With a staggering $39.6 trillion in total U.S. retirement assets, the financial foundation of our golden years is built on a complex and ever-shifting landscape of plans, pots of money, and profound personal challenges.
Key Takeaways
- As of Q4 2023, total U.S. retirement assets stood at $39.6 trillion, with defined contribution plans holding $10.1 trillion.
- IRAs held $12.3 trillion in assets as of Q4 2023, representing 31% of total retirement assets.
- Defined benefit plans accounted for $10.2 trillion in retirement assets in Q4 2023.
- 67% of workers participated in employer-sponsored retirement plans in 2022 per EBRI.
- Participation rate in 401(k) plans among eligible workers was 84% in 2022.
- 15% of private sector workers had access only to DC plans in 2023.
- Social Security provided 50% of aggregate income for aged 65+ in 2022.
- Pensions accounted for 20% of income for households 65+ in 2022.
- Earnings made up 23% of income for near-retirees aged 55-64.
- Number of 65+ Americans living in poverty was 3.6 million in 2022.
- 10.2% poverty rate among elderly in 2022 per Census Bureau.
- 56 million Americans aged 65+ in 2023, projected 82 million by 2050.
- U.S. 65+ population to double by 2050 to 95 million per Census.
- Social Security trust fund depletion projected for 2034 per 2023 Trustees.
- Retirement savings gap averages $1.7 million per Fidelity for comfortable retirement.
U.S. retirement assets approach $40 trillion but many face significant savings shortfalls.
Demographic Trends
- Number of 65+ Americans living in poverty was 3.6 million in 2022.
- 10.2% poverty rate among elderly in 2022 per Census Bureau.
- 56 million Americans aged 65+ in 2023, projected 82 million by 2050.
- Women 65+ had median income 20% lower than men at $46,000 vs $57,000.
- Racial disparity: Black elderly poverty rate 18.5% vs 7.4% white in 2022.
- Life expectancy at 65 is 18 years for men, 20 for women in 2023 SSA.
- 28% of 65+ lived alone in 2022, mostly widows.
- Baby boomers (born 1946-1964) number 73 million, entering retirement.
- Hispanic elderly population grew 55% from 2010-2020.
- 15% of retirees returned to work within 5 years per surveys.
- Average retirement age rose to 62 from 59 in 1990s per EBRI.
- 50% of women vs 39% men claim SS at 62 per SSA 2023.
- Centenarians numbered 101,000 in 2023, doubling every 20 years.
- Married couples 65+ had median income $102,000 vs $37,000 singles.
- Rural elderly 18% of population but 22% of poor seniors.
- Gen X expects to retire at 67, delaying by 2 years.
- 40% of 65+ have chronic disabilities requiring long-term care.
- Homeownership among 65+ is 80%, wealth source for 40%.
- Divorce rate for 50+ doubled since 1990, impacting finances.
- Immigrants 65+ poverty rate 19% vs 8% natives.
- 65+ workforce participation hit 20% in 2023 BLS.
- Female labor force participation 65+ rose to 18% from 10% in 2000.
- 75+ poverty concentrated in women living alone at 14% rate.
- Average years in retirement projected at 20 years for 2024 retirees.
- 22% of 65+ obese, straining retirement health costs.
- Social Security beneficiaries: 51 million retired, 9 million disabled in 2024.
Demographic Trends Interpretation
The retirement industry is confronting a future where, despite America's growing wealth of years and homeowners, the security of our elderly is being fractured along the harsh lines of gender, race, marital status, and geography, proving that a longer life is not necessarily a richer one.
Future Projections
- U.S. 65+ population to double by 2050 to 95 million per Census.
- Social Security trust fund depletion projected for 2034 per 2023 Trustees.
- Retirement savings gap averages $1.7 million per Fidelity for comfortable retirement.
- 401(k) assets projected to reach $20 trillion by 2030 per ICI.
- 10,000 boomers turn 65 daily until 2030 per Census.
- Pension underfunding totaled $500 billion in 2023 per PBGC.
- IRA balances expected to grow 5% annually to 2030.
- 48% of workers not confident in retirement readiness per EBRI 2023.
- SS benefits to replace 28% of earnings by 2035 down from 40%.
- Long-term care costs projected to $400,000 lifetime per Genworth.
- DC plans to cover 90% of retirement income by 2040 EBRI.
- Retirement age to rise to 67 for Gen Z per surveys.
- Medicare spending to hit 5.5% GDP by 2030 CMS.
- Target-date fund assets to $4 trillion by 2026 Morningstar.
- 75% expect to work in retirement due to finances.
- Annuity market to grow to $500 billion sales by 2025 LIMRA.
