Home Forums Hunting & Shooting Hunter's Campfire How does your 401K compare to your age-group's average?

Retirement: Is Your 401(k) Total Above Or Below Average?

BY PAUL KATZEFF
INVESTOR'S BUSINESS DAILY

02/12/2015 08:02 AM ET


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How does your 401(k) retirement account balance compare with balances for other people your age?

If your account balance lags the average for your age group, that's likely a sign that you need to revise your retirement planning.

You may need to boost the percent of pay that you contribute to your account, or allocate more of it to growth-oriented investments such as stocks and stock mutual funds rather than, say, cash or bonds and bond funds.

To pump up your nest egg's prospects, you should also consider kicking in enough money to qualify for the maximum company match your employer may offer. That gives you more flexibility as well as more cash to put to work as you seek funds and stocks to invest in, as well as an age-appropriate allocation to bonds.

The need to fend for yourself with a 401(k) balance that's as large as possible keeps growing.

Only 7% of Fortune 500 companies offered a traditional pension plan to newly hired workers as of year-end 2013, according to professional services company Towers Watson. That compared with 51% as of 1998.

So how does your 401(k) balance stack up?

The average 401(k) account balance was $248,397 for a plan member who is in his or her 60s with 30 or more years on the job, as of year-end 2013, according to a recent report by the Employee Benefit Research Institute.

For a plan member in his or her 50s with the same tenure — 30 or more years — the average balance was $252,418.

Plan members in their 40s who have worked more than 20 years, up to 30 years, have balances that average $154,228.

The average balance was $66,139 for thirtysomethings with more than 10 years, up to 20 years, under their belts.

And plan members in their 20s, who worked more than five years, up to 10 years, for their current employer, average balances of $18,351.

The overall average account balance as of the end of 2013 was $72,383.



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I'm above average but it doesn't make me feel any better. I still wonder how much will I really need (what is inflation going to be in 25-30 years?) and watching my accounts value stall out for the past year while Wall Street is at all time highs doesn't make me feel warm and fuzzy.

I'm screwed...

Me too ! The big mistake was passing age 50 before starting to think about how much money was needed to retire.

I'm a bit above the numbers listed, but what I'm really worried about is the Government stealing it from me and then telling me how much they are going to let me have back.

My mistake was getting married. Well, that's not exactly correct. It was allowing my wife to push our standard of living to the utmost limits of my salary. Add to that, the salary has been stagnant for since about 2008 or 2009.

The only way I can see out is to start my own business with the plan to be increasing my income and putting a healthy portion away for the next 20 years.

I pay attention to our numbers, but not the numbers provided.


always figure to be ok one way or another

we can live really cheap and have fun.

I'd venture we could both quit working now and live off what we've invested and saved easily until I'm dead


but we kinda like spending money on some things, so we still work

and nope our 401K is not even close to the average

This article is very deceptive. Who cares if you're average if the average have not saved enough to retire?

As a general rule, if you don't want to run out of your savings and allowing for inflation, you'd better not spend more than 4% of your savings each year. For a 250,000 401(k) that means you should not spend more than $10,000. Pretty shabby retirement unless you have any additional income. Don't forget Social Security.

Dave Ramsey, as part of his seven baby steps to debt free living says to max out your IRAs then make a minimum contribution to your 401K, enough to collect all matching funds from your company, up to 15% of your income.

http://www.daveramsey.com/new/baby-step-4/

Scott - I had hoped to retire at age 62. I can still do that IF I just stay home and watch TV

The $$$ Social Security pays out at age 62 sucks.

I don't know your health situation, but hopefully you'll still be able to bring in an income at 62 and keep boosting that fund. That's my hope. I'm soon to be 46, and if my health follows that of my dad and his older brother, I'll keep pushing until my late 60's then hang it up.

An older co-worker is just about 62 and plans to put off collecting SS for a few more years so that the monthly pay out increases. His plan is to work part time and pick at his 401k and the like for a few more years.

I'm a bit younger than most here, and did at least start putting a little away back when I started my first post-college job. I'm bit above average, but not sure that this article really tells you anything, especially in the younger age gaps.

A 10 year gap in saving is huge if you compare 10 years of a person saving some for all 120 months of it vs. someone saving nothing. Even at $100 a month that's $12k before you talk interest, especially the TVM of that $12 when that 20-something hits 67 years old. In 30 years that $12k is worth over $50k at %5...even if you don't add another dime to it. Keep the same $100 going in every month and it's worth over $136k plus.

I get a chance to talk to and hire new workforce entrants and it's so hard for them to see how important saving now is...the new workforce is a bit naive in financial matter IMO.

As is often the case, these types of articles generalize too much to truly be that helpful/informative.

Scott - health situation is great and job situation is okay. Like you, I'll keep working until my late 60's. Only real problem is my boss ... he is an azzhole.

Someday you can throw the alarm clock out the window and leave his sorry azz behind.

Oh, and regarding SS, it will be a pleasant surprise to me if it's still there when I'm old enough to get it (approx. 29 years). I'm not planning on it by any means.

.... do I ever love those words.

NTG -- 9 out of 10 people I work with, who are under 30, feel that way.

My 401-K was doing great until I got hurt. I had to cash in out to live the four and a half years we went with no income. Now it is zero.

It is not the end of the world. SS and a little VA disability keep us fairly well but being debt free is the biggest help. Things are looking up, wife gets her first SS in May, VA is going to have to up my disability, and the business my son and I have started is bout to start some $$$ my way.