While over 67 million Americans are now actively building their retirement futures through a 401(k), a closer look at the data reveals a complex landscape of remarkable progress and persistent gaps in participation, savings rates, and ultimate account balances.
Key Takeaways
- In 2022, there were approximately 67.5 million active 401(k) participants in the United States, representing a 2.3% increase from 2021
- As of year-end 2022, 61% of private sector workers had access to a workplace retirement plan like a 401(k), up from 58% in 2020
- In 2023, 82% of 401(k) plan participants aged 30-49 contributed to their plans, compared to 68% for those under 30
- The average annual 401(k) contribution by participants was $7,200 in 2022, up 15% from 2021
- Employee deferrals to 401(k)s totaled $499 billion in 2022 across all plans
- In Vanguard plans, average employee contribution rate was 7.4% of salary in 2022
- Year-end 2022 average 401(k) balance was $112,400 across Fidelity participants, up 20% from 2021
- Median 401(k) balance for Vanguard participants was $35,286 at end-2022
- Balances for ages 65+ averaged $272,588 in Fidelity 401(k)s end-2022
- 55% of target-date fund assets in 401(k)s were in glide paths end-2022
- Equities comprised 72% of 401(k) assets end-2022 Vanguard participants
- Target-date funds held 43% of Vanguard 401(k) balances end-2022
- Average 401(k) plan expense ratio fell to 0.48% in 2022
- Participant-level fees averaged 0.92% end-2022 Vanguard
- 14% of participants took loans in 2022, averaging $12,500 each Fidelity
The 401k industry shows steady growth with participation increasing across diverse worker demographics.
Balances & Growth
- Year-end 2022 average 401(k) balance was $112,400 across Fidelity participants, up 20% from 2021
- Median 401(k) balance for Vanguard participants was $35,286 at end-2022
- Balances for ages 65+ averaged $272,588 in Fidelity 401(k)s end-2022
- Total 401(k) assets reached $7.4 trillion at end-2022, per ICI data
- Average balance for 20-29 year olds was $7,351 in Vanguard plans end-2022
- 401(k) balances grew 13% on average for long-tenured participants in 2022
- Women’s average 401(k) balance was $86,900 vs. $128,600 for men end-2022 Fidelity
- Top 1% of 401(k) balances exceeded $2.1 million end-2022
- Balances under $10,000 held by 28% of participants end-2022 Vanguard
- Average balance for 50-59 age group was $237,500 end-2022 Fidelity
- Total DC plan assets including 401(k)s hit $9.6 trillion Q4 2022
- Median balance for 5+ year participants was $88,400 end-2022 Vanguard
- 401(k) balances for Gen Z averaged $4,800 end-2022
- Balances grew 18% for participants with 15+ years tenure in 2022 Vanguard
- Average balance by income: $250k+ earners had $489,000 end-2022 Fidelity
- 12% of participants had balances over $1 million end-2022 Fidelity
- Black participants median balance $28,000 vs. $42,000 white end-2022
- Average 401(k)/IRA combined balance $134,000 end-2022 Fidelity
- Balances for 30-39 averaged $49,800 end-2022 Vanguard
- 401(k) assets under management grew 10% YoY to $7.5T mid-2023
- Median balance for new participants was $1,500 end-2022
- Ages 60-69 average balance $246,100 end-2022 Fidelity
- 22% balance growth for consistent savers over 10 years thru 2022
- Hispanic median 401(k) balance $24,500 end-2022
- Average balance 40-49: $141,300 end-2022 Fidelity
- Total 401(k) assets per participant averaged $110,000 end-2022
- Balances for 70+ averaged $289,300 end-2022 Fidelity
- 35% of participants had balances $50k-$250k end-2022 Vanguard
- Longevity of balances: 15-year olds averaged $300k+ end-2022
Balances & Growth Interpretation
While these figures show a system capable of generating impressive sums for the persistent and fortunate, the vast chasm between the soaring averages and the grounding medians reveals a sobering truth: for too many, the retirement finish line remains a distant dream, not a guaranteed victory lap.