- Retirement inequality to widen with gig economy.
- SS COLA projected 2.5% average next decade.
- 50% chance of needing $100k+ LTC per HHS.
- Workforce 65+ to 25% by 2030 BLS projection.
- IRA rollovers to hit $2 trillion annually by 2030.
- Pension risk transfer deals to $50 billion yearly.
- Retirement savings adequacy for only 53% middle-income.
- ESG in retirement funds to 30% AUM by 2030.
- State pension debt to $1 trillion by 2025 per NASRA.
- Auto-IRA mandates in 10 states by 2025.
- Global pension assets to $70 trillion by 2025 OECD.
- 40% of Gen Z saving for retirement by age 25.
Future Projections Interpretation
While we meticulously build trillion-dollar mountains of retirement assets, the unsettling truth is that a comfortable future is rapidly becoming a luxury good, as the safety net frays and millions find themselves scrambling to close a gap that widens with every passing day.
Income Sources
- Social Security provided 50% of aggregate income for aged 65+ in 2022.
- Pensions accounted for 20% of income for households 65+ in 2022.
- Earnings made up 23% of income for near-retirees aged 55-64.
- 90% of 65+ households received Social Security benefits in 2022.
- Average Social Security benefit for retired workers was $1,907 monthly in 2024.
- Median retirement income for 65-74 was $50,290 in 2022 per Census.
- Annuity income represented 3% of total for 65+ households.
- 401(k)/IRA withdrawals provided 15% of income post-65 per EBRI.
- Average annual withdrawal from IRAs was $80,000 for 70-79 year olds.
- Social Security replaces 40% of pre-retirement earnings for average worker.
- Defined benefit pensions paid $320 billion annually in 2022.
- 23% of retirees had pensions as primary income source in 2023.
- Required minimum distributions start at age 73, impacting 4.5 million IRAs yearly.
- Median income from assets for 65+ was $22,000 in 2022 Census.
- Government pensions provided 11% of aggregate income for 65+.
- 48% of retirees rely on Social Security for 90%+ of income.
- Average 401(k) income in retirement was $24,000 annually per Fidelity.
- Medicare premiums deducted $200 monthly from SS benefits on average.
- Part-time work provided 10% of income for 65-69 year olds.
- Lump-sum pension distributions averaged $150,000 in 2022.
- 35% of retiree income from DC plans expected to rise to 50% by 2030.
- Veterans benefits contributed 2% to elderly income aggregate.
- Average DB pension benefit was $18,000 annually in 2022 PBGC.
- Withdrawals from retirement accounts totaled $600 billion in 2022.
- 65+ households median income $52,000, 75+ $47,000 in 2022.
- SSI provided income to 5% of 65+ poor households.
- Average retirement income replacement rate targeted at 70-80%.
Income Sources Interpretation
This collection of statistics reveals a retirement landscape where Social Security is the bedrock for half of seniors, yet with that foundation averaging less than two thousand dollars a month, it's clear the American dream of retirement is propped up by a patchwork of modest pensions, personal savings, and part-time work that, for many, still doesn't quite add up to a comfortable or secure finish line.
Participation Rates
- 67% of workers participated in employer-sponsored retirement plans in 2022 per EBRI.
- Participation rate in 401(k) plans among eligible workers was 84% in 2022.
- 15% of private sector workers had access only to DC plans in 2023.
- Access to employer retirement plans was 59% for private industry workers in March 2023.
- Participation rate for offered plans was 82% in private industry per BLS 2023.
- 50% of state and local government workers participated in DB plans in 2022.
- Auto-enrollment in 401(k) plans increased participation by 5-10% per Vanguard.
- 92% of Vanguard plans with auto-enrollment had participation rates over 80% in 2023.
- IRA ownership rate among households aged 55-64 was 48% in 2022 SCF.
- 401(k) participation for Gen X workers averaged 68% in 2022.
- Women’s participation in DC plans lagged men by 4 percentage points in 2022.
- Small business (<100 employees) participation rate was 44% in 2023.
- Roth 401(k) adoption reached 20% of plans offering it in 2023 per Vanguard.
- 78% of Fidelity 401(k) savers contributed in 2023.
- Average deferral rate was 7.4% of salary in 2023 per Vanguard.
- Participation among part-time workers was 52% vs 68% full-time in 2022.
- 401(k) loan rates were 5% among participants in 2022 EBRI.
- Hardship withdrawals occurred in 2.1% of accounts in 2022.
- Catch-up contributions used by 14% of eligible 50+ workers in 2023.
- Union workers had 10% higher participation rates than non-union in 2022.
