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Every year, 401(k) holders at Vanguard hit millionaire status. Not one of them? You’re not alone: A seven-figure 401(k) balance is the exception, not the rule.
According to How America Saves 2023, Vanguard's latest data available, $112,572 was the average 401(k) balance of nearly 5 million Vanguard plan participants in 2022. That balance was down 20% from the previous year, but that can be partially attributed to inflation, rising interest rates and market volatility, particularly in the bond and equity markets.
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If that balance still seems high, consider that averages tend to be skewed by outliers, and in this case, that number is being propped up by those rare millionaires. The median, which represents the middle balance between the highs and lows, was $27,376 in 2022.
No matter which number is closer to your reality — and for some, both might feel out of reach — it’s important to remember that numbers like this might tempt you to gawk, but they probably won’t offer you much actionable information. Answering the question of "How much should I have in my 401(k)?" is dependent on factors like when you want to retire and how much you think you'll need.
Average 401(k) balance by age
According to Vanguard's data, here is the average 401(k) balance by age.
Age | Average 401(k) account balance |
|---|---|
Under 25 | $5,236. |
25 to 34 | $30,017. |
35 to 44 | $76,354. |
45 to 54 | $142,069. |
55 to 64 | $207,874. |
65 and older | $232,710. |
While averages may be more common, the median is often a better metric for getting an accurate view of a data set. Averages are influenced by outliers — either very high or very low numbers. You'll notice that Vanguard's average 401(k) balances are quite a bit higher than the medians.
Age | Median 401(k) account balance |
|---|---|
Under 25 | $1,948. |
25 to 34 | $11,357. |
35 to 44 | $28,318. |
45 to 54 | $48,301. |
55 to 64 | $71,168. |
65 and older | $70,620. |
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Average 401(k) contribution rates
How much are you putting into your 401(k)? The IRS sets contribution limits for 401(k) accounts, or the maximum amount you can add to your account in a given year. Those contribution limits are $23,000 in 2024 ($30,500 for those age 50 or older).
Most people don't contribute the max – only 15% of Vanguard plan participants did in 2022 – and most of those investors were older, made more money, and had been with their employer for longer compared with those who contribute less.
Even if you made the maximum contribution every single year and posted double-digit investment returns — both of which are highly unlikely — it would take nearly 20 years to hit a million. That makes it unfair and fruitless for, say, a 25-year-old to compare their 401(k) balance with the average for savers of all ages.
If you want to beef up your balance without maxing out your 401(k), one way to do it is to contribute at least enough to get the employer match if there's one offered. About half, 49%, of Vanguard's plans had an employer match.
To get their employer 401(k) match, employees had to first put in an average of 6.8% of pay; the median required contribution to get a match was 6%, which means half of plans required more than that, and half required less.
Average employee contribution: 7.4% of pay.Median employee contribution: 6.4% of pay.
Average 401(k) match
Average employer contribution: 4.5% Median employer contribution: 4% Now, let's get back to the balances. The below numbers show how 401(k) balances increase with age, at least until participants start drawing on their money in retirement.
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Ages 20-24
Average 401(k) balance: $5,236.Median 401(k) balance: $1,948.
Many of the participants in this age group are new to working and new to saving for retirement. Yet even at this age, it’s a good rule of thumb to prioritize contributing to your workplace retirement plan, especially if your employer matches a portion of your contributions.
These numbers don’t reflect what younger investors may have saved elsewhere, in taxable brokerage accounts, or individual retirement accounts, such as Roth or traditional IRAs.
» Learn more: IRA vs. 401(k)
Ages 25-34
Average 401(k) balance: $30,017.Median 401(k) balance: $11,357.
At this point, whether measured by the average or the median, participants have increased their balances quite a bit.
As people age and spend more time in the workforce, they’re more likely to hold more than one 401(k), especially if they’ve changed jobs without rolling over or combining accounts.
» Need to simplify? Here’s how to roll over an old 401(k)
Ages 35-44
Average 401(k) balance: $76,354.Median 401(k) balance: $28,318.
Another solid jump by this age range, with both figures more than doubling — the last time we’ll see a percentage jump that large between age ranges. That’s likely at least partially a product of peak earning years. According to compensation research company Payscale, women hit their peak earnings on average at age 44. For men, that age is 55.
Ages 45-54
Average 401(k) balance: $142,069.Median 401(k) balance: $48,301.
This group has hit the age at which catch-up contributions are allowed by the IRS: Participants age 50 and older can contribute an extra $7,500 in 2023, and $8,000 in 2024. That can be helpful for those feeling behind at this point, assuming that extra cash is available to put toward retirement.
Ages 55-64
Average 401(k) balance: $207,874.Median 401(k) balance: $71,168.
Growth has slowed here, which makes sense, as people may start to withdraw the money they've been saving for retirement.
After this age group, 401(k) balances can begin to fall, or at least grow at a slower pace, as even more people start tapping their accounts. The average balance for those 65 and older is $232,710; the median falls to $70,620.
What you can learn from the average 401(k) balance
Again: not much. This is a fairly arbitrary benchmark. In the aggregate, it can speak to how workers in general are doing when it comes to saving for retirement, but it does little to help you analyze your own situation. It’s also limited to people who have a defined contribution plan at work; many workers don’t.
A better approach to benchmarking your efforts: A retirement calculator, which will give you a more personalized recommendation for how much you should have saved now, and how much you’ll need at the end of the line. (If you don't like what you see, you might find our guide to retirement planning helpful.)
Finally, it’s worth noting that you may or may not want to put all your retirement eggs into a 401(k) basket. Should you max out your 401(k)? Maybe. But it isn't the best choice for everyone.
Once you’ve earned your employer match, there can be benefits to spreading your money around among other retirement accounts, such as an IRA. » Ready to get started? Read our full guide to opening an IRA
