Building your retirement fund is critical for financial security. After all, you don’t want to run short of money when you’re older and no longer earning a paycheck.
But how much should you have saved? Although a financial planner can help you determine the amount based on your unique needs and circumstances, it can be helpful to consider how much others have saved at various ages.
With employer-funded pensions less common than they once were, most people will save and invest through employer-sponsored plans, such as 401(k)s, or independently by funding individual retirement accounts. According to a 2025 Fidelity Investments survey, 61% of Americans in their planning years say their retirement savings will be coming from these tax-advantaged retirement accounts.
“I tell everyone to begin saving as early as possible,” says Laurie Rowley, CEO and co-founder of the San Francisco-based Icon Savings Plan, which offers IRAs through payroll deductions. The Fidelity survey found that 66% of today’s retirees recommend the same: Start saving as soon as you can and in amounts you can afford.
Here’s how to compare your financial progress to others in your age group and what you can do to increase your contributions.
[Read: What Is the Average Retirement Age in the U.S.?]
Average Retirement Savings Balance by Age
Many employers offer 401(k) plans as part of their employee benefits package, making them a common way for people to save and invest for retirement. For the fourth quarter of 2024, Fidelity Investments tracked the average balances in these tax-preferred plans by age:
| Age | Average 401(k) balance |
| 20-24 | $7,300 |
| 25–29 | $24,000 |
| 30–34 | $45,700 |
| 35–39 | $73,200 |
| 40–44 | $109,100 |
| 45–49 | $152,100 |
| 50–54 | $199,900 |
| 55–59 | $244,900 |
| 60-64 | $246,500 |
| 65-69 | $251,400 |
| 70 | $250,000 |
Another way to consider your retirement progress is to compare your savings with generational averages. Fidelity broke it down by 401(k) and IRA balances, per fourth-quarter 2024 data:
| Generation | 401(k) | IRA |
| Gen Z (born 1997-2012) | $13,500 | $6,672 |
| Millennials (born 1981-1996) | $67,300 | $25,109 |
| Gen X (born 1965-1980) | $192,300 | $103,952 |
| Baby boomers (born 1946-1964) | $249,300 | $257,002 |
However, workers should look beyond averages when setting their own savings goals, says Ben Bakkum, senior investment strategist for retirement plan provider Betterment. The amount you’ll need can vary based on factors such as your desired retirement lifestyle, health and the cost of living in your area.
Unfortunately, the majority of Americans do not feel financially prepared for retirement. The latest data from the Federal Reserve indicated that most people’s savings fell far short of their goals. By age 60, not even half of non-retirees with a retirement account or pension view their retirement savings plan as being on track:
| Age | Tax-preferred retirement account | Defined benefit pension | Retirement savings on track |
| 18-29 | 43% | 8% | 26% |
| 30-44 | 63% | 19% | 34% |
| 45–59 | 72% | 32% | 38% |
| 60 | 75% | 36% | 45% |
[Read: If You Want to Retire in 2026, Here’s What You Need to Prep Now]
A Rule of Thumb for Retirement Savings
In an ideal world, how much should you have set aside by certain ages? As a general guide, Fidelity suggests people save for retirement using the following rule of thumb based on their annual income:
| Retirement savings based on your annual income | Age |
| 1x | 30 |
| 3x | 40 |
| 6x | 50 |
| 8x | 60 |
| 10x | 67 |
Using this guide, you can make some goal assumptions. For example, if your income is $45,000 when you’re 30, having that same amount in a retirement account is best. If you’re earning $80,000 when you retire at age 67, your final savings goal should be $800,000.
Financial planners often have their own recommendation for how much people may need in their retirement accounts at different life stages. For instance, Rowley suggests the following savings goals:
| Retirement savings based on your annual income | Age |
| 1x | 35 |
| 5x | 50 |
| 7x | 70 |
If any of these recommendations feel too ambitious, start with just six months’ worth of salary by age 30, says Lamar Brabham, CEO and founder of the Noel Taylor Agency, a financial services firm in Myrtle Beach, South Carolina. Then, work up to having four to five times that amount by age 40.
[Read: How Long Will Your Retirement Savings Last]
Determine How Much to Save for Retirement
Before assuming you can’t reach the recommended level of savings, see how your current savings are expected to grow. You may be closer than you think.
“That’s one of the biggest struggles for some people,” says Vanessa N. Martinez, CEO of Expressive Wealth, a Chicago-based wealth consulting firm. “When they see a big number, that seems scary.”
Younger workers who have decades until retirement may find that even a modest amount of savings can grow significantly due to the compounding effect of interest.
For example, if you started contributing to a 401(k) at age 30 with an annual salary of $40,000 — assuming a 3% annual salary rise — and you contribute 10% per month, you will have $1,858,809 by the time you reach age 67, assuming a 7% annual return. However, if you waited until age 45 to start, you would only have $364,660 in your retirement account.
“We usually talk to (clients) in terms of a combination of balance sheet and cash flow,” Brabham says. While having significant assets is important, retirees need to be able to access their funds to generate a regular income.
Cash flow can come from many income sources, including Social Security benefits. According to the Social Security Administration, the average monthly Social Security retirement benefit in 2025 is approximately $1,976. You may have other investments, rental property or annuities to draw from as well. If you own your home, you may downsize and use the proceeds for additional living expenses.
Tips to Boost Your Retirement Savings
If you have access to a 401(k) plan, it usually makes sense to max out your contributions. In 2025, contribution limits are $23,500, with an additional $7,500 in catch-up contributions if you are 50 or older or $11,250 if you are between 60 and 63. Some employers match employee contributions up to a certain percentage, so if they offer it, take advantage. It’s free money.
If you do not have access to a 401(k) or want to increase your contributions, consider opening and funding an IRA. For 2025, the IRA contribution limit is $7,000 if you are under 50, and $8,000 if you are 50 or older.
Keep in mind that savings will go further in retirement if taxes don’t erode them. After all, the more tax you have to pay, the less cash you have for living expenses. For this reason, Brabham tends to steer his clients toward Roth accounts when they open IRAs. Traditional IRAs offer a tax deduction upfront, but withdrawals are taxed as ordinary income. In contrast, Roth IRAs provide tax-free withdrawals in retirement.
If you don’t think you’ll be able to achieve the cash flow needed for a comfortable retirement, there are several ways to boost the balance in your accounts.
“One of the best ways is to make more money,” Bakkum says. That could mean seeking a better-paying job, taking on additional hours or starting a side business.
Another strategy to boost savings is to cut spending. Martinez suggests using a 50/30/20 budgeting system in which 50% of your income is allocated to essential expenses, 30% can be spent on discretionary items and 20% goes to savings. Many people spend money on things they don’t necessarily want or need, such as subscriptions they forget about, Martinez says. Those on tight budgets should pare down where they can.
While knowing the average retirement savings by age is one way to determine whether you are on track, meeting with a financial advisor may be a better way to check your retirement readiness. Either way, make saving consistently a financial priority to ensure you can retire when and how you want.
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What Is the Average Retirement Savings Balance by Age? originally appeared on usnews.com
Update 04/30/25: This story was published at an earlier date and has been updated with new information.
