At the end of 2025, the average 401(k) balance across 5 million accounts was up roughly 13%, primarily because of the surging stock market, while the average balance sat at $167,970, which is not nearly enough for retirement but a healthy amount nonetheless.
The filthy rich really drive the average up.
To get a clearer view of the typical American’s nest egg, the median retirement balance is a better measure. Median is measured by arranging retirement balances in either ascending or descending order and finding the midpoint of that dataset. By splitting the dataset into two equal halves, it isn’t easily skewed by outliers.
Using this measure, the median 401(k) account balance at the end of 2025 was just $44,115.
Perhaps I should be investing pet food businesses. That about all the average median retiree will likely be able to afford.
Don’t forget that for many people, their IRA/401k is only a portion of their net worth.
Also, for lower income Americans (i.e., below median) their SS and Medicare benefit is likely their most valuable asset – even surpassing the value of their home.
The Federal Reserve estimates that the median net worth for 65-74 year olds is $410,000, while the average is $1.8 million. And, while I know people don’t like to hear it, the smaller the portion of that $1.8 million you have tied up in a poorly appreciating home, the better off you really are.
Here’s the “clickbait-free” version of Vanguard’s report, though Vanguard is still selling the need for “professional management”.
Back in John Bogle’s day, there was more emphasis on DIY investor education, which of course, left you much wealthier in the end if you took the advice to heart (i.e., LTB&H low-cost index funds).
Yes, yes. This was my thought as well. I know in my case and those I work with that there are vast differences in account balances in any given ten year period and always up.
I would have liked to see the median balances for those aged 45-54 v. those aged 55-64, for instance. (If you’re including accounts of those under 40, you’re inevitably going to get much lower values)
Or people like my 16 y/o nephew who just opened a Roth account with $5k is driving the average way down. What would be more important and informative, what is the average and median retirement account of 55-60 y/o (near retirement age) and 65 y/o (supposedly retirement age). In essence, articles like this are click bait.
While average net worth is good to know, median net worth by age may be more representative of the state of wealth across the country. That’s because median net worth considers the 50th percentile of earners—those right in the middle—while average net worth factors in outliers of people with very high and very low net worths. Focusing on the median is a more useful way to help you determine how your wealth compares to others in your age range.
Here’s a breakdown of the median net worth of American households by a person’s age, according to the same Federal Reserve Survey of Consumer Finances.2
Median household net worth by age
Age of reference person
Median net worth
Under 35
$39,000
35-44
$135,600
45-54
$247,200
55-64
$364,500
65-74
$409,900
75+
$335,600
Average retirement account balance by age
The average 401(k) retirement balance across all age groups is $144,400, according to Fidelity Investments’ Building Financial Futures Q3 2025 report.3 Here is the average 401(k) account balance for different generations.
Average 401(k) retirement account balance by generation
Generation
Average 401(k) balance
Baby boomers (born 1946–1964)
$267,900
Gen X (born 1965–1980)
$217,500
Millennials (born 1981–1996)
$80,700
Gen Z (born 1997–2012)
$17,000
Keep in mind that 401(k) account balances are just one chunk of someone’s net worth—and might even be just one part of their retirement savings. An investor could have long-term money saved in other types of retirement accounts or a brokerage account.
You wonder what the K recovery squeeze means to 401k balances and contributions. The squeeze has to mean reduced contributions unless they are required. And we hear of increases in penalty distributions to help pay bills.
People continue to call for return to company pension system. Was part of recent labor contract discussions. But seems unlikely. Companies find pension liability costly and unpredictable.
By this metric, I’m below average. ( My 401K balance is several thousand below the average). What this doesn’t show is that I’ve changed jobs several times over my career. Each time, I pulled the entire balance away from the custodian in favor of an IRA/Roth IRA pairing for those funds. The report implies the same for most people:
This is a great report for Vanguard investors. It still would have been helpful to see the overall totals (both 401 & Roth) by age bracket for those who use Vanguard.
Agree, that it doesn’t measure IRAs or taxable accounts, so the 401k reading may not be telling the whole picture.
However, for those with a workplace retirement plan and a low balance nearing retirement, if they could have just been convinced to contribute $500 a month for their multiple decades of working… And for the younger set - just do it!
