Americans are living longer, and healthcare costs continue to rise. That makes retirement savings a growing concern for many households. Yet the Federal Reserve’s 2022 Survey of Consumer Finances found that nearly half of U.S. families had no retirement accounts at all.
For those who do save, the 401k is often the backbone of their plan. It provides tax advantages and, in many workplaces, an employer match. But savings levels look very different depending on age and industry.
So what does the average 401k balance really look like in 2025? In this article, we break down the numbers by age group and industry. These benchmarks can help you see where you stand and where you may want to adjust your own retirement strategy.
What Retirement Readiness Means in 2025
At its core, retirement readiness comes down to two things:
✅ Having access to a retirement plan
✅ Saving enough—consistently—to cover future expenses
Here’s where Americans stand in 2025:
Plan Access
- In 2022, just 54.3% of U.S. families had a retirement account.
- Balances are uneven. The median balance is much lower than the average, showing how a few large accounts can skew the numbers.
- In March 2024, about 70% of private-industry workers had access to a defined contribution plan such as a 401k. Participation rates were lower, which means not everyone with access actually saves.
- Employee deferral limit: $23,500
- Age 50+ catch-up: $7,500
- New SECURE 2.0 rule: $11,250 catch-up for ages 60–63
Together, these limits shape how quickly balances can grow.
Positive Trends
- Fidelity reports that the average total savings rate (employee + employer) reached 14.3% in Q1 2025 — the highest on record. This is a positive signal that many workers are contributing more toward retirement.
Benchmarking Sources
- Large studies such as Vanguard’s How America Saves 2025 provide balance and participation data by age and industry.
- Government datasets (Federal Reserve SCF/SHED, Bureau of Labor Statistics) add context on account ownership and workplace access.
📝 Note: When looking at benchmarks, pay attention to both the median and the average. Averages can be skewed by high-balance savers, while medians reflect what’s typical for most households.
To judge your own retirement readiness in 2025, evaluate three factors together: plan access, savings rates versus IRS limits, and how your balance compares with peers in your age group or industry.
📌 Also read: What Could $100 Invested in a Solo 401k Be Worth in 10 or 20 Years?
Why Average 401k Balances Matter for Americans
Average 401k balances give a quick benchmark for asking, “Am I on track?” But they can also mislead. Many households have little or no retirement savings. The Federal Reserve reported that in 2022, only 54.3% of U.S. families had any retirement account assets. That’s why averages should always be weighed against medians for a more realistic view of typical outcomes.
Access plays a major role in retirement savings. As of March 2024, about 70% of private-industry workers had access to a defined contribution plan such as a 401k, yet only about 50% participated. These participation gaps often reflect differences in industry, job type, and income. Benchmarks broken down by age or sector help distinguish between limited access and lower savings behavior.
Contribution limits also set the pace for growth. For 2025, the IRS allows employees to defer up to $23,500 into a 401k, with an additional $11,250 catch-up contribution for ages 60–63 under SECURE 2.0. Knowing these thresholds helps put average balances into context.
401k balances matter because they cover much more than what Social Security provides. For retirees aged 65 and older, Social Security makes up about 30% – 35% of income on average, and many rely on it for half or more. Comparing your balance against peers can reveal whether adjustments are needed in savings rates, investment choices, or fee management.
Key points to keep in mind when looking at averages:
✅ Compare averages with medians for a realistic view.
✅ Consider access and participation differences across industries.
✅ Factor in IRS contribution limits for your age.
✅ Remember that 401ks are meant to supplement, not replace, Social Security.
