Record High Retirement Savings Contributions by Americans: Fidelity Analysis

Are Americans finally getting serious about saving for retirement? According to a recent report from Fidelity, it seems that way. The total average 401(k) savings rate reached a record 14.2% in the first quarter of 2024, with both employees and employers contributing at high levels. This is just shy of Fidelity’s recommended savings rate of 15%, which is seen as a great track to reach retirement goals.

The strong market returns and healthy contribution levels have also helped push the average 401(k) balance to $125,900 in the first quarter of this year, the highest levels since the end of 2021. This is certainly encouraging news for those who are diligently saving for their future.

However, the report also highlights that only about half of U.S. workers participate in a 401(k) or related plan through their employer. This means that there is still work to be done in terms of encouraging more people to save for retirement. Those with any kind of retirement plan are much more likely to have saved money for retirement compared to those without one.

It’s clear that there is still a gap in retirement savings among different age groups. While some baby boomers are feeling on track to retire, others are concerned about future healthcare costs. It’s important for individuals of all ages to prioritize their retirement savings and plan for the future.

Overall, the report from Fidelity is a positive sign that Americans are taking retirement savings seriously. With the right strategies and commitment, more people can work towards a secure financial future.