How Much Should I Have in My 401(k) at 50?

Most Americans have less in their retirement accounts than they’d like, and much less than the rules say they should have. If that describes you, you’re not alone. Now, most financial advisors recommend that you have between five and six times your annual income in a 401(k) account or other retirement savings account by age 50. With continued growth over the rest of your working career, this amount should generally let you have enough in savings to retire comfortably by age 65.

Consider working with a financial advisor as you develop or finalize your retirement plan. Connect with your advisor matches today.

What Your Retirement Savings Should Look Like by Age 50

Financial experts sometimes suggest planning for your retirement income to be about 80% of your pre-retirement income. For example, someone who earned $100,000 per year going into retirement would plan on having about $80,000 per year. The reason for this discrepancy is that most households tend to have fewer needs and responsibilities while in retirement, and therefore fewer expenses. The only major exception to this rule is healthcare, as costs typically rise in later years.

To make your savings last, financial experts recommend that you plan on withdrawing about 4% per year from your retirement fund. This will depend on three main factors:

• How much money you have in your retirement fund
• The average rate of return that your retirement fund generates
• Your anticipated Social Security income

So, for example, say you plan on needing $80,000 in your first year of retirement.

First, determine how much you can expect to receive from Social Security each month. This amount depends on your lifetime earnings and your chosen retirement age. For reference, the average retired worker benefit in January 2025 was approximately $1,980 per month, or $23,760 per year. So you should plan on withdrawing an additional $56,240 per year to make up the difference.

The 4% rule may entail withdrawing too much. It comes from, in part, conservative estimates of your retirement fund’s returns. By the time you retire, your portfolio should be shifted toward lower-risk assets such as bonds and cash equivalents. Many retirement funds, with comparatively safe assets, will have a return rate of around 3% to 5% by this point, allowing you to hover right around the replacement rate for your withdrawals.

So someone who earns $100,000 per year may want to have around $1.4 million in their retirement account by age 65. At age 50, then, many experts suggest that this retiree would need to have – at a bare minimum – around $600,000 up in a 401(k), or other tax-advantaged account. That would give the retiree 15 years to boost their retirement nest egg by an additional $800,000, or grow by an average of $53,333 annually (6%) for each of the next 15 years. Reaching this goal is unlikely without significant capital appreciation in a tax-advantaged account.

Reaching the Retirement Finish Line

Besides making sure that the asset allocation of your retirement fund is sufficiently aggressive, there are at least four other steps you can take to get from $600,000 at 50 to $1.5 million at 65.

Max Out Your Catch-Up Contributions

This is the most important thing you can do. The IRS limits how much you can contribute to 401(k), individual retirement account (IRA) and Roth IRA in a single year. After you turn 50, the IRS raises the cap, allowing you to make catch-up contributions. In 2025, for example, most workers can only contribute up to $23,500 to their 401(k) account. However, anyone age 50 or older can contribute up to $31,000. Furthermore, 401(k) participants between ages 60 and 63 can save an extra $11,250 beyond the standard contribution limit in 2025 for a total contribution of $34,750.

Open Simultaneous Retirement Funds

The IRS allows contributions to a 401(k), IRA, and Roth IRA in the same year, though IRA and Roth IRA contribution limits overlap.

If you are already maximizing contributions to your 401(k) but still feel it’s not enough, consider opening an IRA or Roth IRA to supplement your savings. Doing so will allow you to put money into multiple retirement accounts at the same time, helping you to boost your savings considerably.

If you already have simultaneous retirement accounts, consider simply opening an earmarked account. While it won’t offer the same tax advantages, an ordinary investment portfolio can still be used for retirement savings. You can put as much money into it as you like then just plan on leaving it there for retirement.

Manage Debt, Manage Spending

An excellent way to free up some cash is to stop making interest payments on debt. If you have existing debt, paying it off more quickly will reduce the amount that you spend on interest and fees. This will, in turn, give you more cash to dedicate toward your retirement account.

When it comes to long-term debt, like a mortgage, paying it off more aggressively can also reduce your potential expenses in retirement. You won’t have to make those payments, which can reduce the amount of money you’ll need each month once you’ve stopped working.

At the same time, consider your overall lifestyle. If you think you may not have enough for your retirement, are there ways that you can shift your lifestyle over the long run that will reduce expenses? Is there someplace less expensive you could live, for example? This isn’t as simple as skipping your morning latte. Instead, consider whether you can shift your monthly needs in a way that might significantly change your budget both today and in retirement.

Consider Working More and Retiring Later

If you don’t have enough money to fund additional retirement accounts, consider taking on additional work to earn that money. This can range from freelance or gig work to a formal part-time job.

This is not a recommendation we make lightly. By the time you reach your 50s, the last thing you may want to do is take on extra work. However, secondary work is a good way to boost your finances, and if you need the money for retirement then it has to come from somewhere. While working a second job at 55 may be undesirable, needing one at 75 would be even more challenging. Working today might help ensure that you don’t have to do so tomorrow.

The jump in Social Security payments from normal retirement age to 70 is significant. If you were born between 1943 and 1954, starting benefits at age 66 provides 100% of your monthly benefit. Should you start receiving retirement benefits at age 67, you’ll get 108% of the monthly benefit because you delayed getting benefits for 12 months. If you start receiving retirement benefits at age 70, you’ll get 132% of the monthly benefit because you delayed getting benefits for 48 months.

Bottom Line

Most financial experts suggest that retirees should have around five to six times their annual income saved up in their retirement account by age 50. If you haven’t hit that mark, it’s probably a good time to maximize catchup contributions and consider opening one or more additional retirement accounts. Additionally, position your investments for capital appreciation while balancing risk, and look for ways to reduce discretionary spending.

Tips on Retirement Planning

• We can all use help with our finances, and never more so than when it’s time to save for retirement. That’s where a financial advisor can offer valuable guidance and insight. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• Use SmartAsset’s 401(k) calculator to get a quick estimate of how much you’ll have in your 401(k) by the time you retire.

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