What's The Average 401(k) Balance At My Age? Am I On Track?

Think you know how much people save for retirement?

The median American over 65 has just $100,000 saved, yet the average household spends $57,000 a year in retirement, with $20,000 going to housing alone. The math doesn’t work.

At Root Financial, most clients retire with $2–3M and plan to spend $100K–$200K annually. That’s not about bragging. It’s a reminder that if you’re here, you’re likely already thinking beyond the basics.

Rules like “save 10%” or “withdraw 3%” don’t fit everyone. The difference between struggling and thriving often comes down to advanced planning—tax strategy, investment allocation, Roth conversions, and estate design. For many, the real risk isn’t running out of money, it’s missing opportunities out of excessive caution.

Know where you stand relative to the averages and to your own vision.

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Advisory services are offered through Root Financial Partners, LLC, an SEC-registered investment adviser. This content is intended for informational and educational purposes only and should not be considered personalized investment, tax, or legal advice. Viewing this content does not create an advisory relationship. We do not provide tax preparation or legal services. Always consult an investment, tax or legal professional regarding your specific situation.

The strategies, case studies, and examples discussed may not be suitable for everyone. They are hypothetical and for illustrative and educational purposes only. They do not reflect actual client results and are not guarantees of future performance. All investments involve risk, including the potential loss of principal.

Comments reflect the views of individual users and do not necessarily represent the views of Root Financial. They are not verified, may not be accurate, and should not be considered testimonials or endorsements

Participation in the Retirement Planning Academy or Early Retirement Academy does not create an advisory relationship with Root Financial. These programs are educational in nature and are not a substitute for personalized financial advice. Advisory services are offered only under a written agreement with Root Financial.

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Ari Taublieb, CFP ®, MBA is the Chief Growth Officer of Root Financial Partners and a Fiduciary Financial Planner specializing in helping clients retire early with confidence.

Episode Transcript

Speaker 1 (00:00):
I went ahead and asked ChatGPT what's the average
retirement account balance byage, and the results are
surprising.
Now I know you could all lookthis up in 10 seconds, so that's
not rocket science.
I'm going to give you myinsight on this because there
are some things that I thinkwill surprise you.
My name is Ari Taublieb.
I am a certified financialplanner, host of this podcast,

(00:21):
the Early Retirement Podcast,and Chief Growth Officer at root
financial, where we help peopleoptimize what they've worked so
hard for and get the most lifeout of their money, especially
around an early retirement inmost cases.
So, with this being said, I'mgoing to go ahead and just read
what is literally the differentaccount balances by age and then
give you some surprisingstatistics here, in addition to

(00:43):
my insight from our clients whoare here at Root Financial.
So I'm going to go ahead andread this list here.
You can see it on my screen ifyou're watching on YouTube.
So, for those under 25, averagebalance is 6,300.
The median balance is 1,400.
A kind reminder for all of you.
I'm putting you back to highschool, real quick.
Average is skewed by those highbalance savers.

(01:04):
The median shows what a typicalsaver has.
So if you remember median goingback to school, remember you'd
cross out kind of the sides,then eventually get to the
middle versus average is whereyou take it all and then divide
it.
This is why median is moreappropriate.
Is the median From 35 to 44,97,000 is the average, 36,000 is

(01:31):
the median From 45 to 54 yearsold 179,000 is the average,
61,000 is the median.
From 55 to 64, 256,000 is theaverage and 89,000 is the median
.
And above 65, we're at 280,000average, 100,000 median.
Wow, wow, wow.
Why is this surprising?

(01:51):
I bet this is not most of you,which is pretty wild.
Because then I went ahead and Ineeded to ask Jachie PT.
I said okay, give me how muchthe average retiree spends, and
this is very different from whatour clients spend.
So let me be clear and I willgive you both of those answers.
So I'm going to go ahead andread this out.

(02:13):
This comes from the BLS ConsumerExpenditure Survey, which is
average spending per retireehousehold is about $57,000 per
year.
Now it doesn't clarify ifthat's after taxes, adjusted for
inflation, all that good stuff,but I'm going to assume it is
here.
And they talk about housingbeing about $20,000 or 35% per
year.
Transportation 7,000.

(02:33):
Healthcare 7,000.
Food 7,000.
Entertainment 3,500.
Insurance, pension stuff, 3,300.
And then other clothing orpersonal care 8,500.
And that's for couples.
They're saying couples is aboutthat uh 57,000 to 75,000 and
singles are 35 to 45,000.
And of course that can vary.

