{"id":1160122,"date":"2026-08-20T22:52:18","date_gmt":"2026-08-20T22:52:18","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/1160122\/"},"modified":"2026-08-20T22:52:18","modified_gmt":"2026-08-20T22:52:18","slug":"fidelitys-401k-benchmark-leaves-many-50-year-olds-short","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/1160122\/","title":{"rendered":"Fidelity\u2019s 401(k) benchmark leaves many 50-year-olds short"},"content":{"rendered":"\n

Fidelity Investments’ first-quarter data<\/a> puts the average balance in employer-sponsored 401(k) retirement plans for savers aged 50 to 54 at $215,700. <\/p>\n

That figure covers 25.6 million participants across 26,800 employer-sponsored plans. It also falls $234,300 short of what the same firm says they need. <\/p>\n

Fidelity’s widely cited savings guideline calls for six times your annual salary by age 50. <\/p>\n

On a $75,000 income, the target is $450,000, and the average saver in that cohort holds less than half of what the firm considers adequate. A federal rule that took effect in January 2026 adds a second problem: the 401(k) catch-up contribution<\/a> now offers tax conditions that some employer plans cannot support. <\/p>\n

Fidelity’s $215,700 average sits $234,300 below its own target <\/p>\n

A Motley Fool analysis <\/a>published August 15, 2026 cited Fidelity’s $215,700 figure and framed it as a competitive marker, telling readers, “If your 401(k) balance is higher, you’re ahead of the game.” <\/p>\n

Fidelity’s savings schedule sets a much higher bar: one times salary saved by 30, three times by 40, six times by 50, and 10 times by 67. <\/p>\n

The targets assume a 15% savings rate starting at age 25 and retirement at 67, Fidelity noted<\/a>. Savings is expected to provide about 45% of pre-retirement income, with Social Security filling the rest. <\/p>\n

David Schneider, president of Schneider Wealth Strategies, told Kiplinger for its June 8, 2026 401(k) analysis<\/a> that market moves are unpredictable, but the savings rate is the variable workers actually control. <\/p>\n

\n

You can’t control or predict market behavior, but you can decide how much you save\u2026Your savings rate is probably the single-most important determinant (in building) long-term wealth <\/p>\n<\/blockquote>\n

On a $75,000 salary, the six-times milestone is $450,000. At $215,700, the average saver sits at roughly 2.9 times salary, producing a $234,300 gap. <\/p>\n

The Motley Fool piece<\/a> also suggested that if a 50-year-old’s balance is below average, ‘you’re probably not going to be able to take advantage of catch-up contributions.’ <\/p>\n

Catch-up eligibility is based on age alone, not on account balance, according to IRS guidance on catch-up contributions<\/a>, but affordability is a separate constraint. <\/p>\n

Median 401(k) balances make Fidelity’s shortfall look even wider <\/p>\n

Averages in retirement data skew upward because a small number of large accounts pull the mean above where most savers land. The median, the balance at the exact midpoint, paints a more accurate picture. <\/p>\n

The median 401(k) balance for workers aged 45 to 54 was $78,730, Vanguard’s 2026 ‘How America Saves’ report<\/a> found. On a $75,000 income, that range represents roughly 0.8 to 1.0 times salary, well short of the six-times benchmark. <\/p>\n

The participation gap compounds the savings gap. About 72% of private-sector workers had access to a workplace retirement plan as of March 2025, and 53% participated, the Bureau of Labor Statistics reported<\/a>. <\/p>\n

\"\"<\/a> Median 401(k) balances reveal how far typical workers may fall short of Fidelity’s retirement savings benchmarks, with participation gaps adding further pressure.Riska \/ Getty Images A 2026 Roth rule affects catch-up contributions <\/p>\n

Workers aged 50 and older can defer up to $32,500 into a 401(k) this year, according to the IRS<\/a>, and that total combines a $24,500 base with an $8,000 catch-up. <\/p>\n

A separate SECURE 2.0 provision<\/a> creates a super catch-up for workers aged 60 to 63, raising the total to $35,750. On a $75,000 salary, deferring $32,500 consumes 43% of gross pay, an impractical rate for most households. <\/p>\n

The SECURE 2.0 Act’s Roth catch-up mandate took effect January 1, 2026. It requires workers aged 50 or older who earned more than $150,000 in FICA wages from their employer in 2025 to direct all catch-up contributions into a Roth account<\/a> on an after-tax basis. <\/p>\n

More Fidelity:<\/strong> <\/p>\n

“If the plan does not permit Roth deferrals, these employees cannot make catch-up contributions,” CAPTRUST noted<\/a> in its compliance guidance on the mandate <\/p>\n

By the end of 2024, 86% of Vanguard-recordkept plans offered a Roth feature, rising to 95% among larger plans, and 93% of the 401(k) plans surveyed by the Plan Sponsor Council of America<\/a> offered the option in 2023. <\/p>\n

Plans without a Roth option lock affected high earners out of catch-up contributions entirely. “If your plan does not offer a Roth 401(k) option, you won’t be able to make catch-up contributions,” Fidelity confirmed<\/a>. <\/p>\n

Three levers that close the gap <\/p>\n

The gap at 50 is wide, but Fidelity’s modeling shows where action can make a difference. A saver with $215,700 today could reach roughly $681,000 by age 67 at a 7% annual return without adding another dollar.\u00a0 <\/p>\n

Reaching $750,000 would require about $170 a month in additional savings. For someone closer to the $78,730 median balance, however, the required contribution rises to roughly $1,275 a month.\u00a0 <\/p>\n

Fidelity outlines<\/a> three levers savers behind on the 6x-by-50 benchmark typically use to close the gap: raising contributions, delaying retirement past 67, or claiming Social Security<\/a> later. <\/p>\n

Related: Fidelity warns American workers on 401(k), IRA mistakes<\/strong><\/a> <\/p>\n

This story was originally published by TheStreet<\/a> on Aug 20, 2026, where it first appeared in the Retirement<\/a> section. Add TheStreet as a Preferred Source by clicking here.<\/a> <\/p>\n","protected":false},"excerpt":{"rendered":"Fidelity Investments’ first-quarter data puts the average balance in employer-sponsored 401(k) retirement plans for savers aged 50 to…\n","protected":false},"author":2,"featured_media":1160123,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[3093],"tags":[51,315122,136415,474,2499,39524,225330,16,15],"class_list":["post-1160122","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-david-schneider","tag-fidelity","tag-finance","tag-personal-finance","tag-retirement-plans","tag-savings-rate","tag-uk","tag-united-kingdom"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/117130293808632920","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/1160122","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=1160122"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/1160122\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/1160123"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=1160122"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=1160122"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=1160122"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}