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A 401(k) can be a great way to save for retirement on a pre-tax basis, while enjoying the added benefit of an employer match. But it can be hard to know if you’re saving enough. You might be wondering, How much should I have in my 401(k) at 30? Generally speaking, it’s a good idea to have at least one year’s salary saved in your 401(k) by the time you turn 30.

Your actual 401(k) balance, however, may be higher or lower depending on when you started saving, how much of your salary you defer into the plan, the amount your employer matches, and the assets you’ve invested in. We’ll break down the average target balance for workers from age 25 to 65, and what to do if you’re not quite hitting that goal.

How Much You Ideally Have Saved for Retirement

It’s never too early to ask, “Am I on track for retirement?” The sooner you do, the more time you’ll have to catch up if you’re falling short. Just know that the answer can be a moving target, depending on a number of variables.

First of all, your retirement savings objective will depend largely on your retirement goals. Someone who wants to retire at 50 is going to need a much larger nest egg by age 30 than someone who plans to wait until age 70 to retire.

Many other factors also come into play. By way of example, let’s calculate the 401(k) savings for one 30-year-old individual. A good rule of thumb is to save 10% to 15% of your income in a workplace retirement plan each year. Following that advice, our hypothetical saver:

•   starts contributing to their plan at age 25.

•   defers 10% of their $60,000 salary annually for five years.

•   benefits from an employer match of 50% of contributions, up to 6% of their salary.

•   earns a 7% annual rate of return investing in mutual funds that contain bonds and stock — a pretty average rate of return on 401(k) investments. Note that the number is a general benchmark. All investments come with risk, and the rate of returns will vary depending on an individual investor’s portfolio.

In this hypothetical scenario, by age 30, our individual would have $46,539 saved in their 401(k). However, keep in mind that this amount can vary based on any number of factors, including a portfolio’s asset allocation and potential market reactions, or brief movements in a stock’s price.

A savings of $46,539 is a great start. However, you can see how their balance might be significantly higher or lower if we changed up one or more details. For instance, by contributing 15% of their pay instead, they’d have $64,439 on their Big 3-0. On the other hand, if they started saving later, earned a lower rate of return, or enjoyed a less generous employer match, their balance could be lower.

Bottom line? How much you should have saved in a 401(k) by age 30 (or any other age) is subjective and varies based on several conditions, including where you’re starting from and how aggressively you’re saving each year.

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How Much Do You Need to Retire

While you might have heard that you need $1 million or even $2 million to enjoy a comfortable retirement, that’s merely a guideline rather than a set-in-stone number. The amount you’ll need to retire can depend on:

•   How long you plan to continue working

•   When you anticipate taking Social Security benefits

•   Your desired lifestyle in retirement

•   How much you expect to spend on basic living expenses in retirement

•   Whether you have a spouse or partner

•   Whether you anticipate needing long-term care at some point

Assessing your personal retirement goals can help you come up with a realistic number that you should be targeting. It’s also helpful to consider how things like changing health care needs, increases (or cuts) to Social Security and Medicare, and inflation may impact the dollar amount you need to save and invest to avoid falling short in retirement.

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Average and Median 401(k) Balance by Age

Each year, Vanguard’s “How America Saves” report analyzes data from nearly 5 million of its retirement plans, including account balances, automatic enrolment, participation and deferral rates, hardship withdrawals, and loan issuances.

Below are findings from its 2024 report. Looking at the average savings by age can give you some idea of whether you’re on track. But keep in mind that your progress and savings will depend on your investments and specific goals.

Using a chart like this can make it easier to see where you are on the savings spectrum. So if you’re wondering “how much should I have saved by 40?,” for example, you can see at a glance that the average 40-something has close to $100,000 in retirement savings.

Remember that average numbers reflect outlier highs and lows, while the median represents where people in the middle of the pack land. Between them, median can be a more accurate or reliable number to measure yourself against.

Recommended: Is My 401(k) Enough for Retirement?

Tips to Save for Retirement

Enrolling in your 401(k) is one of the easiest ways to begin building retirement savings. Your employer may have enrolled you automatically when you were hired. If you’re not sure, contact your HR department. You can also check your default contribution rate to see how much you’re contributing to the plan.

