Americans Are Getting Better at Retirement Investing

After decades of warnings, it looks like the message might finally be landing: Americans are stepping up their retirement game. According to Fidelity, the average 401(k) savings rate hit a record-high 14.3% of income in the first quarter of 2025 — just shy of the 15% advisors typically recommend. That figure includes employer contributions, which now average around 4.8%. Interestingly, many workers are doubling down: Roughly 17% of workers actively increased their savings rate this year, despite market volatility. Only 5% decreased it, and less than 1% stopped saving entirely.

It’s a hopeful sign that long-term thinking may finally be catching on, especially as 401(k) access expands and auto-enrollment becomes more common, often starting workers at 5% or higher and auto-escalating contributions each year.

By generation:

• Boomers are leading the way, saving 17.2% on average

• Gen X is close behind at 15.4%

• Millennials average 13.5%

On one hand, Gen Z is statistically our most financially engaged generation yet. A 2024 Charles Schwab study found they start investing at age 19 — six years earlier than Millennials, and over a decade ahead of Boomers. They’re also more likely to have learned about investing early, whether through school or online, and have benefited from easier access to markets via apps and social platforms.

But despite that head start, many Gen Zers are skeptical about traditional retirement altogether. According to a Nationwide survey, nearly half expect to work past age 65, and over a third say the standard retirement age no longer feels relevant. Between high debt, rising costs, and a sense that retirement is out of reach, some are leaning into nontraditional assets (like crypto) — or even skipping retirement savings entirely in favor of short-term priorities.

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