Those who are between the ages of 45 and 54 are probably starting to think more seriously about retirement. It might even be just a decade or so away, for those able to manage an early retirement or for those in their early 50s thinking of retiring in their early 60s.
If you're in that group, you may be wondering whether you're on track with your saving and investing for retirement -- and whether you've got more or less stashed away than your peers do.
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That's a fair question, and below is the answer -- the average 401(k) account balances for those of various ages, via Vanguard:
|
Age |
Average 401(k) balance |
Median 401(k) balance |
|---|---|---|
|
Younger than 25 |
$7,351 |
$2,816 |
|
25-34 |
$37,557 |
$14,933 |
|
35-44 |
$91,281 |
$35,537 |
|
45-54 |
$168,646 |
$60,763 |
|
55-64 |
$244,750 |
$87,571 |
|
65+ |
$272,588 |
$88,488 |
|
Total average |
$134,128 |
$35,286 |
Data source: How America Saves 2024, Vanguard.
The average balance for 45- to 54-year-olds is $168,646, but the median is just $60,763. That median is arguably more informative, as it shows the mid-point value, if you lined up all the values in ascending or descending order. The average is just an average, and it's vulnerable to being skewed by huge or tiny outliers.
For example, imagine this series of numbers: 6, 5, 11, 33, 15. To average them, add them together and divide by five. The average is 14. But arrange them in order -- 5, 6, 11, 15, 33 -- and the middle value -- the median -- is 11, a number closer to typical in the group than 14.
So, is a 401(k) balance of $60,000 or even $170,000 good? Well, it depends on other things, such as how long you have until you retire, your cost of living, your possible healthcare costs in retirement, and what other sources of retirement income you have.
Take some time to come up with a solid retirement plan, estimating how much you need to retire with and how you'll get there.
