Under 35? See the Average Retirement Savings (Are You Behind?)
How Much Have Young People Saved for Retirement? (A Simple Guide)
Why Age Matters for Retirement Savings
Think of saving for retirement like growing a garden.
- Older workers have been planting seeds for decades. Their gardens are full of big, mature plants.
- Younger workers just started planting. Their gardens have tiny sprouts.
It’s totally normal for people under 35 to have smaller retirement accounts. They simply haven’t had as much time to save and let their money grow.
The Numbers: What Young People Have Actually Saved
Researchers look at two main numbers to understand the big picture: Averages and Medians.
Important: Average vs. Median
- Average: Add up everyone’s savings and divide by the number of people. Can be skewed by a few super-savers.
- Median: Line everyone up from least savings to most. The person in the exact middle is the median. This shows what a "typical" person has.
1. Vanguard Data (End of 2025)
Vanguard manages 401(k) plans for millions of workers. Here’s what they found for 2025:
| Age Group | Average Balance | Median (Typical) Balance |
|---|---|---|
| Under 25 | $7,259 | $2,234 |
| Ages 25–34 | $50,261 | $18,732 |
What this tells us: Half of the people under 25 have less than $2,234 saved. Half of people 25–34 have less than $18,732.
2. Fidelity Data (Early 2025)
Fidelity, another giant retirement company, reported very similar numbers:
- Ages 20–24: ~$7,700
- Ages 25–29: ~$26,600
- Ages 30–34: ~$51,700
3. The Big Picture: Total Retirement Savings (Federal Reserve, 2022)
A 401(k) isn’t the only place to save (there are IRAs, pensions, etc.). The Federal Reserve looks at everything combined for households under 35:
- Average Total Savings: $49,130
- Median (Typical) Total Savings: $18,880
What Do These Numbers Mean for YOU?
Don’t Panic If You’re "Behind"
Seeing $50k averages might feel scary if you have $5k. Relax. You have decades for compound interest (your money making money) to work its magic. Starting now is what matters.
Don’t Get Cocky If You’re "Ahead"
Having $30k at age 28 is great! But the average American thinks they need $1.46 million to retire comfortably (Northwestern Mutual, 2026). You still have a long way to go.
The Real Goal: Make a Plan
Knowing the averages is just a starting line. The finish line is your personal retirement number.
4 Steps to Build Your Retirement Roadmap
- Grab Your Employer Match
- If your job offers a 401(k) match (e.g., they put in 4% if you put in 4%), do it. It’s free money. An instant 100% return.
- Open a Roth IRA
- You pay taxes now; money grows tax-free forever. In 2025, you can put in up to $7,000 (under 50).
- Automate It
- Set up automatic transfers every payday. "Set it and forget it" beats "I’ll save whatever is left" every time.
- Invest in Low-Cost Index Funds
- Don’t pick individual stocks. Buy a "Total Stock Market" or "S&P 500" fund. You own a tiny piece of almost every big company. Low fees = more money for you.
Summary
- It’s normal for under-35s to have modest savings ($2k–$19k median).
- Averages are misleading—a few rich people pull the number up. Look at the median for the real story.
- The target is ~$1.5 million, but you have time on your side.
- Action beats anxiety: Get the match, open a Roth IRA, automate, and buy index funds.
FAQ: Your Burning Questions Answered
1. I’m 28 and have $0 saved. Am I ruined?
Absolutely not. You have 35+ years until retirement. If you start investing $500/month today at a 7% average return, you could have over $850,000 by age 65. Time is your superpower.
2. What’s the difference between a 401(k) and an IRA?
- 401(k): Offered by your job. Higher contribution limits ($23,000 in 2025). Often has a match.
- IRA (Individual Retirement Account): You open it yourself (at Vanguard, Fidelity, Schwab). Lower limit ($7,000), but you pick the investments (usually cheaper/better options).
- Pro Tip: Do both! 401(k) up to the match → Max out IRA → Back to 401(k).
3. Should I pay off student loans or save for retirement?
Do both simultaneously if possible.
- Always get the 401(k) match first (free money).
- Then, compare interest rates. If loans are >6-7%, pay them aggressively. If <5%, invest more while paying minimums. The stock market historically returns ~10%/year (7% after inflation).
4. What if I change jobs? What happens to my 401(k)?
You have three main choices (don’t cash it out!):
- Leave it at old job (if balance > $5,000).
- Roll it into your new 401(k) (keeps things simple).
- Roll it into an IRA (usually best—more investment choices, lower fees).
5. Is $1.46 million really enough?
It depends on your lifestyle! That number assumes you withdraw ~4% per year (~$58k/year) plus Social Security.
- Want to travel the world? You’ll need more.
- Own a paid-off house in a low-cost area? You might need less.
- Use a retirement calculator (like Vanguard’s or Fidelity’s) with your specific numbers.