Planning for retirement is a financial priority that demands careful attention, yet not all individuals have accumulated sufficient savings to support themselves in their later years. To understand how one measures up on the path to retirement security, it is useful to compare individual retirement account balances to those of age-matched peers.
Vanguard’s 2025 How America Saves Report offers extensive data on retirement savings across various age groups among its participants. This data sheds light on the average and median balances held in retirement accounts, enabling a clearer picture of typical savings trajectories across life stages.
| Age Group | Average Retirement Savings | Median Retirement Savings |
|---|---|---|
| Under 25 | $6,899 | $1,948 |
| 25-34 | $42,640 | $16,255 |
| 35-44 | $103,552 | $39,958 |
| 45-54 | $188,643 | $67,796 |
| 55-64 | $271,320 | $95,642 |
| 65 and over | $299,442 | $95,425 |
These statistics demonstrate considerable growth in average savings as individuals age, reflecting incremental accumulation over time. However, the median figures also emphasize significant variation, with many individuals saving markedly less than the average, indicating a non-uniform distribution of retirement assets.
Evaluating one’s position relative to these benchmarks can provide useful context for retirement preparation progress. Individuals holding balances surpassing the average for their age group may be comparatively well-positioned, yet this assessment warrants further nuance. Income levels significantly influence the adequacy of retirement savings. For instance, an individual earning $200,000 annually with $103,552 saved by age 35 might not be as financially prepared as someone earning half that amount with equivalent savings.
Establishing personalized savings objectives based on multiple factors is therefore critical. These considerations include:
- Your current age and years until planned retirement
- The supplementary income needed beyond Social Security benefits to maintain a desired standard of living
- Personal goals such as the intention to retire early or engage in cost-intensive hobbies during retirement
One common benchmark involves targeting retirement savings approximating 10 times one’s final salary. By breaking this aggregate goal into manageable, incremental savings targets, individuals can better ensure consistent progress toward financial readiness.
For those identifying a shortfall between current balances and desired targets, proactive strategies exist to enhance retirement portfolios. Key recommendations include:
- Contributing at least enough to secure the full employer match in 401(k) plans, thereby capturing available free savings
- Automating contributions to ensure regular investment flows precede discretionary spending
- Selecting a prudent investment mix that balances fees, risk tolerance, and life stage considerations to optimize growth potential
Persistence in investing consistently over extended periods, coupled with acquiring investment knowledge, can significantly improve retirement outcomes. Individuals who adopt these disciplined approaches may achieve superior financial security and face fewer monetary concerns during their retirement years than their peers who do not engage in such practices.
While average and median figures serve as informative guides, ultimate success in retirement savings depends on tailored planning and sustained actions aligned with individual circumstances.