It’s a good idea to contribute at least enough to get the full company match if one is offered. Otherwise, you’re leaving free money on the table.

If you’re worried you’re not saving enough, consider supplementing your 401(k) with an Individual Retirement Account (IRA).

An IRA is another tax-advantaged retirement plan. You can open a traditional IRA, which offers the benefit of tax-deductible contributions, or a Roth IRA. With a Roth IRA, you can’t deduct contributions, but qualified withdrawals are 100% tax-free.

Not sure how to start a retirement fund? You can likely do it through an online brokerage. You can create an account, choose which type of IRA you want to open, and set up automatic contributions to start saving.

Of course, retirement planning starts with getting to know your spending habits and budget. If you’re not using a budget app yet, consider a money tracker.

How Much Should You Contribute to Your 401(k) Per Year

The amount you should contribute to your 401(k) each year should reflect your retirement savings goal, how many years you have to save, and your expected annual rate of return.

When deciding how much to contribute, first consider your budget and how much of your income you can commit to your 401(k). Next, look at the amount you need to contribute to get the full company match. You can then plug those numbers, along with your salary, into a 401(k) calculator to get an idea of how likely you are to hit your retirement savings goal.

For instance, you might figure out that you need to contribute 15% of your pay each year. But if you’re not making a lot yet, you might only be able to afford contributing 8% each year. So what do you do then? A simple solution is to increase your contribution amount each year and work your way up to the 15% threshold gradually.

Example of Impact of Compounding Returns on Retirement

Does it matter when you start saving for retirement? Yes, and in a big way, thanks to the concept of compounding returns. Compound returns are the returns you earn on both the initial principal you invested as well as the previous returns you earned on that principal. The earlier you can start investing in a 401(k) or other retirement plan, the more time your money has to potentially compound and grow.

In fact, one effective way to build wealth in your 30s is to continue contributing to your retirement plan and choose an asset allocation that fits with your risk tolerance and risk capacity. Risk tolerance is the amount of risk you’re comfortable with and risk capacity is the amount of risk you may need to take to achieve your investment goals without jeopardizing your financial wellbeing. In general, the younger you are, the more time you have to recover from market downturns, so you might opt to be a little more aggressive with your investments. But if your capacity for risk is low, you may want to invest more conservatively.

For example, let’s say a 25-year-old who makes $60,000 a year starts contributing $500 a month and invests entirely in S&P index funds. By the time they’re 65, their nest egg will be worth more than $1.25 million, assuming annual compounding and a 7% average annual return on their investments. (Note that this number doesn’t account for any fees, taxes, or market movements and that the percentage is based on an inflation-adjusted return and this percentage can be even lower based on time in the market.)

Now, assume that same person waits until age 35 to start saving. By age 65, they’d have just $591,838 saved. Note that this number doesn’t account for any fees, taxes, or market movements and that the percentage is based on an inflation-adjusted return and this percentage can be even lower based on time in the market. That’s still a decent chunk of money, but it’s far less than they would have had if they’d gotten an earlier start. This example illustrates how powerful compounding returns can be when determining how much you’ll end up with in retirement.

Don’t Panic If You’re Behind on Saving

Having a lot of money in your 401(k) by age 30 is great, but don’t feel bad if you’re not where you need to be. Instead of fretting over what you haven’t saved, focus on what you can do next to increase your savings efforts.

That can mean:

•   Increasing your 401(k) contribution rate

•   Opening an IRA to go along with your 401(k)

•   Choosing low-cost investments to minimize fees

•   Investing through a taxable brokerage account

What if you have no money to invest? In that case, you might need to go back to basics. Getting on a budget, for example, can help you rein in overspending and find the extra money that you need to save. A free budget app is a simple and effective way to keep tabs on spending and saving.

The Takeaway

How much you should have in your 401(k) at 30 isn’t a simple number that applies to everyone. Your savings goal depends on a number of factors, such as your anticipated retirement age, when you started saving, your rate of return, and so on. A good rule of thumb is to invest 10% to 15% of your salary in a tax-advantaged retirement plan. From there, compounding returns may help your holdings multiply over a longer period of time, though there are no guarantees. The bottom line: Try to save and invest as much as you comfortably can.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

FAQ

What is the average 401(k) balance for a 35-year-old?

