Average 401k Balance By Age Review

Average 401k Balance by Age

A 401k investment is a very smart move for most people, but what is the average 401k balance by age? This is a question many people wonder, because of the 401k contribution limits and other factors involved. Answering this question must take into account the employment tenure of the group as well, not just their age. Some individuals who are in their forties and fifties may have very small account balances because of numerous employers and limited contributions, if any. An individual in their late thirties could have a substantial nest egg built up in their 401k investment if they started with the same employer at eighteen or twenty, and are still there, because of the average 401k balance by age.

The average amount in the accounts may also vary to a certain degree, depending on whether any 401k hardship withdrawal, loan, or other deductions have been taken from the account balance. The typical account balance for someone in their early twenties may only be two or three thousand dollars and it can range up to eighteen thousand dollars or more, if there is any account balance at this young age. Someone in their early thirties will have an average 401k balance by age of between twelve thousand and more than sixty thousand dollars, depending on the length of time with the same employer. A retirement savings calculator shows someone who is in their 40s and has 20-30 years on the same job can have a balance of more than one hundred and fifty thousand dollars on average.

By the mid fifties, the average 401k balance by age is typically a little less than two hundred thousand dollars for someone who has a long time employer. At sixty four years old the average balance is around three hundred and twenty five thousand dollars, and can be more than this. Many self employed retirement plans may not offer this average, some may offer better returns and others may suffer from lower returns. While a balance by age review can be helpful, there are many variables that need to be considered before deciding whether this is the right retirement plan for your goals and circumstances.