Key Points
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By 40, you should ideally be on your way to building a retirement nest egg.
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If you aren’t happy with your savings balance by 40, some lifestyle changes may be in order.
Age 40 is when a lot of people experience a financial wakeup call. They tell themselves it’s time to get serious about building savings for retirement and focusing on other monetary goals.
If you’re 40, you may be wondering how your 401(k) balance compares to the average person your age. Here’s what you need to know — and how to boost your balance if you aren’t happy with it.
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What the average 401(k) balance for 40-year-olds looks like today
As of mid-2026, the average 401(k) balance among savers aged 40 was $120,100, according to Fidelity. If your balance is much lower, it doesn’t necessarily mean all is lost, though.
At 40, you may still have another 25 years or more in the workforce. And ramping up on retirement plan contributions could go a long way.
At the same time, at 40, it’s time to be honest with yourself. If the average 401(k) saver your age has $120,000 and change and your 401(k) is sitting at, say, $5,000 (or, worse yet, $0), you may need to make some big adjustments to your spending to boost your savings rate.
Start by taking a look at your credit card and bank statements. Figure out exactly where your money goes each month.
Once you do that, make the easy cuts. Cancel the subscription service you hardly use, and stop paying for a gym you visit three times a month at best.
From there, it may be time to think about bigger changes, depending on how much catch-up you need to do on the retirement savings front.
You may want to think about downsizing if your rent monopolizes half your income, or if you’re struggling to keep up with the costs of homeownership. Swapping big vacations for staycations is another sacrifice you may need to consider if your long-term savings need serious work.
Focus on the future, not the past
If you’re 40 with a retirement savings balance you aren’t happy with, beating yourself up over it won’t do you any good. So rather than bemoan the fact that you’re behind, focus on prioritizing savings in the future.
In addition to changing your spending, make sure you’re making the most of the money you are managing to save. Invest heavily in stocks in your 40s, since you may have decades to ride out market turbulence.
Also take advantage of employer matching dollars that are available to you. And pay attention to investment fees in your 401(k) so they don’t eat away at your returns.
With a few key changes, you may find that in a few years, you’re much happier with your retirement savings balance — and much more confident about your future on a whole.
The $23,760 Social Security bonus most retirees completely overlook
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