Record Number of 401(k) Millionaires: ‘People are Staying the Course’
The number of 401(k) millionaires reached a new high in the third quarter of 2024,according to Fidelity Investments. This milestone reflects a growing trend of prosperous long-term retirement saving among American workers. As of September 30, 2024, Fidelity reported 797,000 individuals had 401(k) balances of $1 million or more.
This figure represents a important increase from the 667,000 401(k) millionaires reported at the end of 2023. The growth is attributed to a combination of factors, including consistent contributions, market gains, and investors maintaining their course despite economic volatility.
The average 401(k) balance also saw an increase, reaching $142,570 as of the third quarter. This is up from $130,800 at the end of 2023. The median balance, which is less susceptible to distortion from very high earners, rose to $41,300.
Fidelity’s data also indicates that individuals are increasingly utilizing various investment options within their 401(k) plans. A growing number are diversifying their portfolios, which can help mitigate risk and possibly enhance returns over the long term.
“People are staying the course,” saeid Jessica hall, a retirement reporter for MarketWatch. Hall, a former Age Boom Academy Fellow with Columbia University, has extensively covered retirement and aging issues throughout her career, including award-winning work at the Portland Press Herald and Maine Sunday Telegram. She previously spent seventeen years at Reuters covering financial markets.
The increasing number of 401(k) millionaires is part of a broader trend of growing retirement savings in the United States. While challenges remain, such as ensuring adequate savings rates and addressing the retirement needs of diverse populations, the positive momentum suggests a growing awareness of the importance of long-term financial planning. Future trends will likely be influenced by factors like inflation, interest rates, and changes to retirement legislation.
Frequently asked Questions about 401(k) Millionaires
What is a 401(k) millionaire?
A 401(k) millionaire is an individual who has accumulated $1 million or more in their 401(k) retirement savings account.
How many 401(k) millionaires are there?
As of September 30,2024,Fidelity investments reported 797,000 individuals had 401(k) balances of $1 million or more.
What is the average 401(k) balance?
The average 401(k) balance was $142,570 as of the third quarter of 2024, according to Fidelity.
What factors contribute to becoming a 401(k) millionaire?
Consistent contributions, market gains, and maintaining a long-term investment strategy are key factors.
Is it realistic for most people to become 401(k) millionaires?
While not guaranteed, it is indeed increasingly achievable with disciplined saving and investing over a long period.
We hope this article provided valuable insight into the growing number of 401(k) millionaires. Do you have thoughts on this topic? Share your comments below, or subscribe to our newsletter for more financial news and analysis!