The average 401(k) balance for a 35-year-old is $91,281, according to Vanguard’s How America Saves report. Average 401(k) balances are typically higher than median 401(k) balances across all age groups, as they reflect higher and lower outliers.

How much will a 401(k) grow in 20 years on average?

The amount that a 401(k) will grow over a 20-year period can depend on how much someone contributes to the plan annually, how much of that contribution their employer matches, what assets they invest in, and their average rate of return. Someone who saves consistently, increases their contribution rate annually, and chooses investments that perform well will likely see more growth than someone who saves only the bare minimum or hands back a chunk of their returns in 401(k) fees.

What is a good 401(k) balance at age 30?

A good 401(k) balance by age 30 is at least one year’s worth of salary. So if you make $75,000 a year you’d ideally want to have $75,000 in your retirement account. Whether that number is realistic for you can depend on how much you earn, when you started saving in your 401(k), and your rate of return.

Photo credit: iStock/Burak Kavakci

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SORL-Q324-046

If you need to transfer money from an account at one bank to an account at another, you have several options, including online bank transfers, mobile payment apps, wire transfers, and writing checks. Which method will work best will depend on how quickly you need to make the transfer, how much money you are moving, and whether or not you’re willing to pay a fee. Here’s what you need to know.

What Is a Bank-to-Bank Transfer?

A bank-to-bank transfer is the movement of money from an account at one bank to an account at a different bank. Also known as an external transfer, this type of transaction can be done in numerous ways, including making an online transfer, using a mobile banking app, making a wire transfer, or writing a check.

You might make a bank-to-bank transfer if your funds are spread out at different banks. For example, maybe you have a checking account at a traditional bank but opened a savings account at an online bank to take advantage of the higher rates. Bank-to-bank transfers can also come into play when you’re sending money to friends and family.

Depending on the method, an external bank transfer can happen immediately, or it may take a few days to process.

Things to Consider Before Transferring Money

There are several different methods for sending money from one bank to another. To find the best option for your needs, you’ll want to consider:

•   Transfer speed: Bank transfers can take anywhere from a few seconds to several business days. If time is critical, opt for a faster transfer method, but be aware that this may come with higher costs.

•   Transfer fees: While many transfer methods are free, others may come with fees. You’ll generally pay more for wire transfers and expedited transfers.

•   Transfer Limits: Some banks and payment apps impose limits on how much you can transfer per day or in any one transaction. Additionally, banks often limit the number of withdrawals you can make from a savings account to six per month; exceeding your bank’s transaction limits could result in a fee.

4 Ways to Send Money From One Bank to Another

Here’s a look at four common ways to transfer money to an account at another bank.

1. Online Bank Transfer

A simple way to move money from an account you own at one bank to an account you have at another financial institution is to make an online bank transfer. To illustrate the process, let’s say you want to transfer money from a checking account at Bank A to a savings account you own at bank B.

•   Link the accounts: First, you’ll need to log into your account at Bank A (online or using the app), look for the “transfer” option, then choose “external” transfer. Enter Bank B’s routing number and your account number at that bank.

•   Verify the receiving account: After you provide the required information, Bank A will likely want to verify that you have access to the second bank’s account. You might need to enter your username and password for Bank B. Or, Bank A may make a small deposit into Bank B and ask you to confirm the amounts (which can take a day or two).

•   Make the transfer: Once the accounts are linked, navigate back to Bank A’s “transfers” section, select the “sending” and “receiving” accounts, then enter the amount to be transferred and the date for the transaction to occur. You can also typically choose whether you want to make a one-time transaction or a recurring transfer (once a month, for example). After you’ve made your choices, you’ll hit “submit.”

Online bank transfers can take up to three business days to complete and are typically free; some banks charge a fee for same- or next-day transfers.

2. Peer-to-Peer Payment App

A convenient way to send a small amount of money to a friend, family member, or small business is to use a peer-to-peer or P2P payment app, such as Cash App, Google Pay, and Venmo. Typically, you need to download the app, create an account, and link your bank account or debit card. You’ll also need the recipient’s cell phone number or, in some cases, email address (note that the recipient also needs an account with the service).