- Gig workers retirement plan participation under 20% per surveys.
- 65% of millennials expect employer retirement benefits per Transamerica.
- State auto-IRA programs enrolled 80,000 workers by 2023.
- DC plan participation for ages 25-34 was 62% in 2022 EBRI.
- Overall U.S. retirement plan coverage reached 62% of workforce in 2023.
Participation Rates Interpretation
The data paints a picture of a retirement system where the simple act of being automatically enrolled is a shockingly effective nudge, yet the overall landscape remains a patchwork of haves and have-nots, heavily stitched together by the thread of one's employer, job type, and sheer luck.
Savings and Assets
- As of Q4 2023, total U.S. retirement assets stood at $39.6 trillion, with defined contribution plans holding $10.1 trillion.
- IRAs held $12.3 trillion in assets as of Q4 2023, representing 31% of total retirement assets.
- Defined benefit plans accounted for $10.2 trillion in retirement assets in Q4 2023.
- Government retirement funds held $7.0 trillion as of Q4 2023.
- Annuities comprised $2.9 trillion in retirement assets in Q4 2023.
- The average 401(k) balance for Vanguard participants aged 65+ was $232,710 at end of 2023.
- Total 401(k) plan assets reached $7.4 trillion in 2023 according to Vanguard data.
- Median IRA balance for Fidelity customers aged 60-69 was $219,000 in 2023.
- U.S. household retirement savings averaged $88,400 per family in 2022 per SCF data.
- 56% of U.S. families had retirement accounts in 2022, holding median $86,900.
- Total DC plan assets grew 12% to $9.6 trillion in 2022 per EBRI/ICI.
- Average 401(k)/IRA balance for consistent participants was $134,128 in 2020.
- Private pension assets totaled $8.1 trillion in Q1 2023 per Flow of Funds.
- 403(b) and 457 plans held $0.6 trillion in assets as of Q4 2023.
- Roth IRA assets reached $1.2 trillion in Q4 2023.
- Traditional IRA assets were $10.5 trillion in Q4 2023.
- Employer-sponsored DC plans had average participant balance of $112,400 in 2022.
- Total U.S. pension entitlements were $35 trillion in 2022 per OECD.
- IRA contribution limit for 2024 is $7,000, $8,000 if 50+.
- 401(k) elective deferral limit rose to $23,000 in 2024.
- Average balance in target-date funds was $120,000 in 2023 per Morningstar.
- U.S. retirement market AUM for ETFs hit $1.2 trillion in 2023.
- Median 401(k) balance for ages 55-64 was $89,000 in 2023 per Vanguard.
- Total annuities sales reached $385 billion in 2023 per LIMRA.
- Fixed indexed annuity sales were $133 billion in 2023.
- Variable annuity sales totaled $137 billion in 2023 per LIMRA.
- Employer DB plans covered 30 million active participants in 2021.
- DC plans covered 82 million active participants in 2021 per DOL.
- Average account balance in 401(k)s for ages 65+ was $272,588 in 2022 per Fidelity.
- Total retirement assets under management at Fidelity exceeded $4.5 trillion in 2023.
Savings and Assets Interpretation
The towering $39.6 trillion fortress of American retirement savings is an impressive monument on the hill, though the individual bricks—like the median balance of $86,900—reveal a much more anxious and uneven foundation for most who are building it.
Sources & References
- Reference 1ICIici.orgVisit source
- Reference 2PRESSROOMpressroom.vanguard.comVisit source
- Reference 3FIDELITYfidelity.comVisit source
- Reference 4FEDERALRESERVEfederalreserve.govVisit source
- Reference 5EBRIebri.orgVisit source
- Reference 6PLANADVISERplanadviser.comVisit source
- Reference 7OECDoecd.orgVisit source
- Reference 8IRSirs.govVisit source
- Reference 9MORNINGSTARmorningstar.comVisit source
- Reference 10ETFGIetfgi.comVisit source
- Reference 11LIMRAlimra.comVisit source
- Reference 12DOLdol.govVisit source
- Reference 13BLSbls.govVisit source
- Reference 14CENSUScensus.govVisit source
- Reference 15TRANSAMERICAtransamerica.comVisit source
- Reference 16PEWRESEARCHpewresearch.orgVisit source
- Reference 17NASRAnasra.orgVisit source
- Reference 18SSAssa.govVisit source
- Reference 19PBGCpbgc.govVisit source
- Reference 20NIAnia.nih.govVisit source
- Reference 21CDCcdc.govVisit source
- Reference 22GENWORTHgenworth.comVisit source
- Reference 23CMScms.govVisit source
- Reference 24ACLacl.govVisit source