Boomers Still Working Save 12.1% of Their Pay in a 401(k), More Than Any Other Generation. Only 9.6% of Them Raised It Last Quarter

Many Baby Boomers still working have contributed to a 401(k) for decades, and many of them chose a contribution rate years ago and think there’s little point in raising it now. This article covers how much older workers actually save. It also looks at how few of them raised their rate recently and what a small increase can still do in the last few years before retirement.

Boomers Lead Every Generation on Savings Rate

Fidelity’s fourth-quarter 2025 401(k) data puts the Boomer employee savings rate at 12.1%. That’s ahead of Gen X at 10.4%, Millennials at 8.9%, and Gen Z at 7.5%. The “employee savings rate” is the share of each paycheck a worker sends into the plan, not considering anything the employer adds.

The ranking follows age pretty closely as older workers usually earn more, their kids are often grown, and retirement is close enough that it no longer feels abstract, while younger workers are still dealing with rent, student loans, and childcare, so their rates start lower.

Fewer Boomers Raised Their Rate Last Quarter

The same Fidelity data shows that only 9.6% of Boomers raised their contribution rate in the fourth quarter, compared with 11.2% of workers overall. So the generation saving the most was a bit less likely to push its rate higher.

Part of that may be the feeling that time’s running short. Money put in at 60 does have fewer years to grow than money put in at 30. Even so, contributions in the final working years still count for something. Traditional pretax contributions lower taxable income in the year they’re made, and every added dollar becomes savings a retiree can take later.

Catch-Up Limits Are Higher Than Many Workers Realize

For 2026, the standard employee limit is $24,500. Workers 50 and older can add up to $8,000 in catch-up contributions, which brings the total to $32,500. These extra amounts are allowed under 26 U.S.C. § 414(v), the tax code section on catch-up contributions.

Workers aged 60 to 63 get an even bigger “super” catch-up of up to $11,250, for a total of $35,750. At 64, the limit goes back to the regular catch-up amount.

Higher earners now face a new rule: starting in 2026, workers whose 2025 compensation from the employer sponsoring the plan exceeded $150,000 generally must make their catch-up contributions on a Roth basis. Roth money goes in after tax, so there’s no upfront tax break, but qualified withdrawals in retirement can come out tax-free. The rule comes from the SECURE 2.0 law passed in 2022.

What a Three-Point Raise Can Add by Retirement

Take a single filer earning $80,000 with seven years left to work who raises the savings rate by 3 percentage points. That works out to an extra $2,400 a year going into the 401(k). If those extra contributions earn an assumed 6% a year, they’d grow to about $20,145 by retirement. That figure is on top of whatever the account would have held anyway.

Taxes help soften the hit this year. After the $16,100 standard deduction, this worker lands in the 22% federal bracket for 2026. Making the extra contributions pretax would cut federal income tax by about $528, so the drop in take-home pay comes out smaller than the full amount contributed.

Other Moves Worth Checking in the Final Stretch

Vanguard’s 2025 How America Saves report found that, on average, workers had to contribute 6.5% of pay to get the full employer match. The average promised match was 4.6% of pay. Anyone contributing below their plan’s threshold is leaving that free money unclaimed.

Workers with a high-deductible health plan can also use a health savings account. The IRS limit for 2026 is $4,400 for self-only coverage and $8,750 for family coverage, and people 55 and older can add another $1,000. HSA contributions must stop starting with the first month someone is enrolled in Medicare, so for many people this option ends around age 65.

The other big decision is when to file for Social Security. Retired workers get $2,071 a month on average after the 2026 cost-of-living raise, and the maximum benefit at full retirement age is $4,152. People who remain below full retirement age for all of 2026 can have some benefits withheld if they earn more than $24,480. A higher $65,160 limit applies during the year they reach full retirement age.

One Setting That Can Change at Open Enrollment

Open enrollment is a common time for workers to review their benefits, and the 401(k) contribution percentage is just one number on that screen. Boomers already save more of their pay than any other generation, but fewer of them raised their rate last quarter. Even with only a few working years left, moving that percentage up a few points can still lower this year’s tax bill and leave more money in the account at retirement.

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