📌 Also read: 401k Contribution Limits & Deadlines For 2024 & 2025
Average 401k Balances by Age
401k Balances by Age Bracket (Under 25 to 65+)
Vanguard’s How America Saves 2025 report (based on year-end 2024 data) offers a snapshot of average and median 401k balances across age groups:
| Age Bracket | Average Balance ($) | Median Balance ($) |
| <25 | 6,899 | 1,948 |
| 25-34 | 42,640 | 16,255 |
| 35-44 | 103,552 | 39,958 |
| 45-54 | 188,643 | 67,796 |
| 55-64 | 271,320 | 95,642 |
| 65+ | 299,442 | 95,425 |
📌 Source: How America Saves 2025 | Vanguard
Median vs. Average 401k Balances
Averages can be pulled up by participants with very large accounts, while medians reflect the midpoint of savers’ experiences. Nationwide in 2024, the average 401k balance was $148,153, compared with a median of $38,176. That nearly fourfold gap shows why averages can sometimes feel out of reach.
The median helps you see what a “typical” saver has, while the average reflects the potential of higher contributions, longer participation, and consistent investing. Looking at both provides a more balanced perspective.
401k Benchmarks by Industry and Generation
401k savings patterns vary widely depending on the type of work you do and the stage of life you’re in. Industry benchmarks highlight how employer contributions and tenure affect balances, while generational data shows how savings typically grow with time.
401k Balances by Industry
Vanguard’s How America Saves 2025 report shows meaningful differences across sectors. These variations reflect employer match policies, average years of service, and overall savings behavior:
| Industry | Average 401k Balance | Median 401k Balance |
| Manufacturing | $148,759 | $38,803 |
| Education and Healthcare | $113,003 | $29,978 |
| Communications and Utilities (incl. Tech) | $95,318 | $15,329 |
- Workers in manufacturing generally post higher balances, often due to stronger employer matches and longer tenure.
- Education and healthcare professionals tend to save less on average, likely reflecting lower employer contributions or career transitions.
- Tech and telecom workers show the lowest averages, suggesting shorter tenures and more frequent job changes that can limit compounding over time.
401k Balances by Generation
Generational data provides another benchmark to measure progress. Fidelity’s Q3 2024 research shows the following average balances:
- Gen Z (ages 13–28): $13,500
- Millennials (29–44): $67,300
- Gen X (45–60): $192,300
- Baby Boomers (61–88): $249,300
These figures rise sharply with age. Longer contribution periods, investment growth, and catch-up contributions for those 50 and older all play a role. Comparing balances by generation can help savers see if their current pace aligns with peers or if adjustments are needed in contribution rates or investment choices.
What Drives 401k Growth and Success
The growth of a 401k does not come from investment returns alone. How much you contribute, the support you receive from your employer, and larger economic and demographic factors all play a role in shaping long-term outcomes.
Contribution Rates and Employer Match
Contribution habits are the foundation of retirement savings. Two main levers determine how quickly a 401k grows:
✅ Employee deferrals — In 2025, participants typically save close to 8% of pay into their 401k. Automatic enrollment and annual step-ups are common features that encourage steady saving.
✅ Employer match — Many companies still follow a 50% match on contributions up to 6% of salary. That works out to about a 3% boost in savings from the employer. Taken together, the average combined employee-employer contribution rate lands around 12% of pay.
✅ Automatic enrollment and escalation — Roughly two-thirds of plans now include features that enroll new hires automatically and increase contributions over time. Data show that workers in these plans accumulate significantly higher savings than those in opt-in plans.
📝 Note: A steady contribution rate of 12–15% of pay (including employer match) is often cited as a target for building a solid retirement foundation.
Catch-Up Contributions and Tax Benefits
For workers in their 50s and early 60s, catch-up contributions can make a meaningful difference to accelerate savings:
- Standard catch-up (age 50+) — In 2025, anyone aged 50 or older can save an extra $7,500 beyond the $23,500 deferral limit, raising the total possible contribution to $31,000.
- “Super” catch-up (ages 60–63) — Under SECURE 2.0, savers in this age group may put in up to $11,250 extra, bringing total deferrals as high as $34,750.
- Tax advantages — Contributions reduce taxable income in the year made, while investments grow tax-deferred until retirement. Over decades, this tax treatment can help compound growth significantly.
Demographics and Economic Factors
Not all workers experience 401k growth the same way. Broader trends in income, education, and the economy influence outcomes:
- Income and education — Families earning $150,000 or more tend to hold far larger balances compared to those making under $50,000. Higher education levels also correlate with participation and savings rates.
