IRA balances swelled to a record high in the second quarter of 2025. Are you keeping up? Or do you suffer from IRA balance envy? The answer likely depends on how your Individual Retirement Account (IRA) stacks up versus other savers in your age group. And while there’s no perfect apples-to-apples comparison, as everyone’s financial situation is different, eyeballing average IRA account balances can give you an idea if you’re ahead in the savings game, keeping up, or falling behind.
With traditional pensions on the verge of extinction, the responsibility of saving for retirement increasingly falls on workers. IRAs are an especially important retirement savings tool for self-employed folks or small business owners who don't have a workplace retirement plan . And for those with a 401(k) at work, an IRA is a key — often complementary — retirement savings account that can help workers amass more money in their golden years. Assets in IRAs totaled $16.8 trillion at the end of March 2025 (the latest available data), accounting for nearly 40% of total retirement assets of $43.4 trillion, according to the Investment Company Institute.
The average IRA balance for all ages at the end of the second quarter of 2025 was $131,400, up 5% from a year ago, according to Fidelity Investments’ analysis of 17.8 million IRA accounts. That IRA gains were due in part to a 13.6% return posted by the S&P 500 stock index over the past 12 months, as well as consistent savings by IRA investors despite market volatility sparked by tariff fears, according to Fidelity.
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If your IRA account balance is lower than the average, don’t despair. And if you’re ahead of the pack, don’t get complacent. Instead, use the average balance information as a starting point to figure out if you’re on track to meet your personal savings goals. And if not, what tweaks are needed to course-correct?
Despite market volatility from time to time, there’s no need to panic or bail out of stocks, notes Emelia Fredlick, a senior editor at fund-tracker Morningstar. After analyzing stock market crashes over the past 150 years, Fredlick concluded: “Though they varied in length and severity, the market always recovered and went on to new highs. If you don’t panic and sell your stock holdings when the market crashes, you will be rewarded in the long run.” That stay-the-course advice proved prescient again this year as the S&P 500 has climbed back to new highs, after suffering a 19% dive in early April amid tariff worries.
“It’s an opportunity to rethink and reassess your retirement plan,” said Rita Assaf, VP of retirement offerings at Fidelity Investments. “IRAs can function as a ‘booster’ for your retirement savings.”
Average IRA balance by age and generation
- IRA balances can grow through compounding interest, regular contributions and long-term stock market appreciation
- In the first quarter of 2025, baby boomers had the highest average IRA balance
- In the second quarter of 2025, Gen Z had the lowest IRA average balance
- Roth IRAs are the most popular retirement savings choice among Americans of all ages
Let’s drill down to average IRA balances by age and generation in the second quarter of 2025 to get a more precise picture of how much other workers in your age band have set aside. These totals, Assaf notes, include contributions, appreciation, and rollovers.
Here are the average IRA balances by age and generation for the second quarter of 2025 and the first quarter of 2025, according to Fidelity Investments.
Generation | Age Range | Average IRA Balance 2025 Q2 | Average IRA Balance 2025 Q1 |
|---|---|---|---|
Gen Z | Born 1997-2012 / Age 12-27 | $7,560 | $6,783 |
Millennials | Born 1981-1996 / Age 28-43 | $27,177 | $24,241 |
Gen X | Born 1965-1980 / Age 44-59 | $111,524 | $100,431 |
Boomers | Born 1946-1964 / Age 60-78 | $271,105 | $250,209 |
What jumps out is how IRA account balances for older folks, or those who’ve been saving for decades, balloon with the help of compounding, regular contributions, and the stock market's tendency to rise in value over time. The takeaway (especially for younger savers)? It’s not impossible to accumulate a sizable nest egg.
What looks like a puny account balance today can add up to hundreds of thousands of dollars. Compounding, or earning returns on both your original investment and prior gains, is a powerful force in building retirement savings. In fact, IRA balances at the end of June were 40% higher than they were 10 years ago, Fidelity data show. “It’s never really too late to save,” said Assaf. “There are always things you can do to help your situation.” And when it comes to saving for your golden years, Fidelity recommends saving 15% of your income (including any company match).
