Are ‘Record’ 401k Balances Awesome or Unsettling?

401k, retirement, Fidelity, IRA

Stratospheric heights are great for Elon Musk, but not always for retirement accounts.

“Another record high” typically sends shivers to our spine, especially when it involves market performance, but Fidelity Investments is once again reporting just that.

The Boston-based recordkeeper found that increasing contributions and a strong stock market drove the average 401k balance over six figures for the first time.

Accounts hit $104,300 in the fourth quarter, 13 percent higher than Q4 2016. The average IRA balance climbed to $106,000, which is also a 13 percent year-over-year increase.

In addition, long-term 401k savers saw “significant increases” in their average account balance.

For workers who have been contributing to their 401k for 10 consecutive years, the average 401k account balance increased to $286,700, up from $233,900 a year earlier.

For individuals who have been in their 401k plan for 15-straight years, the average balance rose to $387,100, up from $318,500 in the fourth quarter of 2016.

“2017 was a good year for retirement savers—not only because of the stock market’s performance, but because many investors took positive steps towards managing their retirement savings, such as increasing their contribution rate,” Kevin Barry, president of workplace investing at Fidelity Investments, said in a statement.

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