(02:54):
Now those are all thestatistics from chat GPT.
Now let me tell you real life.
Okay, average root client whowe're working with, they're in
that range of two to $3 million.
Client who we're working withthey're in that range of two to
$3 million.
Now there's clients with 20,$30 million and there's clients
with 500,000 to a milliondollars.
There's a range.
But most of the people thatwe're working with they've got
two to 3 million bucks.

(03:15):
They've saved and investedreally well and they want to
spend anywhere from a hundred to$200,000 per year, adjusted for
inflation, after taxes.
Now why do I share that?
Because that's completelydifferent from the numbers I
just told you.
And I'm not saying that becauseI'm trying to tell you how
great Root is or anything likethat.
I'm telling you this because Idon't want you to feel like

(03:36):
you're in the wrong box by anymeans.
If you're listening to thisgoing, wow, I've only got two
$300,000, I bet you're notthinking about retirement.
So when I'm seeing thesenumbers here.
These are surprising to me.
When I'm looking at an averageof people who are above 65 have
$280,000, I know that's what thestats show.
So I'm not you know, this comesfrom Vanguard and Fidelity.

(03:57):
I'm not doubting that.
I'm saying that's not most ofyou watching this, that's not
most of you listening to this.
So, because of that, thecontent that I'm talking about
really doesn't apply to thosepeople and it probably applies
to more of you who are listeninggoing.
Yeah, I've actually saved andinvested really well.
I'm wondering should I do Rothconversions?
I'm wondering if I retirebefore 65, is healthcare going

(04:18):
to cost me a thousand a month?
Is it going to cost me 20 bucksa month if I'm smart?
I'm wondering do I need In thefuture, when I have those
required distributions?
Are my children going to gettaxed like crazy?
Or is my spouse going to haveto pay crazy taxes if I were to
pass away?
And with our different age gaps, how does that impact the plan?

(04:40):
And how do we make sure thatI'm on track for my retirement
spending in those go-go yearswhen we have our energy and
health and we want to spend waymore?
That's who I'm talking to.
So by no means am I trying tosay I'm not trying to help
people who have $200,000 or$300,000 unless they don't like
soccer, then I'll never helpthem.
No, I'm just kidding.
I'm just a big soccer guy.

(05:00):
My favorite team's Arsenal.
For those who do not know, so Igot to play at Arsenal.
Because of all of you wholisten to the podcast and watch
on YouTube you are know it ornot to help send me to go play
at Arsenal.
So that was a legendaryexperience earlier this year.
So thank you for that.

(05:21):
Now I'm telling you this becausewhat I love talking about is
not what's most talked about infinance.
If you're looking up financialtips, it'll say here's the best
new credit card, here's how youcan travel hack and here's why
you need to make sure you usethis credit union.
Those things are all fine.
Okay, I'll be honest, I don'tcare about them that much.
I'm just being totally honestwith you.
I don't think they really holdthe same weight.
If you're thinking aboutinvesting well and I've made

(05:42):
this case many times I've hadpeople who come to me and
there's like I got to make sureI'm saving the right way and
I'll say you need to investbetter at your stage of life.
If you have a million dollarsand you're 55 and most of your
money is in super conservativeassets and you're getting 2%
growth, or $20,000 a year,versus getting 10% growth at

(06:02):
100,000 per year, that's waymore valuable than you trying to
save or max out your 401k andput 30,000 in your account.
It's the exact opposite.
When you're early on in yourcareer, when you're 20 years old
, I want you to max out your401k because if you get a 10%
return on a thousand dollars,that's a hundred bucks.
That doesn't really change yourfinancial strategy.
So, investing the right way,understanding how much should be

(06:25):
in dividend paying companies,how much should be in small caps
or international or real estateor value that's where there's a
ton of value.
Tax planning, roth conversions,estate planning, insurance I
need to protect against whatyou've worked so hard to
accumulate.
You're entering a different ballgame.
If you've just had the S&P 500,as an example, it's pretty
simple you add more money to theS&P 500, then eventually you

(06:48):
retire and I see people who justhave the S&P 500.
And I see people who just havethe S&P 500.
And I see people who have to goback to work and you don't want
to be those people.
And what happens in those casesare people.
They're continuing to havewhat's worked well for them so
far.
So, for example, pretend you'rea great saver and that's more or
less your identity a little bitat this point.
You're a great saver, you mightstay a great saver in

(07:10):
retirement and you also mightpass away with $10 million if
you do that.
So my job is to come in and say, hey, maybe it's time to spend
a little bit more, not frivolous, don't just spend for the sake
of it.
But here's the position you'rein.
You're in a great spot.
I don't want you mad at me whenyou're 75 with $5 million.
On the flip side, there arecases where I will be the mean
advisor that says look, Ipromise, not mean, just