If savers have a workplace retirement savings plan, they should consider investing in an IRA only after saving enough in their 401(k) to get the full company matching contribution. “If you need another place to save money, an IRA is a great tool to use to continue to get tax-deferred growth,” said Rob Leiphart, VP of financial planning at RB Capital Management. Both traditional and Roth IRAs allow your contributions and gains to grow tax-free. However, traditional IRAs are funded with pre-tax dollars, which gives you an upfront tax deduction, but requires you to pay taxes on withdrawals at your regular income rate. In contrast, Roth IRAs are funded with after-tax dollars but come with tax-free withdrawals in retirement.
The appeal of tax-free withdrawals from Roth IRAs is catching on with savers. Roth IRAs are the retirement savings “vehicle of choice” across all generations, with 68% of all IRA contributions going to the Roth option in this year’s first quarter, according to Fidelity.
What you should have saved, by age
- Fidelity recommends having at least six times your salary saved for retirement by age 50
- IRA account holders essentially doubled their money each decade until retirement, due to the power of compounding
- Generally, 'super savers' regularly contribute to a retirement account and max out contributions up to IRS limits
Let’s see how IRA balances by age, or savings during each decade of life, stacked up at the end of the second quarter of 2025. To help savers get a better guesstimate of whether their savings are on track for a secure retirement, we’ve also included Fidelity’s guidelines as to how much of one’s salary should be saved by the start of each decade in a saver’s life. For example, Fidelity recommends that someone turning 50 should aim to have at least six times their salary saved by then. So, if you earn $75,000 at age 50, you should have at least $450,000 set aside by then, according to Fidelity guidelines.
Age | Avg. IRA balance Q2 2025 | You Should Have Saved at Least |
|---|---|---|
20s | $8,651 | Row 0 - Cell 2 |
30s | $22,087 | Salary X 1 |
40s | $58,677 | Salary x 3 |
50s | $129,222 | Salary X 6 |
60s | $244,270 | Salary x 8 (and 10 x by age 67) |
70+ | $311,934 | Row 5 - Cell 2 |
Again, notice the power of compounding when building wealth. In each 10-year period starting with savers in their 20s, IRA account holders essentially doubled their money each decade until retirement. The key takeaway: the modest average IRA balance of $58,677 in the 40s’ age bracket mushrooms into a quarter-million-dollar nest egg two decades later.
The secret of “super savers,” personal finance experts say, is regularly contributing to a retirement account like an IRA and maxing out contributions up to IRS limits if possible. They also recommend investing for growth via stocks during peak earning years and implementing a buy-and-hold strategy to get the full benefits of compounding.
Although the market finished the April-June quarter higher and IRA balances increased, there was turbulence along the way. The good news is IRA investors shrugged off the volatility and continued to save. IRA contributions held steady at $2,200 annually, the same as last year, according to Fidelity. Baby Boomers boosted their IRA savings the most, with average contributions rising 37% from last year‘s second quarter. Gen Xers upped their contributions by 25%.
"With the market volatility experienced earlier in the quarter, it's understandable that some retirement savers may feel uncertain about how their balances are being impacted," said Robert Mascialino, president of wealth at Fidelity Investments. "However, we're seeing more people adding to their IRAs. It's encouraging to see customers focus on the long-game when it comes to saving for retirement."
For a more comprehensive look at how your savings compare to peers, see our articles on The Average Net Worth by Age, The Average 401(k) Balance by Age and The Average Retirement Savings by Age. To get a handle on projected medical expenses, see Average Cost of Health Care by Age and US State.
Pros and cons of IRAs
- The biggest advantage of IRAs is the tax benefits they offer
- IRAs tend to offer a wider range of investment choices than a 401(k)
- One key drawback of IRAs is their much lower annual contribution limits compared to 401(k)s
- Early withdrawals from your IRA before age 59-1/2 trigger a 10% penalty (plus regular income tax), with fewer exceptions than 401(k) loans or hardship rules
The biggest perk of IRAs is the tax benefits they offer. IRAs, which are held in brokerage accounts, also offer a wider range of investment choices than a 401(k), which has a limited menu of options. “So, if you want to buy individual stocks, or if you want to do something that you can’t do within the confines of a 401(k) because it’s not one of those 20 or 25 investment options, then the IRA serves as a great diversification tool,” said Leiphart.
