Working Americans have been saving for retirement at a record rate, with the average 401(k) balance now hitting $75,900, a whopping 18 percent higher than a year ago, according to figures released Nov. 8 by Fidelity Investments.
Fidelity reports in a news release that this third-quarter figure is the heftiest since it began dogging the numbers 12 years ago. One year ago, that average balance was $64,300.
Average annual employee contributions grew 7.3 percent over the past five years to $5,900 from $5,500. Average company matches increased by 19 percent in that same time span, from $2,880 to $3,420.
Auto-enrollment and auto-escalation in plans have contributed to the larger balances, Fidelity says. (Experts say the stock market’s comeback would not have hurt.)
Fidelity recommends that workers have 10 percent to 15 percent of their salary withheld. But the average worker isn’t digging that deeply. For those employed at companies with an auto-enrollment plan, the average level of savings was 3.7 percent, while workers at companies without these plans saved an average of 8.4 percent.
Fidelity, as the nation’s largest 401(k) provider, analyzed 12 million accounts in 20,200 corporate defined contribution plans.
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