American Families Boost Retirement Savings as Participation Rates Climb

Recent data from the Federal Reserve indicates that American families are participating in retirement plans at higher rates, and their retirement savings balances have grown significantly in the years leading up to 2025.

The Federal Reserve’s Survey of Consumer Finances, which released a detailed report on Friday regarding shifts in family finances from 2022 to 2025, revealed that enrollment in retirement plans reached 54.9% of families in 2025. This represents a steady increase of 0.6 percentage points compared to the figures from 2022.

Over the same period, the conditional median value of retirement accounts climbed by 11%, reaching $106,000. Meanwhile, the conditional mean, or average value, surged by 23% to stand at $451,100 as of last year.

Retirement accounts continued to serve as the second-most commonly held financial asset among American households, encompassing individual retirement accounts (IRAs) and various employer-sponsored plans, such as 401(k)s, 403(b)s, and thrift savings accounts.

Participation in retirement plans among Americans increased in the Fed’s latest survey of consumer finances. (Angela Weiss / AFP for Getty Images)

According to the Fed’s survey of consumer finances, retirement savings balances increased across nearly all demographic age groups between 2022 and 2025.

Specifically, the 55 to 64 age cohort saw their average retirement balances rise from $588,500 in 2022 to $670,200 in 2025. Similarly, families in the 45 to 54 age bracket witnessed their savings grow from $342,700 to $415,800 during this timeframe.

The 35 to 44 age cohort experienced an increase in average retirement savings, climbing from $154,800 to $182,400. Although the under-35 age group’s average savings experienced a minor decline from $53,800 to $48,400 between 2022 and 2025, their balances remained substantially higher than the averages of $43,800 in 2016 and $38,300 in 2019.

Direct ownership of stocks declined slightly in the latest report. (Reuters/Jeenah Moon)

The Federal Reserve’s analysis highlighted that defined contribution plans and individual retirement accounts (IRAs) are far more prevalent than traditional defined benefit plans. In 2025, enrollment in these plans ranged from approximately 50% among the youngest families to about 65% for the oldest families.

The report found that while families across all age brackets saw gains in defined contribution and IRA plan participation over the past decade, the most significant growth occurred within the youngest cohort. Their participation rates surged from 42% in 2016 to nearly 50% in 2025.

In 2025, nearly all American families—98.9%—owned at least one type of financial asset. This broad ownership included transaction accounts, certificates of deposit, savings bonds, other bonds, stocks, pooled investment funds, retirement accounts, cash-value life insurance, or other managed assets.

Retirement plans were the second-most commonly held type of financial asset, behind transaction accounts. (Istock)

This figure remains largely unchanged from 2022. Transaction accounts—including checking, savings, money market, and call accounts, as well as prepaid debit cards—were the most commonly held category of financial assets in 2025, with an ownership rate of 98.7%.

Direct stock ownership declined from 2022 to 2025, dropping from 21% of families to 19%. Notably, the 2022 survey had recorded a sharp six percentage-point increase in direct stock ownership compared to 2019, which represented the largest single survey jump on record.

The latest findings suggest that while some of the surge in direct stock ownership observed in 2022 was temporary, the 2025 rate remains well above the 15.2% baseline recorded in 2019. Additionally, conditional median stock holdings rebounded from $16,400 to $30,000, nearly recovering the previous decline in median stock holdings observed between 2019 and 2022.

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