The average 401(k) account balance increased 10 percent last year, rising to
the highest level since the year 1999, according to a report by Fidelity
Investments.
For a Limited Time receive a
FREE HR Report "Top 10 Best Practices in HR Management." This comprehensive special report will give you the information you need to know about these current HR challenges and how to most effectively manage them in your workplace.
Download NowThe study covered nearly 8.6 million participants in approximately 10,800 corporate
defined contribution plans serviced by Fidelity at the end of 2004.
The analysis revealed the average 401(k) participant account balance increased
from $55,000 in 2003 to $61,000 in 2004.
In addition, the study found that average plan participation rates have stabilized
after a few years of slight declines. Sixty-six percent of eligible workers
contributed in 2004, the same as in 2003.
"The average 401(k) deferral rate remained steady over the past twelve
months at about 7 percent," says Steve Deschenes, executive vice president,
Fidelity Institutional Retirement Services Company. "This is a good start,
but in an environment where retirement-related expenses are continuing to increase,
workers who plan to rely on their 401(k) as their primary source of retirement
income need to be saving more."