Denver Today
A soaring stock market and persistent employee contributions pushed the number of 401(k) millionaires in the United States to an all-time high in the second quarter. Data from Fidelity Investments shows that the number of 401(k) accounts on its platform holding at least $1 million expanded by 19 percent from the first quarter, reaching a record 769,000 accounts. The jump marks the largest quarterly growth in seven-figure balances since late 2023.
The surge was fueled by an exceptional period for equities. The S&P 500 gained roughly 15 percent in the second quarter — its best quarterly performance since 2020 — and has risen 20 percent over the last 12 months. Driven by demand for artificial intelligence, robust corporate earnings, and federal tax cuts enacted last year, investor confidence remained resilient despite persistent inflation and elevated geopolitical tensions.
Average account balances across Fidelity's workplace 401(k)s, 403(b)s, and Individual Retirement Accounts touched record levels. About 3 percent of Fidelity's 25.8 million 401(k) account holders are now millionaires. Michael Shamrell, vice president of thought leadership at Fidelity Investments, told CBS News that most 401(k) millionaires achieved their balances through long-term consistency rather than market timing.
Financial experts say $1 million does not stretch as far as it used to, with recent surveys showing Americans now estimate needing $1.46 million to retire comfortably. Despite the growing tally of millionaires, a seven-figure balance remains out of reach for most American workers. Fidelity reported that the overall average 401(k) balance was $155,800 as of June 30, while average 403(b) and IRA balances hovered near $145,000.
Economic anxiety continues to weigh on the broader workforce, with nearly 70 percent of workers doubting they would be able to retire comfortably, and 72 percent feeling behind on savings goals.
Source: The Independent
