Average 401k balance by age

One of the most important things you can do for your financial future is to start saving early. As a result, the sooner you begin saving, the more money you will likely have available for investment when you retire. And this is where the average age-based 401(k) balance comes in, and it’s an excellent place to start.

The 401k is an employer-sponsored plan that allows millions of Americans to save for retirement in a tax-sheltered way (up to $20,500, or $27,000 if you’re age 50 or older per year in 2022) to help maximize their retirement income. You can stay on track with your retirement savings with a 401k plan, which also allows you to compare your balance to others in your age group.

Knowing the average 401k balance by age will help you better understand how long you have to save before you retire. When it comes to investing in the 401k, the older you get, the more money you have to save and invest. 

Average 401k balance by age group

According to the U.S. Census Bureau, only 41% of American workers contribute to the 401k investment plan. This is far from 68% of employed workers accessing the 401k employer-sponsored plan. Please take advantage of your employer’s 401(k) plan because it may be the most effective way to save for retirement. Additionally, making wise and early contributions guarantees a secure retirement.

Based on Vanguard data “How America Saves,” the estimated numbers for 401(k) averages by age group are provided below. The figures may differ from the lifestyle you want when you retire, meaning you may require significantly more from your 401(k) at each age threshold.

Average 401k balance by age 20-25

It’s never too early to start saving for retirement. You may not consider retirement savings much when you are in your 20s. But the truth is that the sooner you begin saving, the better off you will be. With a contribution rate of 8.1%, the average 401k balance for workers aged 20-25 is $6,718, and a median 401(k) balance of $2,240. 

Average 401k balance by age 25-34

If you fall in this age bracket, your average 401k balance is $33 272, and a median 401(k) balance of $13,265 with a contribution rate of 10.2%. When you’re in this age bracket, you likely haven’t had too many major life expenses yet, so more of your income can go toward savings. If you’ve been in the workforce for a few years, you may have had the opportunity to take advantage of employer-matching contributions. This way, you can contribute to a higher 401k balance.

By the time you’re 30, Fidelity, a financial services company that also manages employee benefits programs, recommends saving one times your annual salary. If you’re earning $50,000, you should have a 401(k) balance of the same amount($50,000).

Average 401k balance by age 35-44

If you’re starting at this age or just joined a company that matches your 401k and are concerned about your 401K balance, you can still start investing. You can still defer a significant portion of your income toward your 401(k) despite the many financial obligations you face in your 40s, such as mortgage payments and expenses related to your family.

You can do a few things to improve it. First, ensure you’re contributing as much as you can each month. Second, consider switching to more aggressive investments if you’re not seeing the growth you’d like. The average 401k balance by age 35-44 is $86,582, and a median 401(k) balance of $32,664.

By age 40, Fidelity recommends contributing three times your annual salary to your 401(k) plan.

Average 401k balance by age 45-54

The average 401k balance by age 45-54 is $161,079, with a median 401(k) balance of $56,722. Using a 401(k) employer-sponsored plan allows you to monitor your progress and determine how much you have saved or how far behind you are on your retirement savings plan.

If you’re in your mid-40s to early-50s, you’re probably starting to think about your retirement savings and how much you’ll need to save by retirement. You have probably secured an excellent job with a fat paycheck in this age bracket which you can use to maximize your 401k account to increase your retirement dollars. According to Fidelity, you should have contributed six times your current salary to your 401(k) by the time you are 50.

Average 401k balance by age 55-64

You may begin making more specific plans for your future in your late 50s and early 60s when you are getting closer to retirement and have a better understanding of your retirement savings. By age 55 to 64, the median 401(k) balance is $84,714, and the average 401(k) balance is $232,379. But that is just the average, and it is a good benchmark to aim for.

Your situation may be different, depending on factors like how long you’ve been working and how much you’ve been able to save. Don’t give up hope if you haven’t saved enough yet. You still have time to catch up. Keep in mind that you can begin saving for retirement at any time. Fidelity suggests having eight times your current salary saved up for your 401(k) plan by age 60.

Average 401k balance by age 65 and above

The average 401k balance by age 65 and above is $255,151, with a middle 401(k) total of $82,297. At this age, the growth of your account starts to slow down because you might begin to spend the money you’ve accumulated by drawing on your 401(k) balance. However, you should be aware that early withdrawals carry penalties and fees. The Internal Revenue Service (IRS) allows 401(k) distributions to begin at age 59½ and says that you can start taking money out of your 401(k) after age 72.

If you’re still saving in your 70s and above, the average balance is $182,100, with a median of $51,900.

What should I do if my 401(k) balance is below the average for my age?

Are your figures different from your age group’s average 401(k) balance report? If your 401k balance is lower, don’t worry – there’s still time to catch up. 

The best way to ensure you have enough saved is to start contributing to your 401k as early as possible. If you can’t afford to contribute a lot each month, that’s okay – even small contributions can add up over time. It is essential to begin saving as early as now and keep contributing as much as possible. With compounding interest, your balance will grow exponentially over time. 

You should start contributing an annual amount of $20,500, the maximum amount you can contribute to your 401(k) account as of 2022. If you’re 50 years and above, you’ll need to add an additional $6,500, which is known as a catch-up contribution to the supposed limit of $20,500. 

You can likewise push back your retirement age to compensate for the years you weren’t accumulating compound interest. Each year you delay retirement, you’ll not only put more into your retirement savings, but your social security benefits will also increase, helping you cover some of your retirement expenses.

If you are behind on your 401(k) contributions, decide to invest more aggressively to take advantage of account value growth opportunities. You might want to consider changing your allocations to make room for more growth, even if you’re older. Consult a financial advisor to ensure you are familiar with various asset allocations and which ones suit your needs and age.

Are there other alternatives to a 401(k)?

There are additional employer-sponsored retirement plans in addition to 401(k) plans, such as a 403(b) and a 457(b). The programs work similarly, but 457(b) is only available to some government employees, while 403(b) is typically available to public employees. 

An IRA is another retirement option. The IRA provides a traditional IRA with tax-deferred savings, allowing you to defer paying taxes until after you withdraw funds. Another IRA option is a Roth IRA. In a Roth IRA, the money you save is already taxed, and you won’t pay any more taxes when you withdraw it.

There are differences between a 401(k) and IRA retirement savings. They both have different contribution limits, with a 401(k) contribution limit being higher than an IRA, which has a limit of $6,000 and $7,000 for 50 and above participants. Your employer provides a 401(k) when you can easily open up an IRA account online. Another difference is that when you need to move money into an IRA, your 401(k) contribution is automatically taken out of your paycheck.


You can track your retirement funds and compare them to those of others your age by participating in an employer-sponsored 401(k) plan. You can better plan for your financial future if you know how your age and retirement plan affect your 401(k) balance.

Determine how much you should save for retirement based on your age threshold by looking at the average 401k balance across various age groups. If you feel your figures are too low to the given figures, the good news is that you can still increase your savings and, at the very least, meet the 401(k) benchmark. You can catch up, but it’s much easier to build up your retirement savings steadily and slowly over time. 

You should make every effort to start contributing to your 401(k) as soon as possible and choose to invest more aggressively. In addition, if your employer offers matching contributions, you should ensure that you contribute at least the minimum amount, preferably more. Take advantage of various retirement savings options to diversify your investments.

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