Is your 401(k) balance above average? Find out if you beat the most savers

We all know that comparing ourselves to others can be a slippery slope, but when it comes to retirement savings, it’s hard not to wonder: am I doing better or worse than the average saver? Checking where your 401(k) balance is can give you some insight, but remember: retirement is your own journey and no two paths are the same.

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What is the average 401(k) balance?

According to Fidelity, the average 401(k) balance in their accounts is $28,900 at the beginning of 2024.

On the other hand, the average balance is much higher at $125,900. Before you start cheering – or panicking – remember that averages can be skewed by people with particularly large or small balances.

The difference between median and average is simple: the median shows the middle saver, while accounts of a few million dollars could increase the average. So if you’re somewhere in between these numbers, you’re probably on par with many other savers.

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Here’s a breakdown by age, as reported by CNBC:

Fidelity reports that the average 401(k) balance for those over 65 is $88,488, while the average is $272,588.

If you’re behind these numbers, don’t worry too much about them: there’s still time to catch up.

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How to grow your retirement savings

Saving for your retirement is not a sprint; it’s more like a marathon. Even if you’re not exactly where you’d like to be, there are steps you can take to grow your savings and feel more confident about your future.

1. Automate contributions

The easiest way to ensure you’re saving consistently is to automate it. Set up direct contributions from your paycheck to your retirement account. This way you don’t even have to think about it. Automating helps you maintain your retirement savings goals by making saving part of your normal routine.

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2. Increase your contributions

Try to increase it annually as you become more comfortable with your current premium rate. Even a small 1% increase can make a big difference over time. Automatically increasing contributions ensure that your savings rate grows with your income, without manual adjustments.

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3. Maximum employer match

If your company offers a 401(k) match, make sure you contribute enough to take full advantage of it. This is free money – essentially a 100% return on the portion your employer matches. It’s one of the best ways to boost your retirement savings.

See also: How do billionaires pay less income tax than you? Tax deferral is their main strategy.

What to avoid: Taking too much risk

It can be tempting to aim for big returns by investing in risky assets, but that strategy can backfire. Retirement savings is best handled with patience.

Whether your balance is above or below average, it’s important to keep your financial goals in mind. Retirement savings is not a competition; it’s about making sure you’re ready for the lifestyle you want.

It may be worth talking to a financial advisor if you’re not quite on track with your savings yet, or if you just want some reassurance that you’re on the right track.

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This article Is Your 401(k) Balance Above Average? Find Out If You’re Beating Most Savers originally appeared on Benzinga.com

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