The average 401(k) return by age ran from 2.04% to 7.29% a year over 2021 to 2024: Vanguard target-date funds for savers about 24 to 44 compounded 6.91% to 7.29%, and the retiree Income fund 2.04%. The median 401(k) plan in Form 5500 filings earned 13.16% in 2024 and 5.88% a year over 2021 to 2024.
Those are two different measurements, and the page keeps them apart. The plan figures are a Q3 tabulation of every 401(k) plan that filed a Form 5500 with Schedule H financial statements for plan years 2021 to 2024, published by the U.S. Department of Labor’s EBSA Form 5500 datasets. The filings carry no participant ages, so the age figures come from a separate source: the calendar-year returns that Vanguard printed in its target-date fund summary prospectuses on SEC EDGAR (Vanguard Chester Funds, CIK 752177).
Key findings
- The median 401(k) plan returned 13.16% in plan year 2024, across 52,023 plans with at least $1 million in beginning net assets (Q3 tabulation of Form 5500 Schedule H, PY2024).
- The median plan lost 16.50% in plan year 2022, and 95.4% of the 59,231 plans in that year’s sample had a negative return.
- Among calendar-year plans only, 99.74% of 55,789 plans lost money in 2022, while 0.07% lost money in 2024.
- For 39,353 plans present in all four years, the median compound return for 2021 to 2024 was 25.68%, or 5.88% a year.
- After CPI inflation of 21.17% over the same four years (NYU Stern historical returns file), that median plan grew 0.92% a year in real terms.
- In 2024, the median $1 billion+ plan earned 14.25% and the median $1 million to $10 million plan earned 12.49%, a 1.76 point spread.
- Vanguard’s Target Retirement 2055 Fund compounded 7.27% a year for 2021 to 2024; the Target Retirement 2025 Fund compounded 3.83%; the Income fund compounded 2.04% (Investor Shares, SEC 497K filings).
- Vanguard’s own recordkeeping data put the average participant total return at 13.7% for 2024, 0.54 points above the Form 5500 median plan (How America Saves 2026, Figure 91).
What was the average 401(k) return in each year from 2021 to 2024?
The median 401(k) plan returned 13.67% in 2021, lost 16.50% in 2022, gained 16.86% in 2023 and gained 13.16% in 2024, per the Q3 tabulation of Form 5500 Schedule H. The middle 80% of plans sat inside a band 5.55 to 6.48 points wide each year, so most plans landed within about 3.5 points of the median.
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| Plan year | Plans kept | 10th pct. | Median plan | 90th pct. | Asset-weighted | Plans with a loss | S&P 500 with dividends | Vanguard avg. participant |
|---|---|---|---|---|---|---|---|---|
| 2021 | 57,550 | 10.07% | 13.67% | 16.47% | 13.88% | 4.68% | 28.47% | 14.6% |
| 2022 | 59,231 | -19.07% | -16.50% | -12.70% | -15.16% | 95.40% | -18.04% | -15.8% |
| 2023 | 52,100 | 13.60% | 16.86% | 20.08% | 17.49% | 0.10% | 26.06% | 18.1% |
| 2024 | 52,023 | 10.47% | 13.16% | 16.02% | 14.39% | 0.16% | 24.88% | 13.7% |
Q3 tabulation of DOL Form 5500 and Schedule H, plan years 2021 to 2024; 401(k) plans (pension code 2J) with $1 million+ beginning net assets. S&P 500 column: NYU Stern historical returns file (Damodaran). Last column: Vanguard How America Saves 2026, Figure 91.
The “plans with a loss” share for 2021 (4.68%) is inflated by non-calendar plan years: a plan year running July 2021 to June 2022 is filed as plan year 2021 but absorbed the first half of the 2022 decline. Restricting the 2021 sample to 54,105 calendar-year plans moves the median to 13.81% and the loss share to 0.11%.
The asset-weighted return (total investment income divided by total average assets) ran above the median in all four years, by 0.21 to 1.34 points. That pattern matches the size table further down: $1 billion+ plans, which dominate an asset-weighted figure, posted the highest band median in 2021, 2022 and 2024 and the second highest in 2023.
