12 states with the lowest average retirement savings — is yours one of them?
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12 states with the lowest average retirement savings — is yours one of them?
Kelly Suzan Waggoner January 24, 2026 at 4:30 AM
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12 states with the lowest average retirement savings (Elena Chertovskikh via Getty Images)
Retirement accounts like 401(k)s, IRAs and 403(b)s can jump-start your long-term savings by offering tax breaks, and workplace plans may also include employer matching.
Fidelity Investments reports that the average 401(k) balance was $144,400 in the third quarter of 2025. That’s not the full picture of retirement savings across all account types, but it offers a useful benchmark. Where you live makes a big difference in how much you’ve managed to save — particularly if you live in one of a dozen states that a recent GoBankingRates study highlights.
Here are the 12 states with the lowest average retirement savings, the economic challenges U.S. Census Bureau data reveals are holding savers back and proven strategies to strengthen your own nest egg, no matter where you call home.
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1. Utah
aheflin via Getty ImagesAverage retirement savings: $315,160
Utah takes the top spot with the lowest average retirement balance in the U.S. at $315,160, a surprising ranking given the state's high incomes and low poverty.
Residents in the Beehive State enjoy high median household incomes of $96,658, about 18% higher than the national median of $81,604, according to U.S. Census data. Its poverty rate is also well below the national average: 8.3% in Utah versus 10.6% for the U.S. overall.
So what explains the low retirement savings? Utah has the nation's youngest population with a median age of 31.7, meaning residents may be early in their careers or busy raising families — stages of life that can affect how much one can sock away, even with good paychecks.
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2. North Dakota
An expansive aerial perspective captures the charming town of Devils Lake, North Dakota (GummyBone via Getty Images)Average retirement savings: $319,609
North Dakota edges past Utah with an average retirement balance of $319,609, despite lower household income and a higher poverty rate. The median household income in this Great Plains state is $77,871, about $18,800 less than in Utah, though the state's poverty rate is 11.1%.
So why the higher savings? It's likely demographics play the biggest role. North Dakota has a significantly older population than Utah, with more than a quarter of its residents older than 55. Those extra decades of working and saving add up.
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3. Mississippi
Jeremy Woodhouse via Getty ImagesAverage retirement savings: $347,884
Mississippi ranks third for lowest average retirement balance in the U.S. at $347,884 — a spot that aligns with the state's economic factors. The Magnolia State has the nation's lowest median income at $59,127 and the second-highest poverty rate at 17.8%, according to U.S. Census data.
With nearly 1 in 5 residents living below the poverty line, far above the 10.6% national average, many Mississippians struggle to meet basic needs, leaving less room to save for retirement.
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4. Oklahoma
DenisTangneyJr via Getty ImagesAverage retirement savings: $361,366
Oklahoma’s average retirement savings of $361,366 narrowly beats Mississippi's by about $13,500, though economic conditions are similar for its residents. The median household income sits at $66,148, while the poverty rate of 14.9% ranks eighth-highest among states, according to U.S. Census data.
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5. Arkansas
Brandon Olafsson via Getty ImagesAverage retirement savings: $364,395
Arkansas holds the fifth spot with an average retirement savings balance of $364,395. Interestingly, the state's median income of $62,106 ranks among the lowest on our list, according to U.S. Census data, while the poverty rate of 15.5% — though higher than the 10.6% national average — reflects economic struggles across the state.
Like Oklahoma, residents of Arkansas face the challenge of building retirement security in an economy where wages barely stretch beyond basic needs.
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6. Hawaii
Hanalei Bay, Kauai Hawaii (DOUGBERRY via Getty Images)Average retirement savings: $366,776
Hawaiians have the highest median income of all 12 states on this list at $100,745 — a huge $41,618 gap with Mississippi — and a poverty rate of 10.0% that's only slightly higher than Utah's, according to U.S. Census data.
The culprit? A high cost of living. While a household earning $100,000 might live comfortably and save aggressively in Mississippi or Arkansas, that same income barely covers the essentials in Hawaii, where housing alone can consume 40% or more of your take-home pay.
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7. West Virginia
JMichael-Photography via Getty ImagesAverage retirement savings: $370,532
West Virginians have saved an average $370,532, despite the state's ranking among the poorest in the nation. The median household income in the Mountain State is just $60,798 — even lower than Utah's, the state with the lowest retirement savings on our list.
At 16.7%, West Virginia has the third-highest poverty rate among states, according to U.S. Census data. An older population and legacy industries like coal mining might explain retirement balances that exceed what you'd expect.
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8. Tennessee
Malcolm MacGregor via Getty ImagesAverage retirement savings: $376,476
Tennessee's average retirement savings of $376,476 outpace West Virginia's, anchored by somewhat better living conditions.
The Volunteer State's median household income sits at $71,997, while the poverty rate of 13.5% is still more than 2 percentage points above the 10.6% national average but lower than neighboring states, according to U.S. Census data. No state income tax may help residents sock away more in retirement accounts, though many still struggle with economic insecurity.
