Key Takeaways
- The median household in its 40s has just $37,700 in financial assets, far below what many retirement benchmarks suggest.
- The average is much higher at $277,538, skewed by a small share of wealthy households with outsized balances.
- Cash makes up much of these portfolios, while relatively few people in this age group directly own stocks or bonds.
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Your 40s are often your peak earning years—or close to it. Yet the latest Federal Reserve data shows that the typical financial portfolio for people in this age group—excluding home equity—is less than $40,000. And nearly four in 10 American fortysomethings have no retirement savings at all.
What 40-Somethings’ Investment Portfolios Really Look Like
The median household in its 40s has $37,700 in total financial assets, according to the latest Federal Reserve data. The average dollar amount is much higher, at nearly $277,538—a gap that shows how a small number of wealthy households skews the picture.
Cash is of course one of the most widely held asset types. Among people in their 40s, the median balance of liquid assets—such as checking, savings, and money market accounts—is $8,500, with a mean of $47,902. That’s a significant share held in accounts that likely don’t keep up with inflation over time.
Meanwhile, direct stock ownership is still relatively uncommon: only about 21% of households ages 40 to 49 hold individual shares. Among those who do, the median value is $10,000, while the mean climbs to $188,015. Owning bonds directly is even rarer, with fewer than 1% of households in this group holding them.
Why Many Are Falling Short on Retirement Savings
About 61% of households ages 40 to 49 have money in retirement accounts. Among those who do, the median balance is $73,000, and the mean is $195,173. Across all households in this age group—including those with no retirement savings—the median drops to just $13,000.
That’s well below common benchmarks. Fidelity suggests having three times your annual salary saved by age 40, four times by age 45, and six times by age 50—targets the typical household in this age group hasn’t met.
More recent data offers additional context, though the picture hasn’t shifted dramatically since the Fed’s 2022 survey. Workers ages 35 to 44 have an average 401(k) balance of $103,552 and a median of $39,958, according to Vanguard’s How America Saves 2025 report.
Meanwhile, Fidelity data show that Gen X workers (roughly ages 46 to 61) hold an average 401(k) balance of $222,100. They’re also increasingly turning to IRAs as a supplement to their workplace plan, with a 25% year-over-year increase in contributions in the fourth quarter of 2025, resulting in an average IRA balance of $120,300.
A Small but Positive Shift for Gen X
Fidelity’s latest data shows Gen X workers are saving more than 15% of their income on average, including employer matches. While this reflects only those with access to a workplace 401(k), it’s an encouraging sign for a generation long seen as behind on retirement savings.
How to Catch Up on Retirement Savings in Your 40s
If you’re behind on retirement savings, your 40s are a key time to catch up. Start with the basics. If your employer offers a 401(k) match, contribute enough to get the full match—it’s essentially free money.
The pay-off-debt-or-invest decision can shift in your 40s. If your expected investment returns are higher than your loan’s interest rate, it can make sense to invest while carrying that debt—especially if you can deduct mortgage interest.
This is also a key window to build a Roth IRA, before income limits start becoming a concern. In 2026, single filers can make full contributions up to a modified adjusted gross income (MAGI) of $153,000, or $242,000 for joint filers.
You’ll also want to plan ahead for age 50. That’s when catch-up contributions kick in, allowing you to contribute an extra $8,000 on top of the standard $24,500 401(k) limit in 2026, for a total of $32,500.
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