Contributions & Savings
- The average annual 401(k) contribution by participants was $7,200 in 2022, up 15% from 2021
- Employee deferrals to 401(k)s totaled $499 billion in 2022 across all plans
- In Vanguard plans, average employee contribution rate was 7.4% of salary in 2022
- Employer match averaged 4.3% of pay in 2022 for matching plans
- 91% of 401(k) plans offered employer matching contributions in 2022
- Participants aged 50+ contributed an average of 9.8% of salary via deferrals in 2022
- Total contributions to 401(k)s reached $600 billion in 2023 estimates
- Automatic escalation features led to 8.2% average savings rates in adopting plans in 2022
- Women contributed at a median rate of 6.9% vs. 7.8% for men in 2022 Vanguard data
- Safe harbor matches were used in 45% of plans, averaging 4% contribution in 2022
- Roth 401(k) contributions grew 28% to $48 billion in 2022
- Average deferral rate for under-25s was 5.6% in 2022
- 78% of plans had contribution limits reached by some participants in 2022
- Employer non-elective contributions averaged 3.2% in plans offering them in 2022
- High earners (over $100k) contributed 11.2% average in 2022
- Total 401(k) inflows hit $1.1 trillion including rollovers in 2022
- 65% of participants maxed catch-up contributions if eligible in 2022
- Median savings rate across all ages was 7.6% in 2022 Vanguard plans
- Profit sharing contributions totaled $120 billion in 2022
- New hires contributed 6.1% on average in first year in 2022
- Plans with auto-escalation saw rates rise from 6% to 8% over 5 years by 2022
- Black participants had median contribution rate of 6.5% in 2022
- 401(k) contribution limits increased to $22,500 in 2023 from $20,500 in 2022
- Employer contribution rates averaged 4.7% overall in PSCA surveyed plans 2022
- After-tax contributions grew 15% to $35 billion in 2022
- Participants in their 40s contributed 8.1% median in 2022
- 52% of plans offered Roth options, with 20% utilization in 2022
- Average total savings rate (employee + employer) was 11.9% in 2022
- Deferral rates for 55-64 age group averaged 9.4% in 2022
Contributions & Savings Interpretation
It seems we’re collectively learning that if you sprinkle enough auto-escalation, employer matches, and a dash of panic as retirement looms, the average saver might just—almost—keep up with their own future.
Fees, Withdrawals & Loans
- Average 401(k) plan expense ratio fell to 0.48% in 2022
- Participant-level fees averaged 0.92% end-2022 Vanguard
- 14% of participants took loans in 2022, averaging $12,500 each Fidelity
- Average plan admin fee $1.2 million annually for large plans 2022 PSCA
- Hardship withdrawals totaled $7 billion in 2022 ICI estimates
- Recordkeeping fees 0.15% average end-2022
- 4% average loan default rate in 2022 Fidelity
- In-plan annuity fees averaged 0.65% for offerings 2022
- Withdrawals under age 59.5: 2.1% of balances end-2022 Vanguard
- Revenue sharing dropped to 10 bps average 2022 ICI
- 401(k) loan balances outstanding $100 billion end-2022 Fidelity
- Average investment fee 0.38% for Vanguard plans end-2022
- CARES Act withdrawals $18 billion in 2020, residual effects in 2022
- 92% of plans fee disclosure compliant in 2022 DOL audit
- Loan origination fees averaged 0.5% of loan amount 2022 PSCA
- Total fees as % of assets: 1.05% average large plans 2022
- In-service withdrawals used by 3% of participants end-2022 Fidelity
- Target-date fund fees averaged 0.32% end-2022 Vanguard
- 22% of plans allowed Roth conversions with no fees 2022
- Average hardship withdrawal amount $4,500 in 2022 Fidelity
- Plan termination fees impacted 1% of plans in 2022 DOL
- 401(k) average 5-year return net of fees 7.2% thru 2022 Vanguard
- Multiple loan allowances in 65% plans, avg 1.8 loans per borrower 2022 PSCA
- Fee benchmarking used by 89% sponsors 2022
- Withdrawals during market downturns: 1.5% balances 2022
- Stable value fees 0.45% average end-2022 ICI
- 8% of loans taken by ages 30-39 end-2022 Fidelity data
- Direct rollover % of distributions: 45% in 2022 DOL
- Active trader fees in brokerage windows 0.2% extra 2022
- Cash-out rates for balances under $1k: 70% end-2022 Vanguard
Fees, Withdrawals & Loans Interpretation
Though participants are saving diligently and overall fees are inching downward, the $100 billion in outstanding loans and $7 billion in hardship withdrawals reveal a retirement system often used as a financial lifeline, while the 70% cash-out rate for small balances tragically undercuts its very purpose.
Investments & Allocations
- 55% of target-date fund assets in 401(k)s were in glide paths end-2022
- Equities comprised 72% of 401(k) assets end-2022 Vanguard participants
- Target-date funds held 43% of Vanguard 401(k) balances end-2022
- Average number of investment options per 401(k) plan was 21 in 2022 PSCA
- Bonds allocation averaged 8% in 401(k)s end-2022 Fidelity
- 92% of plans offered target-date funds in 2022
- Domestic stocks: 45%, international: 27% in average portfolios end-2022 Vanguard
- Stable value funds held 6% of assets end-2022 ICI
- ESG funds available in 18% of plans in 2022
- Cash allocations dropped to 5% end-2022 from 9% pre-2022
- Company stock averaged 3.2% allocation in offering plans end-2022 Fidelity
- Small-cap funds: 4%, large-cap: 38% end-2022 Vanguard
- 67% of participants held diversified portfolios end-2022
- Fixed income rose to 12% for ages 55+ end-2022 Vanguard
- Crypto-related options in 2% of plans 2022
- Target-date vintage 2025 funds averaged 65% equity end-2022
- International bonds: 2.5% average allocation end-2022 ICI
- 75% of balances in index funds in Vanguard plans end-2022
- Actively managed funds declined to 22% of assets end-2022 Fidelity
- Sector funds: 1.8% allocation average 2022 PSCA
- Equity allocation for under-30s: 85% end-2022 Vanguard
- GICs and stable value: 7.1% end-2022
- Lifecycle funds captured 50% of new contributions 2022 Fidelity
- Alternatives like real estate in 5% of large plans end-2022
- Fixed annuities offered in 12% plans 2022 PSCA
- Equity glide path average 50% for retirement-near participants end-2022 Vanguard
- Self-directed brokerage windows in 28% of plans end-2022
- Commodities allocation under 0.5% average end-2022 ICI
- 82% of TDF users stayed in vintage funds end-2022 Fidelity
- Emerging markets: 5.2% in international equity slice end-2022 Vanguard
Investments & Allocations Interpretation
Despite a dizzying menu of 21 options, the modern 401(k) participant has wisely chosen the path of least excitement, entrusting half their new money to target-date funds and three-quarters of their balance to index funds, creating a surprisingly sensible, equity-heavy autopilot for retirement—proving that when left to our own devices, we often wisely choose not to be.
