A Retiree With the Average $167,970 401(k) Can Buy About $1,000 a Month for Life. The Average One Buys Nothing and Draws $560.

The average $167,970 401(k) balance could generate roughly $1,000 a month in guaranteed annuity income, yet most retirees draw only about $560 via 4% withdrawals instead.

Nearly 30% of 401(k) participants hold under $10,000 and the median balance is just $38,176, making the annuity debate largely irrelevant for most savers.

Retirees avoid annuities because they are typically irrevocable, eliminate liquidity and inheritance potential, and lose purchasing power to inflation over a 25-30 year retirement.

Read More: Learn 7 ways to generate income with a $1,000,000+ portfolio (sponsor)

There is a gap in retirement math that does not get enough attention. Take an average 401(k) balance and ask what it could generate as guaranteed lifetime income if you converted it into an annuity, then compare that to what a typical retiree actually pulls out each month. The comparison matters because almost nobody annuitizes. Most retirees keep their balance invested and take percentage-based withdrawals instead, which gives them less current income but preserves flexibility, liquidity, and something to pass on to heirs.

The average 401(k) balance reached $167,970 in 2025, according to industry reporting summarized by Briefs Finance in June 2026. That figure sits above other provider datasets. Vanguard's How America Saves 2025 report put the average balance at $148,153 in 2024, with a median of $38,176. Fidelity's most recent read in the same window landed in a similar range. Differences across datasets reflect different participant mixes, plan sizes, and reporting periods, but the distribution's shape is consistent.

If you've saved over $1,000,000, this guide is for you. The last thing you want in retirement is to run out of money, you want your money to generate lasting income while you enjoy your life.

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