This Is the Average Cost of Retirement Today. Can You Afford It?

It can be really hard to estimate the cost of retirement when that milestone is very far away. After all, if you're in your 20s or 30s, how on earth are you supposed to be able to put a number on your annual living costs in your 60s and 70s?

But it may help you to know that the average cost of retirement today is close to $1 million -- $987,000, to be exact, according to data from Edward Jones. Of course, this doesn't mean that your retirement will cost that amount. And also, if you're years away from retirement, inflation is apt to drive up its cost, because inflation commonly makes just about everything get more expensive over time.

Still, many people aim for a $1 million retirement nest egg because they figure that amount of long-term savings will allow for a nice degree of financial security during their senior years. And if you're looking to amass $1 million for retirement, you should know that a few key decisions on your part could make that goal far more attainable.

Start saving from a young age, and invest your savings wisely

Accumulating $1 million in your IRA might seem completely impossible unless you happen to earn an above-average wage. But while that's certainly a daunting amount of money to try to save up, if you give yourself plenty of time to build that savings and you invest your money in a savvy manner, you might not only end up with $1 million to your name, but a lot more.

Let's say you begin saving for retirement at age 22, which is when many people graduate from college and begin working full-time. Let's also assume that you don't end up retiring until age 67 which, if you're 22 now, is when you're entitled to your full monthly benefits from Social Security. And, let's figure that you're able to put $250 a month into your IRA during your career, which is $3,000 a year.

Let's also make another important assumption -- that you're investing your IRA in stocks, whether by buying shares of different companies individually or falling back on ETFs that allow you to own numerous stocks with a single investment. Over the past 50 years, the stock market has delivered an average annual 10% return before inflation, as measured by the S&P 500 index. So chances are, your investments will give you a similar return.

When we package up all of these assumptions -- $250 monthly contributions over 45 years and a 10% average annual return in your IRA -- you're left with a total savings balance of over $2.1 million. That's more than twice the average cost of retirement today.

It can be done

Many people are quick to assume that they'll never manage to retire with $1 million, or anything close. But as you can see, it doesn't take a ton of money to retire a millionaire. It simply takes the commitment to start saving from a young age, consistent contributions, and the right set of investments.