The typical American worker has less than $1,000 saved in 401(k)-type accounts, largely because many people don’t have access to workplace retirement plans. For workers ages 21 to 64, the median amount saved in defined contribution plans like 401(k)s is just $955, according to a new analysis of 2023 Census data by the National Institute on Retirement Security (NIRS).
The low figure reflects the fact that it includes workers with no such savings at all. Only 51% of workers had a defined contribution plan through their main employer, the analysis found.
That number underscores a persistent issue: many employers don’t sponsor retirement plans, and even when they do, not everyone participates.
Disparities in Access Highlighted
The report notes significant disparities in access to employer-provided retirement plans. Public-sector workers are more likely to have plan sponsorship — and to participate — than those in the private sector. Hispanic workers, those with lower incomes, or individuals with less formal education are also much less likely to have access or take part.
“Strengthening access to reliable retirement plans is essential if we want Americans to retire with dignity rather than anxiety,” said Dan Doonan, NIRS executive director, in a release.
Typical Balances Are Far From Adequate
Even among workers with savings, balances remain insufficient for a secure retirement. For workers with at least $1 saved in 401(k)s and similar plans, the median jumps to $40,000 — far below the $1.26 million Americans say they need to retire comfortably.
Defined Contribution Plan Retirement Wealth (All Workers):
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Median savings: $955
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Average savings: $93,299
Defined Contribution Plan Retirement Wealth (Workers with a positive balance of at least $1):
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Median savings: $40,000
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Average savings: $179,082
The NIRS report provides a sobering counterpoint at a time when strong stock market gains have pushed the number of 401(k) millionaires to an all-time high. Such headlines may suggest that retirement savers are thriving, but they often overlook millions of workers who don’t have access to employer-sponsored plans.
According to The Pew Charitable Trusts, roughly 56 million workers nationwide don’t receive retirement benefits through their jobs. This is particularly important because retirement plan income is the second-largest source of income for older Americans after Social Security, the NIRS analysis shows.
“This research shows the fragility of both the nation’s retirement infrastructure and retirement preparedness for the typical U.S. household,” Doonan said.