Roth IRAs also give you more flexibility in getting at your money without paying an IRS penalty. “You can take out your contributions at any time,” since you’ve already paid taxes on the money used to fund your Roth IRA, adds Assaf.
IRAs are also a great landing spot for assets from old 401(k)s. Rolling over old retirement accounts and balances into a single IRA is a good way to consolidate your accounts and avoid the mistake of taking a distribution from an old retirement account before age 59 ½, which would result in a 10% IRS penalty.
On the negative side, the amount you can contribute to an IRA each year is much lower than the amount you can sock away in a 401(k). In 2025, for example, the IRS limit on IRA contributions is $7,000 (or $8,000 for those 50 or older). In contrast, participants in workplace 401(k) plans can contribute up to $23,500 and $31,000 for 50-and-older savers in 2025. Savers in 401(k) plans aged 60, 61, 62 and 63 may be able to make a super catch-up contribution of $11,250 in 2025, if their company allows it.
Note that these contribution limits increase in 2026: The IRA contribution limit is $7,500 (up $500 from 2025) and the IRA catch-up is $1,100 (up $100 from 2025). Be sure to review income eligibility rules for IRAs.
Account Type | 2025 Limit | 2026 Limit |
|---|---|---|
IRA (Traditional or Roth) | $7,000 | $7,500 |
IRA Catch-up | $1,000 | $1,100 |
401(k) (Traditional or Roth) | $23,500 | $24,500 |
401(k) Catch-up | $7,500 | $8,000 |
401(k) Super Catch-up | $11,250 | $11,250 |
How do IRA balances compare to U.K. pension savings?
- On average, U.K. residents have lower pension wealth than their U.S. counterparts in the same age groups
- The cost of living in the U.S. is higher than in the U.K., particularly because health care costs are almost twice as high per capita in the U.S.
- Americans often supplement their 401(k) with an IRA, leading to substantially greater total retirement savings
According to Kiplinger's British sister site, Moneyweek, average U.K. pension wealth falls below that of similar age cohorts in the U.S. For example, a U.S. saver in their 60s has an average of $244,270 in their IRAs, but U.K. savers in their 60s have average balances of under $200,000 in their pension savings.
Before you feel smug about being American, remember that the U.S. has a higher cost of living than the UK. One of the most significant differences is the cost of health care, which is almost twice as high per capita in the U.S. as in the U.K. Despite the U.S.'s higher spending on health care, the U.K.'s more affordable healthcare system has better health outcomes.
That said, many Americans pair their IRAs with 401(k) accounts, resulting in significantly higher overall retirement savings.
Age group | Average UK pension wealth (in pounds) | Average UK pension wealth (in dollars) |
|---|---|---|
16-24 | £5,500 | $7,450 |
25-34 | £18,800 | $25,465 |
35-44 | £39,500 | $53,503 |
45-54 | £80,000 | $108,361 |
55-64 | £137,800 | $186,651 |
65-74 | £145,900 | $197,623 |
75+ | £59,700 | $80,866 |
Source: Pension wealth: wealth in Great Britain, 2020-2022, ONS, published January 2025. Only includes people with pension wealth; those who have zero pension savings are excluded from the figures. As reported in MoneyWeek.
An IRA can help your retirement savings catch up
- Setting up automatic contributions to your IRA can help boost your retirement savings.
- Boosting your contributions when you get a raise can add up in future years.
- Saving in a workplace 401(k) doesn't mean you can't save in an IRA too.
Just because you’re saving in a 401(k), doesn’t mean you can’t save even more in an IRA, says Assaf.
One way to boost your retirement savings via an IRA is to automate the process by setting up automatic contributions that coincide with each pay period, just like your 401(k) at work, says Leiphart. “I have clients that get paid on the 15th and at the end of the month, so I set up ongoing contributions into their IRA from their checking accounts that align with those dates,” said Leiphart. And if you’re tight on cash now, you can plan on saving a little more in future years, say 1% more each year, when you get your annual raise, adds Leiphart.
Get the full story: what you're worth
Want to see how more of your retirement portfolio compares to peers? Read:
Average Retirement Savings by Age,
The Average 401(k) Balance by Age,
Average 401(k) Match: Do You Work for a Generous Company? and
The Average Social Security Check by Age.
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