401(k), IRA mil­lion­aires hit record

USA TODAY US Edition - - MONEY - Jes­sica Men­ton

Re­tire­ment savers are reap­ing the ben­e­fits of the stock mar­ket’s record run.

The num­ber of in­vestors with at least $1 mil­lion in their 401(k) ac­counts rose to an all­time high of 233,000 in the fi­nal three months of last year, ac­cord­ing to Fi­delity In­vest­ments’ quar­terly anal­y­sis of re­tire­ment sav­ing trends for its hold­ers of 401(k) or IRA ac­counts.

The num­ber of IRA mil­lion­aires also rose to a record 208,000 in the pe­riod.

The in­creases re­flect some of the stock mar­ket’s strong gains at the end of 2019. The Dow Jones In­dus­trial Av­er­age rose 6.7%, in­clud­ing div­i­dends, dur­ing the fourth quar­ter, while the Stan­dard & Poor’s 500 in­dex climbed 9.1%.

Re­tire­ment bal­ances

Av­er­age ac­count bal­ances also set records.

The av­er­age 401(k) ac­count bal­ance reached $112,300 at the end of the fourth quar­ter, or the last three months of the year. That rep­re­sented a 7% gain from the pre­vi­ous quar­ter’s bal­ance of $105,200 and sur­passed a record of $106,500 in the third quar­ter of 2018.

IRA con­tri­bu­tions rise

The per­cent­age of in­vestors con­tribut­ing to their IRAs rose, led by mil­len­ni­als.

Younger adults in that de­mo­graphic con­trib­uted $373 mil­lion to IRAs in the fourth quar­ter, a 46% jump from a year ago with 73% of their con­tri­bu­tions going into Roth IRAs.

The num­ber of IRA ac­counts with a con­tri­bu­tion rose 7% from a year ago, with the per­cent­age of mil­len­ni­als con­tribut­ing to an IRA ris­ing 21% in that span.

Long-term savers cash in

For savers who have been par­tic­i­pat­ing in the same work­place 401(k) plan for a decade, the av­er­age bal­ance reached a record $328,200 in the fourth quar­ter, top­ping a pre­vi­ous high of $306,500.

More em­ploy­ers pitch in

An­other fac­tor that’s help­ing boost re­tire­ment sav­ings: em­ploy­ers. A record level of them (35%) auto-en­rolled new work­ers into their com­pany’s 401(k) plan in the fourth quar­ter.

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