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More millennials are breaking their way into the 401(k) millionaire club than ever. How you can steal their strategy

Aditi Ganguly

Wed, August 26, 2026 at 2:05 PM GMT+3 10 min read

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Ever since coming of age in the wake of the 2008 financial crisis, millennials have struggled to get ahead. Whether facing a bleak job market, a housing affordability crisis, or dealing with crushing student loan debt, this generation has overcome a great deal to find their financial footing.

But lately their efforts have been paying off, albeit slowly. A Fidelity Investments report from earlier this year shows the number of 401(k) millionaires reached 645,000 (1). That's a 26% increase from the year before, which Fidelity attributes to both steadier worker contribution rates and years of market gains. And millennials are finally showing up in that club, even if only in small numbers so far.

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While savers aged 29 to 44 represent roughly 4% of Fidelity's 401(k) millionaires as of the end of 2025, the fact that any have gotten there in their 30s and 40s is impressive (2). And with the right approach, you can, too.

401(k) millionaires on the rise

Americans hit record savings rates in 2025, according to Fidelity's latest retirement analysis. Nearly one in five millennial 401(k) savers managed to increase their savings rate last year — while employer contribution rates clocked a record high of $2,080.

Another Fidelity analysis reviewing Q2 data shows millennials now hold an average $82,600 in their 401(k)s (3).

Meanwhile, balances are particularly up among savers who've been continuously funding their 401(k)s for many years. The average balance for a millennial worker who's been saving in their 401(k) for 15 years grew to $391,300. This tells us that the average 401(k) millionaire has likely been funding their account for a considerably longer period of time.

Among millennials, the average 401(k) balance now sits at $82,600. Given that the oldest millennials are still just halfway through their careers and the youngest have the majority of their working years ahead of them, it's fair to assume that the average balance among 28- to 43-year-olds will continue to grow over time.

How to become a 401(k) millionaire yourself

Becoming a 401(k) millionaire may be more feasible than you'd think. Fidelity (and many other financial experts) recommend aiming to save 15% of your pre-tax income each year.

Currently, millennials are coming very close to that rate, saving an average of 14.4% as of earlier this year. It also pays to take full advantage of any 401(k) match your company offers. That's as close as it gets to free money for your future self.

But in addition to squirrelling away a chunk of your income, here are several other possible ways to get you into the club.

Stay consistent

Let's say you're able to earn a 10% annual return in your 401(k). If you contribute $400 a month to a 401(k) over a 41-year period, you'll be putting $196,800 into your workplace plan in total. But thanks to the power of compounded returns, at 10%, you're looking at growing your balance to just over $2.4 million (4).

The numbers don't look as rosy if you only contribute that $400 a month for 31 years, though. At the same 10% return, you're looking at about $912,000, which highlights the importance of saving consistently and saving over many years.

And the assumed rate of return isn't too far out of reach. The S&P 500 index has delivered an annual return of 10.51% since its inception in 1957 (5).

The strategy isn't exactly a Wall Street secret. In fact, Warren Buffett has been recommending it for years.

"Consistently buy an S&P 500 low-cost index fund," Buffett said in an interview with CNBC, "I think it's the thing that makes the most sense practically all of the time (6)."

"The trick is not to pick the right company, the trick is to essentially buy all the big companies through the S&P 500 and to do it consistently and to do it in a very, very low cost way," he added.

Automate the process

That consistency is where automation can make a difference. And you don't necessarily need to start by committing a huge chunk of your paycheck every month. Even small amounts can add up when they're invested regularly and given decades to compound.

Apps like Acorns allow users to invest spare change from everyday purchases automatically — helping them steadily build wealth without having to think about every market move.

All you have to do is link your cards and Acorns will round up each purchase to the nearest dollar, investing the difference — your spare change — into a diversified portfolio of ETFs managed by experts at leading investment firms like Vanguard and BlackRock. Over a lifetime, a little bit of consistency can go a long way.

With Acorns, you can invest in an S&P 500 ETF with as little as $5 — and, if you sign up today and set up a recurring investment, Acorns will add a $20 bonus to help you begin your investment journey.

Invest in multibaggers

Once you've built a solid foundation with an index fund, you may want to leave some room for individual stocks with the potential to outperform the broader market. Some investors reserve a portion of their portfolio for potential "multibaggers" — companies whose shares could multiply in value over time.

