As you enter the final years of your career, understanding how your 401(k) balance stacks up against others can provide valuable insight. Data from Vanguard's analysis of retirement savings trends shows that retirement balances fall short of recommended targets, with U.S. workers having an average of only $112,572 saved in a 401(k) in 2022.
However, the numbers tend to improve as people get closer to retirement.
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Average 401(k) balances for workers nearing retirement
The average balance in a 401(k) account for American workers between the ages of 55 and 64 was $207,874 in 2022, while the median was only $71,168, according to Vanguard's analysis of nearly 5 million retirement accounts. These numbers are higher than the 401(k) balances for workers under 55, as 401(k) balances tend to increase with age. The more time you have in the workforce, the longer your money can benefit from the power of compounding.
Below is a table that shows the increase in 401(k) balances over each decade.
| Age | Average 401(K) Balance | Median 401(K) Balance |
|---|---|---|
| Younger than 25 | $5,236 | $1,948 |
| 26 to 34 | $30,017 | $11,037 |
| 35 to 44 | $76,354 | $28,318 |
| 45 to 54 | $142,069 | $48,301 |
| 55 to 64 | $207,874 | $71,168 |
Data source: How America Saves, Vanguard.
Depending on where you stand, these average 401(k) balances might either boost your confidence or cause you to panic. At this point, it's important not to take these numbers to heart. Instead, review them for informational purposes. This will help you start thinking about the type of retirement you want and how much you'll need to save.
For a target number to start with, Fidelity recommends aiming to save at least six times your salary by age 50, eight times by 60, and 10 times by 67. You could also use retirement savings tools to determine the specific numbers you should be aiming for. The more planning you do now, the better shape you'll be in come retirement.