- Gender gap — Although men and women contribute at similar rates, women’s balances are typically 15–20% lower, likely influenced by pay gaps and career breaks for caregiving.
- Job tenure and mobility — Frequent job changes can disrupt saving. Research suggests contribution rates often fall by about one percentage point after a job move, which may add up to a significant shortfall over time.
- Economic environment — Market performance and inflation directly affect balances. Strong markets and rising wages speed up growth, while downturns or high inflation can slow progress.
Strategies to Improve Retirement Readiness
Improving retirement readiness is about forming consistent habits and making the most of available tools. Here are some practical steps that can help:
Maximize and Automate Contributions
✅ Use automatic enrollment and escalation – Starting in 2025, new 401k plans must auto-enroll at 3% and increase yearly until at least 10%. This setup helps you save more without constant effort.
✅ Increase contributions with raises – Redirect part of every raise into your 401k. Even small increases add up over time.
✅ Take advantage of contribution limits – In 2025, you can contribute up to $23,500, plus catch-up contributions if you’re age 50 or older.
Diversify Investments and Manage Fees
✅ Rely on broad asset allocation – Options like target-date funds or index funds can simplify diversification and keep your portfolio balanced.
✅ Choose low-cost funds – Index funds with expense ratios as low as 0.03%–0.10% help preserve more of your returns.
✅ Review plan fees yearly – Even with falling averages (around 0.24% for equity funds in 2025), costs still vary. An annual review can uncover cheaper choices.
✅ Benefit from plan-level updates – Some providers, such as Vanguard in 2025, have reduced fund fees, which directly improves long-term savings.
Use Retirement Benchmarks and Planning Tools
✅ Compare with benchmarks – Tools from Fidelity and Vanguard show how your savings stack up against peers of similar age and industry.
✅ Run what-if scenarios – Online calculators let you test how changes in savings rates or retirement age could impact your balance.
✅ Review progress yearly – Adjust contributions, investments, or goals annually to keep your plan aligned with changing circumstances.
Wrapping It Up
Looking at 401k balances by age, industry, and generation gives a clearer view of progress toward retirement. Both average and median numbers matter, since focusing on only one can give a skewed picture. Industry and peer comparisons highlight whether you’re on track or need adjustments.
Simple steps like automating contributions, maximizing employer matches, using catch-up contributions if eligible, and sticking with diversified, low-cost investments can make a meaningful difference over time. Running projections with planning tools and reviewing your strategy each year helps keep you aligned with your goals.
With consistent saving and informed investment choices, you can gradually strengthen your retirement readiness and move forward with greater confidence.
📌 Curious about other ways to build wealth for the future? Explore our related articles for more insights:
Disclaimer:
The Carry Learning Center is operated by The Vibes Company Inc. (“Vibes”) and contains generalized educational content about personal finance topics. While Vibes provides educational content and technology services, all investment advisory services discussed on this website are provided exclusively through its wholly-owned subsidiary, Carry Advisors LLC (“Carry Advisors”), an SEC registered investment adviser. The information contained on the Carry Learning Center should not be construed as personalized investment advice and should not be considered as a solicitation to buy or sell any security or engage in a particular investment, accounting, tax or legal strategy. Vibes is not providing tax, legal, accounting, or investment advice. You should consult with qualified tax, legal, accounting, and investment professionals regarding your specific situation.
The accounts, strategies and/or investments discussed in this material may not be suitable for all investors. All investments involve the risk of loss, and past performance does not guarantee future results. Investment growth or profit is never a guarantee. All statements and opinions included on the Carry Learning Center are intended to be current as of the date of publication but are subject to change without notice.
To access investment advisory services through Carry Advisors, you must be a client of Vibes on an eligible membership plan. For more information about Carry Advisors’ investment advisory services, please see our Form ADV Part 2A brochure and Form CRS or through the SEC’s website at www.adviserinfo.sec.gov.