When Do We Really Start Saving For Retirement? 

United States retirees on average at 63, and the average monthly retirement benefit is a little over $1,600. Even with a modest lifestyle, most Americans in their 60s and beyond will require more than $1,600 per year. This is the purpose of retirement savings.

Thanks to the ubiquity of 401(k) plan in the United States, employed individuals have decades to save for retirement. There were around 600,000 401(k) plans available in the United States in 2020, with 60 million active participants. Many employees contributed to their 401(k)s throughout the recession due to the significance of retirement savings. Only 3.7% of current 401(k) plan members ceased contributing to their funds in 2008. The vast majority of respondents felt contributing to their retirement plan was necessary.

The question is, how much does each account contain? According to Vanguard’s “How America Saves 2023” study, GOBankingRates examined the amount of money saved for retirement by workers in each life stage. 

The following is a breakdown of the results by age group.

Under 25

Most people are not overly concerned with retirement at the beginning of their careers. If individuals under 25 save money, it is most often in their accounts. According to the Fed, 25-year-olds had an average of $11,250 savings.

In contrast, retirement is a different story. The average amount of retirement savings among Americans under the age of 25 is $6,264.


Once folks reach the age of 25 and have a general notion of how much they may anticipate making annually, retirement planning may seem more plausible than when they were just starting. This may also be the first time some employees have been provided a retirement savings plan as part of their benefits package. Some employers may even provide a matching option whereby the company contributes an equal amount for every dollar an employee contributes to their retirement account.

Most Americans between the ages of 25 and 34 had around $37,211 saved for retirement.


After age 35, one may have remained on a certain professional path and attained a certain level of seniority inside a firm or used existing expertise to ascend the ranks at a different organization. However, this is also when many individuals switch occupations and must begin at the bottom before their wages approach their previous level.

Retirement savings continue to rise on average, with most Americans between the ages of 35 and 44 having around $97,020.


Those contributing to a 401(k) plan may move from an aggressive to a cautious investing strategy as retirement approaches. This increases the likelihood that the investments made will provide a return. Employees may also opt to contribute a larger portion of their pay to their retirement plan during this period.

Most persons in this age group had around $179,200 saved for retirement. Additionally, personal savings accounts are larger at this age. The average American in their forties has around $27,900 saved.


This age range encompasses the age at which the majority of individuals retire, and thus their retirement funds are approaching their maximum amount. On average, after Americans reach their mid-50s and continue into their early 60s, they have accumulated $256,244 in retirement savings.


If individuals want to continue working past age 65, they may expect to retire with a respectable amount of money. The average person over 65 has retirement savings of around $276,997.

The age increase from 55 to 64 is not significant, and this may be relevant when determining if the extra couple of years of labor is worth the additional income. Nevertheless, it may not feel like labor if you enjoy your work.