(07:31):
transparent to say I don't wantyou to run out of money.
So I know you don't love yourcurrent role.
I need you to work two moreyears because then we're in a
good spot.
Or I need you to work threemore years because if not, you
want to travel, have healthcare,do a home remodel and pay for
your kid's college.
Yes, your retirement looks goodlong-term, but in the short
term it's going to put too muchpressure on your portfolio if

(07:51):
markets don't do well.
So it's giving the confidenceto a client to retire knowing
they didn't miss something.
There was nothing that theyoverlooked.
So are these average accountsand balance and spending good to
hear?
Yes, maybe it's a little bit ofan ego boost and there's
nothing wrong with that.
If you're like, hey, wow, I'mway above the average.
But then we want to make surewe're kind of bring that back to

(08:13):
real life.
And some of you are in thesweet spot.
You're like I have 2 millionbucks and I want to spend 4,000
a month.
That's awesome.
I would have no idea why you'reworking unless you really love
it.
Other people are like you know.
I saw that.
I just heard you say theaverage balance of you know, 65
is 280,000.
But to be honest, I don't knowhow anyone could retire on that.
I live in California.
280,000 is like one good year.

(08:35):
Like I pay my mortgage, Itravel, kids are in college, I
bought a new car and like we'reright there, and that's true,
and I see a lot of couples inthose cases as well.
So averages are good.
They're not what I would rely on.
In the same way, I don't relyon percentages, like people
often talk about.
Make sure to save 10% of yourincome.
Hey, that's a nice rule becauseit gets people to take action.

(08:56):
But if you make $50,000 a yearand you save 10% of your income,
you're likely not retiringearly.
So that's different.
Versus if you make a million ayear, save 10%, you might
over-save for retirement.
So all of the content I'llalways make is super, super
dialed for tax planning, estateplanning, withdrawal strategy,
income investing.

(09:16):
That's where I find a lot ofthe weight is held.
That changes your retirement ina big way.
Not saying there's people outthere who don't do the credit
card hacking.
Well, and the travel and usethe points.
And you know I try.
You know I do a very bad job atthat, I'll admit, because I
just don't care about it thatmuch.
I would rather spend my timefocusing on my business or
spending time making a new video, because I just enjoy that way

(09:39):
more.
But I know everyone's different.
So by no means am I sayingcredit cards are evil or
anything like that.
But that is not changing yourretirement.
It's these other things thathold way more weight.
And if you're wondering, hey, amI in a good spot?
You know there's tons ofdifferent rules out there.
Some people are saying youshould have one make sure to
save three times your salary byage 40, or six times by age 50,

(10:02):
or 10 times by 67.
There's other people that I'veheard who say, hey, if you want
to make sure that you never runout of money, well, the biggest
thing you can do is just don'twithdraw ever more than 3% of
your portfolio.
You could do that, you couldabsolutely do that, but you'll
probably look back on why didn'tI spend more?
The bigger risk there is youlook back with regret going I

(10:24):
could have lived a more fulllife.
Now, money doesn't only add toa full life, but there are
things where you would go.
Money would create morefulfillment and purpose because
I could spend more time with whoI care about most, and that's
what I want to do.
So hopefully maybe aninformative episode, more of a
gut check that you might go wow,I'm in a pretty good spot
compared to the average retiree,but it doesn't mean I'm on

(10:46):
track for my own retirement.
So I encourage everyone if youhaven't already used the early
retirement academy, to go playaround with your own numbers,
your own software, that you cango.
It's not your software, but youwill be able to use it.
It is software so that you cango play around, run.
What if scenarios see whatyou're on track for and when
you're in a position to retirewith confidence, then, finally,
if you wanna work with us hereat Root Financial, this is what

(11:08):
we love to do.
We help clients optimize whatthey've worked so hard for so
they can get the most life outof their money.
I'll see you guys next time.
Thank you all, as always, forlistening to the Early
Retirement Podcast.
I love getting to host theseshows and make different content
for you guys every single week.
I've not missed a single weekin years and that is because I
love getting to do this.

(11:28):
Now, please be smart about this.
Before you actually execute anystrategy that you see me talk
about or hear me talk about,should I say please talk to your
financial advisor, your taxpreparer, your estate attorney,
please be smart about this.
None of this should beconstrued as financial advice.
This is for fun, educational,informational purposes only.

(11:49):
Once again, just quickdisclaimer here.
Guys, please be smart aboutthis.
Appreciate you listening, asalways, and you can, of course,
submit a question on my website,earlyretirementpodcastcom, if
you, of course, want me toaddress a specific case study or
topic.
I will not promise I can get toit, but I respond to every
single person and if I find itwill be helpful for a lot of

(12:10):
people, I will absolutely makean episode on it, at the very
least give you some insight.
That's it, thanks guys.