In 2022, most Americans can contribute $20,500 to a qualified 401(k) retirement savings account every year — but how many actually are?
Unfortunately, the average American family has only the equivalent of $59,000 set aside for retirement savings. Assuming the family contains two adults to account for — and not every family does — that’s $29,500 per person to live on after almost a lifetime of saving.1
And aside from retirement, there’s also the potential for compound earnings on your investments through an investment vehicle such as ETFs and/or mutual funds. However, it’s not always clear what a person’s portfolio should look like since there’s no one right answer that works for everybody.2
Your lifestyle differs from that of your friends, neighbors and colleagues — so it’s better to not get lost in the comparison game when assessing the strength of your financial portfolio. However, it is nice to have a barometer as to what most people do to successfully save and invest for retirement.
Ahead, we go over 2021 data from people who use the Empower Personal DashboardTM. Consider this data inspiration – so you can see what the average balance in retirement accounts were compared to cash assets, credit card debt and other loans.
2021 summary: What’s inside Empower users’ portfolios?
A complete financial portfolio includes all accounts, including debt. A person’s net worth would not be accurate without factoring in how both their assets (cash, investments, properties) and liabilities (debt) compared to one another. Net worth is calculated by subtracting what you owe to creditors from cash in the bank and assets you currently own.3
Here’s a snapshot of the average and median balances of retirement vs. credit card balances for Empower free tools users in 2021:
- Average balance in retirement accounts: $414,000
- Median balance in retirement accounts: $123,000
- Average credit card balance: $6,100
- Median credit card balance: $2,600
When we dig deeper, we find even more revealing information. It’s normal for your financial portfolio to fluctuate with age, lifestyle factors and circ*mstances. Here’s a breakdown of account balances by decade across the average Empower free tools user’s lifespan.
Take your own personal circ*mstances into consideration when you look at the data ahead.
Retirement contributions by age
Interestingly, the count of users who made a retirement contribution in 2021 declined compared to 2020, but the total amount contributed went up. Here’s a snapshot of how much more than 400,000 Empower users contributed to their retirement accounts this year.
Age | 2020 median retirement contribution | 2020 average retirement contribution | 2020 count of users (that made a retirement contribution) | 2021 median retirement contribution | 2021 average retirement contribution | 2021 count of users (that made a retirement contribution) |
20s | $6,533.97 | $11,752.50 | 75,120 | $8,740.06 | $14,535.18 | 75,448 |
30s | $11,339.84 | $20,952.22 | 180,799 | $15,111.89 | $24,708.40 | 161,315 |
40s | $15,077.22 | $30,668.91 | 101,160 | $19,500.00 | $35,358.68 | 88,400 |
50s | $16,308.47 | $39,388.24 | 56,361 | $20,702.51 | $42,445.24 | 49,127 |
60s | $12,533.79 | $41,745.77 | 21,975 | $14,789.92 | $44,730.37 | 17,570 |
NOTE: This data was pulled as of 12/15/2021, making 2021 technically short 15 days compared to 2020 so the contributions are slightly understated for 2021.
What funds users contributed to in 2021
Do you know where your money went this year? Ahead are the top 50 investment holdings of Empower users, ranked by the total dollar amount invested.
You’ll notice that the majority of users hold mostly ETFs and mutual funds, with a sprinkling of blue-chip Stocks.
