Record 401(k) Savings Rates Show Americans are Prioritizing Retirement Contributions
Are you saving enough for retirement? According to Fidelity, Americans are contributing a record share of their earnings toward retirement savings, with the total average 401(k) savings rate reaching a record 14.2% in the first quarter of 2024. This includes a 9.4% employee contribution and a 4.8% employer contribution, both of which match previous records.
While this is great progress, Fidelity recommends a 15% savings rate between worker and employer contributions to reach retirement goals. The average 401(k) balance has also reached a record high of $125,900 in the first quarter of this year, thanks to healthy contribution levels and strong market returns.
However, not all Americans are on track with their retirement savings. Only about half of U.S. workers participate in a 401(k) or related plan through their employer. Those with a retirement plan are much more likely to have saved money for retirement compared to those without one.
Concerns about inflation and future healthcare costs are top of mind for many Americans when it comes to retirement planning. While some feel confident about their retirement savings, others are unsure if they are on track to retire comfortably.
It’s important to take a closer look at your retirement savings and make sure you are on track to reach your goals. Consider increasing your contributions if possible and seek advice from a financial advisor to ensure you are prepared for retirement. Remember, it’s never too early to start saving for your future.
Disclaimer: The information provided in this article is for informational purposes only and should not be considered as financial advice. The content is based on general research and may not be accurate, reliable, or up-to-date. Before making any financial decisions, it is recommended to consult with a professional financial advisor or conduct thorough research to verify the accuracy of the information presented. The author and publisher disclaim any liability for any financial losses or damages incurred as a result of relying on the information provided in this article. Readers are encouraged to independently verify the facts and information before making any financial decisions.