Retirement readiness in America depends heavily on where a household is located.
A 2026 SmartAsset study of Census Bureau data shows the typical household holds roughly $80,000 in tax-advantaged retirement accounts, approximately one year of current income.
That national median obscures a striking geographic divide across the country, and the top-ranked state reports a median balance of $150,000 in retirement savings.
The bottom-ranked state holds just $35,000, a gap of $115,000 between them. Workplace retirement plan access, not individual behavior, drives most of that disparity.
Massachusetts leads while Mississippi trails by $115,000
Massachusetts holds the top position among all 40 states with available data, with a median retirement savings balance of $150,000 and a median household income of $104,828, the SmartAsset analysis found.
The state’s dominance is not accidental; nearly 75% of Massachusetts households use tax-advantaged retirement accounts, the highest adoption rate in the study, the Census Bureau data showed.
At the other end, Mississippi reported median retirement savings of just $35,000 on a median household income of $59,127, with only 41.8% of households using retirement-specific accounts, the lowest participation rate among all states measured.
Between those extremes, the pattern is consistent: states where more households use tax-advantaged accounts accumulate significantly more savings, according to the Census Bureau’s Survey of Income and Program Participation data.
States with higher workplace plan participation also show larger median balances
Maryland recorded the highest rate of 401(k) and Thrift Savings Plan usage at 65% of households, and its median retirement balance reached $120,000, ranking fifth nationally, the SmartAsset study confirmed.
Washington followed closely, with 60.2% of households contributing to 401(k)s or Thrift Savings Plans and a median balance of $143,400, the third-highest nationally, the research showed.
Alabama reported just 33.7% of households using 401(k) plans and a median retirement balance of $46,000, while Louisiana’s 401(k) participation stood at 38.3% alongside a $50,000 median balance, the data indicated.
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AARP has quantified the scope of this structural barrier at the national level, reporting that roughly 56 million private-sector workers currently lack access to any employer-sponsored retirement plan.
“Older Americans consistently tell us they want policies that expand opportunity and help people build financial security over a lifetime,” said Nancy LeaMond, AARP Chief Advocacy and Engagement Officer.
Cost of living complicates the state-by-state picture
Higher savings balances in states such as Hawaii and Washington do not automatically translate into greater purchasing power, because the cost of living in those states is among the highest in the nation.
Hawaii reported the second-highest median retirement savings at $149,000, but median home prices hover above $722,000, according to Redfin’s May 2026 data.
Washington’s median home price exceeds $612,000 with an overall cost of living roughly 11% above the national average, according to the C2ER Cost of Living Index.
This means a $143,400 retirement balance stretches far less than it would in Oklahoma, where median home prices sit near $264,000.
Key retirement savings figures by state
- Massachusetts: $150,000 median savings, 74.8% account prevalence, $104,828 median income
- Hawaii: $149,000 median savings, 65% account prevalence, $100,745 median income
- Washington: $143,400 median savings, 70.3% account prevalence, $99,389 median income
- New Jersey: $134,000 median savings, 66.7% account prevalence, $104,294 median income
- Oklahoma: $39,450 median savings, 47.9% account prevalence, $66,148 median income
- Mississippi: $35,000 median savings, 41.8% account prevalence, $59,127 median income
Source: SmartAsset analysis of U.S. Census Bureau data, published 2026
State-facilitated retirement programs aim to close the access gap
Recognizing that employer inaction leaves millions of workers without retirement vehicles, 22 states have now enacted state-facilitated retirement savings programs for private-sector workers, the Georgetown University Center for Retirement Initiatives reported as of mid-2026.
Nancy LeaMond, AARP Chief Advocacy and Engagement Officer, noted that simplified automatic enrollment drives higher retirement participation.
These programs show that when saving for retirement is easy and automatic, people do it
These programs typically use automatic payroll deduction to enroll workers whose employers do not offer a 401(k) or similar plan, and nearly 1.2 million employees had enrolled in state “work and save” programs as of January 2026, AARP reported.
“Expanding access to retirement savings accounts directly advances these goals,” LeaMond wrote in a letter to administration leaders earlier this year, urging national adoption of the model that state programs have tested.
Census data reveals the first hurdle is the account itself
The AARP 2026 Financial Security Trends Survey found that 42% of Americans aged 50 and older who have not yet retired reported having less than $50,000 in retirement savings, while 60% expressed concern about having enough money to last through their post-working years.
“With prices rising for everyday essentials like groceries, housing, utilities and health care, current and future retirees are counting on Social Security now more than ever,” LeaMond noted in the survey findings.
Among the bottom 10 states in the SmartAsset rankings, retirement account prevalence averaged below 50%, meaning that more than half of households in those states did not use any tax-advantaged retirement account at all.
The national conversation around retirement readiness tends to focus on contribution rates and investment returns, but the Census Bureau’s state-by-state breakdown points to a prior question raised by AARP and Georgetown researchers: whether workers have access to a tax-advantaged account at all.
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