The number of 401(k) millionaires has hit a new record high, according to Fidelity.
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CONWAY GITTENS: I’m Conway Gittens reporting from the New York Stock Exchange. Here’s what we’re watching on TheStreet today.
Stocks are coming off a losing Thursday on Wall Street with the Dow posting its worst session in over a year thanks to a steep drop in Boeing shares. This came after the company said it would delay plane deliveries.
While U.S. markets will be closed for Memorial Day on Monday, investors have a busy week ahead with a lineup of Fed speakers and a key inflation gauge due Friday. This will be crucial ahead of the central bank’s June meeting.
In other news – a record number of Americans will be able to call themselves millionaires – well, when they retire, at least. According to a new report by Fidelity, there are now more 401(k) contributors than ever with a seven-figure balance. 485,000 people have an account balance of $1 million or more, 43% more than there were just 12 months ago.
Fidelity says that record-high contribution levels, along with overall bullish market conditions, helped balances reach their highest levels since the end of 2021. The firm also said it pays to play the long game, saying “Long-term savers observed the greatest improvement, which is good news, especially for the more than 4.9 million workers that have been in their 401(k) plan for five years or more.”
For the average account with over $1 million in retirement savings, Fidelity revealed the account holder has been saving for 26 years and contributing 17% of their income.
Fidelity’s report also revealed the average balance for the 401(k) millionaires is $1.58 million.. And the average savings rate for all 401(k) contributors, including employer matches, is at a record 14.2%. Retirement experts say the recommended savings rate is 15%.
It is important to note as one retirement expert recently told us – only half of all American households have an employer-backed retirement account.
That’ll do it for your daily briefing. From the New York Stock Exchange, I’m Conway Gittens with TheStreet.
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