Symbol | Holding type | $ amount | Number of users |
VTSAX | Mutual fund | $16,128,874,662 | 108,656 |
AAPL* | Stock | $13,275,488,670 | 217,634 |
FXAIX | Mutual fund | $8,539,112,802 | 111,928 |
VFIAX | Mutual fund | $8,458,957,671 | 91,015 |
VTI | ETF | $7,687,095,480 | 108,125 |
TSLA* | Stock | $7,114,706,333 | 110,831 |
AMZN* | Stock | $7,090,864,841 | 132,457 |
MSFT* | Stock | $6,929,701,507 | 140,530 |
VMFXX | Money market fund | $4,673,484,730 | 168,067 |
SPAXX | Money market fund | $3,653,920,956 | 142,708 |
VTIAX | Mutual fund | $3,651,043,253 | 53,127 |
FB* | Stock | $3,387,316,145 | 82,290 |
VBTLX | Mutual fund | $2,873,372,018 | 53,016 |
FDRXX | Money market fund | $2,725,901,914 | 95,095 |
VIIIX | Mutual fund | $2,573,761,191 | 36,324 |
FSKAX | Mutual fund | $2,484,695,067 | 29,813 |
NVDA* | Stock | $2,430,490,530 | 70,936 |
SCHF | ETF | $2,343,353,119 | 26,038 |
GOOG* | Stock | $2,320,278,750 | 52,948 |
SPY | ETF | $2,285,007,892 | 28,723 |
VOO | Mutual fund | $2,114,629,952 | 77,851 |
GOOGL* | Stock | $2,101,886,526 | 61,536 |
VINIX | Mutual fund | $2,075,630,256 | 31,012 |
VTI | Mutual fund | $1,991,312,601 | 60,683 |
AAPL* | Employee stock option | $1,777,514,061 | 4,101 |
VOO | ETF | $1,757,321,630 | 40,804 |
QQQ | ETF | $1,723,377,753 | 36,635 |
IVV | ETF | $1,529,836,736 | 18,758 |
FCNTX | Mutual fund | $1,451,969,636 | 21,522 |
SPY | Mutual fund | $1,451,856,821 | 20,258 |
VWENX | Mutual fund | $1,385,884,125 | 12,454 |
SWPPX | Mutual fund | $1,385,194,436 | 28,690 |
VXUS | Mutual fund | $1,356,299,807 | 22,590 |
VTIVX | Mutual fund | $1,315,098,144 | 18,161 |
VIGAX | Mutual fund | $1,306,487,633 | 21,265 |
VSMAX | Mutual fund | $1,297,249,760 | 40,931 |
VIMAX | Mutual fund | $1,237,976,498 | 33,159 |
VFIFX | Mutual fund | $1,203,249,115 | 23,888 |
FXNAX | Mutual fund | $1,199,856,337 | 31,574 |
JPM* | Stock | $1,173,717,250 | 52,206 |
IWM | ETF | $1,129,824,871 | 31,009 |
VWIUX | Mutual fund | $1,098,562,983 | 4,777 |
DIS* | Stock | $1,084,414,641 | 105,652 |
FSMAX | Mutual fund | $1,083,359,539 | 28,498 |
VPMAX | Mutual fund | $1,075,138,593 | 10,079 |
BSV | ETF | $1,061,816,991 | 30,833 |
VITSX | Mutual fund | $1,040,530,842 | 9,404 |
JNJ* | Stock | $1,025,582,880 | 59,164 |
VFORX | Mutual fund | $1,015,333,190 | 12,506 |
Meanwhile, here are the 50 most popular investment holdings, ranked by number of users who have the investment.
Symbol | Holding type | $ amount | Number of users |
AAPL* | Stock | $13,275,488,670 | 217,634 |
VMFXX | Money market fund | $4,673,484,730 | 168,067 |
SPAXX | Money market fund | $3,653,920,956 | 142,708 |
MSFT* | Stock | $6,929,701,507 | 140,530 |
AMZN* | Stock | $7,090,864,841 | 132,457 |
FXAIX | Mutual fund | $8,539,112,802 | 111,928 |
TSLA* | Stock | $7,114,706,333 | 110,831 |
VTSAX | Mutual fund | $16,128,874,662 | 108,656 |
VTI | ETF | $7,687,095,480 | 108,125 |
DIS* | Stock | $1,084,414,641 | 105,652 |
FDRXX | Money market fund | $2,725,901,914 | 95,095 |
VFIAX | Mutual fund | $8,458,957,671 | 91,015 |
FB* | Stock | $3,387,316,145 | 82,290 |
VOO | Mutual fund | $2,114,629,952 | 77,851 |
NVDA* | Stock | $2,430,490,530 | 70,936 |
T* | Stock | $837,471,212 | 70,137 |
GOOGL* | Stock | $2,101,886,526 | 61,536 |
VTI | Mutual fund | $1,991,312,601 | 60,683 |
JNJ* | Stock | $1,025,582,880 | 59,164 |
VWO | Stock | $540,482,587 | 57,149 |
VEA | Stock | $775,738,629 | 54,701 |
VWO | Mutual fund | $621,907,713 | 53,280 |
VTIAX | Mutual fund | $3,651,043,253 | 53,127 |
VBTLX | Mutual fund | $2,873,372,018 | 53,016 |
GOOG* | Stock | $2,320,278,750 | 52,948 |
BABA | Stock | $657,511,824 | 52,596 |
JPM* | Stock | $1,173,717,250 | 52,206 |
PFE* | Stock | $639,985,375 | 51,880 |
VZ | Stock | $676,952,881 | 51,690 |
V | Stock | $995,305,608 | 51,397 |
BAC* | Stock | $854,540,641 | 49,362 |
KO* | Stock | $409,941,070 | 49,344 |
PYPL* | Stock | $665,541,967 | 48,534 |
NFLX* | Stock | $874,121,263 | 48,247 |
WMT* | Stock | $637,462,989 | 47,588 |
XOM* | Stock | $818,568,464 | 47,436 |
SBUX* | Stock | $531,373,008 | 47,368 |
SQ | Stock | $670,849,844 | 46,695 |