Experts like Jim Cramer suggest that investors could allocate roughly half their portfolios to index funds while using the other half to hunt for individual winners (7). He pointed to Berkshire Hathaway (NYSE: BRK.B) as one example of a stock that rewarded investors handsomely over the long run.

"Let's say you did my method, my program, where you were half index funds and let's say you picked a good stock. How about Berkshire Hathaway?" Cramer said, "Had you bought Berkshire Hathaway, you would have made a fortune."

Since 1982, the S&P 500 has returned a cumulative 18,004% (8), compared with a 260,462% gain for Berkshire shares (9).

But potential multibaggers are notoriously difficult to identify in advance. Plenty of companies look promising on paper before stumbling, while the biggest winners can appear lackluster.

That's where professional research can make a difference. Platforms like Moby can help you identify stocks with strong growth potential, helping investors uncover opportunities they might otherwise overlook.

Their team of former hedge fund analysts and experts spend hundreds of hours each week sifting through financial news and data to provide you with breaking stock recommendations.

Moby's success speaks for itself. The platform's stock picks have outperformed the S&P 500 index by about 11.9% over the past four years.

Even better, Moby offers a 30-day money-back guarantee so you can see if the service is right for you. And if you sign up for Moby Premium, you get one free top stock to get you off to a good start.

Don't just focus on 401(k)

While a 401(k) may be the star of your retirement strategy, it doesn't have to be the only account working toward your future.

Consider adding an IRA to the mix. A traditional IRA allows you to contribute pretax dollars, potentially lowering your taxable income today. You'll generally pay taxes when you withdraw the money in retirement, when your tax rate may be lower. A Roth IRA flips that equation — you contribute after-tax money, but qualified withdrawals can be tax-free.

Having multiple accounts can also give you more flexibility when building your overall portfolio. For example, if most of your 401(k) is invested in stocks, you could use an IRA or another investment account to allocate to other asset classes to help spread out your risk.

That's especially relevant today as the stock market grapples with soaring inflation, geopolitical uncertainty, changing bond yields and concerns about an AI bubble.

Diversify with gold

Gold can be one option for investors looking to diversify beyond traditional stocks and bonds. It has historically attracted investors during periods of heightened uncertainty and has often been used as a potential hedge against market turbulence.

Today, you can combine the recession-resistant properties of the precious metal with the tax advantages of an IRA by opening a gold IRA with the help of Priority Gold.

And with Priority Gold's platinum package, you can even get free account setup and insured shipping and storage for up to five years. Plus, you can also roll over your existing IRA or 401(k) into a precious metals IRA with Priority Gold — tax and penalty-free.

The best part? You can download Priority Gold's wealth preservation guide for free and get up to $10,000 in complimentary silver upon making a qualifying purchase.

Talk to an expert

Building a million-dollar 401(k) isn't just about picking the right investments. It's also about making sure your overall strategy matches your timeline, risk tolerance and retirement goals.

A financial advisor can help you determine how much risk you should actually be taking, review your investment mix and flag fees that may be quietly eating into your returns. They can also help make sure your portfolio allocation changes as you get closer to retirement.

There may be a financial benefit to getting professional help. Envestnet research found that people who work with financial advisors generate roughly 3% higher returns on average than those who don't (10).

You can find a reputable FINRA/SEC-registered advisor near you for free through platforms like Advisor.com.

Here's how it works: Simply enter a few details about your finances and goals and Advisor.com will comb through its roster and connect you with a qualified expert best-suited for your needs based on your unique financial goals and preferences.

The platform does the heavy lifting for you, vetting advisors based on track record, client ratios and regulatory background. Plus, their network comprises fiduciaries, who are legally required to act in your best interests.

Finding the right advisor isn't always easy — there's no one-size-fits-all solution. That's why Advisor.com lets you set up a free initial consultation, with no obligation to hire, to see if they're the right fit for you.

Just remember: None of this happens overnight. "Saving for retirement is a marathon, not a sprint," says Mike Shamrell, vice president of thought leadership at Fidelity. But the earlier your contributions start compounding, the sooner seven figures stop looking like someone else's milestone.

- With files from Maurie Backman.