Last year's typical 401(k) account balance, as per a recent Vanguard report, is this figure you're wondering about. Does your savings match up?

Last year's typical 401(k) account balance, as per a recent Vanguard report, is this figure you're wondering about. Does your savings match up?

In a recent report by Vanguard, the average 401(k) balances for their participants in the United States have been revealed, offering insight into retirement savings by age range.

For individuals under the age of 25, the average balance stands at approximately $6,899, with a median of $1,948. As workers enter their 20s and 30s, the balances gradually increase. The average 401(k) balance for individuals between 25 and 34 years old is $42,640, with a median of $16,255. This is followed by a median of $39,958 for those between 35 and 44 years old, and an average balance of around $103,552.

As workers approach retirement age, the balances continue to grow. The average 401(k) balance for individuals between 45 and 54 years old is approximately $188,643, with a median of $67,796. Unfortunately, specific data for those aged 55 and older was not provided in the available sources.

It's worth noting that the overall average 401(k) balance for Vanguard participants was $148,153 in 2024, marking a 10.46% increase from the previous year. However, age-specific data for this increased average was not detailed for every age group.

The report also revealed that 86% of Vanguard 401(k) plans offer some type of matching contributions. For instance, a $60,000 annual income with a 100% employer match up to 3% of salary could add $1,800 per year to the total savings. By contributing an additional $300 per year to earn the full employer match, a saver could potentially increase their total savings by over $150,000 over a career.

Investing in a 401(k) is one of the most effective ways to save for retirement. The example provided assumes an 8% average annual return on investments. However, the actual return can vary based on various factors, including market conditions and individual investment choices.

The median 401(k) balance among all Vanguard participants is $38,176, highlighting the importance of consistent contributions and taking advantage of employer matches to build a substantial retirement savings. The report, titled "How America Saves," provides valuable insights into the state of retirement savings in the United States and offers strategies for individuals to improve their savings habits.

1. To increase their personal-finance for retirement, individuals should consider investing in a 401(k), as the median balance among all Vanguard participants is $38,176, and the report reveals that 86% of Vanguard 401(k) plans offer matching contributions.
2. Regarding the state of retirement savings in the United States, individuals under the age of 25 have an average 401(k) balance of approximately $6,899, while those between 25 and 34 years old have a higher average balance of $42,640, and those between 35 and 44 years old have a median balance of $39,958.
3. As workers age and approach retirement, the average 401(k) balance continues to increase, with individuals between 45 and 54 years old having an average balance of approximately $188,643, demonstrating the importance of saving money for retirement.

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