How Much You Should Have In Your 401k By Age

3 min read

Anthony O'neal
How Much You Should Have In Your 401k By Age

By retirement age, studies are showing that the average person will retire with around $255,000 inside in their investments. Retirement is such an important part of building wealth and ensuring that when you do reach retirement age, you have the funds to continue living your lifestyle without having to work. 


Experts say you should have 80% of your salary to retire, but that’s not enough money to really enjoy retirement. If you make $60,000, you would need $48,000 for retirement according to experts. With these numbers, you’d have about five years and three months to live without working – that’s not enough money. 

So let’s break down how much you should have in your 401k or retirement account by age, so you can create a financial plan for yourself that will allow you to retire comfortably and not worry about having to work to sustain your lifestyle. 

Why you need to be investing right now

The caliber of your financial future will be determined by the financial choices you make today. 

Instead of spending $20 on eating out, that could be invested into your 401k. There are so many financial choices that you make on a daily basis that could be helping build wealth instead of depleting your bank account.

I know that income is always a factor when it comes to feeling like you can’t invest, which is why prioritizing increasing your income or just transitioning to a higher paying career field can be something that drastically changes your income. You can start by investing your time into continuing education to land that higher paying job, Bethel Tech is an incredible resource for helping you make money within the tech industry, you can ensure you’re reading and consuming content that increases your knowledge and allows you to increase the value you bring to your career. 

Here are some quick yet impactful benefits to investing right now and why you should be making it a priority. 

Tax advantages 

Investing into a 401k allows you to contribute pre-tax dollars and in turn reducing your taxable income and allow your money to grow 


Employers often will match what you put into your 401k up to a certain percentage – which is basically free money. 

Compound interest

The earlier you start investing the wealthier you will be. If you’re getting an employer-match and investing your money correctly, the impact of compound interest is incredible. 

How much you should have by your age

In America, the retirement age is 66 if you were born between 1943 and 1954 with no penalties, but 67 if you were born after 1960, so you can pull from your retirement accounts at 67 without penalties. Experts typically say you need 10x your current salary to retire comfortably and if we break down the math it looks like this: 

$60,000 (average income) x 10 = $600,000 invested for retirement 

The problem with this is that if you’re going to retire based on that math you can only live for 10 years after you retire at 67 – most of us don’t plan on dying at 77, so how much should you actually have in your retirement accounts in order to comfortably retire without having to worry about working once you do? Sit down and figure out what you want to live off a month when you retire, then you can use this equation to determine how much you need to have saved to retire with that. So, let’s say you want to have $10,000 a month when you retire:

$10,000 x 12 (months in a year) = $120,000

$120,000 x 10 = $1.2 million

$1.2 million x 10% (average return) = $120,000 a year

Let’s break down the median retirement savings balance per age to ensure you’re on the right track and can plan out your financial future by making the right decisions and investments.

Under 35

People under 35 typically have $18,800 invested inside 401k or mutual fund accounts.


People between 35 and 44 have $45,000 invested inside 401k or mutual fund accounts.


People between 45 and 54 have $115,000 invested inside 401k or mutual fund accounts.


People between 55 and 64 have $185,000 invested inside 401k or mutual fund accounts.

65 and older 

People 65 and older have $200,000 invested inside 401k or mutual fund accounts.

Where you need to start investing

You have to start investing into your 401k programs, especially if the company you work for has a match program. Having a company that is willing to match your investment up to a certain percentage is free money - it’s money you don’t have to contribute from your paycheck or from additional contributions, but money that the company is giving you for free to help you build wealth. It’s so incredibly important to start here, if nothing else. 

From there you can move on to a Roth or traditional IRA and invest into a good mutual fund. If you’re not sure where to start with this, MooMoo is a great app and resource that gives you 15 free stocks when you sign up. What truly matters is that you’re taking your financial goals into consideration and making an effort to plan out and save for retirement. 

Let’s Recap

Your children are depending on you. You are depending on you. Your future self is depending on you to invest in your future and start saving for retirement because the caliber of your financial future will be determined by the financial choices you make today. 

While experts say you should have 80% of your salary saved for retirement, I don’t agree with that. You need to sit down and determine what you want your retired life to look like and from there do the calculations to figure out what you need to be saving and putting aside into your retirement depending on your age in order to make that vision of retired life a reality. 

Your retired life and your financial future will not look the same as someone else, and it shouldn’t look the same as someone else. You need to know what you want your future to look like and how you can start planning today to make that vision a reality. 

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