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Compare Your Savings to the Average Michigan Resident

Author Anne Erickson
Getty Images / yaom

If you’re saving for retirement, maybe you’ve wondered if you have enough in your nest egg compared to others in Michigan. As it turns out, the average 401(k) retirement savings is different depending on where you live, which makes sense, since the cost of living in each state is very different. So, how does your 401(k) compare to others in your area? A new study shows what people roughly have in that nest egg depending on which state in which they live.

Michigan Average Retirement Savings

So, what exactly is a 401K? According to Charles Schwab, a 401(k) is “an employer-sponsored retirement plan that comes with tax benefits.” How it works is that “you put money into the 401(k) where it can be invested and potentially grow tax free over time.” Charles Schwab also adds that in most cases, “you pick how much money you put in based on a percentage of your income.”

Looking at national trends across the U.S., according to Unbiased, the average 401(k) balance in the U.S. is $115,710 if add up data for all age ranges. For those 65 and older, the average 401(k) balance is $232,710. They add that women usually have a lower 401(k) balance than men, and that male baby boomers have more than double the savings of their female counterparts, reports Bank of America. If you’re wondering which industries are hot for having a good 401(k), the study says “the collective agriculture, mining, and construction industry has the highest average 401 (k) balance, at $176,369.”

Those under 25, according to Unbiased, have an average 401(k) balance of $5,236, 25-34 is $30,017, 35-44 is $76,354, 45-54 is $142,069, 55-64 is $207,874 and 65 and older is $232,710. The median is quite different, however, with those under 25 at $1,948, those 25-34 at $11,357, 35-44 at $28,318, 45-54 at $48,301, 55-64 at $71,168 and over 65 at $70,620.

Now, let’s specifically get to Michigan. How does your retirement savings stack up to those who are also in the state? Per the Unbiased report, the average retirement balance in the state is $439,568. It’s ranked No. 24 among all the states. A separate report from CNBC also stated that the state with the highest average retirement savings is Connecticut at $523,568, followed by New Hampshire at $494,562. Utah had the lowest average retirement savings of $300,392, followed by North Dakota at $310,766 and Washington D.C. at $325,671. The CNBC report used data from Empower, “an investing and budgeting app, looked at the average retirement savings of its 2.8 million dashboard users, and found that savers in certain regions of the U.S. save more than those in other areas.”

Do You Have More or Less in Your 401K Than Most People Your Age?

  • Under 25 years old

    In this age group, the average 401K balance is $5,236 and the median is $1,948. You’re obviously just getting your feet wet in investing. Some people fresh out of high school or college probably don’t have anything in their 401Ks at this point.

  • Between 25-34

    In this age group, the average 401K balance is $30,017 and the median is $11,357. This is significantly higher than the under 25 age range. But, it’s definitely not enough to retire on. So, keep grinding.

    https://www.instagram.com/p/C2SsxjjsTzs/

  • Between 35-44

    In this age group, the average 401K balance is $76,354 and the median is $28,318. Notice the big difference between average and median. Obviously, with the median, that means half of people in that age group have less than $28,318 and half have more.

  • Between 45-54

    In this age group, the average 401K balance is $142,069 and the median is $48,301. This is another one where the average and median are very different. Half of people in that age group have less than $48,301 and half have more.

  • Between 55-64

    In this age group, the average 401K balance is $207,874 and the median is $71,168. Some people “early retire” in this age group. But, only if you have enough cash. People with pensions are sometimes able to retire in this age group. Also, you can receive Social Security retirement benefits as early as age 62.

  • 65 and older

    In this age group, the average 401K balance is $232,710 and the median is $70,620. Since you can receive Social Security retirement benefits as early as age 62, many people do choose to retire when they hit 65.

  • The average and median 401(k) balance by age

    So, there you have it, the average and median 401K balance by age. The stats are from Vanguard’s “How America Saves 2023” report, which offers data on the average and median 401K account balances by age. Find the full report here.

    Happy Senior Old Retired Couple Walking Holding Hands on Beach at Sunset

    Getty Images / dmbaker

Anne Erickson started her radio career shortly after graduating from Michigan State University and has worked on-air in Detroit, Flint, Toledo, Lansing and beyond. As someone who absolutely loves rock, metal and alt music, she instantly fell in love with radio and hasn’t looked back. When she’s not working, Anne makes her own music with her band, Upon Wings, and she also loves cheering on her favorite Detroit and Michigan sports teams, especially Lions and MSU football. Anne is also an award-winning journalist, and her byline has run in a variety of national publications. You can also hear her weekends on WRIF.

 

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