The S&P 500 gap is the clearest lesson. In 2024, the index returned 24.88% while the median plan earned 13.16%, a gap of 11.72 points, because a typical plan holds bonds, stable value and non-U.S. stocks next to U.S. large caps. In 2022 the gap reversed to 1.54 points in the plan’s favor: the median plan lost 16.50% against the index’s 18.04% loss, because the bond sleeve fell too. The 10-year Treasury lost 17.83% that year in the same NYU Stern file, which is why a stock and bond mix gave so little cushion in 2022. Drawdown tactics for a balance near retirement are covered in the q3adv guide on protecting a 401(k) from a market crash.
What is the average 401(k) return by age?
Return by age follows the stock share a saver holds, and target-date funds make that visible: over 2021 to 2024, Vanguard’s 2055 and 2065 funds (about 90% stocks) compounded about 7.3% a year, its 2035 fund 5.38%, its 2025 fund 3.83% and its Income fund 2.04%. Form 5500 cannot produce this table, because the filings report plan totals without any participant ages.
| Vanguard fund (Investor Shares) | Approx. age in 2024 | Stocks, Jan. 2025 prospectus | 2021 | 2022 | 2023 | 2024 | 2021 to 2024, per year |
|---|---|---|---|---|---|---|---|
| Target Retirement 2065 | about 24 | about 90% | 16.46% | -17.39% | 20.15% | 14.62% | 7.29% |
| Target Retirement 2055 | about 34 | about 90% | 16.44% | -17.46% | 20.16% | 14.64% | 7.27% |
| Target Retirement 2045 | about 44 | 83.6% | 16.16% | -17.36% | 19.48% | 13.91% | 6.91% |
| Target Retirement 2035 | about 54 | 68.6% | 12.96% | -16.62% | 17.14% | 11.78% | 5.38% |
| Target Retirement 2025 | about 64 | 51.5% | 9.80% | -15.55% | 14.55% | 9.44% | 3.83% |
| Target Retirement Income | retired | about 30% | 5.25% | -12.74% | 10.74% | 6.58% | 2.04% |
Calendar-year returns from the 1-year “Return Before Taxes” row in each January summary prospectus (Form 497K) filed by Vanguard Chester Funds in 2022, 2023, 2024 and 2025, for example the January 31, 2025 Target Retirement 2025 Fund prospectus. Ages assume retirement at 65 in the fund’s target year. Annualized column: Q3 calculation. Not from Form 5500.
Two things stand out. First, the 2022 loss barely changed with age: the 2065 fund lost 17.39% and the 2025 fund, with roughly half its assets in bonds, still lost 15.55%. Second, the age gap opened in the recovery years, when the 2065 fund gained 20.15% in 2023 against 14.55% for the 2025 fund. Over the full four years, savers near 64 kept about half the annual growth of savers near 34 (3.83% against 7.27%).
Real participants follow the same slope, if a little less steeply. How America Saves 2026 (Figure 81) reports year-end 2024 equity allocations of 88% for Vanguard plan participants aged 25 to 29, 73% at ages 50 to 54, 60% at ages 60 to 64 and 45% at 70 and older. The same report says about half of participants aged 25 to 34 held a 2060 fund in 2025.
Worked example, Q3 calculation; hypothetical, not a projection. A $250,000 balance invested on January 1, 2021 with no further contributions would have reached $330,975 in the 2055 fund, $290,600 in the 2025 fund and $271,000 in the Income fund by December 31, 2024. The $40,375 gap between the 2055 and 2025 outcomes reflects the 2025 fund’s larger bond share, which held its 2022 loss to 15.55% but also held its 2023 gain to 14.55%. In 2026, a 60-year-old can add $24,500 plus the $11,250 catch-up for ages 60 to 63, or $35,750 in all, and those deposits buy into whichever glide path the plan’s default or the saver’s election sets.
Does a bigger 401(k) plan earn a higher return?
In rising markets, yes, by a modest margin: the median $1 billion+ plan returned 14.25% in 2024 against 12.49% for plans with $1 million to $10 million, per the Q3 Form 5500 tabulation. In the 2022 decline the size bands converged, with every band’s median between minus 16.39% and minus 16.65%.
| Beginning net assets | Plans, 2024 | Median 2024 | 10th to 90th pct. 2024 | Median 2022 | Median 2023 |
|---|---|---|---|---|---|
| $1M to $10M | 17,251 | 12.49% | 9.80% to 15.37% | -16.43% | 16.40% |
| $10M to $50M | 23,642 | 13.25% | 10.75% to 16.10% | -16.52% | 16.93% |
| $50M to $250M | 8,008 | 13.81% | 11.47% to 16.41% | -16.62% | 17.44% |
| $250M to $1B | 2,157 | 13.97% | 11.78% to 16.80% | -16.65% | 17.78% |
| $1B+ | 965 | 14.25% | 11.75% to 16.94% | -16.39% | 17.70% |
Q3 tabulation of DOL Form 5500 Schedule H, PY2022 to PY2024. Returns are net of plan-level administrative expenses reported on Schedule H line 2i.
