Retirement account balances are at new highs, according to Fidelity Investments. Thanks to the market’s recent run-up and increased savings, the number of 401(k) and IRA millionaires also hit all-time records in the second quarter of 2021. CNBC reports:
Retirement account balances, which took a sharp nosedive in 2020 when the coronavirus outbreak caused economic shock waves, are now at new highs, according to the latest data from Fidelity Investments, the nation’s largest provider of 401(k) savings plans.
The overall average 401(k) balance hit $129,300 as of June 30, up 24% from the same time last year, according to Fidelity. Individual retirement account balances were also higher — reaching $134,900, on average, in the second quarter, up 21% from a year ago.
Despite Covid case numbers rising in the U.S. and around the world, the year’s market highs have been a boon for savers. In the second quarter, the S&P 500 ended up 8.2%, before retreating more recently.
Nearly 12% of workers increased their contributions during this time, while a record 37% of employers also automatically enrolled new workers in their 401(k) plans. As a result, the number of 401(k) and IRA millionaires hit fresh highs, as well.
The year’s market highs have been a bonanza for savers, despite the fact that the number of cases of Covid has been climbing both in the United States and around the world.