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9. Nevada
Aerial view of Las Vegas strip in Nevada as seen at night USA (f11photo via Getty Images)Average retirement savings: $379,728
Nevada's average retirement savings of $379,728 puts the state at the higher end on our list. The Silver State's median household income of $81,134 is close to the national average, while 11.6% of the state's population lives below the poverty line, according to U.S. Census data. The combination of higher incomes and lower poverty compared to Tennessee may explain why Nevadans can save a bit more for retirement, despite the state's reliance on inconsistent tourism and gambling industries.
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10. Wyoming
Cheyenne, United States - August 12, 2022: The iconic (Art Wager via Getty Images)Average retirement savings: $381,133
The Equality State's median household income of $75,532 is below the $81,604 national median, and just 10.1% of residents live below the poverty line — better than the 10.6% national rate, according to Census data. A lack of income tax might help explain retirement savings that, while low nationally, outperform many other states on this list.
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11. New York
Woman tourist watching Brooklyn Bridge, New York City, USA (Francesco Riccardo Iacomino via Getty Images)Average retirement savings: $382,027
Didn't expect to see the Empire State land on this list? New York ranks 11th with average retirement savings of $382,027 — low for a state with a median household income of $85,820, above the $81,604 national average. About 14.0% of New Yorkers live below the poverty line, according to U.S. Census data.
High state and local taxes combined with some of the nation's steepest housing costs mean that above-average incomes don't stretch as far for New Yorkers as the numbers suggest.
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12. Louisiana
Nice, historic houses in the streets of New Orleans, Louisiana (picturist via Getty Images)Average retirement savings: $386,908
Rounding out our list is Louisiana, where average retirement savings of $386,908 edge out Utah by about $70,000.
Yet the state faces some of the most difficult economic conditions in America. Median household income sits at just $60,986, barely $1,850 higher than Mississippi's, according to the U.S. Census. And a poverty rate of 18.7% — the highest of any state, according to U.S. Census data — means nearly 1 in 5 Louisianans struggles with day-to-day expenses, making retirement readiness a struggle.
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How much can you save for retirement?
Employer-sponsored retirement plans like 401(k)s and 403(b)s are appealing savings options, offering tax benefits and the ability to put away more for the future. With traditional 401(k)s and 403(b)s, you fund accounts with pre-tax dollars, reducing your taxable income and potentially resulting in a lower tax bill. Roth versions of these plans are funded with after-tax dollars but offer tax-free withdrawals in retirement.
In 2026, you can contribute up to $24,500 to workplace retirement plans, which is more than three times the amount you can put into a traditional IRA or Roth IRA. Your workplace retirement limits increase by an extra $8,000 if you're 50 or older or $11,250 if you're 60 to 63.
🔍 Read more: New 401(k) and IRA limits for 2026: See how much more you can save
How to save more for your golden years
If you have access to a 401(k), max out your employer match first. While people often say this is “free money,” it’s actually part of your total compensation package, just like your salary, and so you should take advantage of it. No 401(k)? Grow your retirement savings through tax-advantaged accounts like traditional or Roth IRAs.
Figure out how much you can afford to put aside for retirement, regardless of the account type you use.
“My advice for those looking to boost their retirement savings is to first create a monthly budget. Determining how you can remove excess monthly costs can help free up some income. Reviewing home and auto insurance, unused monthly subscriptions and more can help trim how much money is being spent each month,” says Fannon. Here’s how to approach this:
Reduce your expenses. Lowering your overall expenses can provide more funds to put toward your retirement. Look to popular budgeting strategies to find the best fit with your lifestyle, spending and income.
Take advantage of pay increases. If you get a raise, put more of it toward your 401(k) or IRA.
Gradually increase contributions. The goal is to save more for retirement, ideally to the maximum contribution limit per year. If you can't do that, start slowly and gradually increase contributions, re-evaluating your budget every quarter.
Max out your employer contributions. We can't say it enough: It's valuable money you don't want to leave on the table.
Review your investments and potential fees. Look over your investment options and review potential fees associated with them. These can be administrative fees, investment fees or individual service fees.
Don’t touch your savings. It can be tempting to withdraw money from your 401(k) or IRA before retirement. But you don’t want to deal with potential consequences and miss out on valuable compound interest.
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About the writer
Kelly Suzan Waggoner is personal finance editor at AOL, where she empowers those planning for, newly entering or fully enjoying retirement to get the most out of their finances — whether that’s saving money, managing debt, maximizing rewards or growing their wealth. Before AOL, Kelly was managing editor at Bankrate and editor-in-chief at Finder, where she led teams focused on helping people navigate unfamiliar financial decisions around banking, lending, credit cards, investments and more. Her work has appeared in Nasdaq, Lifehacker and other publications, as well as through various publishers, magazines and nonprofits throughout New York City. She's also the ghostwriter behind a how-to on copyediting for the Dummies series. Outside of finance, she toys with words, flips through style guides and fantasizes about the serial comma’s world domination.
Melanie Lockert contributed to a previous version of this article
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Source: “AOL Money”
