401(k) Millionaires Hit Record High—But What Does the Average California Family Need to Know About Retirement Savings and Estate Planning?

If you’re a California resident planning for your family’s financial future, the latest retirement savings data reveals both encouraging progress and significant gaps that deserve your attention—especially when it comes to protecting what you’ve worked so hard to build.

What’s Happening with 401(k) Accounts Right Now?

According to Fidelity’s Q3 2025 retirement analysis, the number of 401(k) millionaires reached a record 654,000 accounts—a nearly 10% increase from the previous quarter. While headlines celebrate this milestone, the average 401(k) balance tells a different story: just $144,400.

For California families navigating retirement planning, understanding this gap matters. Here’s why:

Most savers aren’t millionaires: While 654,000 accounts hold over $1 million, millions more are building wealth gradually through consistent contributions.

Long-term discipline pays off: Women who contributed consistently for 15 years now average $501,100—a 16.5% year-over-year increase and the first time this demographic has crossed the half-million threshold.

Younger generations are changing the game: Gen Z investors are directing 95% of their 401(k) contributions to Roth accounts, compared to 75% for Millennials and 66% for Gen X.

How Do Other Retirement Accounts Compare?

If you’re managing multiple retirement vehicles or considering which accounts to prioritize, here are the current averages:

IRA accounts: $137,902

403(b) plans (common for nonprofit and education workers): $131,200

What Does This Mean for California Families?

Sharon Brovelli, President of Workplace Investing at Fidelity Investments, notes that Americans are “continuing to exhibit impactful savings behaviors such as staying the course and focusing on long-term goals”—critical habits as families navigate economic uncertainty.

But growing your retirement savings is only half the equation. California residents face unique estate planning challenges:

How will your 401(k) or IRA transfer to your heirs? Without proper beneficiary designations and estate planning documents, even substantial retirement accounts can become tangled in probate court.

Are your retirement assets protected from creditors? Different account types have different protections under California law.

Have you coordinated your retirement accounts with your trust? Many families assume their revocable living trust automatically covers all assets—but retirement accounts require specific beneficiary coordination.

What about tax implications for your heirs? With 95% of Gen Z choosing Roth accounts, understanding the tax treatment of inherited retirement assets is increasingly important for multi-generational wealth transfer.

Why Estate Planning Matters More as Retirement Balances Grow

Whether your 401(k) balance is $50,000 or $500,000, having a comprehensive estate plan ensures:

Your retirement assets go to the people you choose, not the default beneficiaries listed years ago

Your heirs avoid unnecessary probate costs and delays

Your family understands your wishes for healthcare and financial decisions if you become incapacitated

Your assets are shielded from potential creditors and lawsuits

For California residents managing retirement accounts alongside real estate, business interests, or other assets, coordinating all these pieces requires specialized knowledge of both California probate law and federal tax rules.

Take Control of Your Financial Legacy Today

At California Probate and Trust, PC, we help California families bridge the gap between building wealth and protecting it for future generations. Our estate planning attorneys understand that retirement savings are just one piece of your family’s financial picture—and we create comprehensive plans that address everything from 401(k) beneficiary designations to revocable living trusts, powers of attorney, and healthcare directives.

We offer free consultations to California residents who want to:

Review their existing estate plan in light of growing retirement balances

Coordinate retirement account beneficiaries with their trust documents

Protect their family from unnecessary probate costs

Create a comprehensive plan that covers both asset protection and healthcare decisions

Schedule Your Free Estate Planning Consultation

Don’t let your hard-earned retirement savings go unprotected. Contact California Probate and Trust, PC today for a free, no-obligation consultation with one of our experienced Sacramento estate planning attorneys. Call (866) 674-1130 or visit cpt.law to schedule your appointment.

Source: Yahoo Finance – There’s Now a Record Number of 401(k) Millionaires

Legal Disclaimer: This article is provided for informational purposes only and does not constitute legal or financial advice. The information presented is based on publicly available data and general principles of California estate planning law. Every family’s situation is unique, and estate planning strategies should be tailored to your specific circumstances. Retirement account rules, tax laws, and estate planning regulations are subject to change. For personalized guidance regarding your retirement accounts, estate plan, or specific legal questions, please consult with a qualified California estate planning attorney. California Probate and Trust, PC is available to discuss your individual needs during a free consultation.