A surging stock market propelled 401(k) balances to a record high by the end of 2014, with an average balance of $91,300, according to just-released figures from Fidelity Investments.
The average 401(k) balance is up 3 percent from the end of third quarter of 2014, and 2 percent year-over-year. The average IRA (Individual Retirement Account) balance was $92,200,3 up 4 percent year-over-year, said Fidelity, the nation’s largest provider of 401(k) and IRA accounts.
The increases stem mostly from a robust stock market, which saw the S&P 500 jump by more than 10 percent, marking its third year of double-digit growth. But a surge in worker contributions also played a significant role.
The average 401(k) contribution was $9,670, an increase of 4 percent year-over-year. The average IRA contribution in 2014 was $4,325, an increase of 2 percent year-over-year.
Workers and their employers contributed an average of $9,670 in 2014, up 4 percent from the year before.
“We continue to see American workers take positive steps when it comes to saving for retirement,” said Jim MacDonald, president, Workplace Investing, Fidelity Investments. “However, it’s important to remember to take a long-term approach to retirement savings, and not react to short-term market swings. The typical American worker will see markets go up and down many times during their career, so commitment to a long-term savings and investing strategy will put individuals in the best position to meet their retirement goals.”
For employees in a 401(k) plan for 10 years or more, the average balance was $248,000, up 11 percent year-over-year.
Individual iInvestors continue to seek help with their retirement savings. More than 2.8 million people reached out to Fidelity for help and guidance in 2014, an increase of 15 percent over 2013.