{"id":11243,"date":"2025-06-24T17:05:17","date_gmt":"2025-06-24T17:05:17","guid":{"rendered":"https:\/\/www.europesays.com\/us\/11243\/"},"modified":"2025-06-24T17:05:17","modified_gmt":"2025-06-24T17:05:17","slug":"the-average-401k-savings-rate-is-at-record-high-levels-report-finds","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/11243\/","title":{"rendered":"The average 401(k) savings rate is at record-high levels, report finds"},"content":{"rendered":"

Milan Markovic | E+ | Getty Images<\/p>\n

The average 401(k) savings rate<\/a> has maintained a record high, as some retirement plans make it easier for workers to enroll and contribute.<\/p>\n

In 2024, the average combined savings rate for employee deferrals and company deposits was an estimated 12%<\/a>, according to Vanguard’s newly released yearly analysis of more than 1,400 qualified plans<\/a> and nearly 5 million participants. That percentage matched record-high levels from 2023.<\/p>\n

A separate report from Fidelity also noted all-time high 401(k) savings rates<\/a>, with the combined worker and company rate climbing to 14.3%. Those findings reflected 25,300 corporate plans with 24.4 million participants during the first quarter of 2025.<\/p>\n

More from FA Playbook:<\/p>\n

Here’s a look at other stories affecting the financial advisor business.<\/p>\n

Despite some years of stock market volatility, Vanguard’s reports have shown a “relentless positive trend line” across plan participation, savings rates and investing, Dave Stinnett, the company’s head of strategic retirement consulting, said during a press call Monday afternoon.<\/p>\n

Over time, retirement plans have added features like automatic enrollment<\/a> and immediate eligibility for employee contributions, which have boosted participation, experts say.<\/p>\n

Automatic enrollment signs employees up to contribute to plans unless they opt out. But some companies have waiting periods before employees can contribute to the plan.<\/p>\n

In 2024, 76% of plans offered immediate eligibility for employee contributions, up from 71% in 2020, Vanguard reported. Some 61% of plans included automatic enrollment in 2024, up from 54% four years prior.<\/p>\n

The 401(k) savings ‘rule of thumb’<\/p>\n

For 2024, the combined worker and company 401(k) savings rate was within Vanguard’s “rule of thumb,” according to Stinnett. Vanguard suggests saving 12% to 15%<\/a> of your pay per year, including employer contributions, depending on your income.<\/p>\n

(Meanwhile, Fidelity recommends a 15% benchmark,<\/strong> so its recent record was still shy of that target.)<\/p>\n

“Make sure that that trend keeps going higher and higher,” Stinnett said.<\/p>\n

For 2024, the average employee deferral rate was an estimated 7.7%, and one-quarter of participants saved 10% or higher, according to the Vanguard report.<\/p>\n

An estimated 14% of workers maxed out 401(k) plans in 2024, Vanguard found. Those workers were typically older, with higher incomes, larger account balances and longer tenure with their employer. \u00a0\u00a0<\/p>\n

\"On-time<\/p>\n

However, the ideal savings percentage depends on several factors, according to certified financial planner Trevor Ausen, founder of Authentic Life Financial Planning in Minneapolis.\u00a0<\/p>\n

“I don’t follow a single target retirement savings rate across the board,” he said. It depends on “the client’s current financial position, lifestyle expectations and timeline to retirement.”\u00a0<\/p>\n

The percentage could also change if you’re expecting a pension, aiming for early retirement or plan for part-time work in your golden years, Ausen said.<\/p>\n

However, advisors typically recommend deferring at least enough to receive your full employer’s matching contribution.<\/p>\n

Employer matches can vary widely, so it’s important to review your plan documents.<\/p>\n

The most popular 401(k) match formula \u2014 used by 48% of companies on Fidelity’s platform \u2014 is 100% for the first 3% an employee contributes, and 50% for the next 2%.<\/p>\n

For 2024, most Vanguard plans used a single-tier match formula, such as 50 cents per dollar on the first 6% of pay, the company reported.<\/p>\n","protected":false},"excerpt":{"rendered":"Milan Markovic | E+ | Getty Images The average 401(k) savings rate has maintained a record high, as…\n","protected":false},"author":3,"featured_media":11244,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[12159,64,81,12157,12154,12156,6764,3346,255,12158,12155,12160,708,67,132,68],"class_list":{"0":"post-11243","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-401k-plans","9":"tag-business","10":"tag-business-news","11":"tag-financial-advisors","12":"tag-financial-consulting","13":"tag-financial-planners","14":"tag-financial-planning","15":"tag-investment-strategy","16":"tag-personal-finance","17":"tag-personal-investing","18":"tag-personal-saving","19":"tag-retirement-planners","20":"tag-retirement-planning","21":"tag-united-states","22":"tag-unitedstates","23":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/114739434235241792","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/11243","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=11243"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/11243\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/11244"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=11243"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=11243"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=11243"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}