Sending funds via a P2P app is typically instant. However, the funds may land in the recipient’s account within the app. The recipient can then typically transfer those funds to a bank account within one to three business days (for free) or immediately (for a fee).

Payment apps may limit how much you can transfer in one transaction or within a certain time frame. This is to help minimize the risk of a fraudster draining your account.

3. Wire Transfer

A wire transfer can be a good way to make a bank transfer when you need to send a considerable amount of money to someone quickly and/or the recipient is located overseas. Wire transfer generally allows you to send more money than other methods, and funds are usually available within one business day — often within a few hours. Wire transfers aren’t free though. You may pay around $25 for a domestic wire transfer and $45 for an international wire transfer. Wire transfers can be done through banks, credit unions, or providers such as Western Union or Wise.

4. Writing a Check

An old-school way of transferring money from one bank to another is to write a check. You can write a check to yourself (using your name as the payee), then deposit it into an account you own at another bank using mobile deposit. You can also deposit the check at an ATM that accepts deposits or by visiting a branch. If you’re looking to transfer money to someone else’s bank account, you can write a check to that person.

This transfer method is free, except for the cost involved in ordering checks.

Keep in mind, however, that writing a check is not an instant money transfer. It can take a couple business days, and sometimes longer, for a check to clear and be available in the new account.

Comparing Bank-to-Bank Transfer Methods

Here’s a quick look at how bank-to-bank transfer methods compare.

Staying Safe When Transferring Money from One Bank to Another

Transferring money from one bank to another by any of the above methods is generally safe and secure. However, there are a few things to keep in mind with each method to ensure that nothing goes awry.

•   Online bank transfers: This type of bank transfer uses the Automated Clearing House (ACH) network, which is federally regulated and secure. The main risk with an ACH transfer is having a scammer trick you into sending money or giving them your banking information. If you ever suspect bank fraud, reach out to your bank as quickly as possible.

•   Payment apps: Since payment is typically transferred to the recipient’s account in the app almost instantly, there’s no way to cancel a P2P payment once it’s been made. For this reason, it’s critical to only transfer funds to a verified person or business and be sure to use the correct phone number or email address.

•   Wire transfer: Speed is a big advantage of wire transfers but it can also be a disadvantage, since you typically can’t cancel a wire transfer once the money lands in the recipient’s account. Be sure you only wire money to someone you know.

•   Personal check: There is a small risk of a check being stolen or lost. However, a key advantage of this method of money transfer is that you can cancel checks if they haven’t cleared. To stop a check, contact your bank right away. In some cases, you’ll need to pay a stop-payment fee.

The Takeaway

With the prevalence of digital banking and money transfer apps, sending funds from one bank to another has become significantly quicker and more convenient. Options include online bank transfers, mobile apps, wire transfers, and writing checks. Which one to pick will depend on whether or not you own both accounts, how much you are transferring, how quickly you want the funds moved, and how much (if any) in fees you are willing to pay.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

What is the easiest way to transfer money from one bank to another?

Generally, the easiest way to transfer money between banks is by making an online bank transfer or using a peer-to-peer payment platform or app. These options are secure, user-friendly, and often accessible within your banking app, making them ideal for both personal and external transfers.

Can I directly transfer money to someone else’s bank account at a different bank?

Yes, you can directly transfer money to someone else’s bank account at a different bank through a wire transfer, or you could write them a check. Another simple way to send them money is through a peer-to-peer (P2P) payment platform or app. These services are often free, especially for domestic transactions, and are available through most banking apps or as standalone apps.

Can you transfer large amounts of money between banks?

Yes, you can transfer large amounts between banks. If you’re sending a large amount of money to someone else, you may want to use a wire transfer at your bank. You’ll need the recipient’s account and routing numbers, and both you and the recipient will likely incur fees. If you’re moving a large amount of money between accounts you own, you can do this for free by making an online external bank transfer. You can set this up by logging into your account online or via your banking app.

How to transfer money from one bank to another for free?

If you own both accounts, you can transfer money between banks for free by logging into your bank account and setting up an external transfer. Another free option is to use a peer-to-peer (P2P) payment app, which offers fast transfers to recipients who also have an account with the service.

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SoFi members with direct deposit activity can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.