How much money do Americans think they'll need saved for retirement? According to a recent survey conducted by Charles Schwab, the magic number is $1.9 million. That's the average amount survey respondents said was necessary before leaving the workforce.

The big question is: Are they right?

Is $1.9 million a good retirement savings target?

A nest egg of $1.9 million may sound like a lot of money, but it's important to consider a few key factors:

  • How much income will a nest egg of that size actually provide?
  • How much buying power will that income offer, depending on your retirement date?

The answer to the first question depends on your withdrawal rate. You can't afford to take too much money out of your retirement accounts too quickly, or you risk draining your account balance and ending up short of cash late in life.

There are many different withdrawal strategies, but one of the most common is the 4% rule. If you follow it, you can theoretically take out 4% of your retirement account balance the first year of retirement, adjust the amount upward by inflation each year, and not run out of money while you're still reliant on your investment accounts for income.

If you choose the 4% rule as your withdrawal strategy, a $1.9 million nest egg would leave you with an annual income of $76,000. When you add Social Security to that number, you'd likely have close to $100,000 in income or more (depending on whether your retirement benefit is above or below average).

Don't forget about the effects of inflation

Investment income of $76,000 should be more than enough for most people to have a comfortable retirement -- if they're retiring soon. In fact, a nest egg as large as $1.9 million may not be needed for the vast majority of pre-retirees who are quitting work within a couple of years.

The problem is the actual buying power that $1.9 million would provide is going to vary dramatically depending on exactly what your retirement timeline looks like. If you're not leaving the workforce for another 35 years, then by your retirement date, your $76,000 nest egg would only have the buying power of about $38,00 of today's dollars (assuming a 2% annual rate of inflation).

If you need more income than that as a retiree, you may find the $1.9 million nest egg just isn't enough. In fact, if you were actually aiming to get $76,000 in buying power from your investments, you'd need your annual income to be close to $150,000. That would mean that your nest egg would need to be a whopping $3.75 million.

Now, you may not need a $76,000 income from your retirement plan, but the key lesson is to pay attention to your retirement timeline and don't assume an account balance that sounds large by today's standards will actually make you a wealthy retiree far into the future.

By considering the effects of inflation, you can set a retirement goal that's right for you and make sure that you have the buying power you need to enjoy a nice quality of life in your later years.

This article originally appeared in the Motley Fool. Charles Schwab is an advertising partner of The Ascent, a Motley Fool company. Christy Bieber has no position in any of the stocks mentioned. The Motley Fool recommends Charles Schwab. The Motley Fool has a disclosure policy.