A new study finds that the average American worker has only $955 saved for retirement through a defined contribution plan as a 401(k) account.and most fall short of the retirement savings goals recommended for their ages.

The National Institute for Retirement Security (NIRS) study found that among all workers ages 21 to 64, including those who have saved nothing for retirement, the average amount saved in a defined contribution plan was just $955 in 2023.

On the other hand, among those who are positive retirement plan wealth, or at least $1 saved in a defined contribution (DC) plan, the average savings was much higher, at $40,000.

The report found that the average account balance among workers ages 21 to 64, including those with no savings, was $93,229. However, among those who saved at least $1 in a DC plan, the average savings was $179,082.

A woman talks on her phone while using a laptop at home. (Getty Images/Getty Images)

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The NIRS study also compared Americans retirement savings balances against the targets used by Fidelity, which developed guidelines based on age and income levels.

Fidelity recommends that Americans save their annual retirement income by age 30, triple their income by age 40, six times their income by age 50, eight times their income by age 60, and 10 times their income by the time they reach the normal retirement age of 67.

NIRS found that for all average respondents analyzed in the study by age, race, education and gender groups, none have retirement savings or net worth equal to or greater than their age-based savings target.

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The NIRS study showed that most Americans were far behind their age-based savings goals. (Stock)

Among all respondents, DC’s average retirement savings as a percentage of their savings goals is 4%. When net worth is used instead of DC retirement savings, the average percentage of all respondents achieve their savings goal is 41%.

Among those with positive DC retirement balances, the average percentage of all respondents who met the savings goal was 18%.

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The American average across all demographic groups fell short of savings goals. (iStock/iStock)

The average amount of DC retirement savings as a share of the savings goal was 19% for men and 17% for women, while among racial groups, Asian (23%) and white (20%) workers saved more than black and Hispanic workers (11% each).

The amount saved increases with more education levels from 10% for workers with a high school diploma or less, to 15% for those with associate degrees, 21% with bachelor’s degrees and 26% for those with master’s, doctorate or professional degrees.

Among age groups, the most successful savers were the youngest cohort of workers aged 21-34, with 21% saving as part of the goal, followed by 19% of workers aged 55-64.

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“As expected, those with a certain amount of savings are closer to their savings goal than those with no savings. But even for those with savings, these amounts are quite low if the expectation is that retirement savings in a DC plan will be a significant source of retirement income,” NIRS said.