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401(k) Balances Hit Record High — $111,900 for Ages 50-54

Posted By Carole Fleck On February 15, 2013 @ 2:06 pm In Bulletin Today,Money & Savings | Comments Disabled

Here’s some good news.  [1]

Our retirement plan balances [2] are rising, so maybe we actually can retire in relative comfort, provided we continue to save and save some more. [3]

A Fidelity Investments analysis of 401(k) plans showed that the average balance rose to a record high at the end of last year  — $77,300. That’s up from $69,100, a 12 percent increase from one year earlier.

Workers 50-plus did even better. Here’s the average breakdown by age group as of the end of last year:

Ages 50 to 54: $111,900

Ages 55 to 59: $134,600

Ages 60 to 64: $133,100

Ages 65 to 69: $136,800

The higher balances in retirement plans last year were mostly due to a thriving market. Still, about one-third was from workers’ contributions into their plans [4], according to Fidelity. It looked at 20,500 workplace plans of 12 million participants.

[See also: How much do you need to retire? [5]]

In another sign of the improving economy, workers increased the amount they socked away for the 15th straight quarter.

“It’s encouraging to see how continued savings combined with a healthy equity market have led to another record-high balance for 401(k) savers,” says James MacDonald, president, Workplace Investing, Fidelity Investments.

Workers on average save 8 percent of their annual salaries in their 401(k) plans. When the typical employer contribution was factored in, the savings rate increased to 12 percent, according to Fidelity.

While the $77,300 balance may not sound great, consider this: When the stock market hit bottom in the first quarter of 2009, the average 401(k) balance was $46,200.

Photo credit: Tax credits via flickr.com [6]

 

 


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URL to article: http://blog.aarp.org/2013/02/15/401k-balances-climb-to-record-high/

URLs in this post:

[1] Image: http://blog.aarp.org/wp-content/uploads/2013/02/7067724529_a0862284e94.jpg

[2] retirement plan balances: http://www.aarp.org/aarp-foundation/our-work/income/finances-50-plus-financial-capability/

[3] save and save some more.: http://www.aarp.org/work/retirement-planning/info-12-2012/working-boomer-financial-recovery.2.html

[4] workers’ contributions into their plans: http://www.aarp.org/work/retirement-planning/info-12-2012/working-boomer-financial-recovery.html

[5] See also: How much do you need to retire?: http://www.aarp.org/work/retirement-planning/retirement_calculator/

[6] Tax credits via flickr.com: http://www.flickr.com/photos/76657755@N04/7067724529/sizes/m/

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