The purpose of this disclosure is to explain how we make money without charging you for our content.
Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.
Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.
Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.
Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.
To find out more about our editorial process and how we make money, click here.
Financial advisors generally recommend contributing around 10% of your paycheck to your 401(k), but Americans in all age groups are falling short of that goal.
The good news is that three-quarters of Americans with access to a company retirement plan are contributing something to it; the bad news is most aren’t putting in enough to set themselves up for a comfortable retirement, according to the recently released How America Saves 2019 report from Vanguard.
The saving rates in the chart below reflect employees’ contributions only — they don’t include any matching contributions that their company might offer. A typical worker should aim for a total 401(k) contribution rate of 12% to 15% of pay, including both employee and employer deposits, according to Vanguard’s estimates. Most people aren’t there yet: when you factor in the company match, the average participant contribution rate over the past 15 years was 10.6% in 2018, Vanguard says.
There’s still time to sock away more savings, whatever your age or stage in your career. For 2019, you can contribute up to $19,000 a year to your 401(k), and those age 50 and over can put in an additional $6,000 in “catch-up” contributions.