Clients May Have More Stashed in 401(k)s Than You Think

Give your clients a pat on the back. 

Retirement savings rates and 401(k) account balances have reached record highs, according to Vanguard’s annual report published this week. The average account balance came in at $167,970, which is 13% higher than last year, while the median balance was $44,115, up 16%. Of course, average 401(k) balances don’t necessarily reflect total net worth, and are only a partial measure of retirement preparedness for most people. In fact, many people don’t have their money fully consolidated within view of their current advisor, so it’s worth asking what other assets might be out there that could be part of the overall plan. You know, your clients could be in even better shape than they look. 

By the Numbers 

More good news is that the account balances measured by Vanguard only show how much the approximately 5 million savers have accumulated for retirement with their current employer. When people change jobs or retire, their assets may remain with their former employer, be rolled over to another plan or an IRA, or be cashed out. 

According to the report: 

• One in four savers had an account balance of less than $10,000, while 35% of participants had a balance of more than $100,000. 
• Eighteen percent had a balance of $250,000 or more. 

Because of this skewed distribution of assets, average balances are indicative of savers at about the 75th percentile, meaning about 75% of people had balances below the average and 25% had balances above. Vanguard’s experts note that average balances are best understood as representative of the results experienced by longer-tenured, more affluent or older participants. The median balance, conversely, represents the typical participant. 

What’s Behind the Growth? The average one-year total return for retirement plan investors was 19.3%. Among savers with account balances in both December 2024 and December 2025, the median account balance increased by 27%, reflecting strong positive returns in the equity and bond markets as well as ongoing contributions. Also helpful, nearly 70% of retirement plan investors now use professionally managed allocations, helping them build more diversified portfolios that reflect their time horizons and savings targets.

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