Average 401(k) balance for 65 and older is $272,588. median $88,488.

[SC Maintenance]

Headline says it all. Wow, thats really pretty low, especially given the capital appreciation in the last 5 years. S&P is pretty much double in the last 5 years.

"As of the end of 2023, the average 401(k) balance across all age groups was $134,128."

Full article. There are some charts and things by age group.

https://unusualwhales.com/news/the-...lder-is-272-588-but-the-median-is-just-88-488

 

[JeffKeryk]

Well, 401K is only one type of financial asset... I hope our seniors own more than that.

 

[Titan]

I don't know how many people I hear complaining about their retirement balances and/or overall financial situation. I ask these people: do you realize that the securities markets are at all-time highs, and if they own a home...the values are at all-time highs? I know there is bad luck and good luck, but if you have been investing in a retirement plan and haven't seen tremendous growth over the past 5-10 years, you need a new advisor....if you don't have an advisor: get one...because you are not doing a good job managing your resources. If you have an advisor and haven't done well, change advisors. If you haven't owned a home, you haven't been able to participate in that run-up in valuation, and that's indeed unfortunate.

 

[supton]

Not sure about this one--mostly because, I've seen so many reports like this, and the numbers are all over the place--but uniformly low. So I believe it's correct, even if I question the number.

 

[OneLonelyBurrito]

For the 65 and older, I wonder how many just don't have 401k because their job just didn't offer them. That could really drag them median and average down when you have a bunch of zero's. Like my mother who is 61 only started a job with a 401k like ~6 years ago, so doesn't have an extremely high amount in it, but other wise has a pension from a previous job.

 

[Astro14]

Well, 401K is only one type of financial asset... I hope our seniors own more than that.

Hope - sure.

Believe? No. That number is consistent with many studies I’ve seen.

People don’t plan to fail.

But they sure fail to plan.

 

[Passport1]

A disquieting statistic for all (if true). Harsh reality but reminds me of the Aesop's fable about the 'ant and the grasshopper.'

 

[Astro14]

For the 65 and older, I wonder how many just don't have 401k because their job just didn't offer them. That could really drag them median and average down when you have a bunch of zero's. Like my mother who is 61 only started a job with a 401k like ~6 years ago, so doesn't have an extremely high amount in it, but other wise has a pension from a previous job.

401(k) became available in 1978. A response to the collapse of so many pensions earlier that decade.

IRAs became tax code about the same time.

So, they’ve been around for 40+ years.

For the 65 and older, pensions have not been around for 40+ years, either.

So, in those 40+ years, they may not have had a 401(k) through an employer, but they had IRAs for tax-advantaged savings and they had time to invest in other ways.

 

[Mechanician]

Many have the expectations of the government taking care of them.
But the government is in worse financial shape than them.

 

[OneLonelyBurrito]

So, in those 40+ years, they may not have had a 401(k) through an employer, but they had IRAs for tax-advantaged savings and they had time to invest in other ways.

That was my point, the 401k total might look low, but I would hope there is more retirement money else where like a pension, IRA, or brokerage account.

 

[fdcg27]

Well, I guess you can accumulate wealth in your working years or you can blow your money on flashy cars, a house you really can't afford and indifferent meals out or you can save your pennies and retire with enough money to travel and see live theater and maybe help your kids.
We are fortunate in having avoided blowing our money during our working years, with mine now coming to a close, and we'll be able to travel more and think about the time involved being away less.
It's all a matter of the choices we make while still in our income earning years.

 

[JeffKeryk]

I don't know how many people I hear complaining about their retirement balances and/or overall financial situation. I ask these people: do you realize that the securities markets are at all-time highs, and if they own a home...the values are at all-time highs? I know there is bad luck and good luck, but if you have been investing in a retirement plan and haven't seen tremendous growth over the past 5-10 years, you need a new advisor....if you don't have an advisor: get one...because you are not doing a good job managing your resources. If you have an advisor and haven't done well, change advisors. If you haven't owned a home, you haven't been able to participate in that run-up in valuation, and that's indeed unfortunate.

The richest Americans own the vast majority of the market. The numbers are something like the wealthiest 10% own more then 90%.
The rest is dominated by 401K and such; people do not even know what their accounts contain.

 

[JeffKeryk]

Hope - sure.

Believe? No. That number is consistent with many studies I’ve seen.

People don’t plan to fail.

But they sure fail to plan.

I'm sure you are right. My gripe (broken record time) is education. Give people a fighting chance.

 

[2002 Maxima SE]

Not sure about this one--mostly because, I've seen so many reports like this, and the numbers are all over the place--but uniformly low. So I believe it's correct, even if I question the number.

Agreed. It's common in my industry that companies do not offer match. It's also common to spend anywhere from 1 year to 5 years with a company. There are exceptions, but typically people stay a short while and move on to stay competitive. Based on that, I could see folks with multiple $50k to $100k 401ks. I roll mine into an IRA, but I know folks that are "getting around to it".

 

[Astro14]

I'm sure you are right. My gripe (broken record time) is education. Give people a fighting chance.

You and me both, Jeff.

My wake-up call (shared many times) was the early passing of my father. He was 56. I was 27. His financial situation at that age spurred me into learning, and investing.

The information needed for success (planning) is out there. But a person has to go get it, it won’t come to them, until you and I get our wish about education.

 

[wavinwayne]

I was watching a financial guy on youtube today who cited a stat that ~60% of Americans have less than $10k saved for retirement.

I'm currently saving 25% of my income in my Roth 401k, and if I'm fortunate enough to keep earning at my current salary for the next 15 years, I will reach full retirement age in not terrible shape.

 

[Pablo]

$272K? That's higher than I thought. Keep it up!

Come on, you have to try and sacrifice a little!

 

[Nessism1]

I've been contributing 10% into my 401k since 1985, and it's grown into a decent nest egg. Had to buy "the ex" out of her share, and that hurt, but it's all good. My biggest regret, is moving my money too much over the years. I tell my kid to slam 100% into an S&P index fund and don't touch it. There will be dips, but it will come back...always.

 

[fdcg27]

I'm not sure that it's an issue of education to give people a fighting chance.
Anyone should have the sense to realize that if they spend every dime during their working lives they won't have much to fall back on when they retire, and for those who have failed to save and invest it'll be more a matter of when they have to, not when they want to.
You notice those older folks working at Walmart?
For some of them, it's because they want to get out and do something. For others, it's because they have to to make ends meet.

 

[dbias]

Well I’m 60 and have a bit more than that in my 401k, but I put 8% into my defined benefit pension for 25 years on the fire department and was able to retire at 52 at full benefits and health insurance for the rest of my life. I actually take home a little more now than when I was working as WV doesn’t tax my 1099 R income. I have another pension, not nearly as good, from my job prior to the fire department but at least it will be gas money. Union work has been good to me.
Additionally I’ve paid into social security since 18 and hopefully the WEP legislation is passed so I get full credit for the 30 plus years I paid into SS.