Retirement Account Balances See Another Rise in Q4 2025
Retirement account balances continued increasing through 2025, finds the latest data from Bank of America.
According to the bank’s latest Participant Pulse research, retirement account balances grew 13% in 2025 compared to year-end 2024, reaching $113,590 on average. Contribution rates also remained consistent through the last quarter of the year with an average of 7.2%.
Participation rates were even higher for plans who offered automatic features, at an overall balance of $170,000—a $50,000 increase compared to plans who don’t provide auto-enroll or auto-escalate benefits.
The average Bank of America 401(k) account balance is a solid jump compared to year-end 2024, which had come in at $100,300 last year, and a strong increase from 2023’s $86,000 figure.
While the new figure is a rise from previous recordings, it’s a far cry from President Donald Trump’s recent claim over increases in retirement account balances. In his State of the Union address on Tuesday, Trump boasted that accounts have seen a $30,000 gain since he took office last year.
HSA balances rise, but not for savings
Balances in health savings accounts (HSAs) grew to $5,600 at year-end, a rise from $5,030 at the end of 2024. The number of accountholders who contributed more than they withdrew also increased 36% year-to-date.
Despite the rise, most participants utilize the contributions to cover current healthcare expenses. Fifteen percent of respondents say they’re investing for potential future growth, but 72% are spending more of their contributions for daily healthcare needs rather than saving those contributions (28%). Studies show that out-of-pocket costs have risen, as employers face some of the largest price increases in offering healthcare plans.
When comparing generations, Gen X employees contributed the most at $2,200, while Millennials saved the most of their contributions, at 37% of the age group.
Loans and hardship distributions stay low
Less than 1% of participants obtained a hardship distribution in Q4, at .77%, compared to Q3 at 7.9%. Of those who acquired a hardship distribution, the average borrowed was $5,440, relative to $5,360 the quarter prior.
The number of participants borrowing from their retirement plan fell slightly in 2025, down from 2.6% in Q3 2025 to 2.3% in the last quarter.
On average, those who took out a loan on their retirement savings borrowed $9,300, consistent with Q3 findings of $9,500.
Finally, 10.4% of participants with a loan have a loan in default as of Q4, continuing a downward trend of 10.6% in Q3.
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.