Reaching your 50s usually means your peak earning years are arriving. It is also the perfect time to check your retirement progress.
According to the latest How American Saves report from Vanguard, the average 401(k) balance for participants aged 55 to 64 is $271,320.
A benchmark like that can either make you feel incredibly secure or deeply worried. But before you react to that number, you need to understand how it is calculated.
The problem with average balances
An average balance of more than $270,000 sounds fantastic. It paints a picture of a highly prepared generation.
However, averages in finance can be highly distorted. A tiny percentage of corporate executives with multi-million dollar accounts pulls the overall average drastically upward.
If you look at that average and feel like your own account is lacking, do not panic. You are comparing yourself to an inflated number.
What the median numbers reveal
To get a true reality check on how your peers are doing, you have to look at the median balance.
Vanguard reports that the median 401(k) balance for workers aged 55 to 64 is actually $95,642. This means exactly half of all participants in this age bracket have more than this amount saved. The other half have less.
This figure is a much more accurate reflection of the everyday worker. It accounts for people who faced layoffs, medical emergencies, or periods of high inflation.
Maximize your employer match
If your balance sits closer to the median and you want to accelerate your growth, review your current contribution rate.
If your employer offers a match, contributing enough to get it can be one of the highest-impact moves you can make, assuming you meet any vesting rules.
Workers aged 50 and older can also make catch-up contributions. Directing a portion of any new raise straight into your retirement account can change your financial trajectory.
Use a rollover IRA for old accounts
Many people change jobs several times before reaching their 50s. You might be paying high administrative fees for an old workplace plan you no longer monitor.
Moving those funds into a rollover IRA gives you immediate control over your money.
Corporate retirement plans usually restrict you to a small menu of mutual funds. An IRA gives you access to a massive variety of low-cost index funds. Lowering your investment fees keeps more money in your own pocket.
Automate your strategy
You do not need to be a financial expert to manage your rollover funds. Digital platforms have made professional-level management highly accessible.
Robo-advisors can automate diversification and rebalancing based on the plan you choose. They automatically ensure your portfolio stays aligned with your timeline.
For many people, steady investing over time may beat the stress and risk of frequent market timing.
Your next financial step
Comparing your retirement account to national statistics is only useful if it sparks action. Focus entirely on the variables within your direct control.
Track down your old workplace accounts. Review your current contribution rates. Ensure your money is invested as efficiently as possible.
Consistent actions taken in your 50s will set the foundation for a much more comfortable retirement.
If you are looking ahead to your retirement, and you have over $100,000 in savings, consider getting advice from a pro. SmartAsset offers a free service that matches you to a vetted, fiduciary advisor in less than 5 minutes.
offers a free service that matches you to a vetted, fiduciary advisor in less than 5 minutes.