Let’s be honest—retirement planning often isn’t a priority for those in their 30s or 40s. Yet, if your employer offers a 401(k) plan, it’s wise to take full advantage of it, especially when matching contributions are part of the package.
If you’re uncertain about the amount you should be saving annually in your 401(k), let’s delve into what individuals aged 35 to 44 are generally contributing. While their contributions might not match the national average, this age group is actively leveraging their employer-sponsored plans to prevent falling behind.
Consider the average 401(k) balances for individuals aged 35 to 44.
Vanguard’s “How America Saves” report offers an in-depth look at the savings patterns of 401(k) participants each year. According to the 2024 edition of this report, the average 401(k) balance across all age categories reaches $134,128. However, for those within the 35 to 44 age bracket, the average balance drops to $91,281.
The median balance for this group is even more striking at $35,537, closely aligning with the overall median of $35,286, as per Vanguard’s examination of nearly 5 million retirement accounts.
For a clearer understanding, the median figure illustrates a more typical scenario—half of the 401(k) holders have balances above this amount, and half fall below it. The average, meanwhile, is elevated by those who can afford to contribute more. It’s important to remember that average balances generally grow with age. Therefore, if you’re able to increase your earnings and effectively manage your daily expenses, your retirement savings are likely to rise over time.
The reality is, comparing your retirement savings progress to someone else’s is challenging—individual goals and financial circumstances vary greatly. However, having insight into where your peers stand can serve as motivation to monitor your own progress. The more diligently you track your savings, the better prepared you’ll be when it’s time to retire.
