Fidelity’s Quarterly Retirement Snapshot: Average Balances Increase Year-over-Year, Record Contributions

BOSTON--()--The Q3 2014 retirement savings analysis from Fidelity Investments, the nation’s largest provider of 401(k) 1 accounts and Individual Retirement Accounts (IRAs), reveals:

  • The quarter-end 401(k) balance, which includes all participating employees at various stages of their careers, was $89,100, down 2% from the end of Q2 but an increase of nearly 6% from the same period last year.
  • For employees in a 401(k) plan for 10 years straight2, the average balance was $241,800, down 2% from the end of Q2 but up 8% from the same period last year.
  • In the second year since the launch of Fidelity’s Plan for Life Guidance offering, employee contributions into 401(k) accounts continued to trend upward and reached record levels. The average 401(k) contribution reached $6,080 in Q3, up 1% over the last year. The average contribution to a Fidelity IRA is $4,357, up 3% over the same period last year.
  • The average balance in a Fidelity IRA was $92,1003, down from $92,600 in Q2 but an increase of 8% over the same period from last year.
  • Employees continued to take a diversified approach to their 401(k) asset allocation, with an average of 55% of 401(k) assets in equities and more than 27% in blended investments, such as target date funds, and 18% in conservative investments, such as bonds.

People have an increasing need for guidance in managing their retirement accounts. In the past four years, one out of every two 401(k) investors who reached out to Fidelity for help, either by phone, online or at an in-person seminar, made changes to their account (increased their contribution rate, changed their investment mix, etc.).

“Continuing to contribute to your retirement savings account, even during times of economic volatility, is critical to reaching your retirement goals,” said Jim MacDonald, president, Workplace Investing, Fidelity Investments. “While we’re seeing record contribution rates across our 401(k) business, Fidelity recommends that individuals consistently save between 10-15% each year4 – regardless of market conditions - in order to generate the retirement income stream they’ll need to meet their financial needs in retirement.”

To help plan participants understand the fundamentals of retirement savings, a new Fidelity video5 outlines five ways to help employees maximize their 401(k) savings: http://www.youtube.com/watch?v=udCbn-9n41E

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917

Fidelity Investments Institutional Services Company, Inc., 500 Salem St., Smithfield, RI 02917

Guidance provided by Fidelity is educational in nature, is not individualized, and is not intended to serve as the primary or sole basis for your investment or tax-planning decisions.

Past performance is no guarantee of future results.

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© 2014 FMR LLC. All rights reserved.

1 All 401(k) data as of September 30, 2014 unless otherwise stated, and is based on our recordkept corporate defined contribution plan base of 21,300 plans, including advisor plans and the Fidelity plan, and 13.1 million participants (who are actively employed employees or retired or terminated employees who still carry a balance), excluding tax-exempt employees.

2 Employees with a balance and actively employed by their plan sponsor throughout the past 10 years.

3 Fidelity IRA data analysis from October 1, 2013 through September 30, 2014.

4 Recommended 10-15% includes both employer and employee contributions and deferrals.

5 Third-party web sites linked to herein are unaffiliated with Fidelity. Fidelity does not guarantee or assume any responsibility to its content.

Contacts

Fidelity PR
Mike Shamrell, 617-563-1996
Michael.shamrell@fmr.com
or
Fidelity Corporate Communications
617-563-5800
fidelitycorporateaffairs@fmr.com

Release Summary

The Q3 2014 retirement savings analysis from Fidelity Investments, the nation’s largest provider of 401(k) accounts and Individual Retirement Accounts (IRAs)

Contacts

Fidelity PR
Mike Shamrell, 617-563-1996
Michael.shamrell@fmr.com
or
Fidelity Corporate Communications
617-563-5800
fidelitycorporateaffairs@fmr.com