Younger workers now becoming 401(k) millionaires — here’s what they’re doing and why you should start copying

We adhere to strict standards of editorial integrity to help you make decisions with confidence. Some or all links contained within this article are paid links.

Contents

Don’t miss 401(k) millionaires on the rise How to become a 401(k) millionaire yourself Grow your real estate portfolio What to read next

Americans think it’ll take $1.26 million, on average, to retire comfortably, according to an April 2025 survey by Northwestern Mutual. And reaching $1 million in retirement savings is a step in the right direction.

There’s good news from Fidelity in that regard, and it’s that 401(k) millionaires are on the rise due to an uptick in worker contribution rates and stock market gains. And further good news is that millennials are finally joining the 401(k) millionaire club, albeit slowly.

Don’t miss

I’m 49 years old and have nothing saved for retirement — what should I do? Don’t panic. Here are 5 of the easiest ways you can catch up (and fast)
You’re probably already overpaying for this 1 ‘must-have’ expense — and thanks to Trump’s tariffs, your monthly bill could soar even higher. Here’s how 2 minutes can protect your wallet right now
Gain potential quarterly income through this $1B private real estate fund — even if you’re not a millionaire. Here’s how to get started with as little as $10

While savers aged 28 to 43 represent fewer than 2% of 401(k) millionaires among Fidelity enrollees, the fact that some have gotten to that point is impressive. And with the right approach, you can, too.

401(k) millionaires on the rise

The number of 401(k) millionaires grew by 9.5% in the third quarter of 2024, hitting 544,000 from 497,000 in the previous quarter, according to Fidelity. What’s more, average 401(k) balances saw a year-over-year increase of 23%, climbing to $132,300.

Balances are also rising among long-term savers. Gen X workers who’ve contributed to their 401(k)s for 15 years have an average balance of $586,100, suggesting that many 401(k) millionaires have been saving consistently for a long time.

Meanwhile, millennials have an average 401(k) balance of $66,500. With the oldest millennials halfway through their careers and the youngest just starting, their balances are expected to grow as they continue to save.

How to become a 401(k) millionaire yourself

Becoming a 401(k) millionaire may be more realistic than you think. The key is consistent saving and starting as soon as possible.

For example, if you invest $400 each month into a 401(k) with a 7% annual return for 41 years your total contribution of $197,000 could grow to over $1 million, thanks to compound interest. However, reducing that timeline to 31 years would only yield about $490,000 — illustrating the value of saving consistently and over the long term.

If $400 per month seems out of reach, try starting with a smaller amount and work up from there. One way that might help is by automatically investing your spare change with Acorns.

The app automatically rounds up your everyday purchases to the nearest dollar and invests the difference into a diversified portfolio. This means that every transaction — from your morning coffee to grocery shopping — contributes to building your savings.

Plus, with an Acorns Silver plan you get access to Acorns Later, a retirement investment account with a 1% IRA match on new contributions. With Acorns Gold you get a 3% IRA match on new contributions and the ability to customize your portfolio by selecting your own stocks.

You could also take advantage of Wealthfront’s automated investing platform, where the power of compound interest works for you. Their “set it and forget it” approach means your money is professionally managed and automatically rebalanced, allowing your wealth to grow steadily over time. Wealthfront offers up to 17 global asset classes to help diversify your portfolio.

If you open a Wealthfront account today, you can snag a $50 bonus.

Whether you’re saving for retirement, a home or building generational wealth, Wealthfront’s low-cost, automated investment strategy can help you achieve your financial goals.

Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

Grow your real estate portfolio

Investing in real estate has traditionally been one way to build wealth. But if you aren’t ready to jump into home ownership — financially or otherwise — new investing platforms are making it easier than ever to tap into the market.

For accredited investors, Homeshares gives access to the $36 trillion U.S. home equity market, which has historically been the exclusive playground of institutional investors.

With a minimum investment of $25,000, investors can gain direct exposure to hundreds of owner-occupied homes in top U.S. cities through their U.S. Home Equity Fund — without the headaches of buying, owning or managing property.

With risk-adjusted internal returns ranging from 12% to 18%, this approach provides an effective, hands-off way to invest in owner-occupied residential properties across regional markets.

If you’re not an accredited investor, crowdfunding platforms like Arrived allow you to enter the real estate market for as little as $100.

Arrived offers you access to shares of SEC-qualified investments in rental homes and vacation rentals, curated and vetted for their appreciation and income potential.

Backed by world-class investors like Jeff Bezos, Arrived makes it easy to fit these properties into your investment portfolio regardless of your income level. Their flexible investment amounts and simplified process allows accredited and non-accredited investors to take advantage of this inflation-hedging asset class without any extra work on your part.