very large amount of savings.

Maurie Backman is a freelance contributor to Kiplinger. She has over a decade of experience writing about financial topics, including retirement, investing, Social Security, and real estate. She has written for USA Today, U.S. News & World Report, and Bankrate. She studied creative writing and finance at Binghamton University and merged the two disciplines to help empower consumers to make smart financial planning decisions.