401(k), 403(b) balances rise again as retirement savings habits hold steady

Retirement account balances continued climbing in 2025, as workers maintained steady savings habits and benefited from market gains, according to a new analysis from Fidelity Investments.

The firm’s fourth-quarter retirement report found average 401(k) balances increased more than 11% compared with the same period in 2024, while 403(b) balances rose 13%. Average IRA balances increased 7% year-over-year. The results mark the third consecutive year of double-digit annual balance growth for workplace retirement accounts.

Savings behavior also remained consistent. Average savings rates for both 401(k) and 403(b) plans held steady for the third straight quarter, suggesting workers are continuing to prioritize retirement contributions despite economic uncertainty.

“Retirement savers remain committed to their financial futures by staying the course with their retirement savings,” said Sharon Brovelli, president of Workplace Investing at Fidelity Investments. “The consistency so many Americans show in maintaining responsible savings behaviors and keeping a long-term perspective will serve them well in retirement.”

Generational trends shape retirement strategies

The report highlights several generational shifts in retirement planning. Generation X workers are saving at particularly strong levels, maintaining a total savings rate above Fidelity’s recommended 15% of income as many in the group move closer to retirement age.

Younger workers are also showing distinctive savings patterns. Millennials and Gen Z employees are increasingly contributing to Roth 401(k) accounts, which allow tax-free withdrawals in retirement. Meanwhile, Gen Z savers continue to favor target-date funds, a common default investment option that automatically adjusts risk over time.

More than 13% of Gen Z participants increased their contribution rate in the fourth quarter of 2025, the analysis found.

IRA contributions hit a record

Individual retirement accounts also saw strong momentum. The number of Fidelity IRA account holders making contributions rose 25% year-over-year, while total contributions increased 23%, setting a record for fourth-quarter contributions.

Generation X investors again led the trend, with IRA contributions from the group up 25% compared with a year earlier, partly driven by higher Roth IRA contributions.

“Americans are clearly considering all the savings options available to them in an effort to solidify their financial futures,” said Bob Mascialino, president of Wealth at Fidelity Investments. “Saving early and often, particularly in a tax-advantaged manner, is often the best way to save and invest for the future.”

Women closing the retirement savings gap

Fidelity’s report, released during Women’s History Month, also highlights gains among female retirement savers.

Over the past five years, the average 401(k) balance for women has increased 22%, compared with 20% growth among savers overall.

Women who have continuously participated in a 401(k) plan for 15 years reached an average balance of $508,700 at the end of 2025, up from $453,500 a year earlier, according to the report.

Nearly four in 10 women increased their 401(k) savings rate in 2025, with participation especially strong among younger workers. Forty-seven percent of Gen Z women raised their contributions during the year.

Fidelity’s analysis examined savings behaviors and balances across more than 53 million IRA, 401(k), and 403(b) accounts, making it one of the largest snapshots of retirement savings trends in the U.S.