It’s not just boomers.
Young savers have done especially well. Gen Z saw a 66% increase in average 401(k) balances compared to a year ago, while millennials saw a 24.5% increase. Average Gen X balances were up 14.5%, and baby boomers saw an average increase of 6.3% compared to a year ago.
Source from Fidelity (PDF)
I’ll be curious to see what these numbers look like once student loan repayments start back up in October. I know I’m personally going to have to cut back my 401(k) contributions - which I increased during the payment pause over the last few years - in order to resume my payments, even with an IDR plan.
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Gen Y (millenials) saw the second largest increase. Balances for millenials and Gen Z are much lower due to other expenses like student loans.
Interesting, is Gen Z the first generation to have student loans?
This is the best summary I could come up with:
But this year brings better news: account balances are growing by double digits over the past 12 months.
The growth is so strong, in fact, that the share of 401(k) millionaires has grown by 25% so far this year, according to Fidelity Investments’ Q2 2023 retirement analysis.
Of course, there are many people in the U.S. who do not have a retirement account at all, and balances vary significantly depending on factors like age, profession, and income.
The total contribution rate—which combines employee and employer contributions—for the second quarter was 13.9%, in line with what many experts advise (Fidelity suggests 15%).
“A million dollars isn’t what it used to be, but it can still provide a comfortable retirement if done right,”Gates Little, president and CEO at the Southern Bank Company, previously told Fortune.
“While everyone’s financial situation is different, Fidelity suggests taking a long-term approach to saving and avoiding making changes based on short-term economic swings—positive or negative,” the report reads.
I’m a bot and I’m open source!
Curious about the downvotes here. Jealous bots?
Gee, people who have been saving longer have saved more money! Who’d a thunk?
Many people roll their old 401ks into IRA when changing jobs, so they are seriously undercounting millionaires.
Thank you for sharing!
