Vanguard data shows average retirement contributions rose to 12.1% in 2025, while 6% of participants took hardship withdrawals, the highest share on record.
Americans saved a record $31,000 in 401(k) accounts last year, driven by higher contribution rates and employer matches. The average total participant contribution rate reached 12.1%, up from 11.6% four years earlier and nearly 2 percentage points higher than a decade ago.
Despite the savings increase, financial strain led 6% of participants to make hardship withdrawals in 2025, the largest share ever recorded. This marks a rise from 5% in 2024, with inflation and rising interest rates cited as key pressures. The report analyzed data from 5 million workers.
Nearly half of participants increased their savings rate, reflecting a shift toward automated retirement planning. Default enrollment and employer contributions have boosted participation from 65% to 86% over 25 years.