Fidelity: 401(k) balances at highest level as company match jumps
BOSTON (Reuters) - Fidelity Investments, the No. 1 401(k) provider, said on Thursday that retirement account balances averaged $75,900 at the end of September, the highest level since the company began tracking the data more than 12 years ago.
The average account balance climbed 18 percent from the year-ago period, Boston-based Fidelity said. The company analyzed 12 million 401(k) accounts in more than 20,200 corporate defined contribution retirement plans.
The average annual employee contribution to their 401(k) plan has climbed 7.3 percent over the past five years to $5,900 at the end of September. That's up from $5,500 in the third quarter of 2007, Fidelity said.
But the annual company match over that five-year period is up 19 percent, rising to $3,420 from $2,880.
"It's encouraging to see companies making a greater contribution to their employees' 401(k) plans as we know a healthy employer match not only impacts employees' retirement savings, but also has a positive impact on their behavior, ultimately leading to better outcomes," said James M. MacDonald, president of workplace investing at Fidelity.
Meanwhile, for the 14th consecutive quarter, more participants increased their deferral rate than decreased it - 4.6 percent versus 2.8 percent, Fidelity said.
(Reporting by Tim McLaughlin; Editing by Jan Paschal)