The Average 401(k) Balance Today May Surprise You

Parting with money to fund your 401(k) isn't the easiest thing to do. That money could make your life easier, pay for leisure activities, or allow you to buy a bigger house or a more luxurious car.

But it's important to save for retirement because living on Social Security alone is the pits. Those monthly benefits will only replace about 40% of your pre-retirement wages if you earn a typical paycheck. So unless you want to take a 60% pay cut as a retiree, you'll need savings. And if you have access to a 401(k) plan, you might as well take advantage.

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The nice thing about 401(k)s is that funding them is easy. You tell your employer how much you want to contribute each year and they do the rest for you.

Recent data from Vanguard shows that 401(k) balances rose nicely last year. But the average savings balance may come as a surprise.

What the average 401(k) balance looks like today

As of year-end 2025, the average 401(k) balance reached $167,970, according to Vanguard. That's a 13% increase from a year prior.

That's also a pretty decent number. But when we look at the median 401(k) balance as of the end of 2025, it tells a different story.

The median 401(k) balance as of the end of last year was only $44,115. And when you have a median that's considerably lower than the average, it's typically the more representative number.

In this case, what likely happened is that a small percentage of very large 401(k) balances drove up the average number. The median corrects for that. But it also tells us that many Americans' 401(k)s may be sorely underfunded.

Is the average 401(k) balance today enough?

That's a loaded question. First, as just mentioned, we should really be discussing the median 401(k) balance, not the average. But even if we talk about the average, $167,970 is a nice amount of retirement savings to have for people in their 20s and 30s.

For people in their 40s, it's OK. For people in their 50s, it's more problematic.

Say you're 57 with eight of work left ahead of you. With $167,970 right now, even if you save another $500 a month and your portfolio grows 8% a year, which is a bit below the stock market's average, you're looking at retiring with about $375,000.

That's clearly better than nothing. But it's not a ton of savings, frankly.

Using the 4% rule, a balance that size gives you about $15,000 a year from savings. Even when added to Social Security, that may not be enough for a comfortable lifestyle.

For this reason, you shouldn't get too caught up on whether your 401(k) balance is below, above, or on par with the average. Instead, think about where you are in your career and how much more time your money has to grow.

And if you're worried you're behind on savings, make every effort to catch up. Snag your full workplace match each year, cut spending to raise your savings rate, and take on a side hustle to fund your 401(k) if you don't another way to come up with the money.

You're most likely going to need savings if you want a comfortable retirement. So make sure your 401(k) is on track to lead to that outcome.

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