It can be tough sometimes to tell whether you're on track with your retirement savings. Everyone has different goals, and some people may need hundreds of thousands of dollars more or less than others.
That said, it can still be helpful to see where you stand against the average worker your age. While the average account balance may not necessarily be something to strive for, it can give you an idea of whether you're ahead of or falling behind your peers.
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Where most workers stand on retirement planning
Every year, Vanguard releases its How America Saves report, providing a snapshot of the typical American's journey toward retirement. The report includes a breakdown of account balances among Vanguard 401(k) participants, separated by age.
Among all workers across generations, the average 401(k) balance is $134,128, according to the 2024 report. The median balance may be more telling, however, as the average may be skewed by extremely high earners. This year, the median balance among all workers is just $35,286.
The average and median balance also varies significantly by age, which makes sense considering older workers normally have far more saved for retirement.
| Age Group | Average 401(k) Balance | Median 401(k) Balance |
|---|---|---|
| Under 25 | $7,351 | $2,816 |
| 25 to 34 | $37,557 | $14,933 |
| 35 to 44 | $91,281 | $35,537 |
| 45 to 54 | $168,646 | $60,763 |
| 55 to 64 | $244,750 | $87,571 |
| 65 and older | $272,588 | $88,488 |
Source: Vanguard. Table by author.
If you're ahead of the average worker, give yourself a pat on the back. However, it's still important to make sure you're saving enough for your individual retirement needs. If you haven't already, it's wise to calculate your own retirement goal to determine whether you're really on track.
Many factors will affect how much you should save, such as the number of years you expect to spend in retirement, whether your expenses will change after you leave your job, and how much you'll be receiving from Social Security. But the more planning you put into your goal, the better your chances of retiring comfortably.
Simple strategies for increasing your savings
If you're behind the average worker or simply want to increase your savings, you have options. If your 401(k) offers employer matching contributions, saving enough to earn the full match is one of the simplest ways to strengthen your nest egg with little effort on your part.
Also, don't underestimate how far small contributions can go. If you were to save just $100 more per month while earning an 8% average annual return on your investments, that could add up to roughly $136,000 after 30 years. No contribution is too small, and it can amount to more than you might think over time.
Finally, while it may sound counterintuitive, prioritizing other financial goals could help you save more for retirement. Paying down high-interest debt, for example, can free up more room in your budget for saving. Similarly, when you have a robust emergency fund, you can avoid tapping your retirement savings if you face an unexpected expense.
It's not easy saving for retirement, but seeing how your 401(k) balance stacks up to the average can make it easier to determine where you stand. With small steps and consistency, you can grow your savings and set yourself up for a financially secure retirement.
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