Important points
- The average 401(k) balance for individuals in their 60s stood at $568,040 as of June 2025, whereas the median amount was significantly lower, at $188,792.
- Your retirement savings needs hinge on your lifestyle and anticipated annual expenses. A common guideline suggests saving eight times your pre-retirement income by age 60.
- You can enhance your savings by downsizing earlier rather than later, utilizing higher catch-up contributions in your 60s, and redistributing your assets to focus on growth.
As you enter your 60s and start thinking about retirement, it might be worthwhile to evaluate your 401(k) savings. Have you ever wondered how your savings stack up against others in your age group? And how much do you really need for retirement? Those are pretty significant questions.
It’s easy to feel tempted to compare your savings with friends or coworkers, but what you need to save can vary widely based on your retirement plans and lifestyle choices.
401(k) Savings in Your 60s: Average and Median Balances Explained
As of June 2025, the average 401(k) balance for those in their 60s reached $568,040, per Empower. This figure is a slight dip from the average of $607,055 for people in their 50s, likely because many individuals in their 60s have already retired and are drawing from their accounts.
It’s important to remember that averages don’t always represent the whole picture—high or low balances can skew the average. The median saved amount for individuals in their 60s was significantly lower, at $188,792.
How much money do I need to retire?
If you find yourself anxious about your savings numbers, you’re not alone. Research from Western & Southern Financial Group shows that 47% of baby boomers feel unsure about their financial readiness for retirement, and an additional 11% are uncertain.
The same study indicated that baby boomers believe they require an average of $760,000 to retire comfortably, with Gen X anticipating about $1.18 million. When you consider the average and median 401(k) balances for those in their 60s, it’s evident that they fall short of these expectations.
That said, determining how much you need for retirement depends on various factors, particularly your lifestyle choices and health. Rather than just focusing on averages, it’s advisable to analyze your personal situation to identify your savings target.
One common rule states that by age 60, you should aim to save eight times your pre-retirement income. So, if you make $75,000 each year, your retirement savings goal would ideally be around $600,000.
Another guideline, called the 4% rule, suggests that retirees withdraw 4% of their 401(k) in the first year of retirement, adjusting for inflation thereafter. Following this approach, you’d need to save 25 times your expected annual expenses. For instance, if you anticipate spending $36,000 annually, your savings target should be about $900,000.
Keep in mind, most retirees don’t solely rely on their 401(k). Many receive Social Security benefits, and you might also have investments or an IRA to supplement your income, or even keep a side job during retirement.
Interestingly, research revealed that while 90% of baby boomers expect Social Security to be their main retirement income, only about half of Millennials and Gen Zers share that belief.
5 ways to increase your retirement savings
If you’re in your 60s and feel like your 401(k) isn’t where it should be, here are some strategies to help bolster your savings as retirement approaches.
1. Make a catch-up contribution
In 2025, individuals can contribute up to $23,500 to their 401(k). However, if you’re in your early 60s, your contribution limit can be higher. If you’re between the ages of 60 and 63, you can add an extra $11,250, totaling $34,750. For those 64 and older, the catch-up contribution limit drops slightly to $7,500, allowing for a total of $31,000 in contributions.
2. Take advantage of workplace benefits
Financial planner Alexa Cain recommends maximizing any retirement benefits offered by your employer. If they provide a matching contribution, ensure you put in enough to receive the full match, regardless of whether you’ve done so in the past.
She also advises automating your retirement savings to simplify the process. “Many plans allow you to automatically increase your contributions by a set percentage each year,” she noted.
3. Asset reallocation
Typically, younger investors tend to hold a heavier share of stocks, taking on risk for potential growth. As retirement nears, many shift towards a more conservative mix of stocks and bonds. If you’re invested in a target-date fund, this transition might happen automatically.
However, if you’re in your 60s and still feel behind, consider not moving everything to conservative investments immediately. Focusing on growth for just a few more years could potentially yield significant returns, and gradually adjusting your asset mix might provide balance as retirement approaches.
4. Consider downsizing now
If you’re among those planning to downsize in retirement, perhaps it would be wise to consider doing it sooner. Downsizing can effectively lower your living expenses by cutting costs tied to:
- Property taxes
- Home maintenance
- Insurance
- Utilities
If you’re strategic about your move, prioritizing access to public transport, for example, can help further reduce expenses related to owning multiple vehicles.
By lowering your outgoings, you can channel more funds into your retirement accounts, maximizing the benefit of catch-up contributions during your early 60s.
5. Work with an advisor
Partnering with a financial advisor can clarify how much you need to save as well as help shape the kind of retirement you envision.
“We often say, ‘You can do anything, but you can’t do it all,'” said Cain. There are trade-offs with every choice you make regarding retirement.
An advisor can assist you in weighing your options and understanding the potential compromises associated with different choices. For example, many retirees might dream of living abroad for a lower cost of living but don’t realize the complexities involved in such a move.
“These international transitions require careful planning,” she added. “It’s crucial to navigate laws and regulations, plus you still need to file U.S. taxes while living overseas.” An advisor can clarify these issues, enabling you to determine a retirement plan that aligns with your resources and priorities.
Conclusion
You may be inclined to compare your retirement savings to your peers’. While certain benchmarks can provide insight into whether your 401(k) is on track, the ideal savings amount truly varies depending on individual circumstances and future plans.
Your early 60s are an excellent time to consult with a financial advisor about your retirement options. If things veer off course, they can suggest various strategies—like leveraging catch-up contributions, downsizing to save money, or revisiting your investment allocation within your 401(k).
