Boomers Are Leading the Way for Retirement Savings in 2023, According to Experts

talking about finance plans and insurance.
vm / iStock.com

Commitment to Our Readers

GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.

20 Years
Helping You Live Richer

Reviewed
by Experts

Trusted by
Millions of Readers

If there’s one thing that we know about retirement savings, it’s that too few Americans have enough of it. A recent GOBankingRates survey found that most Americans have less than $50,000 saved for retirement, and more than one-third (36%) have less than $10,000 saved.

But not all Americans are created equal when it comes to retirement savings. Older workers tend to do a better job of it than their younger cohorts, according to some experts — partly because they earn higher incomes. The latest retirement analysis from Fidelity Investments found that baby boomers still in the workforce “continue to save at the highest levels.”

The 401(k) savings rate for boomers climbed to 16.7% during the 2023 first quarter, according to Fidelity. That was up from 16.5% the previous quarter. In comparison, Gen Z saving levels rose to 10.5% in Q1 from 10.2% the previous quarter.

Those numbers align with the GBR survey, which found that Americans ages 25 to 34 are the most likely to have $10,000 or less saved for retirement, with 38% reporting that their retirement savings fell into this range. Among those ages 35 to 44 and 55 to 64, 37% have $10,000 or less; 36% of Americans ages 18 to 24 have $10,000 or less; 35% of Americans ages 45 to 54 have $10,000 or less; and 31% of those ages 65 and older have $10,000 or less.

The overall 401(k) savings rate during the 2023 first quarter improved to 14% from 13.7% in Q4 2022 and 13.8% in Q3 2022, according to Fidelity. The most recent data show a return to the savings rate seen at “the start of market volatility” during the 2022 first quarter and came in just below Fidelity’s suggested savings rate of 15%, including both employee and employer contributions.

Today's Top Offers

We are encouraged to see positive gains for retirement savers, evidenced through rising account balances, improved savings rates, and a commitment by employers — including small businesses — to help employees prepare for the future,” Kevin Barry, president of Workplace Investing at Fidelity Investments, said in a May 25 news release.

Other highlights from Fidelity’s Q1 2023 analysis include the following:

  • The average IRA balance was $109,000 in Q1 2023, a 5% increase from both the previous quarter and pre-pandemic levels five years earlier.
  • The average 401(k) balance increased to $108,200, up 4% from Q4 2022 and 5% from five years earlier.
  • The average 403(b) balance rose to $97,900, up 6% from the previous quarter and 16% from five years earlier.
  • The average 401(k) employer contribution, which includes profit sharing and matching contributions, reached a record 4.8% in Q1 2023.

In addition to higher contributions from employers, account balances were helped by improving market conditions during the first quarter, Fidelity noted.

BEFORE YOU GO

See Today's Best
Banking Offers

Looks like you're using an adblocker

Please disable your adblocker to enjoy the optimal web experience and access the quality content you appreciate from GOBankingRates.

  • AdBlock / uBlock / Brave
    1. Click the ad blocker extension icon to the right of the address bar
    2. Disable on this site
    3. Refresh the page
  • Firefox / Edge / DuckDuckGo
    1. Click on the icon to the left of the address bar
    2. Disable Tracking Protection
    3. Refresh the page
  • Ghostery
    1. Click the blue ghost icon to the right of the address bar
    2. Disable Ad-Blocking, Anti-Tracking, and Never-Consent
    3. Refresh the page