Here's the Newest 401(k) Average Account Value by Age Group. Where Do You Stand?

Comparing yourself to the "average" investor your age isn't necessarily a be-all and end-all kind of exercise. A small but extreme number of people in your peer group could be skewing these numbers lower or higher, for instance. It's also possible that most people your age aren't actually doing as well they need to in order to secure a comfortable retirement, making such a comparison a bit pointless.

Nevertheless, even if only as a starting point to determine how you're doing and then make any necessary changes to your savings plan, a look at other investors in your age group offers at least some value. Here's a closer look the average 401(k) balance for each current generation of savers.

How we're doing

As of the end of the second quarter of this year, the overall average value of a 401(k) account for U.S. adults was $137,800. That's according to mutual fund company and retirement plan administrator Fidelity Investments, although it jibes with data from rival fund company and plan administrator Vanguard Group.

That's not a number that means a whole lot to any particular investor, however. It's based on the total retirement savings for people with age differences in excess of 40 years. The older cohorts of this group should have significantly more tucked away than the crowd at the younger end of the spectrum. How are we doing by peer group? 

There's still far more to the story though. See, while these are the averages among participants in Fidelity's workplace retirement plans, as was noted above, these numbers are skewed by a small number of extreme outliers.

Specifically, a few very aggressive savers and/or highly paid employees are pumping these averages up by an enormous amount. While Fidelity doesn't disclose the number, data from Vanguard as well as the Federal Reserve's Survey of Consumer Finances suggests that the median value of all these 401(k) accounts in question is only about one-third the average value cited above.

That means half of the people in each of these generational groupings has saved even less than the one-third of the average figures in the above table. Yikes.

Perhaps the truly concerning part? Insurer Northwestern Mutual's most recent survey on the matter indicates the average American believes they'd need $1.26 million in savings to ensure a comfortable retirement. Most people clearly aren't even getting close to that mark.

A "catch-up" plan of action

Don't panic if you're one those people coming up short! The fact is, you can still enjoy a nice lifestyle with a nest egg of less than $1.26 million. You're also going to be receiving some Social Security retirement benefits, even if the strained program is forced into making cuts to future payments. Most people will also have some of their total savings invested outside of their 401(k), which isn't factored into Fidelity's numbers.

Still, if your savings are less than the median or the mean figures above, you might want to take some serious action -- and soon -- starting with these three:

1. Max out your company's 401(k) match

Most employers that offer a 401(k) plan are also willing to match a portion of your own money you put into these accounts. There are limits to these matching contributions, of course. Vanguard reports that most of the companies it manages retirement plans for only contribute half of the amount the employee puts in, and then caps that match at 6% of the worker's total pay. These matching contributions also aren't always immediately vested.

Even so, this is essentially free money being put on the table for workers who want to take it. At the very least you should make a point of deferring as much of your own salary into a 401(k) account as your employer is willing to match.

2. Invest smart(er)

It's not difficult to understand why so many investors invest so aggressively in the market's most popular growth stocks. The media loves to talk about these tickers.

The fact is, however, most of the long-term wealth that's created by the stock market is created by its most boring buy-and-hold names like Coca-Cola, JPMorgan Chase, and Walmart; sizzling-hot stocks like Nvidia and Amazon are the largely unpredictable exception to the norm, while popularity waves like the one artificial intelligence stocks are experiencing right now often come and go.

Image source: Getty Images.

You probably won't be doing much stock picking in your 401(k), since the vast majority of them limit your investment options to just mutual funds. The same premise still applies though. Standard & Poor's ongoing scorecard of all the mutual funds available to U.S. investors indicates the majority of them actually underperform their benchmark index, like the S&P 500.

In other words, you'd be better off not trying to beat the market and instead simply plugging into its long-term uptrend using a simple S&P 500 index fund.

3. Make an honest assessment of your spending

Finally, if you find yourself just not coming up with enough money to tuck away for retirement after paying all of your other bills, it may be time to take a more discerning look at your spending, starting with a look in the mirror. Has treating yourself to a regular visit to a pricy restaurant become an overly expensive habit? How about a membership to a gym you rarely go to? And, that premium coffee that's "only" costing you $5 a day is actually costing you over $1,000 per year. The nickels and dimes add up.

With some serious (but doable) cost-cutting, most households can free up at least a few hundred extra bucks per month to put toward retirement, even if that means starting by paying down your most expensive debt. And for perspective, investing just $200 per month in a simple S&P 500 index fund could be worth $150,000 after 20 years.

Just start somewhere, by doing something

Overwhelmed? Maybe discouraged by the amount of saving you don't already have compared to your peers? Don't be. You don't have to close the retirement savings gap overnight. You don't even have to do it in a year!

You just have to start somewhere, with one action -- maybe starting with a look at your spending and then making a new budget, or asking your human resources department for the paperwork needed to raise your 401(k) contribution to the amount your employer is willing to match. It doesn't really matter.

The key is just getting started with that first step. Once you do that, each subsequent one gets a little easier until you've built some serious savings momentum. Eventually you'll be doing as well as your peers, if not better.