Number of 401(k) ‘millionaires’ jumped 41% last year, says Fidelity | CNN Business (2024)

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Number of 401(k) ‘millionaires’ jumped 41% last year, says Fidelity | CNN Business? ›

Fidelity also reported that the number of 401(k) accounts with balances of at least $1 million rose in the fourth quarter by 20%, to 422,000 accounts; and by 41% for the whole year. The average account balance for this group was $1,551,300 in the fourth quarter.

The universe of 401(k) accounts with balances of $1 million or more at Fidelity Investments rose to a record 485,000 in the first quarter, according to the company. With stocks surging, the number of retirement account millionaires jumped 15% from the prior quarter and 43% since March 2023.

The number of 401(k) millionaires surged 43% from a year ago, boosted by market gains and steady contributions. But those millionaire success stories were an average of 26 years in the making, according to Fidelity Investments. The first quarter had 485,000 401(k)-created millionaires.

(TND) — A record number of people have reached $1 million in their 401(k) retirement accounts, according to Fidelity Investments. A Fidelity spokesperson Tuesday said they counted 485,000 such accounts as of the first quarter of the year, up 15% from the previous quarter and up 43% from a year ago.

The first quarter had 485,000 401(k)-created millionaires. That was a 15% increase from last quarter, when there were 422,000, and a 43% increase from a year ago's count of 340,000, Fidelity said. Of course, these millionaires didn't turn rich overnight.

Relatively few embrace working with multiple advisors (13%) or any individual advisor managing other advisors (quarterback approach, 5%). those with $1 million to $5 million in investable, non-retirement assets, and ultra-high-net-worth are investors with over $5 million in investable assets.

How much do people save for retirement? In 2022, about 46% of households reported any savings in retirement accounts. Twenty-six percent had saved more than $100,000, and 9% had more than $500,000. These percentages were only somewhat higher for older people.

The average age of 401(k) millionaires at Fidelity skews older at around 59. However, Gen Xers also hit a nice milestone in the last few months of 2023. Those who have had the same 401(k) plan for 15 straight years saw average balances hit $501,000.

The financial services firm handles more than 45 million retirement accounts total. The average 401(k) balance ended 2023 up 14% from a year earlier to $118,600, Fidelity found. The average individual retirement account balance also gained 12% year over year to $116,600 in the fourth quarter of 2023.

Is $400,000 enough to retire at 65? ›

You can retire a little early on $400,000, but it won't be easy. If you have the option of working and saving for a few more years, it will give you a significantly more comfortable retirement.

What is Considered a High Net Worth in Retirement? A high-net-worth individual or HNWI is generally anyone with at least $1 million in cash or assets that can be easily converted into cash, including stocks, bonds, mutual fund shares and other investments.

The top 1% of household net worth in the U.S. was just shy of $13.7 million in 2023. An individual would have to earn an average of $407,500 per year to join the top 1%. A household would need an income of $591,550.

How to get your retirement savings on track. Despite feeling behind, many Americans have good money habits when it comes to saving for retirement. While only 11% report maxing out their 401(k) contributions, 46% of people say they're contributing as much as they can afford, CNBC's Your Money survey found.

Each year, Vanguard collects data from approximately 5 million retirement accounts. Based on its analysis in 2023, the average 401(k) balance was $112,572 in 2022, down about 20% from 2021. The drop was largely due to declines in the stock and bond markets through the end of 2022.

**Individual investors total includes 44.2 million customers who have direct relationships with Fidelity through retail, workplace, and the Health Care Group and 5.6 million customers who have indirect relationships, including customers served by advisors who have clearing and custody relationships with Fidelity ...

The financial services firm handles more than 45 million retirement accounts total. The average 401(k) balance ended 2023 up 14% from a year earlier to $118,600, Fidelity found. The average individual retirement account balance also gained 12% year over year to $116,600 in the fourth quarter of 2023.

The founding Johnson family, individually and through various trusts, owns stock representing a 49% voting interest in FMR, and have signed agreements pledging to vote all their shares as a bloc. Edward Johnson III was chairman of the group, but was replaced by his daughter, Abigail Johnson.