The number of 401(k) millionaires just fell — but workers hit record savings rates.
Retirement account balances fell in the first quarter amid broad market weakness, cutting the number of 401(k) millionaires — but the total savings rate reached record levels, as savers benefitted from features that automatically enrolled workers into retirement plans and increased their contributions, Fidelity Investments said Thursday. The drop in 401(k) account balances in the first quarter came as the S&P 500 SPX fell 4.4% in that period amid the war in Iran and surging oil prices CL00 BRN00, which cooled interest-rate-cut expectations. Most Read from MarketWatch “Given the economic environment, people are still prioritizing savings and retirement.
Eight in 10 people are saving enough to get their employer match,” said Kirsten Hunter Peterson, vice president of workplace thought leadership at Fidelity. Hardship withdrawals and loans also increased compared with a year ago as Americans struggled with everyday affordability and insufficient emergency savings, according to Fidelity Investments, the largest 401(k) administrator. “Anecdotally, it is an affordability issue. A significant number of American workers don’t have sufficient emergency savings.