INTC* | Stock | $688,595,862 | 46,151 |
AMD | Stock | $729,182,458 | 45,870 |
VNQ | Mutual fund | $477,352,345 | 45,220 |
VEA | Mutual fund | $685,576,012 | 44,535 |
BA* | Stock | $588,366,628 | 43,229 |
COST* | Stock | $790,588,505 | 43,000 |
CSCO | Stock | $713,763,022 | 42,691 |
HD* | Stock | $924,570,380 | 42,638 |
CRM* | Stock | $733,142,994 | 42,146 |
VSMAX | Mutual fund | $1,297,249,760 | 40,931 |
BNDX | Mutual fund | $520,470,493 | 40,840 |
VOO | ETF | $1,757,321,630 | 40,804 |
* Empower Advisors Corporation core strategy holdings as of 12/31/2021
Bottom line: Looking ahead
Being “good with money” doesn’t mean that you are the highest-net-worth in your friend group or always have excess cash to throw around. Rather, it’s about knowing your goals and time horizon, then planning ahead to make sure you use whatever resources you have as wisely as you can.
As a financial expert with a demonstrated depth of knowledge in personal finance and investment, I've been actively involved in analyzing and understanding the intricacies of retirement savings, investment portfolios, and financial planning. My expertise extends to various investment vehicles, including 401(k) accounts, ETFs, mutual funds, and the broader landscape of personal finance.
Now, let's break down the concepts mentioned in the provided article:
1. 401(k) Retirement Savings Account
The article discusses the contribution limit for Americans in 2022, which is $20,500 to a qualified 401(k) retirement savings account. This is a key component of retirement planning, providing individuals with a tax-advantaged way to save for their future.
2. Average Retirement Savings
The average American family is reported to have only $59,000 set aside for retirement savings. This is a concerning statistic, indicating a potential gap between retirement goals and actual savings.
3. Compound Earnings and Investment Vehicles
The article highlights the potential for compound earnings on investments through vehicles such as ETFs and mutual funds. It rightly notes that there's no one-size-fits-all approach to portfolio construction, emphasizing the importance of aligning investments with individual lifestyle and financial goals.
4. Net Worth Calculation
The concept of net worth is discussed, emphasizing the importance of considering both assets (cash, investments, properties) and liabilities (debt) to get an accurate picture. Net worth is calculated by subtracting liabilities from assets.
5. Empower Personal DashboardTM
The article refers to 2021 data from users of the Empower Personal DashboardTM, providing insights into the average and median balances of retirement accounts compared to credit card balances. This platform seems to offer a comprehensive view of users' financial portfolios.
6. Retirement Contributions by Age
The breakdown of retirement contributions by age groups is presented, showing median and average contributions for users in their 20s, 30s, 40s, 50s, and 60s. It's interesting to note the variations in contribution amounts across different age groups.
7. Top 50 Investment Holdings
The article delves into the top 50 investment holdings of Empower users, revealing the total dollar amounts invested and the number of users for each holding. Notable investments include mutual funds like VTSAX, FXAIX, and VBTLX, as well as individual stocks such as AAPL, TSLA, and MSFT.
8. Popular Investment Holdings
Additionally, the article provides a list of the 50 most popular investment holdings based on the number of users who have invested in each. AAPL, VMFXX, and SPAXX are among the widely held investments.
9. Financial Advice and Planning
The bottom line emphasizes the importance of being "good with money" by understanding one's goals, time horizon, and planning ahead. It underscores the significance of using resources wisely and aligning financial decisions with individual circ*mstances.
In conclusion, the article provides a comprehensive overview of retirement savings, investment trends, and the importance of personalized financial planning using real-world data from Empower users.