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Workers should aim to save 15% of their paychecks in a 401(k) or other retirement account, many financial advisors say. But that’s an ambitious target for most people, even if you include matching contributions you get from your employer.

How close is the average worker to hitting this target? Data from two big retirement-plan providers give some idea.

At Vanguard, the average contribution rate was 6.2% of pay in 2016, according to the firm’s annual How America Saves report, released Tuesday. When you add in employer matches, the average contribution per worker hits 10.9% of pay.

At Fidelity, the average contribution rate was 8.4% as of March 31, the company said last month, or 12.9% when you factor in employer matches. That overall contribution rate is actually a record high, up from 12.7% at the end of 2016 and 12.4% at the end of 2015, according to Fidelity.

Yet Americans still understand that they're missing the mark when it comes to savings.

Half of Americans, for instance, aren’t sure they’ll be able to afford retirement, a recent survey by the American Institute of CPAs found. And the average 401(k) balances reported by Vanguard and Fidelity — around $95,000 in plans administered at both firms — are certainly cause for concern.

Why? Many financial pros say you should figure on withdrawing no more than 4% of your nest egg in the first year of retirement — meaning that a $100,000 retirement account would provide just $4,000 in annual spending money.


At Vanguard, the average employee deferral rate of 6.2% in 2016 was actually down from 6.9% the year before, reflecting the fact that more workers are being automatically enrolled by their plans starting at lower percentages of pay. (When companies auto-enroll new workers, the plans usually start them off at a relatively low level — typically 3% or 4% of pay, and nudge employees in the right direction by ratcheting that up each year.)

Not surprisingly, Vanguard reports that contribution levels are higher at higher income levels and among older workers. While employees earning less than $30,000 contribute an average 3.9% of pay, that figure jumps to 8.1% for those earning $100,000 or more. Employees between the ages of 25 and 34 save an average 5.3% of what they earn, while those in the 55-to-64 range save 7.8%.