Participation & Demographics
- In 2022, there were approximately 67.5 million active 401(k) participants in the United States, representing a 2.3% increase from 2021
- As of year-end 2022, 61% of private sector workers had access to a workplace retirement plan like a 401(k), up from 58% in 2020
- In 2023, 82% of 401(k) plan participants aged 30-49 contributed to their plans, compared to 68% for those under 30
- Women represented 47.2% of 401(k) participants in plans surveyed by Vanguard at year-end 2022
- Among Fortune 500 companies, 98% offered 401(k) plans in 2022, covering over 90% of their employees
- Black workers had a participation rate of 68% in 401(k) plans in 2022, compared to 75% for white workers
- In 2021, small businesses (under 100 employees) had 401(k) participation rates of 52%, versus 85% for large firms
- 15.3 million participants were auto-enrolled in 401(k) plans in Vanguard-administered plans in 2022, comprising 80% of eligible employees
- Hispanic/Latino workers showed a 401(k) participation rate of 62% in 2022, lower than the overall average of 70%
- By 2023, 145,000 employer-sponsored 401(k) plans existed, holding $7.5 trillion in assets
- Participation rates for Gen Z workers (born 1997-2012) in 401(k)s reached 57% in 2022, up 5% from 2019
- Unionized workers had a 78% 401(k) participation rate in 2021, compared to 69% for non-union
- In 2022, 72% of full-time workers participated in 401(k) plans, versus 41% for part-time
- Baby Boomers (aged 59-77 in 2023) made up 22% of 401(k) participants despite being 28% of workforce
- 401(k) coverage reached 56% of state and local government employees in 2021
- In tech industry plans, 92% participation rate was observed in 2022, highest among sectors
- Asian American workers had the highest 401(k) participation at 79% in 2022
- 401(k) plans covered 85 million workers cumulatively in 2022, including defined contribution plans
- Remote workers showed 65% 401(k) participation in 2022, down 3% from in-office peers
- Manufacturing sector had 74% 401(k) coverage rate for employees in 2021
- Millennials (aged 27-42 in 2022) represented 42% of 401(k) participants
- 68% of workers aged 25-34 contributed to 401(k)s in 2022
- Healthcare sector boasted 88% 401(k) participation in large plans in 2022
- In 2023, 401(k) opt-out rates dropped to 12% with auto-enrollment
- Finance and insurance industry had 82% 401(k) coverage in 2021
- Gen X (aged 43-58) had 76% participation rate in 401(k)s in 2022
- 55% of gig economy workers had access to 401(k)-like plans via platforms in 2023
- Education sector showed 79% 401(k) participation for full-time faculty in 2022
- Overall U.S. workforce 401(k) participation hit 52% in 2022
- Silent Generation (75+) held 4% of 401(k) accounts in 2022 despite small population share
Participation & Demographics Interpretation
While America's retirement savings engine is sputtering to life—with more workers getting keys and automatic enrollment helping many start the ignition—glaring disparities persist, showing that who you work for, your age, race, and even your industry still heavily determine whether you're on the road to security or left stranded on the shoulder.
Sources & References
- Reference 1ICIici.orgVisit source
- Reference 2DOLdol.govVisit source
- Reference 3VANGUARDvanguard.comVisit source
- Reference 4PSCApsca.orgVisit source
- Reference 5EBRIebri.orgVisit source
- Reference 6PRESSROOMpressroom.icrinc.comVisit source
- Reference 7FIDELITYfidelity.comVisit source
- Reference 8BLSbls.govVisit source
- Reference 9URBANurban.orgVisit source
- Reference 10INSTITUTIONALinstitutional.vanguard.comVisit source
- Reference 11MORNINGSTARmorningstar.comVisit source
- Reference 12IRSirs.govVisit source
- Reference 13BRIGHTSCOPEbrightscope.comVisit source