The data does not say why larger plans earned more in up years. A higher stock share, cheaper share classes and fewer participants near retirement are all consistent with the pattern, and Schedule H does not break out any of them. The fee side is covered in the q3adv analysis of what the average 401(k) plan costs.
What did $100,000 in the median 401(k) plan earn over 2021 to 2024 after inflation?
Compounded at each year’s median plan return, $100,000 on January 1, 2021 became $125,514 by the end of 2024, a 5.85% annual pace. Consumer prices rose 21.17% over the same four years, so the median plan in the four-year panel (5.88% a year nominal) gained 3.72% in total after inflation, or 0.92% a year.
The year-by-year path shows how much of that came back after 2022: $113,670 after 2021, $94,914 after 2022, $110,917 after 2023 and $125,514 after 2024 (Q3 calculation from the annual medians; hypothetical). For the 39,353 plans that appear in all four years, the 10th percentile compounded 4.43% a year and the 90th percentile 7.32%, and only 0.08% ended the four years below their starting value.
That four-year window is short and starts at a market high, so it is a record, not a planning rate. The q3adv guide to how much to have in a 401(k) by age treats balances separately, and whether a 401(k) keeps growing after retirement covers growth during withdrawals.
A down year also changes the arithmetic of a Roth conversion. Under IRC 408A(d)(3)(A), a converted amount is taxed as ordinary income at its value on the conversion date. A single filer in 2026 with $100,000 of taxable income has $101,775 of room before the 24% bracket tops out at $201,775; after a 16.50% drop like the 2022 median, that same $101,775 conversion moves shares that were worth $121,886 at the prior year-end. The trade-offs for this age group are covered in Roth conversions at 60.
Why does a plan’s return differ from the return on your statement?
A plan’s return is one dollar-weighted figure for all of its assets, while a statement shows one participant’s fund mix and contribution timing. In 2024 the gap between Vanguard’s average participant (13.7%) and the Form 5500 median plan (13.16%) was 0.54 points; across 2021 to 2024 the gap ranged from 0.54 to 1.24 points.
Four mechanical differences can open that gap. Plan dollars tend to sit in older participants’ larger balances, which hold fewer stocks; plan assets include participant loans, which earn a fixed interest rate; the Q3 formula subtracts plan-level administrative expenses; and Vanguard reports a time-weighted “total return” per participant, while a plan figure blends every account.
Federal rules already put a fund-level return in front of every participant. 29 CFR 2550.404a-5(d)(1)(ii) requires a participant-directed plan to disclose each designated investment’s average annual total return for 1, 5 and 10 calendar-year periods, in a chart that lets the funds be compared with a benchmark. That chart is furnished before a participant first directs investments and at least annually afterward, so the question to ask the plan administrator is for the most recent 404a-5 comparative chart, which shows the 2025 calendar-year figure for each fund in the lineup.
The “personal rate of return” on a recordkeeper statement is a separate, dollar-weighted number. Vanguard reported 2024 personal returns averaging 12.7%, one point below the 13.7% time-weighted average; How America Saves 2026 describes personal returns as adjusted for each participant’s own pattern of contributions, exchanges and withdrawals.
What the data cannot tell you
Form 5500 has no participant age field, no asset allocation field and no fund-level returns, so no age-based return can be computed from it. The age table on this page uses six target-date funds from one fund family, which is one glide path among many; other families held different stock shares at the same target year.
The filings cover only plans that file a full Form 5500 with Schedule H, generally plans with 100 or more participants. Starting with plan years that began on or after January 1, 2023, a defined contribution plan counts participants with account balances at the beginning of the plan year for that line, per the 2024 Form 5500 instructions, which describe a small plan as one with fewer than 100 participants with account balances. That change moved plans out of the sample: 401(k) filings with Schedule H fell from 67,853 for 2022 to 57,720 for 2023.
Plan year 2024 data includes filings received through October 23, 2026; late and amended filings can still change the counts. Plan year 2025 filings are not yet complete, so the 19.3% average participant return Vanguard reported for 2025 has no Form 5500 counterpart on this page.
The return formula assumes contributions, distributions and expenses arrive evenly through the year (the half-year convention). Plans with large mid-year inflows or a merger can be misstated, which is why the 5% reconciliation filter below dropped 2,790 plans from the PY2024 sample.
Method
Dataset: DOL EFAST2 Form 5500 “Latest” files and Schedule H files for plan years 2021, 2022, 2023 and 2024, read in place and joined on ACK_ID. Universe: filings whose pension benefit codes include 2J (401(k) feature) and whose Schedule H net assets at the beginning of the year were at least $1,000,000, deduplicated to the latest filing per sponsor EIN and plan number.
Formula: return = (TOT_INCOME_AMT minus TOT_CONTRIB_AMT minus TOT_ADMIN_EXPENSES_AMT) divided by (NET_ASSETS_BOY_AMT + 0.5 times net flow), where net flow = contributions minus benefit distributions minus administrative expenses. Filters: end-of-year net assets must reconcile within 5% of beginning assets plus income minus distributions minus expenses, and the return must fall between minus 60% and plus 60%.
Counts for PY2024: 57,392 401(k) filings with Schedule H; 55,408 with $1 million+ beginning net assets; 54,829 after deduplication; 2,790 dropped for failing the reconciliation, 14 dropped as outliers and 2 dropped for a non-positive denominator; 52,023 kept, holding $6.50 trillion of beginning net assets. Four-year panel: plans kept in all four years, matched on EIN and plan number (39,353). Code: tab_average-401k-return-by-age.py (Form 5500) and byage_average-401k-return-by-age.py (target-date and inflation figures).
Cross-checks: Vanguard How America Saves 2026, Figure 91 (average participant total returns 2021 to 2025) and the S&P 500 and CPI series in the NYU Stern histretSP file. S&P Dow Jones Indices fact sheets could not be retrieved, so the NYU Stern series (S&P 500 including dividends) stands in; as a compiled series it can differ by a fraction of a point from the index provider’s official total return.
How to cite this data
Q3 Advisors, “Average 401(k) Return by Age: 2021 to 2024 Data From 52,023 Plan Filings,” https://q3adv.com/average-401k-return-by-age/, November 8, 2026.
Frequently asked questions
Is a 7% return on a 401(k) good?
Against 2021 to 2024 records, 7% a year sat near the top of the range. The median 401(k) plan compounded 5.88% a year in Form 5500 filings, and the 90th percentile plan 7.32%. Vanguard’s 2045 target-date fund compounded 6.91% and its 2055 fund 7.27% over the same four years.
Why is my 401(k) return lower than the S&P 500?
Most 401(k) balances hold bonds, stable value and non-U.S. stocks alongside U.S. large caps. In 2024 the S&P 500 returned 24.88% (NYU Stern file) while the median plan in Form 5500 filings earned 13.16% and Vanguard’s 2055 target-date fund 14.64%. In 2022, the median plan lost 16.50% against the index’s 18.04% loss.
How do I find my own 401(k) rate of return?
Two numbers are available. The quarterly statement often shows a dollar-weighted personal rate of return, and the annual fee and investment disclosure required by 29 CFR 2550.404a-5 lists each fund’s 1, 5 and 10 calendar-year returns. Ask the plan administrator for the latest comparative chart if it is not posted on the recordkeeper website.
How often does a 401(k) lose money in a year?
It tracks market years, not plan quality. In plan year 2022, 95.4% of 59,231 large 401(k) plans in Form 5500 filings had a negative return, and 99.74% of calendar-year plans did. In 2023 and 2024, fewer than 0.2% of plans lost money in either year.
Do older workers earn lower 401(k) returns?
On average, yes, because their accounts hold fewer stocks. Vanguard participants aged 60 to 64 held 60% equities at year-end 2024 against 88% at ages 25 to 29 (How America Saves 2026). Vanguard’s 2025 target-date fund compounded 3.83% a year for 2021 to 2024 against 7.27% for its 2055 fund.
This article is for educational purposes only and is not individualized investment, tax, or legal advice. Consult a qualified professional about your specific situation.
